CAPTIONS BY JAMES BROWN AND MAEVE KELLY. CAPTIONS WERE MADE WITH THE SUPPORT OF NZ ON AIR. WWW.ABLE.CO.NZ COPYRIGHT ABLE 2023 TENA KOUTOU, GOOD AFTERNOON, AND WELCOME TO THIS 1 NEWS SPECIAL. THE GOVERNMENT HAS JUST PUBLISHED THE 2023 BUDGET. OVER THE NEXT TWO HOURS, WE'LL BRING YOU DETAILS AND ANALYSIS. SHORTLY, WE'LL TAKE YOU LIVE TO PARLIAMENT, WHERE FINANCE MINISTER GRANT ROBERTSON WILL BE ADDRESSING THE HOUSE. BUT FIRST, 1 NEWS POLITICAL EDITOR JESSICA MUTCH-MCKAY HAS BEEN IN A LOCKUP WITH TREASURY OFFICIALS GOING OVER ALL THE DETAIL. JESS, WHAT ARE THE BIGGEST ANNOUNCEMENTS IN THIS YEAR'S BUDGET? THAT'S RIGHT, JACK. I HAVE JUST DONE A SLOW JOG FROM THE BUDGET LOCK-UP TO BRING YOU THE LATEST INFORMATION. IT IS OF COURSE FIVE MONTHS OUT FROM AN ELECTION, SO LET'S GO THROUGH THE NUMBERS. EARLY CHILDHOOD EDUCATION IS THE BIG WINNER. $1.2 BILLION WILL BE SPENT THERE, EXTENDING THE 20 HOURS FREE. AT THE MOMENT IT IS THREE AND FOUR-YEAR-OLDS THAT GET IT. THAT WILL GO DOWN TO 2-YEAR-OLDS. THAT IS A BIG WIN FOR PARENTS WITH YOUNG FAMILIES. THERE IS THE ISSUE OF THE FIVE DOLLAR PRESCRIPTION FEE. YOU GO TO THE CHEMIST, PAY FIVE DOLLARS FOR MEDICINE. 133,000 PEOPLE DON'T GET THEIR BRISK OPTIONS BECAUSE OF THAT FEE, ANOTHER ONE TO HELP WITH THE COST OF LIVING IS THE ENERGY BILL. $400 MILLION WILL HELP PEOPLE PAY TO KEEP ENERGY COSTS DOWN. ANOTHER IN THE AREA OF CLIMATE CHANGE IS MAKING PUBLIC TRANSPORT MORE AFFORDABLE. AT THE MOMENT, YOU GET HALF PRICE PUBLIC TRANSPORT. THAT GOES UNTIL JUNE. SOON IT WILL KICK IN, IN AND CHILDREN UNDER 13 WILL GET PUBLIC TRANSPORT FREE. THAT WILL BE PERMANENT. IT WILL BE HALF PRICE FOR ANYONE UNDER 25. THE PRICETAG ASSOCIATED WITH THAT IS $333 MILLION. ALL UP, 5.5 BILLION HAS BEEN SPENT THIS ELECTION, 1.2 BILLION LESS THAN LAST YEAR. A BIG SPEND UP. A FEW THINGS THAT HAVEN'T BEEN ON THE LIST ` NOTHING REVOLUTIONARY WHEN IT COMES TO CLIMATE CHANGE. BENEFICIARIES DIDN'T SEE A BOOST THIS TIME. THE COST OF FOOD, WHICH HAS BEEN A BIG ONE, THERE HASN'T BEEN ANYTHING TO HELP PEOPLE WITH THAT EITHER. HOW WILL THIS BUDGET BE RECEIVED? I THINK IT IS A PRETTY STRAIGHT UP AND DOWN LABOUR BUDGET. FOR YOUNG FAMILIES, IT WILL MAKE A BIG DIFFERENCE. $130 EXTRA A WEEK FOR CHILDCARE IS A BIG DEAL. THE FINANCE MINISTER SOLD AS A TWOFER. IT GETS PEOPLE INTO THE WORKFORCE AND EASES THE COST OF LIVING. INFLATION IS AN ISSUE HIGH ON GRANT ROBERTSON'S MIND, SO THIS IS SOMETHING A LOT OF NEW ZEALANDERS OR ANY PAY FOR, SO IT WON'T ADD TO INFLATION. HOW WOULD THIS DIFFER FROM A REGULAR ELECTION YEAR BUDGET, WHEN IN NORMAL CIRCUMSTANCES, WE MIGHT EXPECT A GOVERNMENT OF THE DAY TO THROW OUT A FEW MORE LOLLIES? THE ONLY LOLLY SCRAMBLE GOING ON WAS WITH JOURNALISTS TODAY. YOU WOULD USUALLY SEE THAT HAPPEN WITH AN ELECTION. WHEN YOU LOOK AT THIS, THERE IS STILL STUFF HERE PEOPLE CAN TAKE AWAY. FREE PUBLIC TRANSPORT WILL HELP FAMILIES. EARLY CHILDHOOD EDUCATION STUFF WILL HELP FAMILIES. THE MIDDLE INCOME FAMILY WILL BE PERHAPS LOOKING AT THIS AND SAYING THIS ISN'T MAJOR FOR ME. IT IS VERY DIFFERENT FROM ELECTION YEAR SPENDING. WE HAVE CYCLONE RECOVERY TO FACTOR IN. AND THE GEOPOLITICAL ENVIRONMENT, TOO. THANK YOU FOR YOUR TIME. WE APPRECIATE YOU COMING STRAIGHT TO US. FOR THE LAST FEW HOURS, SHE HAS BEEN IN A TIGHT LOCK-UP ALONGSIDE TREASURY OFFICIALS. WE ARE TAKING YOU LIVE TO THE HOUSE. GRANT ROBERTSON IS HANDING OUT COPIES OF THE BUDGET. OPPOSITION MPS DON'T GET TO SEE THE BUDGET EARLIER. THEY ARE ONLY RECEIVING THE BUDGET AT THE SAME TIME AS EVERYONE ELSE. IT CAN QUITE OFTEN CONTAIN MARKET MOVING, SENSITIVE INFORMATION, TREASURY OFFICIALS ARE CAREFUL IN ENSURING DETAIL DOESN'T SLIP OUT AHEAD OF TIME. IN A COUPLE OF MINUTES, WE WILL EXPECT THE FINANCE MINISTER TO BEGIN HIS SPEECH, AS HE PRESENTS THE BUDGET. THEN IT WILL BE THE TURN OF THE OPPOSITION TO RESPOND. WE WILL EXPECT TO HEAR FROM THE PRIME MINISTER THIS AFTERNOON AS WELL. THAT IS THE SPEAKER OF THE HOUSE, ADRIAN RURAWHE. LET'S GO LIKE THE PARLIAMENT NOW. FINANCE MINISTER GRANT ROBERTSON. NEW ZEALAND LABOUR. 62 VOTES IN FAVOUR. 34 VOTES OPPOSED. 10 VOTES OPPOSED. GREEN PARTY. NINE VOTES IN FAVOUR. TE PATI MAORI. TO VOTES IN FAVOUR. DOCTOR ELIZABETH KEREKERE. ONE VOTE IN FAVOUR. HON MEKA WHAITIRI. ONE VOTE IN FAVOUR. THE AYES ARE 75. NOES ARE 44. APPROPRIATIONS 2023 ESTIMATES BILL IS SET DOWN FOR SECOND READING. I MOVE THAT THE APPROPRIATION 2023-24 ESTIMATES BILL BE READ A SECOND TIME. BEFORE I BEGIN MY FORMAL BUDGET SPEECH, AS A MEMBER OF PARLIAMENT FOR WELLINGTON CENTRAL, I WANT TO ACKNOWLEDGE THE VICTIMS OF THE LOAFERS LODGED VIA FIRE AND ALL THOSE AFFECTED BY IT. OUR THOUGHTS ARE WITH ALL THOSE AFFECTED. MR SPEAKER, IT IS MY PRIVILEGE TO PRESENT NEW ZEALAND'S FIFTH WELL-BEING BUDGET. IN EACH OF THESE BUDGETS, WE HAVE TAKEN INTO ACCOUNT THE WELL-BEING OF OUR PEOPLE, THE STRENGTH OF OUR COMMUNITIES, THE HEALTH OF OUR ENVIRONMENT, ALONGSIDE THE PERFORMANCE OF OUR ECONOMY AND FINANCES. IN DOING SO, WE ARE STRIKING A BALANCE BETWEEN SUPPORTING OUR PEOPLE NOW WITH THE PRESSURE OF COST OF LIVING AND INVESTING IN FUTURE JOBS AND ECONOMIC SECURITY. THE BACKDROP TO BUDGET 2023 IS CHALLENGING. IT IS HARD TO REMEMBER A TIME IN NEW ZEALAND'S HISTORY WHERE THERE HAVE BEEN SO MANY CHALLENGES TO OUR ECONOMIC, ENVIRONMENTAL AND SOCIAL SYSTEMS, IN SUCH A SHORT PERIOD OF TIME. INDIVIDUALS, FAMILIES BUSINESSES AND COMMUNITIES FEEL THE IMPACT OF GLOBAL ECONOMIC AND POLITICAL TURBULENCE, HIGH INFLATION, THE LINGERING HANGOVER OF THE COVID 19 EMERGENCY AND MORE FREQUENT AND INTENSE WEATHER EVENTS. PRESSURES ARE FELT ACROSS OUR COMMUNITIES. BUDGET 2023 RESPONSE TO THOSE PRESSURES IN A TARGETED AND RESPONSIBLE WAY, BUILDING ON WHAT WE HAVE DONE OVER RECENT YEARS IN A WAY THAT WILL NOT EXACERBATE INFLATION. THERE IS A PARTICULAR FOCUS ON PARENTS AND YOUNG FAMILIES, INCLUDING THE EXPANSION OF 20 HOURS ECE SUPPORT TO 2-YEAR-OLDS. (APPLAUSE) FREE PUBLIC TRANSPORT FOR CHILDREN AND HALF PRICE FOR UNDER 25S AND THE SCRAPPING OF THE FIVE DOLLAR PRESCRIPTION CHARGE FOR ALL NEW ZEALANDERS. (APPLAUSE) MR SPEAKER, WE ARE ALSO MAKING A SIGNIFICANT COMMITMENT TO SUPPORT THE RECOVERY AND REBUILD OF REGIONS AFFECTED BY SEVERE WEATHER EVENTS EARLIER IN THE YEAR. THIS WAS UNWELCOME AND UNPLANNED FOR. BUT OUR CAREFUL FINANCIAL MANAGEMENT AND REPRIORITISATION PROGRAM LED BY THE PRIME MR HAS ALLOWED US TO REALLOCATE RESOURCES AND MEET FUTURE CONTRIBUTIONS THROUGH THE BUDGET ALLOWANCES. WE ARE ON TRACK TO RETURN TO SURPLUS WITHIN THE FORECAST PERIOD. OUR NET DEBT WILL PEAK AT 22% OF GDP, BELOW THE CEILING SET IN FISCAL RULES. INFLATION IS SET TO RETURN TO 3% BY THE END OF 2024. BUDGET 2023 ALSO LOOKS AHEAD. WE ARE FOCUSED ON DOING THE BASICS WELL, WITH SIGNIFICANT INVESTMENT IN EDUCATION, HEALTH AND HOUSING. THESE AREAS ARE THE BEDROCK OF OPPORTUNITY FOR EACH AND EVERY NEW ZEALANDER. AT THE SAME TIME, WE ARE IMPROVING THE RESILIENCE OF NEW ZEALAND'S CRITICAL INFRASTRUCTURE AND INVESTING IN A MORE PRODUCTIVE, HIGHER WAGE, LOWER EMISSIONS ECONOMY, INCLUDING THROUGH RESEARCH AND TECHNOLOGY. THE BUDGET STRIKES THE CRITICAL BALANCE BETWEEN THE SUPPORT REQUIRED TODAY AND THE INVESTMENT NEEDS OF THE FUTURE. WE HAVE CAREFULLY CUT OUR CLOTH, AS THE EMERGENCY SPENDING AND RESPONSE TO COVID 19 ACTIONS DECLINES, AND WE MOVED TO A MORE FISCALLY SUSTAINABLE PATH. NEW ZEALAND HAS WITHSTOOD MANY SHOCKS IN RECENT MEMORY, AND OUR WELL-BEING HAS HELD UP WELL. HOWEVER, ABSORBING THESE SHOCKS HAS AFFECTED OUR WEALTH, AND WE NEED TO REBUILD OUR RESILIENCE TO THE FUTURE CHALLENGES WE KNOW WILL COME. THE FIRST WELL-BEING REPORT PROVIDED A BROAD PERSPECTIVE ON THINGS THAT MATTER FOR WELL-BEING. NEW ZEALAND IS A GOOD PLACE TO LIVE IN MANY WAYS, AND MANY ASPECTS OF OUR LIVES HAVE IMPROVED OVER THE PAST 20 YEARS. WE ENJOY CLEAN AIR, LONGER LIFE EXPECTANCY. HOWEVER WE FACE WELL-BEING CHALLENGES, PARTICULARLY AROUND MENTAL WELL-BEING, EDUCATION AND HOUSING QUALITY. THESE CHALLENGES ARE FELT MORE STRONGLY BY YOUNGER PEOPLE. THESE ISSUES ARE LONG-STANDING AND HAVE NOT LOST THE URGENCY, WE ARE IN A GOOD POSITION TO MEET THE CHALLENGES. THE NEW ZEALAND ECONOMY EMERGED FROM COVID 19 WELL, WITH MODEST GROWTH ANTICIPATED. OUR ECONOMIC RECOVERY IS IN THE TOP 10 OF OECD NATIONS. AT THREE POINT 4%, THE SURVEY OF LABOUR PERFORMANCE BETTER THAN ANY PERIOD PRIOR TO 2020. WE CONTINUE TO HAVE THE LOWEST PUBLIC DEBT IN THE WORLD, AND 2023 IS ANOTHER STEP TO BRING IN CORE CROWN EXPENSES BACK TO PRE-PANDEMIC LEVELS. WE REMAIN COMMITTED TO RETURNING TO SURPLUS AND KEEPING NET DEBT BELOW THE CEILING. THAT GOVERNMENT REMAINS COMMITTED TO IMPROVING CHILD WELL-BEING. THE LATEST FIGURES RELEASED BY STATS NEW ZEALAND SHOWED THAT EIGHT OUT OF NINE CHILD POVERTY MEASURES HAVE SEEN A SIGNIFICANT REDUCTION SINCE THE BASELINE YEAR