CAPTIONS BY TOM CLARKE AND JAMES BROWN. CAPTIONS WERE MADE WITH THE SUPPORT OF NZ ON AIR. WWW.ABLE.CO.NZ COPYRIGHT ABLE 2025 TENA KOUTOU, GOOD AFTERNOON, AND WELCOME TO THIS 1 NEWS SPECIAL. I'M JOHN CAMPBELL, STANDING IN FOR JACK TAME, WHO IS DOWN WITH A COLD. THE GOVERNMENT HAS JUST PUBLISHED THE 2025 BUDGET. OVER THE NEXT TWO HOURS, WE'LL BRING YOU DETAILS AND ANALYSIS. SHORTLY WE'LL TAKE YOU LIVE TO PARLIAMENT, WHERE FINANCE MINISTER NICOLA WILLIS WILL BE ADDRESSING THE HOUSE. BUT FIRST, 1 NEWS NEWS POLITICAL EDITOR MAIKI SHERMAN HAS SPENT PAST FEW HOURS WITH TREASURY OFFICIALS GOING OVER ALL THE DETAIL. MAIKI, WHAT STOOD OUT TO YOU IN THIS YEAR'S BUDGET? VERY TO EVERYONE WATCHING AND LISTENING. GOO DAY TO EVERYONE WATCHING AND LISTENING. THERE IS A WAYSIDE LEADING UP TO THE BUDGET, THE BEEHIVE BEING PAID EQUITY. THE GOVERNMENT RUSHED THROUGH PARLIAMENT, WHICH MADE IT HARDER FOR LOW-PAID WOMEN TO MAKE CLAIMS ON PAY EQUITY. THE BIG QUESTION WAS HOW MUCH THE GOVERNMENT SAVED IN TERMS OF THOSE CHANGES,. AND WE FOUND OUT THAT WAS AROUND $12.7 BILLION OVER THE NEXT FOUR YEARS. THAT IS HOW MUCH THE GOVERNMENT HAS CLAWED BACK FROM LOW-PAID WORKING WOMEN IN TERMS OF THOSE CHANGES. THAT IS A HUGE SUM OF MONEY, BROKEN DOWN, IT IS AROUND $2.7 BILLION EACH YEAR. ADDED ONTO THAT, THE GOVERNMENT ALSO FOUND AROUND $1.8 BILLION IN CAPITAL SAVINGS. THAT IS ESSENTIALLY $13 BILLION. THAT WILL PROBABLY GET THE BACKS OF THE WOMEN WHO ARE PROTESTING RIGHT NOW OUTSIDE PARLIAMENT. THAT IS A STAGGERING NUMBER. FOR MANY PEOPLE, THAT WILL BE THE TALKING POINT. WHAT ELSE IS IN THERE? AT THE MOMENT, WE ARE EXPECTING TO SEE VERY WAFER THIN SURPLUS. IN 2028, 2029, OF AROUND $200 MILLION. NICOLA WILLIS KNOWS THAT IS WAFER THIN. SHE KNOWS THAT IS UNDER PRESSURE. IF WE HAD A NATURAL CRISIS, CRISIS ON OUR HANDS IN TERMS OF FLOODING, IN TERMS OF ANYTHING LIKE THAT, THAT WE HAVE SEEN IN THE PAST, THAT COULD PUT THAT ALL OUT OF WHACK. WE KNOW THE OPERATING ALLOWANCE FOR THE GOVERNMENT IN TERMS OF THE NEW MONEY THEY WERE SPENDING THIS YEAR, THAT WAS AROUND $1.3 BILLION. THE GOVERNMENT ALREADY SHAVED OFF $1 BILLION EARLIER FORMAT IN ORDER TO HIT THE SURPLUS. THERE WERE ALSO A BUNCH OF SAVINGS. HUNDRED AND 16 SAVINGS ACROSS ALL GOVERNMENT DEPARTMENTS. THAT ARE CREATED TO AROUND $5.3 BILLION. THIS BUDGET HAS BEEN CALLED THE GROWTH BUDGET. PERHAPS ANOTHER NAME COULD BE THE SWITCHEROO BUDGET, BECAUSE IT IS SWITCHING A LOT OF THE MONEY AROUND THAT HAS ALREADY BEEN IN THE GOVERNMENT COFFERS. $1.3 BILLION OF NEW SPENDING. IT IS EXTRAORDINARY TO BE A LOT, BECAUSE YOU GET THE SNIFF OF HOW THE GOVERNMENT IS FEELING ABOUT THIS. THE FINANCE MINISTER ATTENDS, THE TREASURY OFFICIALS ARE THERE, WHAT WAS THE VIBE? HOW IS THE GOVERNMENT FEELING ABOUT THIS BUDGET? NICOLA WILLIS IS UNDOUBTABLY VERY PROUD OF HER BUDGET. SHE IS WORKING IN SIDE SOME VERY TIGHT MARGINS IN TERMS OF THAT SURPLUS THAT I MENTIONED IN TERMS OF THE MASSIVE AMOUNTS OF SAVINGS THAT THE GOVERNMENT AND THOSE DEPARTMENTS HAVE HAD TO FIND, BUT SHE IS FOCUSING ON GROWTH. MAY HAVE CALLED IT THE GROWTH BUDGET, AND SO A BIG PART OF TODAY'S BUDGET WAS ON THE INVESTMENT BOOST THAT THE GOVERNMENT HAS ANNOUNCED. THAT IS AROUND $1.7 BILLION A YEAR THAT WILL TARGET BUSINESSES, AND IT WILL ESSENTIALLY ALLOW THEM TO GO OUT AND INVEST IN THINGS LIKE NEW EQUIPMENT, NEW ASSETS, AND IMMEDIATELY, THEY WILL BE ABLE TO CLAWBACK AROUND 20% OF THEIR TAX BILL ON THAT. NICOLA WILLIS SAID THAT IS A BIG MOVE FROM THE GOVERNMENT IN ORDER TO, AGAIN, PUSH THAT ISSUE OF GROWTH. THEY WANT TO SEE A GROWTH ECONOMY. ANOTHER BIG ISSUE WAS KIWISAVER, AND THAT HAS COME UP A LOT IN THE LEAD UP TO THIS BUDGET, AND THERE HAVE BEEN SOME MAJOR CHANGES HERE, THE DEFAULT CONTRIBUTION, FOR EXAMPLE, GOING UP FROM 3% RIGHT UP TO 4% FOR EMPLOYEES AND EMPLOYERS, AND ALSO THE GOVERNMENT CONTRIBUTION. ANNUALLY, THEY ARE USUALLY GIVEN $500 TO EMPLOYEES, BUT THEY ARE HALF HALVING THAT./ IT WILL BE MEANS TESTED. THOSE EARNING OVER HUNDRED AND 80,000, THEY WILL NO LONGER GOT THAT. WHAT ALL THOSE EARNING UNDER THAT GET? IT IS PUTTING THE ONUS BACK ON THE EMPLOYEE AND THE EMPLOYER, BY AGAIN, UPPING THE DEFAULT CONTRIBUTION. ONE OF THE PIECES OF ADVICE THAT CAME FROM TREASURY, WAS THAT THE ADVICE WAS, THIS COULD POTENTIALLY SUPPRESS WAGE GROWTH FOR WORKERS, BECAUSE IF YOU HAVE GOT BUSINESSES THAT ARE GOING TO HAVE TO INVEST MORE MONEY IN TERMS OF A HIGHER DEFAULT CONTRIBUTION RATE, THEN PERHAPS THEY MIGHT NOT BE AS WILLING TO GIVE THAT PAY RISE, ESPECIALLY AT A TIME WHEN BUSINESSES AND PEOPLE, FAMILIES, ARE ALREADY DOING IT SO TOP IN TERMS OF THE COST OF LIVING. THIS COULD BE A BIG GAMBLE FOR THEM. THANKS, MAIKI. WE'LL TAKE YOU NOW LIVE TO THE DEBATING CHAMBER, WHERE FINANCE MINISTER NICOLA WILLIS WILL PRESENT BUDGET 2025. AS I SAID, IT IS AN HONOUR TO ANNOUNCE THIS YEAR'S BUDGET. THIS IS A RESPONSIBLE BUDGET TO SECURE NEW ZEALAND'S FUTURE. (CHEERING, APPLAUSE) IT SUPPORTS THE ECONOMIC RECOVERY NOW AND AWAY. IT ALSO TAKES A LONGER TERM VIEW, WITH INITIATIVES TO BOOST FUTURE INVESTMENT, SAVINGS, AND GROWTH. IT CONTINUES THIS GOVERNMENT'S INVESTMENT IN HEALTH, IN EDUCATION, AND LAW & ORDER. AND, IN A CHALLENGING GLOBAL ENVIRONMENT, IT PROVIDES FUNDING TO BOOST NEW ZEALAND'S DEFENCE CAPABILITY. IT DOES ALL OF THIS WITH IN AN EXPENDITURE TRACK THAT REDUCES GOVERNMENT SPENDING AS A SHARE OF THE ECONOMY, RETURNS THE GOVERNMENTS BOX TO BALANCE AND BEND THE DEBT CURVE DOWN FROM GOING UP TO GOING DOWN. THE ECONOMIC OUTLOOK PRESENTED ALONGSIDE THIS BUDGET IS A BRIGHT ONE. AFTER A TOUGH FEW YEARS, GROWTH, JOBS, AND WAGES ARE