You might have seen that Finance Minister Bill English has talked a little about what to expect in the Budget he will present to Parliament on May 21.
As he told an audience in Wellington this week, you wouldn’t open your presents before Christmas Day so he’s not spilling the beans just yet on what will actually be in the Budget.
But he has confirmed that the Government’s careful control of its spending will continue, along with a determination to do a better job of providing improved public services, especially to those who most depend on them.
The Government is doing a good job of its running its books. For example, in the last six Budgets the total annual cost of new initiatives is less than $2.9 billion. Compare that with Labour’s last six Budgets where the figure was $20 billion.
The Government is determined to maintain that discipline because it knows it’s your money that’s being spent. And you worked hard to earn it, so we’re being careful about how we spend it.
But we’re not just focussed on the dollars alone. The Budget will continue with the Government’s focus on delivering better public services, especially to the people who need them most. As Mr English puts it, what works for our communities also works for the Government’s books. So saving money in the long term is not about slashing spending, it’s about doing a better job early on.
You’ll know that the Government, back in 2011, set a target of returning to surplus in the 2014/15 financial year. The actual figures for that year won’t be known till October, but the Treasury forecasts show us falling a bit short of the target. Making it harder, is that low inflation means the Government is collecting less money than it expected to. For example, because interest rates are low, we’re collecting less withholding tax from the interest that people earn on their savings.
So while the Government’s books are on the right track, reaching surplus may take a bit longer than expected. It’s not a risk to the economy, and we won’t be slashing and burning just to get there.
What matters is that the public can be assured that our good economic management is continuing for this Budget, and next year’s, and the one after. We’re looking ahead with confidence.