OF 2018. OVER THE LAST TWO YEARS, CHILD POVERTY MEASURES WE HAVE DATA FOR ARE THE LOWEST THEY HAVE BEEN SINCE WE STARTED MEASURING, AND RATES HAVE ALMOST HARD ON TWO. THIS IS A TESTAMENT TO THE COMMENTS OF PACKAGE OF INVESTMENTS TO SUPPORT FAMILIES OVER SEVERAL YEARS, AND ARE CONTINUING TO DO SO AND BUDGET 2023. MR SPEAKER, IT IS WORTH NOTING OUR WELL-BEING APPROACH APPLIES A LENS TO 2023, EXPANDING LAST YEAR'S PILOT PROGRAM. WE LOOKED AT 15 AGENCIES, INCLUDING IN THE COST OF LIVING SPACE, AND IT HAS BEEN AN USEFUL INDICATOR OF WHETHER THE BUDGET IS MEETING OUR OBJECTIVES. FOR EXAMPLE, WE KNOW THAT ON AVERAGE, WOMEN HAVE LOWER KIWI SAVER BALANCES THAN MEN. TIME OUT OF THE WORKFORCE FOR PARENTING RESPONSIBLY IS ONE KEY REASON FOR THIS. THE GOVERNMENT IS ADDRESSING THIS THROUGH BUDGET 2023. SETTLE DOWN, MR BISHOP. THE GOVERNMENT IS ADDRESSING THIS THROUGH BUDGET 2023 BY INTRODUCING A MATCHING EMPLOYER CONTRIBUTION TO PAID PARENTAL LEAVE RECIPIENTS. THIS RECOGNISES THE UNPAID NATURE OF CHILDCARE AND SUPPORTS SAVINGS FOR RETIREMENT. IT IS A SMALL BUT SIGNIFICANT BOOST TO LIFETIME INCOME FOR MANY WOMEN. BUDGET 2023 BUILDS ON THE SUPPORT WE HAVE BEEN PROVIDING TO NEW ZEALANDERS IN THE FACE OF COST OF LIVING PRESSURES. THE GLOBAL INFLATION CRISIS, WHICH HAS SEEN PRICES RISE FASTER AND STAY HIGHER FOR LONGER, IS CAUSING STRAIN FOR MANY PEOPLE, PARTICULARLY FOR LOW AND MIDDLE INCOME HOUSEHOLDS AND THOSE WITH YOUNG CHILDREN. THE GOVERNMENT HAS ALREADY DELIVERED SICK CAN SUPPORT THROUGH THE COST OF LIVING PAYMENT, AND HALF PRICE PUBLIC TRANSPORT. MORE THAN 1.4 MILLION NEW ZEALANDERS HAVE BENEFITED FROM INCREASED ASSISTANCE, INCLUDING PEOPLE RECEIVING A MAIN BENEFIT, STUDENTS AND SUPERANNUITANTS. THIS INCLUDES NEW ZEALANDERS WE HAVE SUPPORTED THROUGH A $311 MILLION INVESTMENT TO SUPPORT MAIN BENEFITS TO INCREASE SEVEN POINT 2%. BUDGET 2023 FOCUSES ON COST OF LIVING SUPPORT THAT WILL NOT EXACERBATE INFLATION WHILE LAYING THE FOUNDATION FOR LONG-TERM BENEFITS, INCLUDING EDUCATION AND HEALTH AND MEETING CLIMATE CHANGE GOALS. MR SPEAKER, WE KNOW THAT THE FIRST FIVE YEARS OF A CHILD'S LIFE ARE IMPORTANT FOR DEVELOPMENT AND LEARNING. WE ALSO KNOW THAT RIGHT NOW, THE COST OF ACCESS TO EARLY CHILDHOOD EDUCATION AND CHILDCARE CAN BE A BARRIER FOR PARENTS AND CAREGIVERS WANTING TO ENTER OR REMAIN IN EMPLOYMENT OR TRAINING. PARENTS SHOULD NOT HAVE TO FORGO ECE BECAUSE OF THE COST. BUDGET 2023 RESPONSE TO THIS BY INVESTING $1.8 BILLION IN EARLY CHILDHOOD EDUCATION. MR SPEAKER, THE FLAGSHIP OF THIS PACKAGE IS EXTENDING THE 20 HOURS SUPPORT TO INCLUDE TWO-YEAR-OLDS, ADDING TO THE EXISTING 3 TO 5-YEAR-OLDS. BASED ON AVERAGE COSTS IN 2023, FAMILIES WHO WERE NOT RECEIVING CHILDCARE SUBSIDIES WOULD SAVE AN ESTIMATED $133.20 PER WEEK IF THE CHILD ATTENDS ECE FOR 20 HOURS A WEEK. WE ARE PROVIDING FURTHER SUPPORT FOR PAY PARITY FOR ECE TEACHERS, GIVING AN AVERAGE FIVE POINT 3% FUNDING INCREASE AND PROVIDING A SUSTAINABILITY GRANT FOR PLAY CENTRE AOTEAROA. WE ARE EXTENDING ELIGIBILITY CRITERIA FOR CHILDCARE ASSISTANCE FOR LOW TO MIDDLE INCOME FAMILIES, INDEXING RATES OF CHILDCARE ASSISTANCE TO THE CPI, WHICH WILL SUPPORT PARENTS WHEN FORMAL CARE IS NOT AVAILABLE. THIS WILL RELIEVE THE PRESSURE OF AN ESSENTIAL COST, WHILE ENSURING THAT THOSE WHO PROVIDE IT ARE ADEQUATELY FUNDED TO MEET INCREASES IN DEMAND AND PAY FOR THOSE WHO WORK IN THE SECTOR APPROPRIATELY. IT IS A SUBSTANTIAL INVESTMENT IN OUR CHILDREN, PARENTS, AND TEACHERS AND CAREGIVERS, AND A NEW ZEALAND'S FUTURE. WE EXTEND THE PILOT RUN UNDER WHANAU ORA, ENSURING THAT CHILDREN ARE SUPPORTED IN THEIR FIRST THOUSAND DAYS, ALONGSIDE BROADER WHANAU ASPIRATIONS. PRESCRIPTION COSTS ARE A BARRIER TO ACCESSING HEALTHCARE. WE KNOW THAT IN THE FINANCIAL YEAR 2021-2033, 100,000 PEOPLE DID NOT COLLECT THEIR PRESCRIPTION. FROM 1 JULY, WE ARE REMOVING THE FIVE DOLLAR PRESCRIPTION COPAYMENT FOR ALL NEW ZEALANDERS. (APPLAUSE) THIS WILL REDUCE INEQUALITY IN HEALTH SYSTEM AND LEAD TO BETTER HEALTH OUTCOMES. WE ARE ALSO EXTENDING THE HEALTHY SCHOOL LUNCH PROGRAM. RISING INFLATION ON HOUSEHOLD INCOMES PUTS PRESSURE ON FOOD SECURITY FOR FAMILIES, AND WE KNOW THAT LEARNING IS AFFECTED IF CHILDREN ARE HUNGRY. $325 MILLION IS BEING INVESTED TO CONTINUE THIS PROGRAM UNTIL THE END OF 2024. FOR FAMILIES WITH TWO CHILDREN, IT IS ESTIMATED THE SCHEME SAVES ON AVERAGE $60 PER WEEK. ACCESS TO AFFORDABLE TRANSPORT IS A COST PRESSURE FOR MANY NEW ZEALANDERS. THE GOVERNMENT HAS PREVIOUSLY CREATED THE COMMUNITY CONNECT PUBLIC TRANSPORT CONCESSION ` HALF PRICE OF PUBLIC TRANSPORT. TODAY, I CAN ANNOUNCE THAT THIS IS BEING EXTENDED TO ALL UNDER 25-YEAR-OLDS AND USES OF TOTAL MOBILITY SERVICES. (CHEERING) I KNOW THAT THIS COMMITMENT WILL BE PARTICULARLY WELCOMED BY TERTIARY STUDENTS, OFTEN RELIANT ON PUBLIC TRANSPORT. THE GOVERNMENT HAS DECIDED TO GO FURTHER IN ORDER TO SUPPORT FAMILIES. WE WILL FUND FREE PUBLIC TRANSPORT FOR CHILDREN. THIS WILL HELP PASSENGERS MEET THE COST OF PUBLIC TRANSPORT, ENCOURAGE INCREASED USE AND SUPPORT NEW ZEALAND TO ACHIEVE ITS CLIMATE CHANGE GOALS. IT IS ANOTHER EXAMPLE OF WHERE WE CAN RELIEVE THE COST OF LIVING PRESSURES AND CONTRIBUTE TO OUR EMISSIONS REDUCTIONS. WE CAN ALSO DO THIS THROUGH HOUSEHOLD ENERGY BILLS. A WARM AND DRY HOME IS KEY TO IMPROVED HEALTH OUTCOMES. HOMES THAT LACK ADEQUATE INSULATION AND HEATING LEAD TO HIGH ENERGY BILLS AND POOR HEALTH. THAT IS WHY BUDGET 2023 IS FUNDING THE EXTENSION AND EXPANSION OF THE WARMER KIWI HOMES PROGRAM. THIS WILL SEE A FURTHER 100,000 INSULATION AND HEATING INSTALLATIONS AS WELL AS THE INSTALLATION OF HEATERS AND LED LIGHTS. THIS IS ESTIMATED TO HAVE REDUCED RISK OF RESPIRATORY ILLNESS. IT IS A TRUE WELL-BEING POLICY. THAT WAS GRANT ROBERTSON SPEAKING FROM PARLIAMENT ON HIS SIXTH BUDGET. JUST TO REITERATE THE TOP POINTS THAT CAME OUT OF IT ` IN CASE YOU MISSED THEM. THESE OTHER TOP ANNOUNCEMENTS. THE GOVERNMENT IS SPENDING MORE THAN $1 BILLION EXTENDING ACCESS TO FREE EARLY CHILDHOOD EDUCATION, ONE POINT TO BILLION DOLLARS IN TOTAL, MEANING THAT TWO-YEAR-OLDS GET 20 HOURS FREE EVERY WEEK IN ADDITION TO THE THREE-YEAR-OLDS AND FOUR-YEAR-OLDS. $620 MILLION HAD HAS BEEN ANNOUNCED TO SCRAP THE FIVE DOLLAR PRESCRIPTION FEES. THE GOVERNMENT IS SPENDING $400 MILLION EXTENDING THE WARMER KIWI HOMES PROGRAM TO GIVE NEW ZEALANDERS CHEAPER ENERGY BILLS. $330 MILLION HAS BEEN ANNOUNCED IN SPENDING TO PROVIDE CHEAPER PUBLIC TRANSPORT, SO PUBLIC TRANSPORT WILL BE FREE FOR FIVE-YEAR-OLDS TO 12-YEAR-OLDS AND HALF PRICE FOR UNDER 25-YEAR-OLDS. TOTAL SPENDING IS $5 BILLION. THAT IS NEW SPENDING IN TOTAL THE GOVERNMENT'S IS ABOUT HUNDRED AND $30 BILLION, BUT OF COURSE, MOST OF THAT IS TO KEEP THE LIGHTS ON. THAT FIGURE, IT HAS TO BE SAID, IS LARGER THAN GRANT ROBERTSON HAD BEEN FORECASTING IN DECEMBER. WE'RE CROSSING LIVE NOW TO PARLIAMENT, WHERE WE'RE JOINED BY NATIONAL FINANCE SPOKESPERSON NICOLA WILLIS. THIS IS THE BLOWOUT BUDGET. IT IS A BLOWOUT OF INCREASED SPENDING, BIGGER DEFICITS AND MORE DEBT. THE RESULT FOR WORKING KIWIS WILL BE HIGHER INFLATION AND MORE PRESSURE ON INTEREST RATES, MEANING THEY WILL STAY HIGHER FOR LONGER. THERE IS NOT A DOLLAR OF TAX RELIEF IN SIGHT. THIS IS JUST MORE OF LABOURS BIG SPENDING WASTEFUL APPROACH. WHAT WILL IT DO TO THE LIVES OF NEW ZEALANDERS WHO ARE DOING IT TOUGH AND THE COST OF LIVING CRISIS? I THINK NEW ZEALANDERS WHO ARE DOING IT TOUGH WOULD HAVE BEEN LOOKING FOR SOME RELIEF, SOME HOPE IN THIS BUDGET, AND INSTEAD, WHAT WE HAVE IS CONFIRMATION THAT HIGHER PRICES ARE HERE TO STAY, WITH INFLATION CONTINUING FOR AT LEAST ANOTHER YEAR. WE HAD THE TREASURY EXPLICITLY WARNING THAT BECAUSE THE GOVERNMENT IS CHOOSING TO SPEND EVEN MORE, THAT WILL MEAN INTEREST RATES WILL STAY HIGHER FOR LONGER, MEANING ANYBODY WITH A MORTGAGE CAN BE LOOKING FORWARD TO MORE PAIN WITH THEIR MORTGAGE PAYMENTS. I THINK NEW ZEALANDERS WHO WERE HOPING MAYBE NOW FINALLY THE GOVERNMENT WOULD LET ME KEEP A BIT MORE OF WHAT I AM EARNING, VERY DISAPPOINTING. NOT A DOLLAR INSIGHT FOR THE EVERYDAY WORKER. IS THERE ANY SPENDING THAT NATIONAL WOULD HAVE PRIORITISED? WE AGREE WITH THE GOVERNMENT'S DECISION TO PRIORITISE INCREASED INVESTMENT INTO DEFENCE SPENDING. THERE IS NO DOUBT THAT WE ARE LIVING IN A MORE DANGEROUS WORLD, AND NEW ZEALAND NEEDS TO STEP UP TO OUR OBLIGATIONS. WE THINK IT IS RIGHT TO BE MAKING THE INCREASES IN KIT WE ARE BUYING BUT ALSO TO ENSURE THAT THOSE SERVING AN HOUR I'M SERVICES ARE PAID PROPERLY. I GIVE THE GOVERNMENT A TICK FOR THAT ONE. WHAT ABOUT THE INCREASE IN ACCESS TO EARLY CHILDHOOD EDUCATION? THAT WAS SOMETHING NATIONAL HAS SUPPORTED IN PART FOR THREE-YEAR-OLDS AND FOUR-YEAR-OLDS. THAT HAS BEEN EXTENDED TO FAMILIES WITH TWO-YEAR-OLDS. WE PREFER OUR APPROACH. WE HAVE PUT FORWARD TO THE FAMILY BOOST