SET TO RISE. THE GOVERNMENT IS NOT PROMISING THAT TODAY'S BUDGET WILL SOLVE ALL OF NEW ZEALAND PROBLEMS. BUT WE DO PROMISE THAT DECISIONS MAKING NOW, WILL SET OUR COUNTRY UP FOR A BETTER FUTURE. MR SPEAKER, THE CREATION OF THE DELIVERY OF AN ANNUAL BUDGET IS AT THE HEART OF A STRONG AND STABLE GOVERNMENT, AND THIS BUDGET IS A TEAM EFFORT. I WANT TO ACKNOWLEDGE AND THANK THE ASSOCIATE MINISTERS OF FINANCE, DAVID SEYMOUR, SHANE JONES AND CHRIS BISHOP, FOR THEIR IDEAS AND ADVICE. THEY WERE HEAVILY INVOLVED IN PUTTING THIS BUDGET TOGETHER, AS WAS THE PRIME MINISTER, WHOSE LEADERSHIP AND WISE COUNSEL WAS INVALUABLE. THANK YOU, PRIME MINISTER. MR SPEAKER, IN RECENT YEARS, NEW ZEALANDERS HAVE BATTLED THROUGH AN EXTENDED PERIOD OF HIGH INFLATION, HIGH INTEREST RATES, AND LOWER GROWTH. WE NOTE THAT TIMES REMAIN TOUGH FOR MANY KIWIS. THE GOOD NEWS TODAY IS THAT WITH STRONG ECONOMIC AND FISCAL MANAGEMENT, OUR RECOVERY IS UNDERWAY. THE RECOVERY IS BEING SUPPORTED BY LOW INTEREST RATES AND STRONG EXPORT PERFORMANCE. OVER THE NEXT TWO YEARS, THE GOVERNMENT'S NEW INVESTMENT BOOST POLICY, WHICH I WILL COME TO SHORTLY, WILL HAVE A POSITIVE IMPACT ON GROWTH. RECENT TARIFF ANNOUNCEMENTS HAVE CREATED UNCERTAINTY AROUND THE WORLD, AND FOR A SMALL TRADING NATION LIKE NEW ZEALAND, THE GLOBAL SITUATION IS CONCERNING. IT DOESN'T THREATEN THE RECOVERY, BUT IT DOES THREATEN THE PACE OF THE RECOVERY. THE TREASURY HAS PEGGED ITS FORECASTS BACK , AND DOWNSIDE RISKS REMAIN. DESPITE THIS, BUDGET FORECASTS SHOW ECONOMIC GROWTH PICKING UP TWO HEALTHY LEVELS ONCE AGAIN. REAL GDP GROWTH IS EXPECTED TO ACCELERATE TO 2.9% IN THE NEXT FISCAL YEAR AND 3% IN THE YEAR AFTER THAT. GROWTH MATTERS. IT MEANS MORE JOBS, HIGHER INCOMES AND OPPORTUNITIES FOR FAMILIES TO GET AHEAD. AND OVER THE FORECAST PERIOD, WAGES ARE EXPECTED TO GROW FASTER THAN INFLATION AND AT THE END OF THAT PERIOD, THERE ARE EXPECTED TO BE 240,000 MORE PEOPLE IN JOBS. (CHEERING, APPLAUSE) MR SPEAKER, THE GOVERNMENTS BOX HAVE TAKEN A HAMMERING OVER THE PAST SIX YEARS OR SO. SPENDING HAS RISEN SHARPLY, SO HAS GOVERNMENT DEBT, THE BUDGET DEFICIT LEFT BY THE PREVIOUS GOVERNMENT IS STRUCTURAL. IT IS NOT SIMPLY DUE TO THE STATE OF THE ECONOMY. IN OTHER WORDS, THE LAST GOVERNMENT WAS LIVING BEYOND ITS MEANS. LOADING THE CREDIT CARD TO PAY FOR THINGS NEW ZEALAND COULDN'T AFFORD. LISTED REAL DAMAGE TO OUR ECONOMY, AS A MASSIVE SPIKE IN THE COST OF LIVING LED TO HIGH INTEREST RATES AND LOW GROWTH. THIS GOVERNMENT IS TAKING RESPONSIBILITY FOR CLEANING UP THE . MESS. MESS UNDER OUR FISCAL MANAGEMENT, GOVERNMENT DEBT WILL STABILISE AND START TO COME DOWN. OUR CONTROLLER SPENDING CREATES ROOM FOR MONETARY POLICY TO RESPOND WITH LOWER INTEREST RATES. THERE IS NO DOUBT, MR SPEAKER, THAT FISCAL CONSOLIDATION IS CHALLENGING. SOME WOULD DO IT WITH HIGHER TAXES. THAT WOULD BURDEN NEW ZEALAND WORKERS AND BUSINESSES AND SCARE AWAY TALENT AND INVESTMENT. IT WOULD PUT OUR ECONOMIC RECOVERY AT RISK. THIS GOVERNMENT IS TAKING A DIFFERENT APPROACH. WE ARE GETTING THE BOOKS IMBALANCE BY CONTROLLING GROWTH AND GOVERNMENT SPENDING. THE OPERATING ALLOWANCE FOR BUDGET 2025 IS $1.3 BILLION ON AVERAGE PER ANNUM. THIS IS THE LOWEST ALLOWANCE IN A DECADE. SIGNIFICANTLY DOWN FROM THE $2.4 BILLION ALLOWANCE SIGNALLED IN THE BUDGET POLICY STATEMENT IN DECEMBER. THAT REDUCTION OF $1.1 BILLION GOES STRAIGHT TO THE BOTTOM LINE. . THE GOVERNMENT'S HEADLINE OPERATING BALANCE INDICATOR, OBEGAL X, IS 1.1 BILLION BETTER EACH YEAR ON AVERAGE THAN IT OTHERWISE WOULD HAVE BEEN. IN ADDITION, THEY TREASURY ESTIMATES THAT THE TIGHTER BUDGET PACKAGE WILL SEE INTEREST RATES BEING 30 BASIS POINTS LOWER THAN THEY OTHERWISE WOULD HAVE BEEN BY THE END OF THE FORECAST PERIOD. (CHEERING, APPLAUSE) (CHEERING, APPLAUSE) IMPORTANTLY, $1.3 BILLION ALLOWANCE IS A NET FIGURE. ON THE ONE HAND, IT ENCOMPASSES $5 BILLION A YEAR OF NEW INVESTMENT AND 1.7 BILLION A YEAR FOR TAX REDUCTIONS THROUGH INVESTMENT BOOSTS. ON THE OTHER HAND, IT CONTAINS SAVINGS OF $5.3 BILLION A YEAR. THESE SAVINGS ARE THE RESULT OF ONGOING EFFORTS BY MULTIPLE MINISTERS, AND I WANT TO ACKNOWLEDGE YOU ALL TODAY. WE TAKE SERIOUSLY OUR ROLES AS CUSTODIANS OF TAXPAYER MONEY. A SIGNIFICANT PORTION OF THOSE SAVINGS COME FROM CHANGES TO THE PAY EQUITY REGIME. CHANGES WERE MADE TO YOUR FUTURE SETTLEMENTS STICK TO CORRECTING PAY DISCREPANCIES THAT ARISE FROM SEX-BASED DISCONNECTION AND NOT FOR OTHER REASONS. MAKING THOSE CHANGES MEANS THE GOVERNMENT CAN RE-PURPOSE TO .7 ALIEN DOLLARS A YEAR ON AVERAGE TOWARDS BUDGET PRIORITIES LIKE HEALTH, LIKE EDUCATION, AND LAW & ORDER. THAT 2.7 BILLION HAS BEEN PUT ASIDE IN CONTINGENCIES TO WHAT, UNDER THE PREVIOUS REGIME, WERE EXPECTED TO BE VERY WIDE-RANGING PAY EQUITY CLAIMS, INCREASINGLY DIVORCED FROM THE SEX-BASED DISCRIMINATION THAT PAY EQUITY IS SUPPOSED TO BE ABOUT. A ONE-OFF $1.8 BILLION HAS ALSO BEEN REPURPOSED FROM PREVIOUS CONTINGENCIES AND PUT TOWARDS CAPITAL EXPENDITURE IN THIS BUDGET, SUPPORTING THE NEW HOSPITALS, NEW SCHOOLS, AND OTHER INFRASTRUCTURE. I CAN ASSURE MEMBERS THAT ADEQUATE FUNDING REMAINS IN CONTINGENCY TO MEET POTENTIAL COSTS OF FUTURE PUBLIC SECTOR PAY EQUITY SETTLEMENTS UNDER OUR NEW REGIME. THE GOVERNMENT ALSO ANTICIPATES THERE WILL BE PAY RISES IN FEMALE DOMINATED PUBLIC SECTOR WORKFORCES, ACHIEVED THROUGH NORMAL COLLECTIVE BARGAINING. MR SPEAKER, THE GOVERNMENT HAS ALSO BEEN ABLE TO FIND NET SAVINGS BY INCREASING FUNDING FOR INLAND REVENUE'S COMPLIANCE ACTIVITIES. FUNDING OF $35 MILLION A YEAR IS EXPECTED TO RESULT IN $280 MILLION OF EXTRA TAX REVENUE. THAT IS AN 8 TO 1 RETURN