POLICY, WHICH WOULD MEAN THAT ALL FAMILIES WITH CHILDREN UNDER THE AGE OF FIVE COULD BE ELIGIBLE FOR AN UP TO $75 A WEEK REBATE IN THEIR CHILDCARE COSTS. THAT WOULD APPLY WHETHER YOUR CHILD IS A-YEAR-OLDS, TWO, THREE, FOUR. ANYONE WHO HAS BEEN A PARENT OF A THREE-YEAR-OLDS OR FOUR-YEAR-OLD WILL TELL YOU THAT 20 HOURS "FREE" IS ANYTHING BUT FREE, AND WE THINK IT WILL BE EXACTLY THE SAME WITH THE GOVERNMENT'S 20 HOUR FREE FOR TWO-YEAR-OLDS POLICY. THE OTHER THING IS THERE IS A BIG DIFFERENCE BETWEEN NATIONAL AND LABOUR ON OUR CHILDCARE POLICIES. WE FUNDED OURS BY IDENTIFYING SAVINGS ELSEWHERE. LABOUR HAVE PUT MORE FUEL ON THE SPENDING FIRE. THANK YOU VERY MUCH FOR YOUR TIME THIS AFTERNOON. NATIONAL'S FINANCE SPOKESPERSON NICOLA WILLIS. PRESCRIPTION COSTS ARE A BARRIER TO ACCESSING HEALTHCARE. HERE IN STUDIO, ANZ CHIEF ECONOMIST SHARON ZOLLNER AND FORMER LABOUR MINISTER AND CURRENT DIRECTOR OF ELMBANK ENGAGEMENT PARTNERS IAIN LEES-GALLOWAY. SOME PEOPLE WILL SEE THIS AS OVERLY GENEROUS AND SOME AS OVERLY STINGY. I THINK IT IS PERHAPS PARTICULARLY THE CASE WHERE YOU HAVE TO SPEND A LOT MORE MONEY TO DELIVER THE SAME SERVICES, YOU HAVE TO DELIVER A LOT OF MONEY TO GET THE ROADS AND BRIDGES BACK TO WHERE THEY WERE. SO THERE WILL BE SOME PEOPLE DISAPPOINTED THAT THERE IS NOT MORE NEW THINGS, BUT THE MARKET, THE BOND MARKET WILL BE LOOKING AT THIS THINKING IT IS A LOT OF BONDS THAT THEY HAVE TO SELL, A LOT OF MONEY THEY HAVE TO RAISE. A LOT OF BORROWING. I THINK IT IS A BUDGET THAT IS FOCUSED ON THE MEDIAN VOTER, THE SWING VOTER. CLEARLY, FAMILIES PACKAGE THERE DESIGNED TO REDUCE THOSE EVERYDAY PAIN POINTS THAT FAMILIES EXPERIENCE. I THINK IT IS A DEEPLY POLITICAL BUDGET. IT IS AN ELECTION YEAR BUDGET, BUT IT IS SMARTLY DELIVERED IN TERMS OF THE POLICIES. THE NARROW GROUP OF PEOPLE WHO ARE GENUINE SWING VOTERS, THIS IS CLEARLY TARGETED AT THEM. LOOKING FORWARD TO DIGGING INTO THE SMALL THIS AFTERNOON. *THIS MORE STAY WITH US. WELCOME BACK, AS WE GO THROUGH THE DETAILS ON THE 2023 BUDGET. DEBBIE NGAREWA-PACKER IS THE CO-LEADER OF TE PATI MAORI. SHE HAS BEEN BY JESTING THE DETAILS IN THE BUDGET. TENA KOE. WHAT DO YOU THINK OF THE BUDGET? I THINK IT'S IMPORTANT TO MIHI TO OUR STAUNCH ADVOCATES, THEIR WHANAU ORA ADVOCACY. YOU KNOW HOW PASSIONATE WE WERE ABOUT TE MATATINI, AND THE CONTRIBUTION THEY HAVE FOR AOTEAROA, AND MATARIKI. THEY ARE ALL HEARTY TE PATI MAORI POLICIES. WHAT WE NEEDED WAS A GOVERNMENT COURAGEOUS IN ADDRESSING ENTRENCHED POVERTY THAT WE SEE AOTEAROA SLIPPING INTO. WE WOULD HAVE LIKED A CAPITAL GAINS TAX. WE WOULD HAVE LIKED TO HAVE SEEN MORE IN MAORI HEALTH. WE HAVE 2%, WITH 20% OF THE POPULATION. WE WOULD HAVE LIKED MORE COMMITMENT TO CLIMATE CHANGE AND INVESTMENT AND ADAPTATION. THINGS THAT REALLY MATTER ABOUT HOMELESSNESS, CHILD POVERTY, KAI ON THE TABLE. WE ARE IN A REAL STATE, AND WE NEED TO SEE EFFORTS TOWARDS LONG-TERM PAIN, NOT BE SHORT-TERM ISSUES THE COST OF LIVING CRISIS HAS. WE HAVE SEEN POVERTY SQUEEZING AOTEAROA AND MURRAY FOR A LONG TIME. THE GOVERNMENT HAS ANNOUNCED 30 FORMER DOLLARS IN FUNDING FOR TE MATATINI OVER TWO YEARS, AS WELL AS A FUNDING BOOST FOR WHANAU ORA. TE PATI MAORI HAS ADVOCATED TO SCRAP GST ON FOOD. THE GOVERNMENT HASN'T GONE THAT FAR. THEY HAVE ANNOUNCED $13 MILLION FOR FOOD AND SECURITY. WILL THAT MAKE A DIFFERENCE? NO. WHAT WE HAVE AS A GOVERNMENT THAT GAVE A TARGET OF 11 AND A HALF THOUSAND. THEY HAVE DONE 6000. WE DON'T NEED PIECEMEAL APPROACHES, WE NEED RADICAL TRANSFORMATION TO STOP POVERTY. THEY HAD THE ABILITY TO DO THAT WITH A WEALTH TAX, CAPITAL GAINS TAX. GST OFF KAI, WHICH WOULD HAVE INJECTED 200 BILLION BACK INTO OUR ECONOMY OVER A PERIOD OF TIME. $20 BILLION WE ARE SHORT IN MAORI HEALTH. WE ARE GOING TO SEE THE ISSUES HOLDING US BACK ESCALATING. THAT IS WHAT WE HAVE, A BUDGET REPAIRED FOR THE MIDDLE CLASS TO RICH. IT IS NOT A BUDGET THAT WILL STOP THE PAIN OF LONG-TERM POVERTY THAT OUR PEOPLE HAVE BEEN ENDURING FOR A LONG TIME. THANK YOU VERY MUCH FOR YOUR TIME. TE PATI MAORI COLEADER DEBBIE NGAREWA-PACKER. ANZ CHIEF ECONOMIST SHARON ZOLLNER. WE JUST HEARD NICOLA WILLIS FROM NATIONAL SAYING THE GOVERNMENT HAS DELIVERED A BLOW OUT BUDGET. THERE IS A LOT OF PRESSURE ON THE GOVERNMENT TO REIN IN ITS FISCAL POLICIES. WHAT WILL THIS MEAN FOR INFLATION GOING FORWARD? WITH THE INCREASE IN SPENDING OVER THE NEXT 12 MONTHS TO JUNE NEXT YEAR, IT IS BIGGER. GOVERNMENT'S STRUGGLE TO INVEST AS QUICKLY AS THEY PLAN. THE RESERVE BANK WILL LOOK AT THAT AND SEE IT AS A REASON TO HAVE HIGHER INTEREST RATES THAN OTHERWISE, BECAUSE IT IS MORE OF A BUNFIGHT FOR RESOURCES. THAT IS THE STARTING POINT FOR THE ECONOMY. THE ECONOMY COULD BE CALLING MORE RAPIDLY THAN WE KNOW. THERE IS A LOT OF UNCERTAINTY. IT IS A TERRIBLE TENSION, BECAUSE FROM THE FINANCE MINISTER'S PERSPECTIVE, THERE IS EVERY POLITICAL INCENTIVE, AND EVERY HUMAN INCENTIVE TO REDUCE THE IMPACT ON FAMILIES WHO ARE DOING AT TOUGHEST. BUT KNOWING THAT MISDIRECTED SPENDING WILL MAKE THE PROBLEM WORSE. IT COMES DOWN TO A QUESTION OF HOW RAPIDLY YOU WANT TO DO IT, AND HOW MUCH EMPHASIS YOU PUT ON SMOOTHING THE ROUGH EDGES OF THAT PROCESS, WHICH CAN BE VERY ROUGH INDEED. IF YOU TRY AND ADDRESS HIGH INFLATION BY BOOSTING INCOMES, YOU ARE PROLONGING THE INFLATION. WHEREAS, AT THE OTHER END OF THE SCALE, YOU CAN HAVE AN AUSTERE BUDGET, CALL THE ECONOMY MORE QUICKLY. THERE WOULD BE COLLATERAL DAMAGE IN THAT SCENARIO AS WELL. YOU HAVE TO FIND THE MIDDLE GROUND THAT YOU THINK IS ECONOMICALLY AND ETHICALLY DEFENSIBLE. YOU HAVE BEEN KEEPING A CLOSE EYE ON THE BOND MARKETS OVER THE LAST 20 MINUTES. EXPLAIN HOW THEY ARE REACTING. THERE ARE TWO REASONS INTEREST RATES COULD GO HIGHER. THE RESERVE BANK MIGHT DECIDE TO RAISE THE OCR OR KEEP IT HIGHER. AT THE OTHER END OF THE SCALE, IT IS A LOT OF BORROWING, AND IF YOU BORROW A LOT FAST, YOU MIGHT NEED TO PAY MORE INTEREST. LOOKING AT WHAT HAS HAPPENED AT THE SHORT END, WE ARE SEEING THE MARKET PRICE A 50% CHANCE OF ONE EXTRA BASIS POINT HIKE. THAT IS THEIR FIRST CUT, BUT THE MARKET WILL CONTINUE TO MOVE. NOT SO MUCH OF A MOVE IN THE BOND YIELDS YET. WE WILL SEE HOW THAT MARKET GOES OVER THE NEXT 12 MONTHS. WE HAVE AN UPDATE ON WHEN THE GOVERNMENT EXPECTS TO RETURN THE BOOK TO SURPLUS, PUSHED BACK ANOTHER YEAR. IN ADDITION TO RAISING MONEY FOR NEW SPENDING, WE HAVE THE UNWINDING OF THE QUANTITATIVE EASING, MONEY PRINTING, AS IT IS KNOWN, UNWINDING THAT, THE TREASURER NEEDS TO SELL AN EXTRA $5 BILLION WORTH OF BONDS A YEAR. QUITE A LOT WE ARE ASKING OF NEW ZEALAND AND FOREIGN INVESTORS THAT WE RELY ON. THERE IS A TERRIBLE TENSION, IAIN, BECAUSE GOING INTO AN ELECTION, THE FINANCE MINISTER WANTS TO OFFER SUPPORT TO PEOPLE WHO MIGHT BE SWING VOTERS OR WHO MIGHT SUPPORT LABOUR, BUT AT THE SAME TIME, LABOUR IS ALWAYS VULNERABLE TO THE CRITICISM THAT IT IS A TAX AND SPEND GOVERNMENT, SPENDING RECKLESSLY, AND MAKING INFLATION WORSE. THAT IS THE TIGHT ROPE GRANT ROBERTSON WAS TALKING ABOUT. IT AS A REAL TIGHT ROPE AND PARTICULAR LABOUR GOVERNMENTS. THE CLEVER THING HERE IS THAT SPENDING IS NOT GOING INTO PEOPLE'S BANK ACCOUNTS THAT CAN JUST BE SPENT ON WHATEVER, IT IS GOING TOWARDS THINGS LIKE PRESCRIPTION CHARGES, REDUCED PUBLIC TRANSPORT FEES. ON THE ONE HAND, THAT MEANS SPENDING IS MORE PREDICTABLE, BUT POTENTIALLY IT ALSO MEANS IT IS NOT AS INFLATIONARY, AS TAX CUTS THAT JUST GO INTO BANK ACCOUNTS AND DRIVE INFLATION. TAX CUTS WHICH NATIONAL ARE TALKING ABOUT, AND GOING INTO THE ELECTION WITH AS A CENTRAL FISCAL POLICY. TAX CUTS WOULD BE INFLATIONARY IF THEY ARE MATCHED BY CUTS TO SPENDING. NICOLA WILLIS TALKING ABOUT CUTTING THE NUMBER OF CONSULTANTS. EASY TO SAY. IMPOSSIBLE TO DO. I'M NEVER CHRIS HIPKINS SAYING THERE WOULD BE A CUT. THE REALITY WHEN YOU GET INTO GOVERNMENT IS HARDER THAN RHETORIC FROM OPPOSITION. $13 MILLION TO HELP FOR PEOPLE WITH FOOD INSECURITY. A LOT OF ADVOCATES IN POVERTY HAVE BEEN CALLING FOR BIG STEPS FROM GOVERNMENT TO EASE THE COST OF FOOD. THE SPIKE TO THE YEAR IN APRIL WAS THE HIGHEST IN 35 YEARS. IS $13 MILLION A DROP IN THE OCEAN? I DO SOME WORK IN THIS SPACE. IT IS A DROP IN THE OCEAN, THE LEAST THAT MOST PEOPLE WOULD EXPECT. BUT DEBBIE NGAREWA-PACKER TALK ABOUT TRANSLATIONAL CHANGE. WE WILL NOT GET TRANSFORMATIONAL CHANGE FROM LABOUR OR NATIONAL. THIS IS A NO-FRILLS BUDGET. THIS IS THE POLITICS OF IT. IF PEOPLE ARE LOOKING FOR TRANSFORMATIONAL CHANGE, THEY WILL HAVE TO LOOK TO ACT, GREEN AND TPM/ THEY WILL HAVE TO LOOK TO ACT, GREEN AND TE PATI MAORI THANK YOU. IAIN LEES-GALLOWAY. WILL BE BACK WITH THE PANEL SHORTLY. COMING UP ` WHAT DOES NATIONAL THINK OF THE BUDGET? A SPEECH FROM OPPOSITION LEADER CHRISTOPHER LUXON IN A BIT. KIA ORA. WELCOME BACK TO THIS ONE NEW SPECIAL AS WE LOOK AT THE 2023 BUDGET. IF YOU ARE JUST JOINING