ON INVESTMENT. THIS WAS PROPOSED LAST BUDGET BY NEW ZEALAND FIRST ON EXPANDED BY 2025. FURTHER SAVINGS HAVE BEEN MADE BY CLOSING A NUMBER OF CONTINGENCIES AND FROM REVIEWING THE VALUE OF MONEY OF GRANTS AND FUNDS ACROSS GOVERNMENT. THIS IS NOT AUSTERITY. IN FACT, IT IS WHAT YOU DO TO AVOID AUSTERITY. BECAUSE GETTING THE BOOKS IN SHAPE, AND SHOWS NEW ZEALAND HAS FINANCIAL CHOICES INTO THE FUTURE AND SECURITY. SAVINGS IN THIS BUDGET HAVE ALLOWED US TO MADE MUCH NEEDED INVESTMENTS IN HEALTH, AND EDUCATION, LAW AND ORDER, AND REBUILDING OUR DEFENCE FORCE. BUDGET FORECASTS SHOW THAT EXPENSES ARE COMMITTED TO REMAIN STEADY IN A DECLINE OF PERCENTAGE OF GDP. THE OBEGAL X DEFICIT IS EXPECTED TO WIDEN IN THE NEAR TERM AND THEN GRADUALLY IMPROVE AFTER THE NEAR TERM, RETURNING TO A SURPLUS OF 200 MILLION BY THE END OF THE FORECAST PERIOD. AT THAT POINT, MEMBERS, THE STRUCTURAL DEFICIT THE PREVIOUS GOVERNMENT LEFT US WILL HAVE BEEN ELIMINATED. (CHEERING, APPLAUSE) NET CORE CROWN DEBT IS EXPECTED TO PEAK AT 46% OF GDP, SLIGHTLY LOWER THAN FORECAST AT THE HALF-YEAR UPDATE, BEFORE THEN BEGINNING TO CLIMB. AS THESE FORECASTS SHOW, MR SPEAKER, THE GOVERNMENT IS TAKING A DELIBERATE, MEDIUM TURN APPROACH TO FISCAL CONSOLIDATION. I'M AWARE THERE ARE ALTERNATIVE APPROACHES. SOME SAY WE SHOULD KEEP BORROWING FOR EVER, WHACK IT ON THE CREDIT CARD, AND HOPE FOR THE BEST. THAT WOULD BE THE HEIGHT OF IRRESPONSIBILITY. IT WOULD PUT THE FINANCIAL SECURITY OF NEW ZEALAND AT RISK. WE BETTER TO OUR KIDS. WE OEW BETTER TO OUR KIDS. BUT FIRST, IN CASE YOU'VE JUST JOINED US,TO MY OWN KID SITTING IN THE GALLERY TODAY, I WANT TO SAY THAT I KNOW MUM HAS BEEN BUSY LATELY, AND I'M SORRY THAT I MISSED YOUR SHOW LAST NIGHT, HETTA. BUT YOUR FUTURE AND THE FUTURE OF THE NEXT GENERATION OF NEW ZEALANDERS HAS BEEN VERY MUCH ON MY MIND AS WE HAVE PUT THIS BUDGET TOGETHER. THIS BUDGET WILL BE GOOD FOR YOU AND FOR ALL OUR KIDS. (APPLAUSE) NICOLA WILLIS SPEAKING LIVE FROM PARLIAMENT. IN CASE YOU HAVE JUST JOINED US, HERE ARE SOME OF THE BIG ANNOUNCEMENTS FROM THE BUDGET. PAY EQUITY CUTS HAVE FUNDED THE BUDGET. IT HAS SAVED $12.8B OVER FOUR YEARS. GOVERNMENT SO SOME OF WHAT THEY ARE REVEALING IS COMMERCIALLY SENSITIVE. THE GOVERNMENT SAY WHEN PAY EQUITY STARTED IN 2020, IT WAS SUPPOSED TO COST $3.7B. COSTS HAVE BALLOONED. THEY CAN'T OUTLINE THE FULL BLOWOUT, BUT $12.8B THAT HAD BEEN SET ASIDE HAS NOW BEEN RETURNED. FOR KIWISAVER, AN INCREASE IN MINIMUM CONTRIBUTION FROM 3% TO 4%. AND THE GOVERNMENT CONTRIBUTION HAS BEEN HALVED TO $206 MAXIMUM. IF YOU EARN OVER HUNDRED 80,000, YOU'RE GETTING NOTHING. THIS APPLIES TO BOTH EMPLOYER AND EMPLOYEE CONTRIBUTIONS. DEFAULTS TO 3.5% FROM APRIL 2026. DEFAULTS TO 4% FROM APRIL 2028. PEOPLE CAN OPT OUT TEMPORARILY IF THEY CHOOSE. THE GOVERNMENT CONTRIBUTION HAS BEEN HALVED. THIS IS EXPECTED TO SAVE THE GOVERNMENT $2.5B. THIS IS EXPECTED TO SAVE THE GOVERNMENT $2.5B. IT IS IMPORTANT TO NOTE, THE GOVERNMENT CONTRIBUTION TO YOUR KIWISAVER THIS FINANCIAL YEAR WILL NOT BE AFFECTED. HOPING FOR THAT $500, YOU ARE STILL GETTING IT. INVESTMENT BOOST ` $1.7B A YEAR. THE BIG TO 'GROW THE ECONOMY' INITIATIVE GIVES BUSINESSES AN IMMEDIATE TAX BREAK FOR NEW ASSETS EQUAL TO 20% OF THE PURCHASE PRICE OF THE ASSET. IT AIMS TO INCENTIVISE BUSINESS INVESTMENT. IF YOU SPEND, YOU CAN DEDUCT 20% OF THE COST OF YOUR NEXT TAX RETURN. THE GOVERNMENT SAYS IT WILL LIFT GDP BY 1% AND WAGES 1.5% OVER THE NEXT 20 YEARS. I'LL BE INTERESTED IN HOW THEY DETERMINE THAT. NEW FUNDING FOR SERVICES AND TO BUILD INFRASTRUCTURE OF $6.7B, ONLY MADE POSSIBLE BY 116 'SAVINGS AND REPRIORITISATIONS' WORTH $5.3B. MET BUDGET PACKAGE OPERATIONAL SPENDING, $1.3 BILLION. NEW FUNDING FOR SERVICES AND TO BUILD INFRASTRUCTURE OF $6.7B, ONLY MADE POSSIBLE BY 116 'SAVINGS AND REPRIORITISATIONS' WORTH $5.3B. WE GOT ONE OF WONDERFUL I'M JOINED HERE BY FORMER LABOUR LEADER AND POLIS CONSULTING GROUP PARTNER DAVID CUNLIFFE AND BRIGITTE MORTEN, A DIRECTOR WITH LAW FIRM FRANKS OGILVIE AND A FORMER SENIOR MINISTERIAL ADVISOR FOR THE PREVIOUS NATIONAL-LED GOVERNMENT. SHE IS A NATIONAL PARTY MEMBER AND VOLUNTEERS FOR NICOLA WILLIS DURING ELECTION YEARS. I'M A FAN OF THE MINISTER OF FINANCE AND THE WORK SHE DOES, THAT DOESN'T MEAN THAT I DON'T HAVE THOUGHTS ON THE BUDGET. IS CLEAR TO ME THAT IT'S NOT REALLY A BUDGET FOR TODAY. IT IS A BUDGET FOR THE FUTURE. I THINK THE KIWISAVER CHANGES ARE IMPORTANT. INFRASTRUCTURE CHANGE IS IMPORTANT. DIGGING INTO SOME OF THAT DETAIL IN THE RESEARCH SPACE. GENE REGULATORY IMPORTANT, SO THAT WE CAN GET SOME NEW SIGNS REGULATION THERE. THEY ARE IMPORTANT THINGS THE SETTING IS UP TO THE FUTURE. RATHER THAN HAVING A LOLLY SCRAMBLE. THEY WENT AND GRABBED THE LOLLIES. HOW DO YOU THINK THAT WILL WASH POLITICALLY? I THINK THEY HAVE LOST THE NARRATIVE ON PAY EQUITY. IT'S BEEN DIFFICULT TO DIE JUST FOR MOST PEOPLE. WOMEN HAVE SEEN IT AS A CUT TO PAPER TO. WOMEN HAVE SEEN IT AS A CUT TO PAY EQUITY. THAT IS WHAT'S GOING TO RUN THROUGH. GOING TO HAVE TO WAIT SEVERAL YEARS TO SEE WHAT PAY EQUITY ENDS UP AS, BUT AS OF TODAY, THIS LOOKS LIKE MASSIVE CUT. I AGREE WITH THAT. THE CUTS TO PAY EQUITY DIVISION ARE MORE THAN TWICE THE PROVEN TO BE OBEGAL. NOT ONLY DID NICOLE NEED TO PENNY TO PAY PAUL, BUT SHE'S ROBBED PENNY TWICE AS MUCH THAT SHE IS PAYING PAUL. THIS IS WHAT SOME HAVE CALLED A MAGA STYLE OVERRIDE. WHAT YOU MEAN BY THAT? WE ARE SEEING THE ABROGATION OF NORMAL CONSTITUTIONAL CONVENTIONS TO DRIVE THE PRESIDENT'S AGENDA. TODAY WE ARE SEEING THAT OF AN EXISTING ARRAY OF CLAIMS, SQUASH MY LEGISLATION, PASSED UNDER URGENCY WITH NO SELECT COMMITTEE PROCESS. IT IS AN OUTRAGE. THAT SHOULDN'T HAVE HAPPENED. NATIONAL HAVE LOST THE NARRATIVE I THINK THEY HAVE LOST A LOT OF WOMEN VOTERS. LABOUR WILL CAMPAIGN ON THAT. IS NOT THE SAME THING AS LABOUR COMING UP WITH A PLAN TO GROW THE ECONOMY, AND BOTH SIDES NEED TO FIX ENORMOUS SOCIAL GAPS THAT ARE OBVIOUS ALL OVER THE PLACE. IT IS A TOUGH GIG. WE HAVE TO BALANCE THE BOOKS, GROW THE PIE, AND FILL IN GAPS ALL OF THE SAME TIME. IT IS A TOUGH GIG IN PRECARIOUS TIMES. THERE IN A COALITION WITH NEW ZEALAND FIRST ACT WHO ARE IDEOLOGICAL DIFFERENT IN TERMS OF HOW THEY MANAGE THE ECONOMY. SETTING ASIDE YOUR CONSTITUTIONAL QUESTIONS AND YOUR THE CITRUS ATTACK ON PAY EQUITY, SHOULD WE BE A SURPRISED BY ANY OF THIS? THIS IS A BIT LIKE TRYING TO KICK A GOAL FROM THE HALFWAY LINE AND THE POSTS ARE PRETTY CLOSE TOGETHER. THEY CAN SPEND LARGE WHILE REDUCING DEFICITS. INTERNATIONAL MARKETS AND NEW ZEALAND BUSINESS NEED TO HAVE CONFIDENCE THAT THE FISCAL FOUNDATIONS ARE FIRM. DID THEY ACHIEVE THAT? ONLY FROM SAVING FROM PAY EQUITY. I THINK THEY ACHIEVED IT BY SOME OF THE GROUND WORK VERY DONE FOR THAT BUDGET. IT IS A BETTER TARGET. I DON'T THINK WE TALKED ABOUT THAT. RATHER THAN IT BEING A UNIVERSAL BENEFIT, IT IS NATURALLY GOING TO THE FAMILY THAT NEEDED MOST. CHANGING SOME OF THOSE FUNDAMENTAL STRUCTURES ACTUALLY MEANS THAT WE HAVE GOT BETTER BUDGET FLEXIBILITY GOING FORWARD. PRETTY HARD TO ARGUE WITH THAT. THAT IS THE THINGS THAT WE NEED TO CHANGE. WE NEED TO GET RID OF SOME OF THE SLUSH IN THE SYSTEM TO ALLOW AS TO GIVE THE MONEY TO THOSE WHO NEED IT MOST. AND VERY SUPPORTIVE OF THAT TAX INCENTIVE. I THINK BUSINESSES CREATE JOBS, NOT GOVERNMENT, SO I THINK TAKING THAT TAX INCENTIVE FOR PRODUCTIVE ASSETS, THAT IS A GREAT WAY OF TELLING BUSINESSES TO HAVE THE CONFIDENCE TO INVEST IN THESE UNCERTAIN TIMES. I THINK IT IS VASTLY INSUFFICIENT FOR TWO REASONS. FIRST, THERE'S NONDIRECTIONAL. WE CAN'T PRETEND TO BE WORLD-CLASS AT EVERYTHING. WE HAVE TWO HAVE GOVERNMENT WORKING WITH INDUSTRY TO SAY HERE OUR OUR KEY GROWTH OPPORTUNITIES, HERE IS WHERE WE WILL BE WORLD-CLASS. BLANKET 20% OFF ASSET WRITE-DOWNS IS ALMOST THE GOVERNMENT QUITTING THE PLAYING FIELD, BY SAYING WE HAVEN'T GOT ANY DIRECTIONAL IDEAS SO THAT THE HOT TOPIC IS THAT MISSION-BASED INVESTMENT. WE HAVE GOT A FANTASTIC AEROSPACE SECTOR. WITH GOT AN AMAZING PASTORAL AGRICULTURAL SECTOR THAT NEEDS TO GET HIGH-VALUE PRODUCTS. THOSE WILL BE TWO AREAS THAT YOU MIGHT HAVE TO FOCUS ON TO LIFT THE GOING TO (TIMOTHY. TO LIFT PRODUCTIVITY. THANK YOU FOR JOINING US. WILL BE TALKING TO BARBARA EDMONDS, NICOLA WILLIS, TE PATI MAORI, AND THE GREEN PARTY. THERE OR POPPING INTO JOHN NEXT HOUR AND �. THIS IS A REVENUE BUSINESS. WILL TAKE AN AD BREAK AND WILL BE BACK WITH YOU SHORTLY. STAY WITH US. WELCOME BACK TO THE 1 NEWS Q+A BUDGET SPECIAL. THE PICTURES YOU'RE SEEING HERE ARE A PROTEST THAT TOOK PLACE EARLIER THIS AFTERNOON ON THE GROUNDS OF PARLIAMENT, ORGANISED BY THE UNION MOVEMENT ANGRY AT THE GOVERNMENT'S PRE-BUDGET CHANGES TO PAY EQUITY LEGISLATION AND SETTLEMENTS. DAVID CUNLIFFE EXPRESSED VERY STRONG VIEWS. $12.7 BILLION BEING SAVED FROM PAY EQUITY EXPENDITURE. AND WE'LL HEAR MORE FROM THE COUNCIL OF TRADE UNIONS LATER IN THE PROGRAMME, ALONG WITH FINANCE MINISTER NICOLA WILLIS' VIEWS. TO UNPACK TREASURY'S FORECASTS, I'M NOW JOINED BY ANZ CHIEF ECONOMIST SHARON ZOLLNER. THE FISCALS HAVE A RESPONSE. THE MOST OBVIOUS QUESTION, IS WHAT ARE THE MARKETS DOING? WE HAVE SEEN BOND YIELDS FALL THREE POINTS. THAT REFLECTS THERE WEREN'T HUGE SURPRISES FOR THE MARKET TODAY. THE CHANGES AND HOW MANY BONDS THEY ARE ISSUING, SO HOW MUCH THEY WILL BORROW OVER THE NEXT FOUR YEARS, THERE WAS GIVE-AND-TAKE, BUT NOT A SIGNIFICANT CHANGE. WE ARE STILL GETTING BACK INTO SURPLUS, JUST. 2028, 2029. THERE WAS SOME INFERENCE THAT NICOLA WILLIS MIGHT BE AFTER 2027. THAT IS MORE OR LESS AS EXPECTED. THERE ARE A LOT OF MOVING PARTS TO THAT. THEY HAVE BEEN DOWNED REVISIONS TO TREASURY GROWTH FORECASTS. THERE ARE GROWTH HEADWINDS COMING FROM OFFSHORE. THEY HAVE CHANGED MODELLING SLIGHTLY ABOUT HOW MUCH TAX TENDS TO GET RAISED FOR EACH BIT THE ECONOMY GROWS. MOVING PARTS, BUT MARKETS ARE SATISFIED WITH THIS BUDGET. I WOULD DRAW A CONTRAST WITH THE US AT THE MOMENT, WHERE DONALD TRUMP IS PUSHING THROUGH HIS BIG, BEAUTIFUL BILL, WHICH INCLUDES SIGNIFICANT TAX CUTS. THE DEBT THERE IS 100% OF GDP. THE BOND MARKET DOES NOT LIKE IT, SO US BOND YIELDS WENT UP A LOT. THIS IS NOT A BAD TIME FOR NEW ZEALAND TO DIFFERENTIATE IN A POSITIVE WAY THROUGH PRUDENT FISCAL POLICY. WE HAVE TALKED ABOUT THE SURPLUS. WE HAD THE HAIFU, RELEASED LAST DECEMBER, THAT HAD US HEADING TO 2.9%. HAVE GROWTH PROJECTIONS COME BACK? THESE ARE NOT THE MINISTERS FORECASTS, BUT TREASURY'S. THE ECONOMY IS RECOVERING, BECAUSE INTEREST RATES ARE COMING DOWN, BUT IT IS A BIT TENTATIVE. THESE TAX MEASURES WILL HOPEFULLY SUPPORT INVESTMENT, THAT WILL HOPEFULLY OFFSET THE CHILLING EFFECT FROM OFFSHORE. INVESTMENT IS VOLATILE. IT HAS A BIG IMPACT ON THE BUSINESS CYCLE, EVEN THOUGH CONSUMPTION, WHAT HOUSEHOLDS CHOOSE TO DO, IS BIGGER, INVESTMENT AS A BIGGER SWING VARIABLE. ANYTHING THAT SUPPORTS INVESTMENT IS LIKELY TO SUPPORT THE GROWTH OUTLOOK GOING FORWARD. LOTS OF MONEY BEING REDIRECTED FROM PAY EQUITY. THAT WOULD PROBABLY HAVE BEEN SPENT. GROWTH SLIGHTLY DOWN. DO YOU HAVE A SENSE OF THE INFLATIONARY ASPECTS OF THIS? WHAT ARE YOU EXPECTING THE IMPACT OF THIS TO BE ON INTEREST RATES? GOVERNMENT IS REDUCING SPENDING IN REAL TERMS. THAT SLOWS DOWN GDP. THAT IS OFFSET BY THE TAX CUT FOR