US, WHERE HAVE YOU BEEN? HERE OTHER TOP LINES. ONE POINT TO BILLION DOLLARS IN SPENDING HAS BEEN ANNOUNCED TO EXTEND FREE EARLY CHILDHOOD EDUCATION TO 2-YEAR-OLDS. AT THE MOMENT, IT IS AVAILABLE FOR THREE AND FOUR-YEAR-OLDS. $620 MILLION IN SPENDING TO SCRAP PRESCRIPTION FEES. SO IF YOU GO TO THE PHARMACIST, THE FIVE DOLLAR PRESCRIPTION COST WILL BE FREE. AS WELL AS THAT, $400 MILLION INCHED SPENDING FOR CHEAPER ENERGY BILLS HAS BEEN ANNOUNCED AS PART OF THE WARMER KIWI HOMES PROGRAM. AND $330 MILLION HAS BEEN ANNOUNCED FOR CHEAPER PUBLIC TRANSPORT. THAT WILL MEAN PUBLIC TRANSPORT IS FREE FOR PEOPLE AGED 5 TO 12 AND HALF PRICE FOR PEOPLE UNDER THE AGE OF 25. PUBLIC TRANSPORT HAS BEEN HALF PRICE FOR SOME TIME. ALONGSIDE THE CUT TO THE FUEL EXCISE TAX, ALTHOUGH THAT TAX CUT IS DUE TO END SHORTLY. TOTAL NEW SPENDING IN THIS BUDGET IS ABOUT $5 BILLION. IT TAKES THE GOVERNMENT SPENDING TO ABOUT $130 BILLION. ALTHOUGH THE MOST RECENT NUMBERS OUT OF THE CONSUMER PRICE INDEX SUGGESTS THAT INFLATION IS STARTING TO COOL, SOME OF GRANT ROBERTSON'S CRITICS ARE SUGGESTING THE GOVERNMENT'S FISCAL PLANS WILL MAKE THE PROBLEM WORSE. BRINGING YOU BACK TO OUR PANEL NOW. SHARON ZOLA AND IAIN LEES-GALLOWAY. I WANT TO TALK ABOUT CYCLONE GABRIEL, BECAUSE THIS IS SOMETHING HE WASN'T FACTORING AND WHEN HE LAST CONSIDERED HIS BUDGET IN DECEMBER AND PUBLISHED THE FORECAST AT THAT STAGE. SHARON, THE GOVERNMENT HAS ANNOUNCED $1 BILLION LEADING INTO THIS BUDGET AND ADDITIONAL CYCLONE FUNDING AS WELL AS THE $6 BILLION FOR A NATIONAL RESILIENCE PLAN. TALK TO US ABOUT THE BALANCE HE HAS TO STRIKE, BECAUSE AS MUCH AS THEY MIGHT WANT TO INVEST IN ADDRESSING OUR INFRASTRUCTURE SHORTFALL, WE DON'T If you've just joined us, HAVE THE TALENT AND CAPACITY TO DO IT. TO PROBLEMS FIRSTLY, CLIMATE CHANGE IS GOING TO HAVE A HUGE FISCAL... THIS IS JUST THE START. WE HAVE TO FIX THIS, MAKE IT MORE RESILIENT. THE WEATHER WILL NOT STOP HAPPENING. THIS WILL BE ONGOING. AS WELL AS THAT, THIS IS NOT JUST NEW ZEALAND; THIS IS ALL OVER THE WORLD, SO THERE IS GOING TO BE AN INTERNATIONAL BUNFIGHT. $210 BILLION THAT SOUNDS LIKE A FANTASTICAL NUMBER TO MOST PEOPLE. 210,000 MILLION DOLLARS IS THE ESTIMATED INFRASTRUCTURE SHORTFALL FMF WE ARE TO BE RESILIENT. THE LATEST NUMBERS SUGGEST WE COULD HIT THAT ONE .5 DEGREES OF WARMING WITHIN THE NEXT FIVE YEARS, WHICH MEANS THAT THE CLIMATE IS CHANGING FASTER THAN WE EXPECTED. HOW DOES THE FINANCE MINISTER GO ABOUT TRYING TO PREPARE US FOR THAT? PROBABLY GLAD THE CYCLE IS THREE HAS RATHER THAN 30. AT SOME POINT, IT BECOMES SOMEBODY ELSE'S PROBLEM. IT IS A VERY BIG PROBLEM, AND NOT JUST FOR US. UNFORTUNATELY, NEW ZEALAND'S STARTING POINT IS RELATIVELY LOW. A DECENT RECESSION PLUS A DECENT WEATHER EVENT AND AN EARTHQUAKE, AND SUDDENLY THINGS CAN LOOK VERY DIFFERENT VERY FAST. IT SOUNDS LIKE A WILD FRIDAY NIGHT. WHAT DO YOU MAKE OF THE GOVERNMENT'S RESPONSE TO CYCLING GABRIELLE? LIKE I SAY, THIS IS NOT SOMETHING HE WAS FACTORING IN UNTIL THE EARLY THIS YEAR AND THIS WILL HAVE CHANGED THE BUDGET PLANS QUITE SIGNIFICANTLY. ABSOLUTELY. HOW MANY TIMES HAVE WE HEARD THAT? "THIS WILL CHANGE THE PLANS." COVID, CYCLONES... BUDGETS TAKE A YEAR TO PREPARE, YET SO MANY TIMES THIS GOVERNMENT HAS HAD TO MAKE LAST-MINUTE CHANGES. SO IT IS UNHELPFUL, BUT WHAT THE GOVERNMENT NEEDS TO DO IS GET THAT MONEY OUT THE DOOR AND FOR PEOPLE TO SEE STUFF HAPPENING. I THINK THIS YEAR, PEOPLE NEED TO SEE THE REPAIR JOB HAPPENING, BUT THEY WILL TAKE SOME COMFORT THAT THE GOVERNMENT IS ACTUALLY THINKING ABOUT THE FUTURE AND HAVING A RESILIENCE PLAN. WE HAVEN'T BEEN VERY GOOD AT THAT OVER THE YEARS, THINKING ABOUT THE FUTURE. WE HAVEN'T ADDRESSED CLIMATE CHANGE; WE HAVEN'T SPENT WHAT WAS REQUIRED TO PREVENT IT HAPPENING, AND NOW WE FACE THE BILL OF THE CLEANUP AND PREPARING FOR IT. SO I THINK MOST PEOPLE, IF YOU ARE THINKING ABOUT THIS FOR A POLITICAL LENS, WILL WANT TO SEE THE DAMAGE CLEANED UP AS QUICKLY AS POSSIBLE, THE ROADS REPAIRED, THE CONNECTIONS REBUILT, THE RESILIENCE PROJECT THAT IS FOR THE FUTURE. MOST PEOPLE AREN'T THINKING ABOUT IT. LOOKING FORWARD TO TALKING WITH YOU MORE ABOUT THIS IN A COUPLE OF MINUTES. SHARON ZOLLNER AND IAIN LEES-GALLOWAY. WE'RE ABOUT TO TAKE YOU LIVE NOW TO THE RESPONSE TO GRANT ROBERTSON FROM NATIONAL LEADER CHRISTOPHER LUXON. THIS IS NOT APPLAUSE FOR CHRISTOPHER LUXON, ALTHOUGH HE WOULD LIKE TO BE, I AM SURE. THE REASON THAT ONE HALF OF THE HOUSE IS STANDING AND THE OTHER HALF IS NOT AS THAT THAT WAS LABOURS CAUCUS AND PERHAPS SOME MEMBERS OF THE GREENS ARE SUPPORTING GRANT ROBERTSON. HERE IS NATIONAL LEADER CHRISTOPHER LUXON. ... THIS HOUSE HAS NO CONFIDENCE IN THE GOVERNMENT BECAUSE IT CANNOT MANAGE THE ECONOMY PROPERLY, HAS NO PLAN TO TACKLE THE COST OF LIVING CRISIS AND NEW ZEALAND IS GOING BACKWARDS. MR SPEAKER, THAT SPEECH AND THIS BUDGET IS JUST ANOTHER EXAMPLE OF THIS GOVERNMENT GAS LIGHTING THE COUNTRY. CHRIS HIPKINS AND GRANT ROBERTSON ARE TRYING TO TELL KIWIS THAT THEY ARE DOING A SPLENDID JOB MANAGING THE ECONOMY AND EVERYTHING IS JUST FINE AND BEING WELL-MANAGED. I HAVE TO SAY IT IS NOT FINE. NEW ZEALANDERS KNOW IT IS NOT. I CAN TELL YOU I KNOW IT IS NOT, AND DEEP DOWN, CHRIS HIPKINS AND GRANT ROBERTSON KNOW IT TOO. SADLY, NEW ZEALANDERS KNOW IT, AND 50% OF KIWIS NOW WHO WORRY ABOUT MONEY ON A DAILY BASIS, THEY KNOW IT IS NOT FINE. THE 430,000 KIWIS WHO HAVE DEBT ARREARS, THEY KNOW THINGS ARE NOT FINE. SADLY, THE 20,000 KIWI FAMILIES WHO ACTUALLY ARE FACING A LOSS OF THEIR HOUSES BECAUSE OF THEIR MORTGAGES, THEY KNOW THINGS AREN'T FINE AS WELL. WHAT THEY KNOW TODAY IS THAT THAT BUDGET DOESN'T CHANGE THEIR SITUATION. BECAUSE THIS WAS PRESENTED AS THE NO-FRILLS BUDGET, BUT WHAT WE HAVE TODAY IS THE BLOWOUT BUDGET. BECAUSE WHAT WE HAVE SEEN AS A CONTINUED ADDICTION TO SPENDING ` SPENDING UP TO $137 BILLION ` ALMOST DOUBLED SINCE THIS GOVERNMENT CAME TO POWER. WE SEE A HUGE GROWTH IN DEBT TO $97 BILLION BY 2026. WE ARE SEEING A MASSIVE BUDGET DEFICITS. UP SEVEN-POINT $1 BILLION LARGER THIS YEAR. THE IMPLICATION OF ALL OF THAT IS THAT WE ACTUALLY HAVE TREASURY ` PAGE 1 OF THE EXECUTIVE SUMMARY SAYING INTEREST RATES WILL REMAIN HIGHER FOR LONGER. JUST THINK ABOUT THE PAIN AND SUFFERING THAT CAUSES FOR KIWIS WHO HAVE A MORTGAGE. EVERY SINGLE ONE OF THEM DOING IT TOUGHER, HARDER, FOR LONGER. AND NOT A SINGLE CENT OF TAX RELIEF GOING TO HARD-WORKING KIWIS. NOT NOTHING. THE GOVERNMENT SAYS THIS IS THE BREAD AND BUTTER BUDGET, BUT IT IS DELIVERED ON THE BACKDROP OF FOOD PRICES UP 28%, AND THE PRIME MINISTER TALKS ABOUT BREAD AND BUTTER A LOT, BUT BREAD IS UP 39% UNDER LABOUR, AND THE SAUSAGE ROLLS HE LIKES TO HAVE SALVIAS WITH, THEY ARE 36%. *SELFIES. NO IDEAS TO DRAG NEW ZEALAND OUT OF THE ECONOMIC HOLE, TO TACKLE INFLATION, AND THERE ARE NO IDEAS IN HERE TO STOP A SINGLE YOUNG PEOPLE HERE SHOOTING OFF OVERSEAS AND JOINING THE OTHER KIWI CITIZENS WHO HAVE BOOKED ONE-WAY TICKETS TO SYDNEY OR MELBOURNE OR LONDON. LAST NIGHT, WE SAW A RATHER PERVERSE THING HAPPENED WHAT WE SAW AS WE SAW THAT CHRIS HIPKINS HAS TAKEN $10,000 OF HARD-WORKING TAXPAYERS MONEY AND HE HAS ADVERTISED TO AUSTRALIA TO SAY HOW MUCH IS YET IS TO GET IN AUSTRALIA THAN IT IS IN NEW ZEALAND. BY MINISTER, YOUR JOB IS TO FIGHT TO KEEP KIWIS HERE AND CREATE A COUNTRY THAT CAN DELIVER A BETTER FUTURE FOR THEM HERE AT HOME. THAT IS NATIONAL LEADER CHRISTOPHER LUXON ADDRESSING THE HOUSE, RESPONDING TO FINANCE MINISTER GRANT ROBERTSON'S 2023 BUDGET. THIS IS ONE OF THE MORE DIFFICULT SPEECHES FOR ANYBODY TO HAVE TO DELIVER IN PARLIAMENT. YOU HAVE NO DETAIL UNTIL ABOUT 2 O'CLOCK, WHEN FINALLY ALL THE INFORMATION COMES THROUGH, AND YOU HAVE TO TWEAK YOUR SPEECH IN THE MOMENT. CHRISTOPHER LUXON ADDRESSING THE HOUSE THERE. WE WILL HAVE MORE OF HIS COMMENTS 44 STAY WITH US AS THIS I NEW KIA ORA, WELCOME TO THIS BUDGET SPECIAL AS WE GO THROUGH THE DETAILS ON THE 2023 BUDGET. WE ARE EXPECTING TO HEAR FROM FINANCE MINISTER GRANT ROBERTSON LIVE FROM PARLIAMENT. ONE USE BUSINESS REPORTER CORAZON MILLER IS WITH US. LOOKING AT THE DETAILS IN THE BUDGET AND COMPARING TO WHAT BUSINESSES HAVE BEEN CALLING FOR, HOW OUR BUSINESS IS LIKELY TO REACT. THERE ISN'T A LOT IN THIS BUDGET TARGETED AT BUSINESSES. IT HAS BEEN A DIFFICULT TIME FOR THEM. WE HAVE HAD THE PANDEMIC, BAD WEATHER THIS YEAR, JUST WHEN PEOPLE WERE HOPING TO GET A SEMBLANCE OF NORMALITY WE HAD BEEN MISSING OVER THE LAST COUPLE OF YEARS. THEY HAVE BEEN PAYING MORE FOR THE WAGES, AND PEOPLE ARE SPENDING LESS. IT IS A DIFFICULT TIME FOR SMALL BUSINESSES THAT DON'T HAVE A MASSIVE AMOUNT OF OVERHEAD. WHAT MANY BUSINESSES HAD HOPED TO SEE FROM THE GOVERNMENT IS LESS SPENDING, BUT ANY SPENDING THAT DID HAPPEN FOCUSED ON AREAS OF GREATEST NEED. THAT IS A DIFFICULT JUNGLE FOR THE GOVERNMENT. YOU