INVESTMENT. THE RESERVE BANK CAN OFFSET HEADWINDS TO FISCAL POLICY, THROUGH LOWER INTEREST RATES. WE HEARD THE ESTIMATE OF 30 BASIS POINTS. THAT SEEMS A LOT, BUT WE HAVEN'T CRUNCHED THE NUMBERS. WE HAVEN'T UPDATED OUR ANALYSIS. THE LESS FISCAL POLICY IS STIMULATING THE ECONOMY, THE MORE ROOM THERE IS A FOR MONETARY POLICY TO DO THAT. THE DIFFERENCE BETWEEN FISCAL AND MONETARY POLICY, ONE IS POLITICAL, ONE IS THE RESERVE BANK. ARE THEY WORKING IN HARMONY NOW? THEY DON'T HAVE TO, BUT ARE THEY? WHEN THEY DON'T, IT CAN BE PROBLEMATIC. WE HAD A MASSIVE HOUSING BUBBLE IN 2021. PUBLIC AND PRIVATE SPENDING WERE BOOMING, COMPETING FOR RESOURCES. THE LABOUR MARKET FOR WORKERS. WE SAW A VERY INFLATIONARY, TIGHT ECONOMY. THEN UNFORTUNATELY THAT DOES MEAN THEY ARE NOW WORKING IN THE OTHER DIRECTION. THE RESERVE BANK IS NOW IN STIMULATORY MODE. WE ARE SEEING THE TWO AND LESS CONFLICT THAN THEY WERE. FISCAL POLICY IS GETTING TIGHTER, AND MONETARY POLICY IS GETTING LOOSER. FEEL FREE TO NOT ANSWER THIS, BUT IN A BANK, YOU SEE THE RETAIL REALITY OF LIVES BEING LIVED, PEOPLE GOING INTO INTEREST ONLY MORTGAGE HOLIDAYS OR DEFAULTING. PEOPLE WHO ARE CURRENTLY PRESSED, IS THERE A SENSE OF RELIEF HERE? I AM NOT ASKING YOU TO POLITICALLY JUDGE THE BUDGET. IF YOU WERE LIVING WITH A TIGHT TUMMY AND AN EMPTY WALLET, ARE THINGS GOING TO EASE A BIT? WHILE IN AGGREGATE LOWER INTEREST RATES CAN OFFSET FISCAL POLICY, IT AFFECTS DIFFERENT PEOPLE. MORTGAGE HOLDERS ARE NOT THE ONES HAVING TROUBLE PUTTING FOOD ON THE TABLE. FISCAL POLICY CAN BE MORE PRECISE IN ITS EFFECTS ON ITS ABILITY TO REDISTRIBUTE. MONETARY POLICY IS A BLUNT TOOL. THE SALVATION ARMY WILL JOIN US LATER. WE ARE GOING TO TAKE A BREAK, BUT I WOULD LOVE TO TALK YOU LATER. NO, WE'RE NOT TAKING A BREAK. DEBT PEAKING AT 46% OF GDP. DOWN HALF A PERCENT. REMIND ME OF THAT STAGGERING FIGURE FROM THE US. 45% HERE. IN THE US? PRETTY MUCH 100%. THAT IS WHY THE MARKET HAS LIMITED TOLERANCE OVER THERE. YOU CAN'T BULLY THE BOND MARKET. IT IS MADE UP OF MILLIONS OF PEOPLE INDEPENDENTLY DECIDING WHETHER TO LEND YOU MONEY, AND WHAT KIND OF CREDIT RISK YOU ARE. YOU CAN'T FORCE PEOPLE TO LEND MONEY TO YOU. IN THE UK, WITH LIZ TRUSS, LASTING LESS TIME THAN A LETTUCE, THERE ARE CONSTRAINTS ON POLITICIANS AND THE BOND MARKET CAN BE A POWERFUL ONE. NEW ZEALAND IS A SMALL COUNTRY AT THE END OF THE WORLD. WE HAVE THE WORLD'S LARGEST FAULT LINE WE COULD NEVER RUN THE KIND OF DEBT LEVELS THAT OTHER COUNTRIES GET AWAY WITH. WE DO HAVE TO PREPARE OURSELVES FOR THE NEXT INEVITABLE SHOCK, WHETHER AN EARTHQUAKE OR A GLOBAL FINANCIAL CRISIS. OR JUST THE SLOW BURN TRAIN WRECK THAT MANY COUNTRIES ARE FACING, WITH AN AGEING POPULATION AND HEALTH COSTS. SHARON ZOLLNER, YOU WILL BE JOINING US THROUGHOUT THE PROGRAM. WE ARE DELIGHTED TO HAVE YOU WITH US. WHEN I WAS A KID, EVERYTHING HAPPENED ON BUDGET DAY. I REMEMBER ROB MULDOON, AND THE QUESTION WAS, WOULD CIGARETTES AND BEER BECOME MORE EXPENSIVE? THE GOVERNMENT HAS MADE A NUMBER OF OTHER ANNOUNCEMENTS AHEAD OF TODAY. UP TO 80 NEW AFTER HOURS URGENT CARE SERVICES. THE GOVERNMENT SAYS THIS WILL MEAN EASIER ACCESS TO HEALTHCARE, INCLUDING IN RURAL ECONOMIES. THAT IS OVER FOUR YEARS. THAT WILL INCLUDE MONEY FOR FRONTLINE SERVICES THAT WORK WITH STUDENTS. IF YOU DON'T KNOW WHAT SOCIAL INVESTMENT IS, THIS WAS BILL ENGLISH'S BIG DREAM, MORE TARGETED INTERVENTION. THE GOVERNMENT WILL USE MORE DATA TO FIGURE OUT HOW BEST TO INTERVENE IN THE LIVES OF PEOPLE WITH COMPLEX NEEDS. THE GOVERNMENT SAYS IT WANTS TO SEND OVERSEAS TV AND FILM MAKERS A SIGNAL TO INVEST IN NEW ZEALAND. THEY WERE SOME OF THE PREBUDGET ANNOUNCEMENTS. THE GOVERNMENT ALSO MADE A SERIES OF ANNOUNCEMENTS $2 BILLION FOR MARITIME HELICOPTERS. THE GOVERNMENT WANTS TO DOUBLE DEFENCE SPENDING TO 2% OF GDP IN THE NEXT EIGHT YEARS. INITIATIVES TO REDUCE THE RISK OF ABUSE IN THE FUTURE. TESTS TO IDENTIFY WHICH STUDENTS NEED HELP. STUDENT LOANS, YOU START PAYING THAT BACK AT A LOWER INCOME LEVEL. COMING UP ` WHAT DOES LABOUR THINK OF THE BUDGET? A SPEECH FROM OPPOSITION LEADER CHRIS HIPKINS IN A BIT. AS PART OF THE BUDGET, FINANCE MINISTERS HAVE TO LAY OUT HOW THE GOVERNMENT IS TRACKING AGAINST THREE CHILD POVERTY REDUCTION TARGETS. ONE OF THOSE TARGETS MEASURES THE PROPORTION OF CHILDREN WHO LIVE IN HOUSEHOLDS EARNING LESS THAN HALF OF A TYPICAL FAMILY'S INCOME IN 2018, ONCE HOUSING COSTS AND INFLATION ARE TAKEN INTO ACCOUNT. THIS CAN SHOW IF INEQUALITY IS INCREASING OVER TIME AND THE IMPACT OF RISING COSTS OF LIVING. USING THAT MEASURE, ACCORDING TO TREASURY'S LATEST PROJECTIONS RELEASED JUST TODAY, THE GOVERNMENT IS SET TO COMPLETELY MISS ITS TARGET OF HALVING CHILD POVERTY RATES BY 2028. JOINING ME NOW TO UNPACK THOSE NUMBERS IS BONNIE ROBINSON, WHO HEADS UP THE SALVATION ARMY'S SOCIAL POLICY AND PARLIAMENTARY UNIT. THANKS SO MUCH FOR JOINING US. THROWN YOU IN EARLY, SO I REALLY APPRECIATE YOU STEPPING UP. WE ARE WAITING FOR NICOLA WILLIS TO COME DOWN. WE HAVE BEEN TALKING TO SHARON ZOLLNER ABOUT THE MARKETS. YOU SPEAK ON BEHALF ON SOME OF THE MOST DISADVANTAGED AND MARGINALISED PEOPLE IN OUR COMMUNITIES. WHAT IS IN THIS BUDGET FOR THEM? THANKS FOR THE OPPORTUNITY, AND I SHOULD SAY, WE ARE STILL ANALYSING. READ ONLY JUST GOT THE INFORMATION. THERE IS A LITTLE BIT IN THERE FOR SOME LOW-INCOME FAMILIES, BUT NOT MUCH, AND I THINK WHAT IS REALLY DISAPPOINTING IS JUST THE TOTAL LACK OF AMBITION ABOUT MEETING THESE TARGETS TO REDUCE CHILD POVERTY. IT IS JUST THERE IS NO AMBITION TO MEET THOSE TARGETS, IT IS WHAT IT LIKE. WHAT WE GOT A LITTLE BIT OF ASSISTANCE THAT WILL PUBLICLY