NEED TO SPEND MONEY, AND THE FOCUS HAS BEEN ON EASING THE COST OF LIVING FOR NEW ZEALANDERS ACROSS THE BOARD WITH THINGS LIKE REDUCED COSTS OF EDUCATION, TRANSPORT AND MEDICATION COSTS. THE LOGIC BEHIND THAT WILL PROBABLY BE THAT AS PEOPLE FIND THINGS A BIT EASIER, HAVING TO SPEND LESS IN DAY-TO-DAY LIFE, THAT WILL HAVE A FLOW ON EFFECT TO BUSINESSES. BUT THAT IS NOT GREAT COMFORT FOR BUSINESSES WHO ARE STRUGGLING AT THE MOMENT. IT IS TOUGH, BECAUSE THE GOVERNMENT IS VERY AWARE THAT WHATEVER IT DOES, IN TERMS OF ITS SPENDING PLANS, IF THERE IS MISDIRECTED SPENDING, THAT WILL CONTRIBUTE TO INFLATION. THERE HAS BEEN TALK FROM BUSINESSES WHO WANT TO SEE THE GOVERNMENT DO WHAT IT CAN TO REDUCE INFLATIONARY PRESSURES. ONE THING THAT IS INTERESTING, IS THAT IMMIGRATION NUMBERS ARE VERY HIGH. THIS IS ONE AREA WHERE BUSINESS MIGHT SAY THE GOVERNMENT IS SUPPORTING US, STARTING TO RELAX IMMIGRATION RULES, WHICH MIGHT MEAN WE CAN EASE LABOUR PRESSURES AND FILL JOBS. THAT WILL HELP BUSINESSES. THINGS HAVE BECOME EASIER, IN TERMS OF PEOPLE COMING THROUGH. WE STILL DON'T HAVE A MASSIVE POOL OF PEOPLE TO DRAW ON, IN TERMS OF THOSE SHORTAGES. SOME BUSINESSES WERE HOPING FOR MORE INVESTMENT FOR THINGS LIKE TRAINING, SO WE CAN AGAIN TO GROW A POOL OF RESOURCES THAT IS HERE IN NEW ZEALAND, AND NOT RELY ON PEOPLE FROM OFFSHORE. CORAZON MILLER THANK YOU VERY MUCH. GRANT ROBERTSON HAS JUST WRAPPED HIS SPEECH. THANK YOU FOR BEING WITH US, MINISTER. WHAT YOU TRYING TO ACHIEVE WITH THIS YEAR'S BUDGET? WE ARE TRYING TO GET A BALANCE, JACK. IT IS A CHALLENGING TIME FOR A LOT OF NEW ZEALANDERS. THERE IS PRESSURE FROM THE COST OF LIVING INCREASES, SO WE HAVE TRIED TO TARGET SUPPORT THEIR BUT BALANCE THAT AGAINST THE PUBLIC SERVICES NEW ZEALANDERS RELY ON, AND GETTING OURSELVES BACK INTO A MORE FISCALLY SUSTAINABLE POSITION. WE HAD SOME BIG SPENDING BUDGETS, BUT NOW WE HAVE TO RING OURSELVES BACK TO A LOWER LEVEL OF GOVERNMENT SPENDING AS A PERCENTAGE OF GDP. IT IS A BALANCED, PRACTICAL, PRAGMATIC BUDGET FOR THE TIME WE ARE . DO YOU ACCEPT THAT SOME OF YOUR FISCAL PLANS WILL CONTRIBUTE TO INFLATION? MY CRITICS ARE COMING FROM BOTH SIDES. THEY THINK IT IS NOT ENOUGH AND TOO MUCH. WE HAVE CAREFULLY CALIBRATED THIS. YOU CAN SEE IN THE TREASURY FORECASTS, BASED ON INVESTMENTS WE ARE MAKING, THAT THEY THINK INFLATION WILL BE BACK DOWN TO 3% NEXT YEAR AND 2.5% THE YEAR AFTER. WE HAVE PUT TOGETHER INVESTMENTS PARTICULARLY IN THE COST OF LIVING TO EASE THE PRESSURE ON FAMILIES AND INDIVIDUALS, RATHER THAN PUTTING LOTS OF MONEY INTO THEIR POCKETS, WHICH WOULD HAVE MORE INFLATIONARY IMPACT. YOU ARE BEING CRITICISED FROM BOTH SIDES. WHAT CONSIDERATION DID YOU GIVE TO BORROWING AND SPENDING MORE? WE TRIED TO STRIKE A BALANCE. THERE IS UNDOUBTABLY MORE THINGS WE WOULD LIKE TO DO. MINISTERS HAVE A LOT OF PROPOSALS THEY WANT TO ADVANCE. THAT WE HAVE INVESTED HEAVILY IN PUBLIC SERVICES, LOOKING HEAVILY TOWARDS NEW JOBS, RESEARCH AND DEVELOPMENT, THE DEVELOPMENT SECTOR GETTING A 20% REBATE. TRYING TO FIND WAYS TO DO LONG-TERM INVESTMENTS, BALANCED AGAINST FISCAL SUSTAINABILITY. WE CONSIDERED A LOT OF IDEAS, BUT WE HAVE STRUCK A PLACE WHICH ACHIEVES THE TWO THINGS WE WANTED. SUPPORT PEOPLE TODAY BUT INVEST IN THE FUTURE. BALANCE IS A WORD YOU HAVE BEEN USING FOR SOME TIME. IF ANYONE HAS IT ON THEIR BINGO CARD THIS AFTERNOON, THEY WILL HAVE SEVERAL LINES FILLED. TALK ABOUT TARGETED SPENDING, WHEN IT COMES TO EASING THE COST OF LIVING CRISIS, THE SPENDING HAVE ANNOUNCED THE EARLY CHILDHOOD EDUCATION AND HEATING. ABSOLUTELY. EARLY CHILDHOOD EDUCATION IS A SIGNIFICANT COST ON YOUNG FAMILIES. IT HAS ANOTHER BENEFIT, WHICH IS ALLOWING PEOPLE TO COME BACK INTO THE WORKFORCE OR ENTER THE WORKFORCE OR GO INTO EDUCATION. BY EXTENDING THE 23 HOURS TO 2-YEAR-OLDS, WE ARE EXPANDING THE NUMBER OF CHILDREN WHO GET EDUCATION OPPORTUNITIES, AND THE PEOPLE WHO COME INTO THE WORKFORCE. THE WARMER KIWI HOMES INITIATIVE, THAT IS 100,000 MORE HOMES GETTING INSULATED AND HEATED, WHICH LOWERS ENERGY BILLS, BUT CONTRIBUTES TO CLIMATE CHANGE GOALS. FREE PUBLIC TRANSPORT FOR CHILDREN, THAT EASES PRESSURE BUT SUPPORTS ANOTHER GOAL, CLIMATE CHANGE GOALS. WE KNOW HOW BUSY YOU ARE, THANK YOU FOR YOUR TIME. GOING THROUGH SOME OF THE DETAIL, HEADING INTO TODAY, THE FINANCE MINISTER HAD SAID THERE WOULD BE NO SIGNIFICANT TAX CHANGES. LABOUR IS YET TO PUBLISH ITS TAX POLICY GOING INTO OCTOBER'S ELECTION. THEY SAID THERE WOULD BE NO MAJOR TAX CHANGES. THERE IS, HOWEVER, ONE RELATIVELY SMALL TAX CHANGE THAT IS INTERESTING TO NOTE, THE TOP TAX RATE FOR TRUSTS IN NEW ZEALAND HAS BEEN CHANGED. IT WAS PREVIOUSLY 33%. THE TOP TAX RATE HAS BEEN LIFTED TO 39%. THAT IS IN LINE WITH INCOME TAX RATES. NO MAJOR TAX ANNOUNCEMENTS OR CHANGES TODAY. WE WILL GET A PANEL THOUGHT SHORTLY. MORE TO COME. WE WILL TAKE YOU LOVE TO PARLIAMENT, WHERE DAVID SEYMOUR IS STANDING BY. WHAT DO YOU THINK OF THE BUDGET? IT IS A BLOWOUT. IT IS IRRESPONSIBLE. I HEARD CHRIS HIPKINS TWO WEEKS AGO SAY IT DOESN'T SEEM RIGHT THAT NEW ZEALANDERS UP AND DOWN THE COUNTRY ARE HAVING TO TIGHTEN THEIR BELTS IF THE GOVERNMENT WON'T DO THE SAME. THE $7.5 BILLION SURPLUS NEXT YEAR FOLLOWING A $7 BILLION SURPLUS THIS YEAR AT A TIME WHEN THE RESERVE BANK GOVERNOR IS RAISING MORTGAGE RATES TO TRY AND GET INFLATION UNDER CONTROL AND REALLY STRUGGLING WITH THAT, I THINK IT IS THE HEIGHT OF IRRESPONSIBILITY, AND SADLY, THE PRESSURE ON INFLATION AND INTEREST RATES IS GOING TO TOTALLY SWAMP ANY OF THE WELL-MEANING MEASURES SUCH AS A FREE DAY CARE FOR TWO-YEAR-OLDS OR FREE PRESCRIPTION MEDICINES THAT WERE SUPPOSED TO TARGET THE COST OF LIVING. TALK TO ME MORE ABOUT THOSE NEW SPENDING PLANS. IS THERE ANYTHING SPECIFICALLY ABOUT THOSE PLANS YOU THINK IS A RESPONSIBLE? THINK IS IRRESPONSIBLE? I DON'T THINK ANY PARTICULAR PART OF THE BUDGET IS IRRESPONSIBLE. FOR A LONG TIME, COMMUNITY PHARMACIES HAVE BEEN FACING REAL CHALLENGES GETTING UNDERCUT BY THE BIG AUSTRALIAN CHAINS, SO THAT CHANGE WILL BE WELCOME FOR A LOT OF PEOPLE, BUT IN AGGREGATE, NEXT YEAR IS SEVEN-POINT $5 BILLION DEFICIT ` THAT MEANS THE GOVERNMENT IS GOING TO BORROW AND PUMP SEVEN-POINT 5 BILLION MORE INTO THE ECONOMY THAN THEY TAKE OUT. THAT IS INFLATIONARY, AND I SUSPECT THE RESERVE BANK GOVERNOR, ALTHOUGH HE WILL NOT BE ABLE TO SAY IT, WILL HIT THE ROOF. THE GOVERNMENT WILL GIVE YOU ALL SORTS OF EXCUSES COVID, VLADIMIR PUTIN. AND NOW THE FLOODS AND CYCLONES. BUT IN THIS BUDGET, THE EXPENDITURE FOR THOSE PURPOSES IS ABOUT 900 MILLION, SO IT IS LESS THAN ONE DOLLAR AND SEVEN THAT THEY ARE GOING OUT AND BORROWING CAN BE JUSTIFIED BY FLOODS AND CYCLONES. ALTOGETHER, WHAT YOU HAVE IS FLAGRANT IRRESPONSIBILITY, MASSIVE INCREASES IN DEFICIT SPENDING AT EXACT EITHER TIME THE GOVERNMENT NEEDED TO BE PULLING BACK ON ITS DEFICIT SPENDING SO PEOPLE CAN GET RELIEF ON THEIR MORTGAGES, RELIEF ON THEIR RENT, BECAUSE LANDLORDS HAVE MORTGAGES TO, AND RELIEF AT THE SUPERMARKET BECAUSE DOMESTIC INFLATION HAS BEEN THE REAL DISTURBING STORY OF 2023. ACT HAS PUBLISHED ITS ALTERNATIVE BUDGET. GIVE US A FLAVOUR HOW DIFFERENT WOULD TODAY'S BUDGET HAVE LOOKED IF YOU WERE FINANCE MINISTER? IF WE WERE FINANCE MINISTER, WE WOULD HAVE ACKNOWLEDGED THE SEVERE PRESSURES NEW ZEALAND IS FACING DUE TO INFLATION THAT THE GOVERNMENT ITSELF HAS ULTIMATELY CAUSED. BUT WE WOULD HAVE DONE IT IN SUCH A WAY THAT WE PULLED BACK SPENDING BY ASKING IN EACH INSTANCE, IF THIS GOVERNMENT DEPARTMENT OR'S EXPENDITURE PROGRAM DIDN'T EXIST, COULD WE BUILD A CASE TO START IT UP ANEW TODAY, AND IF WE CAN'T, MAYBE WE SHOULDN'T CONTINUE. IF YOU TAKE THAT APPROACH, THEN WE SHOW HOW YOU COULD REDUCE EXPENDITURE BY 38 BILLION` 9 BILLION A YEAR SIMPLY BY ASKING THE QUESTION, WOULD WE DO THIS TOMORROW IF WE HADN'T DONE IT TODAY? THAT IS WITHOUT TOUCHING A SINGLE FRONTLINE SERVICE. IN FACT, AND A FEW SELECT AREAS GP FUNDING, TEACHER PAY WE WOULD ACTUALLY BOOST. WHAT WE WOULD ALLOW BY SPENDING LESS AS FESTIVAL TO GET BACK INTO SURPLUS AND STOP THE DEFICITS, AND SICK OF ALL, WITH THE LEFTOVER MONEY, ACTUALLY GIVE PEOPLE TAX RELIEF. WE WOULD BE KEEPING ANOTHER 2 1/2 GRAND A YEAR SO THAT THEY CAN FIGHT SOME OF THE PRICE RISES THEY HAVE ALREADY EXPERIENCED. ACTUALLY TO DAVID SEYMOUR. BACK WITH OUR PANEL IN THE STUDIO NOW SHARON ZOLLNER AND IAIN LEES-GALLOWAY. AS WELL AS THE GOVERNMENT'S SPENDING PLANS, WE GET A NEW SET OF FORECASTS. WHAT DOES THAT TELL US? THEY LOOKED A LITTLE ON THE ROSY SIDE. THE FORECASTS ARE A LITTLE BIT OLD BECAUSE THERE IS A WHOLE PROCESS, SO THEY DON'T INCORPORATE THE LATEST DATA. THEY ASSUME THE ECONOMY WILL GROW, WHICH IS A CONTRAST WITH THE RESERVE BANK, WHO SAYS THEY EXPECTED TO SHRINK. THE STRONGER THE ECONOMY IS GOING, THE BETTER THE GOVERNMENT'S BOOKS ARE. YOU GET MORE TAX REVENUE AND LESS BENEFITS OUT. SO THAT HAS GIVEN THE GOVERNMENT MORE OPTIONS. BUT INSOFAR AS THERE IS SCOPE FOR THE ECONOMY TO DISAPPOINT, THAT DOES RAISE THE POSSIBILITY THAT THE DEFICITS COULD BE A LITTLE WORSE THAN EXPECTED. SO THEY PUSHED OUT THE RETURN TO SURPLUS BY ONE YEAR, BUT IT IS WAFER THIN, SO IN PRACTICE, IT SEEMS QUITE LIKELY IT COULD BE PUSHED OUT ANOTHER YEAR, WHICH WOULD MARK SEVEN YEARS IN A ROW OF GOVERNMENT DEFICIT. TALK TO US MORE ABOUT THE DIFFERENCE BETWEEN THE RESERVE BANK'S FORECAST AND TREASURIES. WE ARE EXPECTING FRESH FORECASTS FROM THE RESERVE BANK WHEN THEY MAKE THE DECISION ON THE OFFICIAL CASH RATE. IT IS INTERESTING TO SEE THAT TREASURY IS ASSUMING THAT MIGRATION OF 66,000 THIS YEAR; THE RESERVE BANK ASSUMES LESS THAN HALF OF THAT. THE ACTUAL NUMBERS ARE RUNNING WELL OVER 100,000 PACE AT THE MOMENT. OBVIOUSLY, THAT GROWS THE ECONOMY, GROWS THE NOMINAL ECONOMY BUT ALSO GROWS THE NEED FOR INFRASTRUCTURE, SCHOOLING, ERODING AS WELL. SO IT IS AMBIGUOUS, BUT IT IS A PRETTY GOOD REASON WHY WE ALL MIGHT LOOK RATHER SILLY WITHOUT ECONOMIC FORECASTS FOR THE NEXT YEAR. IAIN? HOW LUCKY ARE WE TO HAVE A FORMER IMMIGRATION MINISTER SITTING IN THE STUDIO? WHAT YOU MAKE OF THOSE NUMBERS? BECAUSE COMPARED TO LABOUR'S POSITION WHEN YOU WERE MINISTER, DOWNRIGHT SAY, *DARE I SAY ` THE APPROACH TO IMMIGRATION IS TOTALLY DIFFERENT. AND WE ARE IN A COMPLETELY DIFFERENT ENVIRONMENT, AND I NEED IS A VERY DIFFERENT. PLUS, WE'RE BOUNCING BACK FROM ZERO. NOBODY, NOT EVEN NEW ZEALAND FIRST, I DON'T THINK, PLANNED FOR US TO GET TO 0 NET MIGRATION. SO YOU ARE SEEING A MAKE UP FOR MISSING MIGRANTS OVER THE LAST FEW YEARS, BUT CLEARLY, THE GOVERNMENT HAS TWEAKED THE SETTINGS TO MAKE IT EASIER FOR PEOPLE TO GET IN AND RESPONSE TO BUSINESS SAYING, LOOK, THE BIGGEST RESTRAINT ON ECONOMIC GROWTH AT THE MOMENT IS THE AVAILABILITY OF LABOUR, AND WAGE INFLATION THAT GOES ALONG WITH THAT. SO THE CHALLENGE, OF COURSE, WITH EMIGRATION IS THAT YOU CHANGE THE SETTINGS BUT THERE IS SUCH A HUGE LAG BETWEEN THAT AND THE ACTUAL EFFECT OF PEOPLE CROSSING THE BORDER. SO THIS WILL CONTINUE TO BE SOMETHING THE GOVERNMENT KEEPS A CLOSE EYE ON. THAT MUST BE TRICKY. AT ANY ONE MOMENT, THE GOVERNMENT IS TRYING TO REACT TO THE ECONOMIC ENVIRONMENT, BUT WHEN YOU ARE TRYING TO PREDICT WHERE YOU WILL BE IN SIX MONTHS COMPARED TO PRE-PANDEMIC, IT IS VERY DIFFICULT TO ACTUALLY GET AN EXACT IDEA, AS EVIDENCED BY THE RESERVE BANK. THAT IS RIGHT. YOU ASK FIVE ECONOMISTS WHAT THE FUTURE IS GOING TO LOOK LIKE, YOU WILL GET FIVE DIFFERENT ANSWERS. IF YOU ASK TREASURY AND THE RESERVE BANK, YOU WILL GET QUITE DIFFERENT ANSWERS. ONE SAYS GROWTH, ONCE IS SHRINKING. SO IT IS A CHALLENGE, AND THIS IS THE NATURE OF THE JOB OUR POLITICIANS AND BUREAUCRATS HAVE ` IT IS HARD. WE HAVE HIGH EXPECTATIONS OF THEM, AND IT IS A VERY DIFFICULT ENVIRONMENT AT THE MOMENT. I KNOW THERE WILL BE PEOPLE WATCHING THE TV NOW THINKING, WHAT DOES THIS MEAN FOR MY MORTGAGE? WHAT DOES IT MEAN FOR THE OCR? THE RESERVE BANK IN APRIL TALKED ABOUT FISCAL POLICY AS ONE OF THE UPSIDE RISKS TO MEDIUM-TERM INFLATION` SCHOOL POLICY BEING GOVERNMENT SPENDING? EXACTLY. I DON'T THINK THEY WOULD HAVE HAD A DOWNWARD SURPRISE IN TERMS OF THE SIZE OF OVERALL GOVERNMENT SPENDING. IS UNLIKELY TO CHANGE THEIR ACTUAL DECISION ON THE DAY, BUT THE MARKET IS ASSESSED WITH WHAT THE RESERVE BANK FORECASTS FOR THE OFFICIAL CASH RATE, BECAUSE THAT WILL HAVE A MUCH AGO IMPACT ON FIXED MORTGAGE RATES, AND MOST PEOPLE ARE ON FIXED RATES, SO WE ARE IN THIS WEIRD WORLD WHERE THE EXPECTATION OF WHAT THE RESERVE BANK IS GOING TO DO IS ACTUALLY MORE IMPORTANT THAN WHAT THEY DO ON THE DAY. WE ARE ALL WAITING TO SEE... THEY ARE VERY UNLIKELY TO BE SPECIFIC THAT MIGRATION WAS WHETHER THIS MUCH AND FISCAL POLICY WAS WITH THIS MUCH, BUT IT WILL ALL BE IN THE MIX, AND WE ARE THINKING IT WILL BE A HIGHER OCR TRACK. POTENTIALLY ANOTHER 25 BASIS POINT ANNOUNCEMENT NEXT WEEK, AND THEN POTENTIALLY MORE RISES? WE CHANGED OUR FORECAST YESTERDAY TO ADD ANOTHER HIKE IN JULY. OTHERS PREDICT MORE THAN THAT. AND NOTHING FROM THIS HAS CHANGE YOUR POSITION? THAT IS FEAR. *FAIR. SHARON ZOLLNER AND IAIN LEES-GALLOWAY. THE 1 NEWS BUDGET SPECIAL CONTINUES AFTER THE BREAK. WELCOME BACK. THE NATIONAL PARTY IS CALLING THIS YEAR'S BUDGET THE 'BLOW-OUT BUDGET'. HERE'S NATIONAL PARTY LEADER CHRISTOPHER LUXON SPEAKING A SHORT TIME AGO. HE IS TOTALLY, UTTERLY, COMPLETELY ADDICED TO SPENDING. EVERY BUDGET, HE STANDS UP AND PROMISES HE'S GONNA DELIVER IT THIS TIME. 'THIS TIME I'LL GET BETTER. THIS TIME I'LL DO BETTER.' BUT EVERY TIME, HE BLOWS IT OUT. AND THAT'S BECAUSE HE'S ADDICTED TO SPENDING, AND HE'S AN ADDICT. AND AS A RESULT, HE DOESN'T WANNA ADMIT THAT HE'S GOT A PROBLEM. AND THE SAD THING IS THAT THE NEW PRIME MINISTER, HIS NEW BOSS, ISN'T TOUGH ENOUGH TO TELL HIM, 'HEY, SUNSHINE, WE NEED TO MAKE AN INTERVENTION HERE, 'TO ACTUALLY GET IT SORTED, GET IT BACK ON TRACK.' CHRISTOPHER LICENSE BEING IN THE HOUSE, A MAN WHO KNOWS THAT FEELING ALL TOO WELL, HOW DIFFERENT IS TO DELIVER A SPEECH AS THE OPPOSITION LEADER IS SIMON BRIDGES, WHO IS NOW WITH THE AUCKLAND CHAMBER OF COMMERCE. FOR AN OPPOSITION LEADER, THAT IS THE HARDEST MOMENT. WATCHING VARIOUS OPPOSITION LEADERS, I WAS PANICKED BY IT. I WOULD OVER PREPARE, TELL MY TEAM A MONTH AND A HALF AHEAD, BECAUSE I KNEW IF IT DIDN'T GO WELL, PEOPLE WOULD BE TALKING AND SO FORTH, SO YOU HAVE TO BE PREPARED. 20 MINUTES SEEMS LIKE A LONG TIME, BUT I CAN TELL YOU, IN PARLIAMENT, 20 MINUTES IS A LONG TIME, AND YOU DON'T WANT TO GET TO 14 MINUTES, AND NOT HAVE ANOTHER SIX MINUTES OF GOOD MATERIAL. THERE IS PRESSURE ON THE OTHER SIDE. GRANT ROBERTSON HAS BEEN PREPARING FOR MANY MONTHS, MEETING WITH MINISTERS, TRIBES OF OFFICIALS, THERE IS A DIFFERENT PRESSURE IN GOVERNMENT. REMEMBER THIS, THE OPPOSITION LEADER HAS ONE HOUR WITH THAT BUDGET BEFORE HE IS IN THE HOUSE. IT IS NOT LONG. YOU HAVE TO HAVE A PREPREPARED, THIS IS SOMETHING I PREPARED EARLIER, AND INSERT SOME NUMBERS. TAKE YOUR POLITICAL HAT FOR A MOMENT, PUT ON YOUR CHAMBER OF COMMERCE HAT. HOW WILL BUSINESS RESPOND? IT IS NOT PROBABLY BE BACK TO BASICS OR RESTRAINT BUDGET BUSINESS HAD EXPECTED. IT IS AN ELECTION YEAR BUDGET. THAT IS NOT A BAD THING. WE SURVEYED MEMBERS, SMEs WERE SAYING THEY WANTED A FOCUS ON HEALTH, EDUCATION, COST OF LIVING. THERE AS THINGS THEREFORE HOUSEHOLD, BUT IT IS NOT A TRULY RESTRAINT BUDGET. LOOKING BACK, BILL ENGLISH SOMETIMES HAD A ZERO BUDGET, OR A FEW HUNDRED MILLION. THIS ISN'T IN THAT CATEGORY. FROM A BUSINESS PERSPECTIVE, I'M NOT SURE THERE IS A LOT. SOMETHING IS A REALLY GOOD. I HAVE TALKED TO MINISTERS ABOUT AN INCENTIVE FOR GAMING. THAT HAS A CAPACITY FOR A BILLION-DOLLAR SECTOR. WE ARE TALKING ABOUT GAMING, VIDEO GAMING, NOT GAMBLING. 100% CLEAR. IT WOULD BE A FISCALLY RESPONSIBLE DECISION, THE OTHER WAY AROUND. THERE IS ALSO THE OTHER SIDE, THE TRUST RATE GOING UP. MANY SMES, THAT IS THE NEST EGG. ANOTHER POINT IS INFRASTRUCTURE. FANTASTIC TO SEE BILL BACK BETTER, NAPIER, AUCKLAND DESERVE THAT. A LOT OF PUBLIC TRANSPORT SUBSIDY. IT IS HARD TO KNOW, SOMETIMES IT TAKES DAYS TO WORK OUT, BUT HOW MUCH IS THEREFORE LONG-TERM INFRASTRUCTURE IMPROVEMENT, GIVEN THAT GRANT ROBERTSON HAS TALKED ABOUT THE NEED FOR RESILIENCE, AND A MASSIVE INFRASTRUCTURE DEFICIT. THAT IS SOMETHING WE HAVE TO DIG INTO. BE AS POLITICAL AS YOU LIKE FOR THIS QUESTION. HOW DO YOU SEE THIS BUDGET CHANGING THE DYNAMICS HEADING INTO OCTOBER? THE TRUTH IS, IT IS IN THE EYE OF THE BEHOLDER. IT IS ONE WHERE THERE IS NOT A CLEAR WIN. BOTH SIDES WILL SAY WE GOT THAT ONE RIGHT. IT IS A LABOUR PARTY ELECTION YEAR BUDGET. I WONDERED IF WE WOULD SEE A MOVE INTERNATIONAL TERRITORY WITH TAX RELIEF. GRANT ROBERTSON HAD TALKED ABOUT TAX CUTS. IT HASN'T BEEN THAT KIND OF BUDGET. IT HAS BEEN A TRADITIONAL LABOUR PARTY BUDGET. THE OTHER SIDE CAN BE SOMEWHAT PLEASED, BECAUSE IT DOES GIVE THEM THE OPPORTUNITY TO RUN THOSE LINES ABOUT THE BLOWOUT BUDGET, GAS LIGHTING NEW ZEALANDERS AROUND RESTRAINT AND SO ON. BOTH SIDES HAVE A BIT OF THAT. FROM A BUSINESS PERSPECTIVE, SOME GOOD ` AN INVESTMENT IN HOUSEHOLDS, BASICS. NOTHING REALLY THERE TO MOVE PRODUCTIVITY IN THE LONG-TERM. ONE WORRY, IN BUSINESS OR NOT, IS WHAT THIS MEANS FOR INTEREST RATES AND INFLATION OVER TIME. BECAUSE THERE HAS BEEN A SPEND THEIR. ONE THING IS THE NEW FUNDING ANNOUNCED FOUR NEW MAORI INITIATIVES, WHANAU ORA, NOT A HUGE SURPRISE, SIGNIFICANT FOR TE MATATINI. TO WHAT EXTENT WILL THOSE DECISIONS HAVE BEEN MADE WITH AN EYE TO OCTOBER 15 AND COALITION NEGOTIATIONS WITH TE PATI MAORI. IF YOU ARE WILLIE JACKSON OR GRANT ROBERTSON, YOU SAY THIS IS ABSOLUTELY RIGHT, WE WANT TO SPEND THE MONEY. IT WOULD BE NOT CYNICAL BUT NAIVE TO SAY THERE IS NO POLITICS IN THESE THINGS. WE HAVE