TICKING ALONG AT ABOUT THE SAME LEVEL IT IS NOW, BUT NOTHING THAT SIGNALS ON HOW WE INTEND TO REACH THOSE TARGETS AND HOPEFULLY END POVERTY FOR CHILDREN IN THIS COUNTRY. WHAT HAD YOU HOPED FOR, BEARING IN MIND THAT WHAT WE KNOW FROM THE COALITION AGREEMENT, FROM THE BUDGET, FROM THE CAMPAIGN, PRETTY MUCH IN A BALLPARK WHAT TO EXPECT FROM THIS GOVERNMENT AND ITS BUDGETS? WHAT ARE YOU HOPING FOR? WE ARE NOT SURPRISED THAT THERE IS NOT A LOT, BUT WE ARE ALWAYS HELPFUL. THE SALVATION ARMY IS BUILT ON HOPE. THAT THE GOVERNMENT WILL UNDERSTAND THAT THE LONG-TERM IMPACTS OF CHILD POVERTY ARE VERY SERIOUS FOR US SOCIALLY AND ECONOMICALLY, BECAUSE WE KNOW THAT IF CHILDREN LIVE IN POVERTY OVER A SUSTAINED LENGTH OF TIME, IT CAN IMPACT ON THEM FOR THE REST OF THEIR LIVES, SO IF YOU DON'T WORK WITH BSU OF CHILD POVERTY NOW, YOU KICK THE CAN DOWN THE ROAD TO OTHER COSTS WHEN PEOPLE ARE ALL THE COMMENTERS OF HEALTH, MENTAL HEALTH, ABILITY TO GET EMPLOYMENT AND TRAINING, ALL THOSE THINGS IN OUR JUSTICE SYSTEM. RECEIVE THE IMPACTS OF POVERTY IN ALL THOSE AREAS. WE SEE THE IMPACTS OF POVERTY IN ALL THOSE AREAS. I GUESS, WE WERE HOPING THAT I WAS GOING TO BE A GREATER DEGREE OF CONCENTRATION ON HOW WE ACTUALLY END POVERTY AND INVEST NOW SO THAT WE DON'T HAVE A COST ON THE ROAD, AND ALSO SO WE DON'T HAVE PEOPLE SUFFERING NOW AND FURTHER DOWN THE ROAD, BECAUSE IF WE DON'T INVEST IN THOSE THINGS THAT ARE GOING TO REDUCE POVERTY, THEN BASICALLY, WE BASICALLY HAVE MORE FOLLIES, MORE CHILDREN, WHOSE LIVES ARE BASICALLY PRETTY NOT GOOD, PRETTY TOFF, AND WE SEE THEM AT OUR CENTRES EVERY DAY. DR BONNIE ROBINSON, DIRECTOR AT THE SALVATION ARMY WHO RACED INTO BE ON WIDOWS MUCH EARLIER THAN YOU WERE EXPECTING TO BE ON, THANK YOU SO MUCH FOR YOUR TIME. LET'S BRING IN FINANCE MINISTER NICOLA WILLIS WHO IS JOINING US FROM PARLIAMENT. THANKS FOR JOINING US. YOU HAVE RACED OUT OF THE HOUSE. DID YOU GET A STANDING OVATION? I ASSUME THAT YOUR SIDE ROSE EN MASSE. THEY DID, BUT THE MOST IMPORTANT THING WAS THAT MY KIDS WERE UP THERE IN THE PUBLIC GALLERY, AND THEY GAVE ME A CLAP. THEY HAVEN'T SEEN THAT MUCH OF THEM ON LATELY, SO IT WAS SPECIAL. IF PEOPLE WERE CLAPPING, WHAT DO YOU THINK THEY WERE CLAPPING FOR, IN OTHER WORDS, IF YOU ARE SITTING AT HOME THIS AFTERNOON, SELL IT TO PEOPLE. WHAT IS GOOD ABOUT THE BUDGET? FINALLY, THE ECONOMIC RECOVERY IS HERE. YOU WILL SEE YOUR INCOME IS RISING FASTER THAN THE COST OF LIVING. JOBS ARE GOING TO BE GREATER, MORE THAN TWO 40,000 OVER THE NEXT FEW YEARS, AND WE ARE MAKING SURE WE CAN INVEST IN THINGS THAT MATTER TO YOU, IN LEARNING SUPPORT, HUGE CLIFFS IN FUNDING FOR OUR HEALTH SYSTEM, MORE FUNDING FOR THE POLICE, REBUILDING OUR DEFENCE CAPABILITY, AND WE ARE DOING IT ALL IN A RESPONSIBLE WAY THAT MEANS THAT WE ARE NOT GOING TO HAVE TO BURDEN FUTURE GENERATIONS WITH UNMETEABLE LEVELS OF DEBT. THE REFINER, TRADER, MANUFACTURER, IF YOU MAKE A NEW INVESTMENT IN YOUR BUSINESS IN THIS COUNTRY, WE ARE GOING TO GIVE YOU A 20% TAX DEDUCTION, REDUCING YOUR TAX BILL, GIVING YOU MORE CASH IN HAND AND MAKING THIS COUNTRY GO FASTER SO OUR WAGES GROW FASTER TO. $6.6 BILLION THE VALUE OF THAT POLICY, THAT IS OVER WHAT PERIOD? FOR YEARS. FOUR YEARS. IF YOU ARE BUYING NEW EQUIPMENT, MACHINERY, AND YOU ARE GETTING UP 20% OFF, YOU CAN DEDUCT THAT FROM YOUR NEXT TAX PAYMENT, HOW'S THAT STIMULUS GROWTH? BECAUSE MOST OF THE STUFF PEOPLE ARE BUYING WALK IN FROM OVERSEAS, WON'T IT? A LOT OF IT WILL BE NEW ZEALAND ASSETS THAT THEY BUY. WHAT HAPPENS IS THAT WHEN A BUSINESS BY VIEW MACHINERY, IT OFTEN MAKES THEM MORE EFFICIENT, MORE PRODUCTIVE, THEY CAN CREATE MORE VALUE, AND SO IT MAKES THOSE BUSINESSES MORE COMPETITIVE, MORE PROFITABLE. THE ADVICE WE HAVE RECEIVED FROM OUR OFFICIALS IS THAT THIS POLICY WILL GROW OUR ECONOMY FASTER, IT WILL LEAD TO MORE INVESTMENT, MOST IMPORTANT, FROM MY PERSPECTIVE, JOHN, THE BENEFITS WILL BE EARNED BY WORKERS, BECAUSE THE BIGGEST THING THAT WILL HAPPEN IS MORE EMPLOYMENT, MORE WAGE GROWTH. AND THE ADVICE WE HAVE RECEIVED IS THAT DOLLAR FOR DOLLAR, BANKS OR BLOCK, THIS IS A TAX CHANGE THAT WILL BE WIDELY SPREAD AMONG NEW ZEALANDERS. WIDELY SPREAD AMONG NEW ZEALANDERS, EXCEPT, IT SEEMS, THOSE AT THE VERY BOTTOM. I DISAGREE WITH THAT, JOHN. LET'S USE AN OBJECTIVE MEASURE. CHILD POVERTY OBJECTIVES, YOU'RE GETTING NOWHERE NEAR THEM. THE MOST IMPORTANT THING WE CAN DO TO TAKE FOLLIES OUT OF POVERTY IS TO ENSURE THAT THEY HAVE GOT BETTER JOBS TO GO TO, AND THAT BUDGET FORECAST DECLINING UNEMPLOYMENT AND IT FORECAST GROWING WAGES. ALSO BEEN REALLY CAVIL TO MAKE SOME TARGET INVESTMENTS. WITH INCREASED WORKING FOR FAMILIES PAYMENTS FOR LOW AND MIDDLE INCOME FAMILY, BECAUSE WE RECKON ISLEY NEED MORE SUPPORT. OUGHT FOR FAMILY NUMBERS WITH HIGH HEALTH NEEDS, WE HAVE EXTENDED TRIPS AND PERIODS. CAN I COME IN THERE? U HAVE INCREASED WORKING FOR FAMILIES PAYMENTS BY HOW MUCH? UP TO $23 A FORTNIGHT, ON AVERAGE $14 A FORTNIGHT. SO AROUND SEVEN DOLLARS A WEEK? THAT IS RIGHT, AND THAT IS MEANINGFUL. THE MOST MEANINGFUL THING, JOHN, IS A JOB THAT PAYS BETTER. CAN WE TALK ABOUT PAY EQUITY? IN TERMS OF JOBS THAT PAY BETTER. $12.7 BILLION OVER 4 YEARS. WHAT YOU SAY NOW TO PEOPLE WHO ARE GOING TO BE PAID BETTER BY THE FACT THAT THE MONEY IS GOING TO BE USED ELSEWHERE? I WOULD SAY THAT WE HAVE NOW GOT A PAY EQUITY REGIME IN PLACE THAT BYLAW MEANS THAT IF YOU CAN DEMONSTRATE THAT YOU HAVE BEEN UNDERPAID AND UNDERVALUED AS A CAUSE OF SEX-BASED DISSEMINATION THEN YOU CAN MAKE A CLAIM AND THE GOVERNMENT HAS PUT ASIDE FUN SO THAT WE CAN SETTLE THAT CLAIM AND PROVIDE FUNDING INCREASES. SCHEME