HAD A DEFECTION TO THE MAORI PARTY. THOSE SEATS WILL BE INTO PARTIES, OR POSSIBLY MORE. WE ARE IN AN ELECTION YEAR. YOU SAY EVEN MORE? NATIONAL STAND. THEY HAVEN'T DONE THAT FOR A WHILE. WHO KNOWS? BUT AS YOU SAY, TE PATI MAORI AND LABOUR ARE GOING FOR THOSE SEATS. GRANT ROBERTSON HAS SAID HE HAS AIMED FOR BALANCE, TO TRY AND STRIKE A BALANCE SUPPORTING CORE SERVICES AND EASING THE COST OF LIVING CRISIS FOR THOSE WORST AFFECTED. FROM A POLITICAL PERSPECTIVE, HE HAS ALSO PERHAPS ACHIEVE BALANCE. THANK YOU FOR YOUR TIME. THAT IS FORMER NATIONAL LEADER SIMON BRIDGES. WE'LL BE BACK WITH MORE ON THIS 1 NEWS BUDGET SPECIAL. WELCOME BACK. THE PRIME MINISTER, CHRIS HIPKINS, HAS JUST SPOKEN AT PARLIAMENT, RESPONDING TO THE NATIONAL PARTY'S CRITIQUE OF HIS PARTY'S BUDGET. BUDGET DAY IS A DAY FOR DETAILS, A DAY FOR PLANS, A DAY FOR VISION. WE JUST HEARD NONE OF THOSE THINGS FROM THE LEADER OF THE OPPOSITION. MR SPEAKER, THE BIGGEST BLOWOUT WE HAVE SEEN TODAY WAS THE RELEASE OF HOT AIR FROM THE LEADER OF THE OPPOSITION OPPOSITE. IT IS NO WONDER HIS OWN COLLEAGUES HAVE STARTED TO REFER TO HIM AS CAPTAIN CLICHE. BECAUSE AFTER THREE YEARS, TO COME UP WITH A CREDIBLE PLAN FOR WHAT NATIONAL WOULD DO FOR NEW ZEALANDERS, WE HAVE NOTHING TODAY FROM THE LEADER OF THE OPPOSITION ABOUT WHAT A NATIONAL GOVERNMENT WOULD STAND FOR, WHAT A NATIONAL GOVERNMENT WOULD DO. ALL WE HEARD, AS WE HAVE HEARD FOR THE LAST THREE YEARS, IS MORE RUNNING-DOWN OF THE NEW ZEALAND ECONOMY. MORE RUNNING-DOWN OF NEW ZEALANDERS. HOW OUT OF TOUCH CAN YOU GET? MR SPEAKER, THIS IS A GREAT DAY FOR NEW ZEALANDERS. IT IS A GREAT BUDGET FOR KIWI FAMILIES. IN A COST OF LIVING CRISIS, NEW ZEALANDERS KNOW THEY CAN TRUST THIS GOVERNMENT. NEW ZEALANDERS KNOW THEY CAN TRUST THIS GOVERNMENT TO HAVE THEIR BACKS AND EASE THE PRESSURE THEY FACE, BECAUSE THAT IS EXACTLY WHAT WE HAVE DONE TODAY. WE KNOW THAT FAMILIES ARE UNDER THE PUMP AT THE MOMENT, AND THEY ARE FEELING THE PRESSURE. WE KNOW THAT HOUSEHOLD BUDGETS ARE STRETCHED. THE ANSWER TO THAT NEEDED TO BE A BUDGET THAT IS GOING TO SUPPORT FAMILIES NOT JUST NOW, BUT ALSO IN THE FUTURE. ONE THAT LAYS THE FOUNDATIONS FOR A BETTER FUTURE FOR NEW ZEALAND, BECAUSE THAT IS WHAT THIS BUDGET DOES. THIS BUDGET UNASHAMEDLY IS ABOUT BALANCE. IT IS A PROUDLY LABOUR BUDGET, ABOUT MAKING TARGETED AND AFFORDABLE INVESTMENTS IN THE COST OF LIVING AND PROVIDING RELIEF FOR NEW ZEALANDERS WHO ARE NEEDING THAT. AND IT IS ALSO ABOUT MAKING SURE THAT THE FUTURE CAN BE BETTER. WHEN I BECAME PRIME MINISTER IN JANUARY, MR SPEAKER, I SAID WE WOULD GET BACK TO BASICS, AND THAT IS WHAT WE HAVE BEEN DOING. I SAID WE WOULD PRIORITISE BREAD-AND-BUTTER ISSUES LIKE THE COST OF LIVING AND INVESTING IN PUBLIC SERVICES NEW ZEALANDERS RELY ON EVERY DAY. AND THAT IS WHAT THIS BUDGET DOES. I SAID WE WOULD BE FOCUSED ON INFRASTRUCTURE, BECAUSE THIS IS THE GOVERNMENT OF INFRASTRUCTURE. YOU MIGHT HEAR OTHERS TALKING ABOUT IT, BUT THEY DON'T DELIVER. THIS AS THE GOVERNMENT THAT IS DELIVERING WHEN IT COMES TO INFRASTRUCTURE. THIS IS A GOVERNMENT CREATING CONDITIONS FOR A GROWING ECONOMY. THE SPEAKER, I HEARD THE MESSAGE THAT NEW ZEALANDERS THOUGHT IN SOME AREAS WE WERE DOING TOO MUCH TOO FAST AND THEY WANTED TO SEE US FOCUS ON THE BASIC ISSUES THAT ARE AFFECTING THEM HERE AND NOW, AND THAT IS WHAT WE HAVE BEEN DOING. PRIME MINISTER CHRIS HIPKINS SPEAKING IN HOUSE A SHORT TIME AGO. HIS SECOND MOST IMPORTANT APPEARANCE OF THE DAY. THE PRIME MINISTER IS ABOUT US NOW. WHAT ARE YOU TRYING TO ACHIEVE WITH THIS YEAR'S BUDGET? IT IS A BALANCED APPROACH IN THIS BUDGET. WE ARE TRYING TO SUPPORT NEW ZEALANDERS THROUGH A DIFFICULT PERIOD OF TIME WHILST ALSO MAKING SURE WE'RE NOT MAKING IT WORSE. OF COURSE, PLANNING FOR THE FUTURE, MAKING SURE WE ARE INVESTING IN THE FUTURE SO WE CAN COME OUT OF THE CURRENT ECONOMIC CONDITIONS BETTER AND STRONGER. NOT MAKING IT WORSE. IF I COMPARE YOUR SPENDING TO THE SPENDING YOUR GOVERNMENT HAD PREVIOUSLY FORECAST THAT ANALYSTS WORK SPEAKING, YOU ARE SPENDING SIGNIFICANTLY MORE THAN PREVIOUSLY FORECAST. WHY WON'T YOU MAKE THE INFLATION PROBLEM WORSE? I THINK IF YOU LOOK AT THE AREAS OF INCREASED SPENDING, IT IS AROUND CYCLONE RECOVERY. THOSE ARE THINGS BEYOND THE CONTROL OF THE GOVERNMENT, BUT WE ARE MAKING SURE WE'RE NOT LEAVING THEM BEHIND. WE MADE THE DECISION NOT TO INCREASE LEVIES OR CREATE TAXES OR ANYTHING TO FUND THE RECOVERY; WE WILL FUND THAT FROM WITHIN THE GOVERNMENT'S BUDGET. THAT MEANS WE HAVE INCREASED THE ALLOWANCES TOOK ON A DATE THAT. WE MADE A COMMITMENT TO THE PEOPLE AFFECTED BY THE FLOODS AND CYCLONES THAT WE WOULD SEE THIS THROUGH, AND WE WILL ABSOLUTELY DELIVER ON THAT COMMITMENT. WHAT WILL MAKE THE BIGGEST EVIDENCE TO THE AVERAGE NEW ZEALANDERS LIFE? ONE OF THE THINGS THAT WILL MAKE THE GUEST DIFFERENCE IS GETTING INFLATION BACK UNDER CONTROL, AND BY THE END OF NEXT YEAR, WE ARE ACCEPTING INFLATION TO BE BACK WITHIN THE 1% TO 3% TARGET RANGE, WHICH WE WERE VERY FOCUSED ON AND PUTTING TOGETHER A BALANCED PACKAGE, MAKING SURE THAT WE WERE KEEPING INFLATION TRENDING DOWN, BECAUSE THAT IS HITTING KIWI HOUSEHOLD BUDGETS EVERY DAY ` SUPERMARKET SHOPPING, EVERY COST HAS BEEN GOING UP. GETTING THAT BACK UNDER CONTROL SO THEY ARE NOT SEEING THE EXPONENTIAL GROWTH IN THE DAY-TO-DAY BILLS THAT HAS BEEN AN ABSOLUTE FOCUS FOR THIS YEAR'S BUDGET. IT IS ONE OF THE REASONS YOU SEE THAT THE INVESTMENTS WE HAVE BEEN MAKING HAVE BEEN TARGETED. THERE ARE NOT A LOT OF BIG ACROSS-THE-BOARD SPENDING; IT IS FOCUSED ON AREAS WHERE WE CAN HELP TO EASE HOUSEHOLD COSTS AND SUPPORT NEW ZEALANDERS THROUGH THIS PERIOD. TOOK US THROUGH THE PRIORITISATION. IN PARTICULAR I AM INTERESTED IN YOUR DECISIONS AROUND EARLY CHILDHOOD EDUCATION FUNDING. WE KNOW THAT EARLY CHILDHOOD EDUCATION CAN BE A BIG COST FOR FAMILIES, AND WE KNOW THAT MORE AND MORE KIDS ARE NOW ATTENDING FORMAL EARLY CHILDHOOD EDUCATION. IT IS THE NATURE OF THE CURRENT LABOUR MARKET THAT WE HAVE. WE WANT TO BE ABLE TO SUPPORT THOSE FAMILIES WHO HAVE TWO-YEAR-OLDS AND EARLY CHILDHOOD EDUCATION IN THE WAY WE SUPPORT THOSE WITH THREE-YEAR-OLDS AND FOUR-YEAR-OLDS. SO WE ARE EXTENDING IT TO THEM, THAT WE ALSO MAKING SURE THAT WE ARE INVESTING IN THE QUALITY OF THAT. WE KNOW THERE ARE TEACHERS WORKING AND EDUCATION SERVICES AT THE MOMENT THAT ARE BEING PAID LESS THAN PEOPLE WORKING IN KINDERGARTENS, SO WE HAVE PUT MONEY INTO MAKING SURE WE ARE BRINGING UP THEIR SALARIES AS WELL SO WE CAN MAKE SURE THAT THE KIDS ARE GETTING A GOOD DEAL AND THE PEOPLE WHO ARE WORKING WITH THEM ARE APPROPRIATELY IGNITED. *RECOGNISED. WE DID CONSIDER EXTENDING THE EXCISE TAX CUT, EDGE THAT WOULD COME WITH A VERY LARGE PRICETAG. IT WAS A TRANSITIONAL MEASURE, AND WHEN WE EXTENDED IT, IT WAS TO SUPPORT NEW ZEALANDERS THROUGH THE WORST OF THE CRISIS. WE EXTENDED IT BECAUSE INFLATION WAS STAYING HIGHER FOR LONGER. WE ARE SEEING INFLATION POINTING DOWNWARD AND WE WANT TO SEE IT CONTINUE. WHAT DO YOU SAY TO CRITICS FROM THE OTHER SIDE OF THE AISLE ` NOT THE ONES WHO SAY YOUR SPENDING IS LEADING TO HIGHER INFLATION, BUT THOSE WHO SAY THE GOVERNMENT SHOULD BE SPENDING MORE? ON THE FACE OF A WARMING CLIMATE, WE SHOULD BE SPENDING MORE TO SPEED UP RESILIENCE IN THE FUTURE? WHY DID YOU NOT DECIDE TO BORROW MORE THAN YOU HAVE? I HAVE YET TO SEE A GOVERNMENT BUDGET UNDER ANY GOVERNMENT WHERE THERE AREN'T PEOPLE SAYING WE SHOULD BE SPENDING MORE OR SPENDING LESS. THAT IS THE NATURE OF GOVERNMENT BUDGETS. WE HAVE GOT THE BALANCE ABOUT RIGHT. WE ARE INVESTING HEAVILY IN CLIMATE CHANGE AND RESILIENCE AND RECOVERY FROM THE NATURAL DISASTERS WE HAVE EXPERIENCED IN RECENT TIMES, BECAUSE WE HAVE TO SEE THIS THING THROUGH. THE ANNOUNCEMENT ON THE WEEKEND ABOUT ENHANCED PROTECTION WORK, ABOUT MAKING SURE WE ARE INVESTING IN EMERGENCY MANAGEMENT SO THAT WE CAN SEE PEOPLE THROUGH THOSE THINGS ARE HAPPENING, BUT WE ARE ALSO INVESTING IN THINGS THAT WILL BRING OUR EMISSIONS DOWN, BECAUSE WE HAVE TO BE ABLE TO MITIGATE CLIMATE CHANGE AS WELL AS ADAPT TO IT. BY MINISTER CHRIS PICKENS JOINING US LIVE FROM PARLIAMENT. AS WELL AS THE SPENDING ALLOCATIONS ANNOUNCED TODAY, THE GOVERNMENT HAD ALREADY ANNOUNCED MUCH OF THE NEW MONEY IN THIS BUDGET. JUST TO REMIND YOU, THEY INCLUDE ` A $1B PACKAGE FOR REGIONS IMPACTED BY CYCLONE GABRIELLE AND THE AUCKLAND ANNIVERSARY FLOODS. THIS MONEY WILL GO TOWARDS MENTAL HEALTH SUPPORT IN HAWKE'S BAY AND TAIRAWHITI, FIXING ROADS AND RAIL, REPAIRING OR RELOCATING SCHOOLS, AND PREPARING FOR FUTURE FLOODS; $400M FOR UP TO FOUR NEW SCHOOLS AND 300 NEW CLASSROOMS; $457M TO UPGRADE DEFENCE FORCE ASSETS AND BOOST STAFF PAY, IN THE FACE OF HIGH ATTRITION RATES; AND A $300M INJECTION INTO GREEN INVESTMENT FINANCE ` THAT BRINGS THE GREEN INVESTORS' TOTAL POOL OF MONEY TO $700M, TO PUT TOWARDS