HAD COME COMPLETE THE UNSUSTAINABLE, UNWORKABLE, IT HAD DEPARTED FROM ITS ORIGINAL PURPOSE, WHICH WAS TO CORRECT FOUR GENDER DISSEMINATION. I ACKNOWLEDGE THAT WORKERS ACROSS OUR ECONOMY WANT BETTER WORKING CONDITIONS. THEY WANT TO BE PAID MORE. THOSE ISSUES ARE DEALT WITH THROUGH THE NORMAL COLLECTIVE BARGAINING PROCESS, AND I FULLY EXPECT THAT THIS GOVERNMENT WILL BE FUNDING PAY RISES FOR TEACHERS, FOR NURSES, FOR OTHER WOMEN DOMINATED PROFESSIONS. PAY EQUITY SHOULD BE ABOUT CORRECTING FOR GENDER BASED AS CREMATION, AND UNDER OUR NEW REGIME, DWELL. IT WELL. I WASN'T IN THE LOCK-UP, BACK IN THE GLORY DAYS, YOU WILL ATTEND AND THEN ROUND WHERE YOU ARE STANDING. EXACTLY WHERE YOU ARE. A LOT OF THIS IS BREAKING NEWS FOR . ME MEANS TESTING OF 18 AND 19 YEAR OLD BENEFICIARIES, CAN YOU TALK TO ME ABOUT THAT? WE THINK THAT EVERY 18 YEAR OLD AND 19 ARE ALTERED EITHER BE IN A JOB OR IN TRAINING. WE ARE SACRIFICING THEIR POTENTIAL IF WE LET THEM LANGUISH ON A BENEFIT, SO THIS POLICY IS ABOUT SAYING THAT IF YOU ARE AN 18 YEAR OLD AND 19 OLD, WE WILL TEST YOU AGAINST YOUR PARENTS INCOME, AND YOU WILL NOT BE ABLE TO RECEIVE A BENEFIT UNLESS YOU ARE IN WORK OR TRAINING. I KNOW, HAVING SPOKEN TO PARENTS OF GOT KIDS WHO SEEM TRACKED ON THE COUCH, THAT THIS WILL BE A USEFUL PRICE FOR MANY OF THEM, AND IT IS REALLY ABOUT THE FACT THAT WE WANT PEOPLE IN TRAINING, WE WANT PEOPLE IN WORK. FINAL QUESTION ` THESE ARE STRANGE AND PRECARIOUS TIMES, AND YOU ARE RECURRING TO A SURPLUS IN '28, '29, YOU TALKED ABOUT UNICORNS AND LOLLY SCRAMBLES AND THEIR ABSENCE FROM THIS BUDGET, BUT THIS IS A MID-TERM BUDGET, NEXT YEAR, WILL YOU BE HAULING UNICORNS AND LOLLIES OUT OF THE HAT? I WILL BE DOING THE MAIN JOB, WHICH IS GROWING THE ECONOMY AND MANAGING IT RESPONSIBLY, BECAUSE THERE WILL BE POLITICIANS, I GUARANTEE, NEXT FEW MONTHS, HE WILL SAY DON'T WORRY, WAAKA, CREDIT CARD, WE CAN KEEP SPENDING, AND WE WON'T BE A GOVERNMENT THAT PUTS THE BLACKBOX OUT OF WHACK, BECAUSE THE PEOPLE WHO PAY FOR THAT ART NEW ZEALANDERS, THROUGH HIGHER INTEREST RATES, AND MY KIDS, AND YOUR KIDS, ALL OF OUR KIDS, WE SHOULD NOT BE LEAVING WITH AN UNSUSTAINABLE DEBT BURDEN. WILL BE MANAGING SPONSORING, GROLIER,, THOUGH BE MORE BUSES IN HEALTH AND EDUCATION, AND ALL THE THINGS THAT MATTER, AND IN THE MEANTIME, JOHN, I FORGOT TO MENTION THAT KIWI SAVER POLICIES ARE SET TO GROW. WE ARE GROWING THAT CITY FOR THE FUTURE. GROW. WE ARE GROWING THAT SCHEME FOR THE FUTURE. THANK YOU, NICOLA WILLIS. WE HAVE LOTS MORE ANALYSIS COMING UP. TIME FOR US TO PAY SOME BILLS, PAY WITH US, WE WILL BE BACK SHORTLY. IN CASE YOU'VE JUST JOINED US, HERE ARE SOME OF THE BIG ANNOUNCEMENTS FROM THE BUDGET. PAY EQUITY CUTS HAVE FUNDED THE BUDGET. IT HAS SAVED $12.8B OVER FOUR YEARS. WE DON'T KNOW MUCH MONEY HAS BEEN LEFT IN THE KITTY ` THE GOVERNMENT SAYS THAT IS COMMERCIALLY SENSITIVE. THE GOVERNMENT SAY WHEN PAY EQUITY STARTED IN 2020, IT WAS SUPPOSED TO COST $3.7B. COSTS HAVE BALLOONED. SO WHILE WE CAN'T OUTLINE THE FULL BLOWOUT, $12.8B THAT HAD BEEN SET ASIDE HAS NOW BEEN RETUNRED. KIWISAVER ` INCREASE IN MINIMUM CONTRIBUTION FROM 3% TO 4%, AND THE GOVERNMENT CONTRIBUTION HAS BEEN HALVED TO $206 MAXIMUM. IT IS MEANS TESTED. IT IS MEANS TESTED. MEMBERS EARNING MORE THAN $180,000 THIS IS EXPECTED TO SAVE THE GOVERNMENT $2.5B. IMPORTANT TO NOTE, THE GOVERNMENT CONTRIBUTION TO YOUR KIWISAVER THIS FINANCIAL YEAR WILL NOT BE AFFECTED. INVESTMENT BOOST - $1.7B A YEAR. THE GOVERNMENT IS GIVING BUSINESSES AN IMMEDIATE TAX BREAK FOR NEW ASSETS, THE MINISTER THINK THIS WILL STIMULATE GROWTH. THE GOVERNMENT SAYS IT WILL LIFT GDP BY 1% AND WAGES BY 1.5% OVER THE NEXT 20 YEARS. REMEMBER, WONDERFUL VIEWERS, THERE WAS ONLY $1.3 BILLION OF NEW MONEY AVAILABLE. I HAVE TWO WONDERFUL PANELLISTS. GREEN PARTY CO-LEADER MARAMA DAVIDSON. TENA KOE, THANK YOU SO MUCH FOR JOINING US. KIA ORA RAWA ATU. YOU HAVE RACED INTO THE LEGISLATIVE CHAMBER TO BE WITH US. WHAT IS YOUR REACTION TO THE BUDGET? IT IS WORSE THAN BS, THIS BUDGET. I WENT TO THE CHILD POVERTY REPORT. I HAD A LOOK. UNDER THIS BUDGET, BY THIS GOVERNMENT'S OWN REPORTING, AND OWN INFORMATION, CHILDREN AND THEIR FAMILIES WILL NOT BE LIFTED OUT OF POVERTY. THEY WILL BE GETTING WORSE. THE POVERTY RATE WILL BE GETTING WORSE. IF THAT IS NOT ONE OF THE MOST IMPORTANT INDICATORS OF ANY BUDGET, I DON'T KNOW WHAT IS. THIS BUDGET IS ABOUT WHAT THIS GOVERNMENT VALUES AND WHO THEY VALUE. THEY ARE SENDING A CLEAR MESSAGE THAT THIS BUDGET, THE HOLES IN IT HAVE BEEN PLUGGED BY OUR COUNTRIES LOWEST PAID WORKING WOMEN, BY CHILDREN ALREADY LIVING IN MATERIAL HARDSHIP, BY THE CLIMATE ` IT HAS SUBSIDIES FOR OIL AND GAS ` BY SO MANY OTHER PEOPLE WHO NEEDED OUR HELP AND WHO ARE INSTEAD BEING LEFT BEHIND. I PUT SOME OF THIS TO DOCTOR BONNIE ROBERTSON, AND SHE TALKED ABOUT CHILD POVERTY TARGETS THAT ARE NOT BEING MET. I PUT THIS TO NICOLA WILLIS, AND SHE SAID THE BEST THING WE CAN DO IS GROW THE ECONOMY AND CREATE JOBS, BECAUSE EMPLOYMENT WILL LIFT CHILDREN OUT OF POVERTY. JOHN, WHEN HAS MIMI POLITICS EVER WORKED? WHEN HAS TRICKLE-DOWN AND ECONOMICS EVER ENDED POVERTY? WHAT WE CAN INSTEAD DO IS WHAT OUR GREEN BUDGET WOULD DO, TO INCREASE FAMILY SUPPORT PAYMENTS, THE BEST START PAYMENTS, INCREASE THE INCOME GUARANTEE, SO THAT NO MATTER WHAT TOUGH TIMES WE ARE FACING, THERE IS A MINIMUM INCOME PEOPLE WILL GET. BOOST PUBLIC HOUSING, END THE HOUSING WAITING LIST, MAKE SURE WE ARE PROPERLY PROVIDING WHANAU SUPPORT. THIS GOVERNMENT COULD HAVE MADE THAT CHOICE. MIMI-DOWN ECONOMICS WILL NOT CUT IT EVER. THANK YOU SO MUCH FOR YOUR TIME, MARAMA