LOW-CARBON COMPANIES AND PROJECTS. THE GOVERNMENT ALSO RULED OUT ANY MAJOR TAX CHANGES IN THE BUDGET. THAT TOP TAX RATE FOR TRUSTS HAS GONE FROM 33% TO 39%. THAT BRINGS IT IN LINE WITH INCOME TAX RATES IN NEW ZEALAND. BACK TO PARLIAMENT NOW. GREENS COLEADER JAMES SHAW IS STANDING BY WITH US. KIA ORA. WHAT DO YOU MAKE OF THE BUDGET? KIA ORA. THERE ARE SOME GOOD THINGS IN THE BUDGET. MANY OF WHICH THE GREEN PARTY HAVE BEEN CAMPAIGNING FOR SOME FOR OVER A DECADE, SO WE OBVIOUSLY SUPPORT THINGS LIKE THE HALF PRICE PUBLIC TRANSPORT FOR PEOPLE UNDER THE AGE OF 25, FREE FOR THOSE UNDER 12 AND SO ON. IT WON'T SURPRISE YOU TO LEARN THAT WE THINK THE GOVERNMENT COULD HAVE GONE FURTHER, COULD HAVE GONE FASTER WITH SOME OF THE GREAT CHALLENGES OF OUR TIME. IT IS A POLITICAL CHOICE, WE WOULD ARGUE, THAT THE GOVERNMENT HAS TIED ITS HANDS IN TERMS OF BEING ABLE TO HAVE THE RESOURCES AVAILABLE TO FACE THOSE CHALLENGES. TALK TO ME ABOUT THAT MORE. THIS WEEK, THE UNITED NATIONS SAYS WE MIGHT HIT THAT ONE .5 DEGREES OF WARMING MARK WITHIN THE NEXT FIVE YEARS. BY 2027. DOES THIS BUDGET REFLECTS THE URGENCY OF THE PRESSURE COMING FROM THE WARMING CLIMATE? JACK, YOU KNOW, YOU HAVE KNOWN ME FOR A WHILE, AND YOU KNOW I HAVE SAID MANY, MANY TIMES THAT THIS COUNTRY HAS BEEN VERY LATE TO GET STARTED ON REDUCING POLLUTION THAT CAUSES CLIMATE CHANGE. I HAVE ARGUED CONSISTENTLY THAT WE NEED TO PICK UP THE PACE. I AM VERY PROUD OF THE WORK WE HAVE DONE OVER THE LAST 5 1/2 YEARS, BUT IN MANY WAYS WE ARE JUST AT THE START OF THE JOURNEY.. WHAT WOULD YOU LIKE TO HAVE SEEN INCLUDED? AGAIN, IT WILL NOT SURPRISE YOU TO LEARN THAT I HAVE A LIST. BUT SOME OF THE THINGS THAT ARE IN THE BUDGET THAT I THINK WILL MAKE IS AN EVIDENT DIFFERENCE THE $300 MILLION ADDITIONAL FINANCE GOING INTO GREEN INVESTMENT; THEY ARE REALLY STARTING TO SHIFT TO THE DIAL ON THINGS LIKE DECARBONISE INK SOME OF OUR PORTS, HELPING TO ELECTRIFY VEHICLE FLEETS, PUTTING SOLAR ON SCHOOLS. HELPING TO SHIFT PEOPLE TOWARDS PUBLIC TRANSPORT, MEANING THAT THEY CAN RELY LESS ON THEIR CARS. THOSE SORTS OF THINGS WILL MAKE A FAIRLY SIGNIFICANT DIFFERENCE OVER THE COURSE OF THE COMING YEARS. BUT AGAIN, I DO WANT TO EMPHASISE I WOULD AGREE WITH THE TENOR OF YOUR QUESTIONS. WE DO NEED TO PICK UP THE PACE. IS THERE AN INVESTMENT THAT YOU WOULD HAVE LIKED TO HAVE SEEN? I WILL NOT GET INTO BUDGET BEDS THAT DID OR DIDN'T PASS MUSTER IN THIS PARTICULAR ELECTION` SORRY, BUDGET ROUND. BUT I THINK IN THE COURSE OF THE COMING ELECTION, YOU WILL SEE US PUT OUT OUR STALL IN TERMS OF THE THINGS WE WOULD LIKE TO SEE IN THE FUTURE, WHICH I AM LOOKING FORWARD TO HAVING A GO AT IN BUDGET 2024. GREEN COLEADER JAMES SHAW LIVE FROM PARLIAMENT. STAY WITH US. WE'LL HAVE MORE ON THIS 1 NEWS BUDGET SPECIAL AFTER THE BREAK. WELCOME BACK. AS WE GO THROUGH THE DETAILS OF THE 2023 BUDGET. IF YOU'RE JUST TURNING US ON THIS AFTERNOON, HERE THE MAIN THINGS YOU NEED TO KNOW ` THE GOVERNMENT HAS ANNOUNCED JUST OVER $1 BILLION IN FUNDING TO EXTEND ACCESS TO EARLY CHILDHOOD EDUCATION, FREE, 20 HOURS PER WEEK ARE AVAILABLE FOR THREE AND FOUR-YEAR-OLDS, EXTENDING IT TO TWO-YEAR-OLDS. SCRAPPING PRESCRIPTION FEES. FIVE DOLLARS WILL NO LONGER BE REQUIRED. FOR HUNDRED MILLION DOLLARS IN FUNDING FOR CHEAPER ENERGY BILLS, AS PART OF THE WARMER KIWI HOMES PROGRAMME. CHEAPER PUBLIC TRANSPORT, FREE FOR NEW ZEALANDERS BETWEEN THE AGES OF FIVE AND 12, HALF PRICE FOR NEW ZEALANDERS UNDER 25. NEW SPENDING IS ABOUT $5 BILLION. CRITICISM FROM GOVERNMENT OPPONENTS IS THAT SPENDING WILL CONTRIBUTE TO INFLATION THAT HAS CAUSED THE COST OF LIVING CRISIS. THE GOVERNMENT SAYS IT IS NECESSARY. THE GOVERNMENT SAYS GENDER EQUALITY WAS A KEY FOCUS OF THIS BUDGET. HERE'S FINANCE MINISTER GRANT ROBERTSON A SHORT TIME AGO. WE KNOW THAT ON AVERAGE, WOMEN HAVE LOWER KIWISAVER BALANCES AND RETIREMENT SAVINGS THAN MEN. TIME OUT OF THE WORKFORCE FOR PARENTING RESPONSIBILITIES IS ONE KEY REASON FOR THIS. THE GOVERNMENT IS ADDRESSING THIS THROUGH BUDGET 2023. SETTLE DOWN, MR BISHOP. THE GOVERNMENT IS ADDRESSING THIS THROUGH BUDGET 2023 BY INTRODUCING A MATCHING EMPLOYER CONTRIBUTION TO PAID PARENTAL LEAVE RECIPIENTS. (APPLAUSE) MR SPEAKER, THIS RECOGNISES THE UNPAID NATURE OF CHILDCARE AND SUPPORTS SAVINGS FOR RETIREMENT. IT IS A SMALL BUT SIGNIFICANT BOOST TO LIFETIME INCOME FOR MANY WOMEN. FINANCE MINISTER GRANT ROBERTSON. BACK TO OUR PANEL, FORMER LABOUR CABINET MINSTER IAIN LEES-GALLOWAY AND ANZ CHIEF ECONOMIST SHARON ZOLLNER. WHO YOU THINK THAT IS TARGETED AT? OBVIOUSLY WOMEN, BUT IT IS A POLITICAL STRATEGY. I HATE TO SOUND LIKE A RINGING BELL, SAYING THE SAME THING, BUT IT IS ABOUT THE MEDIAN VOTER, PEOPLE WHO ARE ON MIDDLE INCOMES, THEY HAVE KIDS, THEY MAY OR MAY NOT HAVE A MORTGAGE, THEY HAVE A LOT OF COSTS AT THE MOMENT. IT IS ONE OF THOSE PAIN POINTS, ONE OF THOSE ANNOYANCES THAT WOMEN TAKE TIME OUT OF WORK TO RAISE THE KIDS, STILL FAR MORE WOMEN DO THAT THAN MEN. THEY ARE PENALISED FOR THAT IN MYRIAD WAYS WITH INCOMES. THIS IS A NICE WAY OF THE GOVERNMENT ACKNOWLEDGING THAT. CHANGES BEING MADE TO KIWISAVER ON THAT FRONT. WHEN WOMEN ARE OUT OF WORK RAISING KIDS, THE GOVERNMENT IS SAYING THEY WILL MAKE A CONTRIBUTION TO THEIR KIWI SAVER, MATCHING EMPLOYER CONTRIBUTIONS THERE. AS HE SAID, IT IS A GOOD INVESTMENT IN THE FUTURE. FROM THE POLITICS OF IT, IT IS ANOTHER ONE OF THOSE THINGS THAT ANNOYS PEOPLE THAT THE GOVERNMENT IS ADDRESSING. SHARON, CHANGES TO THE TOP TAX RATE IN TRUSTS. THE GOVERNMENT HAS SAID THEY WOULDN'T MAKE ANY MAJOR CHANGES. THE TOP TRUSTS RATE IS 39%. WHAT YOU MAKE OF THAT CHANGE? IT IS A CONTINUATION OF A THEME. IT IS CLEAR THE GOVERNMENT HAS BEEN ON A MISSION TO MAKE TAXES LESS ATTRACTIVE AS A WAY OF REDUCING ONE'S TAX BURDEN, REDUCING REPORTING REQUIREMENTS. THE DATA SHOWS 6% OF OWNER OCCUPIED HOMES ARE OWNED IN A TRUST FORM. IT WILL NOT BE INSIGNIFICANT. IT WOULD BE A TWEAK. THEY SAY THEY HAVEN'T ANNOUNCED ANY MAJOR TAX PLANS HEADING INTO THE ELECTION. THE BIG TENSION TODAY WAS WHETHER GRANT ROBERTSON COULD STRIKE A BALANCE SUPPORTING PEOPLE WHO ARE AFFECTED BY THE COST OF LIVING CRISIS, AFFECTED THE MOST BY HIGH INFLATION, 6.7% SUPPORTING THEM WHILE NOT CONTRIBUTING TO THE PROBLEM FURTHER. THIS IS THE DANGER WITH NEW SPENDING. MISDIRECTED SPENDING CAN MAKE THE PROBLEM WORSE. TALK ABOUT THE TARGETED PROGRAMS ANNOUNCED TODAY. HOW WILL THEY COMPARE TO PREVIOUS EFFORTS TO ADDRESS THE COST OF LIVING CRISIS, LIKE THE EXCISE TAX CUT? THESE ARE MORE SENSIBLE THAN REDUCING THE PRICE OF FUEL. THESE POLICIES ARE MORE LIKELY TO HAVE POSITIVE SIDE EFFECTS BEYOND THE INDIVIDUALS AFFECTED. FREE PUBLIC TRANSPORT FOR CHILDREN MAY REDUCE THE 3 PM CRUSH OF TRAFFIC CONGESTION. THE UNIVERSITY OF OTAGO STUDY SHOWS EACH DOLLAR OF PRESCRIPTION FEES COST $18 FOR HOSPITAL COSTS. THERE IS CONCERN FOR HOSPITAL CAPACITY GOING INTO WINTER. THE FREE EARLY CHILDHOOD, THAT COULD EXPAND LABOUR SUPPLY. THERE WILL BE BENEFITS TO THESE. THE GOVERNMENT IS SPENDING MORE THAN MANY HAD EXPECTED, MORE THAN THE FINANCE MINISTER HAD FORECAST HE WOULD SPEND, BUT YOU ARE SAYING THESE MEASURES, AT LEAST IF YOU TAKE THEM FROM THE POLICY TOP LINES, ARE MORE TARGETED THAN PREVIOUS MEASURES. THEY ARE NOT PURE COST, THE WAY THE FUEL SUBSIDY WAS. IAIN, HOW WILL THIS PLAY OUT IN ELECTION YEAR? IT IS CLEARLY A PLAY TO THOSE VOTERS WHO ARE IN PLAY FOR THE GENERAL ELECTION. I THINK LABOUR WILL BE FEELING PRETTY GOOD ABOUT WHAT THEY HAVE DELIVERED TODAY. IT IS TARGETED TO THAT GROUP. BUT I ALSO THINK THERE IS ROOM FOR NATIONAL TO GET IN THERE. THEY HAVE TALKED ABOUT TAX CUTS. THAT WILL APPEAL TO A LOT OF PEOPLE. I IMAGINE THAT NATIONAL WILL ALSO TACK TO HEALTH AND EDUCATION, BUT LOOKING MORE AT THE STRUCTURAL SIDE AND THE DELIVERY. I EXPECT THEM TO GO BACK TO DELIVERY AS A TALKING POINT. THE MONEY IS THERE FOR CERTAIN THINGS, BUT CAN THE GOVERNMENT ACTUALLY DELIVER ON ITS PROMISES? SO IT IS WHAT WE WOULD HAVE EXPECTED IN THIS ELECTION YEAR. LABOUR WILL FEEL GOOD, BUT NATIONAL WILL SEE SOME GAPS THAT THEY CAN GET INTO. IS IT GOING TO COST THEM ANY VOTES, LABOUR? I DON'T THINK SO. I THINK THE PEOPLE WHO MIGHT BE DISAPPOINTED IN THIS BUDGET ARE LOCKED IN ONE WAY OR THE OTHER. SO, NO I DON'T THINK IT WILL COST THEM VOTES. WILL AGAIN THEN MANY? WE WILL SEE. GRANT ROBERTSON KEEP SAYING BALANCE. IF THAT IS HOW WE END UP, HE MIGHT BE PLEASED BY THAT MEASURE. THANK YOU SO MUCH FOR YOUR TIME. SHARON ZOLLNER AND IAIN LEES-GALLOWAY. THAT'S US FOR TODAY'S 1 NEWS BUDGET SPECIAL. THANKS FOR JOINING US. TE KARERE IS UP SHORTLY, AND THE 1 NEWS TEAM WILL HAVE COMPREHENSIVE COVERAGE OF THE BUDGET AT 6 O'CLOCK. KIA PAI TE AHIAHI NEI ` HAVE A GOOD AFTERNOON. CAPTIONS BY JAMES BROWN AND MAEVE KELLY. CAPTIONS WERE MADE WITH THE SUPPORT OF NZ ON AIR. WWW.ABLE.CO.NZ COPYRIGHT ABLE 2023