DAVIDSON. I WILL BRING IN THE PANELLISTS. DAVID CUNLIFFE GENERALLY DOESN'T SUPPORT NATIONAL. BRIGETTE MORTEN GENERALLY DOES. IS THAT FAIR? I AM REMARKABLY POST-PARTISAN. I DIDN'T LIKE THE PAY EQUITY. YOU TOOK NO PRISONERS ON PAY EQUITY. WHAT DID YOU LIKE? I LIKE THE FACT THAT IT IS FISCALLY RESPONSIBLE, BROADLY. THERE IS A STABLE PATH FOR DEBT. THE OBEGAL IS UP SLIGHTLY. THAT IS OK. WHAT I AM NOT SEEN ARE THE SORTS OF INVESTMENT THAT WILL TURN THE DIAL ON PRODUCTIVITY AND LIFT WAGES AND INCOMES GOING FORWARD. A LITTLE BIT OF THIS AND THAT. WE USE PHRASES LIKE OBEGAL AND WE NOD. IF PEOPLE ARE THINKING, WHO IS OBEGAL? IT SOUNDS LIKE SOMETHING FROM THE LORD OF THE RINGS. AND HOUSEHOLD BUDGET TERMS, BY THE TIME YOU HAVE YOUR PAY PACKET AFTER-TAX, AND YOU SPEND ON UTILITIES, WHAT HAVE YOU GOT LEFT? IT AS THE OPERATING BALANCE, EXCLUDING VALUATIONS AND A FEW OTHER THINGS. HOUSEKEEPING. HELL HAS JUST FROZEN OVER. DAVID CUNLIFFE HAS BEEN MODERATELY COMMENDING A NATIONAL PARTY BUDGET. BRIGETTE, I WILL ASK YOU TO FLIP. WHERE ARE THE WEAKNESSES IN THIS BUDGET? WHERE DO YOU THINK THEY ARE EXPOSED, POLITICALLY? I HAVEN'T HAD A CHANCE TO DIG INTO IT. THERE IS INCREASED INVESTMENT IN INFRASTRUCTURE. BUT WE HAVE AN INFRASTRUCTURE DEFICIT AND WE NEED MORE SPENDING THEIR. I WILL SAY I WANT TO SEE MORE THERE. THERE ARE SOME GOOD THINGS THERE, IN TERMS OF CLASSROOMS AND SCHOOLS. NONE OF THOSE BIG PROJECTS, WE ARE NOT SEEING THOSE NECESSARILY YET. BUT I COULD BE PROVEN WRONG. I WANT TO COME BACK TO THE POINT THAT TWO GUESTS HAVE MADE, DR BONNIE ROBINSON AND MARAMA DAVIDSON, WHO SPOKE ANGRILY ABOUT THE DISMAL FAILURE TO GET ANYWHERE NEAR CHILD POVERTY REDUCTION TARGETS. WE HAVE TO GET AWAY FROM THIS SHORT-TERM, WHAT IS MONEY IN THE BUDGET, THEREFORE TOMORROW, THAT IS WHAT THOSE KIDS WILL HAVE. YOU HAVE TO LOOK AT THE FUTURE FACTORS THAT WILL MAKE KIDS LIVES BETTER. WE ARE SEEING KIWI SAVER EXTENDED DOWN TO 16-YEAR-OLDS AND 17-YEAR-OLDS. THEY WILL GET ON THE SAVING LADDER EARLIER AND BE ENCOURAGED TO DO THAT EARLIER. THE INFRASTRUCTURE INVESTMENTS IN TERMS OF SCHOOLS, ALL OF THOSE THINGS WILL MAKE A DIFFERENCE TO THOSE CHILDREN'S LIVES GOING FORWARD. IT WOULD BE GREAT IF THEY HAD $15 OR $20 MORE IN THE WEEKLY BUDGET. BUT WE HAVE TO GET THOSE WIDER FACTORS RIGHT, TO GIVE THESE GUYS AND ASPIRATIONAL FUTURE. THERE IS A LOT OF SMOKE AND MIRRORS AROUND KIWI SAVER. THE GOVERNMENTS PURSE IS ESTIMATED TO SAY $2.7 BILLION A YEAR THAT IT WON'T PUT INTO KIWI SAVER. YOU ARE EITHER PROVIDING MORE FOR FUTURE SUPERANNUATION OR YOU ARE NOT. LABOUR HAS ESTIMATED THE IMPACT ON AN 18 YEAR OLD BY THE TIME THEY RETIRE AT 65 IS $66,000 LESS, THAT IS THE CHANGE OF THE CONTRIBUTION RATE, THE GOVERNMENT IMPACT. I DON'T AGREE THAT THE KIWI SAVER STUFF IS SOLVING THE PROBLEM. I DON'T THINK THERE IS MUCH THAT IS ADDRESSING THE LONG-TERM. WHAT IS THE BIG ISSUES LIST? CLIMATE CHANGE, SUPERANNUATION, AGEING POPULATION. AND THE DETERIORATING INTERNATIONAL ENVIRONMENT. WE HAVE DEFENCE SPENDING. I SUPPORT THAT. BOTH SIDES WILL HAVE TO HAVE THEIR HEADS AROUND THE HEIGHTENED RISK ENVIRONMENT. STAY WITH US UNTIL 4 O'CLOCK. WE WILL JUST TAKE A BREAK. WE WILL BE SPEAKING TO TE PATI MAORI COLEADER DEBBIE NGAREWA-PACKER. VOICEOVER: The new Subway signature chicken pepperoni. A perfect pairing of tender, strips of chicken and pepperoni with melty mozzarella. Sub-perb. Yeah, I think that works. YOU ARE WITH THE BUDGET SPECIAL LET'S BRING IN BARBARA EDMONDS. THANKS FOR JOINING US. YOUR TAKE ON THE BUDGET. THIS BUDGET IS THE WOMAN OF WORTHLESS BUDGETS. I'M INCREDIBLY DISAPPOINTED FOR THOSE HUNDREDS OF THOUSANDS OF WOMEN ACROSS OUR COUNTRY, THE WOMEN WHO CARE FOR US WHEN WE ARE PREGNANT, THE WOMEN THAT CARE FOR US WHEN WE HAVE YOUNG CHILDREN, AND THE WOMEN THAT CARE FOR US IN OUR LAST DAYS, THAT THEY HAVE BEEN SAID BY THIS GOVERNMENT, WE HAVE SHUT THE DOOR ON YOU, YOU ARE NO LONGER WORTH IT. THAT IS INCREDIBLY POINTING. ARE NO LONGER WORTH IT. THAT IS INCREDIBLY DISAPPOINTING. $12.7 BILLION OVER FOUR YEARS NOT BEEN PAID OUT OVER PAY EQUITY. DO THE RE-PRIORITISATIONS JUSTIFIED THAT DECISION? WE ARE ONLY GOING BACK INTO SURPLUS BY $200 MILLION IN 2028, 2029. DO YOU THINK THEY ARGUE FOR THEMSELVES? SHE BORROWED $12 BILLION LAST YEAR BUDGET, JUST TAKE AWAY $12 BILLION FROM ONE, THAT IS EFFECTIVELY SAYING TO WOMEN THAT YOUR CONTRIBUTION TO THIS ECONOMY IS NOT VALUED. IF YOU HAD BEEN FINANCE MINISTER, SETTING ASIDE YOU WOULD HAVE STAYED WITH PURGATORY AS IT STOOD, BUT WHAT WOULD YOU HAVE DONE DIFFERENTLY, GIVEN DEBT AND SURPLUS OR DEFICIT LEVELS? AS I SAID, NICOLA WILLIS BORROWED $12 LAST YEAR FOR TAX CUTS AND ADDITIONAL SEVEN THIS YEAR. THE PLAN WE TOOK INTO THE 2023 ELECTION NATURALLY GUTTERS INTO SURPLUS A YEAR EARLIER THAN THIS. BUDGETS ARE ALL ABOUT CHOICES, AND LABOUR WILL COME OUT WITH OUR CHOICES, BUT TODAY IS ABOUT THE GOVERNMENT, AND HOLDING THEM TO ACCOUNT FOR WHAT THEY ARE DOING TO WORKING WOMEN ACROSS NEW ZEALAND. IT IS TOUGH AT THE MOMENT. THERE IS A PRECARIOUSNESS IN THE GLOBAL ECONOMY. DONALD TRUMP IS THROWING THE CAT AMONGST THE PIGEONS EVERY DAY. HOW DOES NICOLA WILLIS, WHO IS IN A COALITION GOVERNMENT WITH ACT AND NZ FIRST, HOW SHE GET IT RIGHT IN THAT CONTEXT? THEY MADE THEIR BED, SO THEY NEED TO LINE IT, THEY NEED TO STICK THEIR DECISION, SO ULTIMATELY, INVESTING IN OUR PEOPLE, INVESTING IN THE THINGS THAT MATTER TO EVERYDAY NEW ZEALANDERS. INSTEAD, THEY ARE SCRAPPING ABOUT OTHER THINGS, WHICH AREN'T IMPORTANT TO KIWIS. SO MUCH FOR JOINING US. THANK YOU SO MUCH. WILL THE BACK AFTER THE BREAK. THIS IS A COALITION GOVERNMENT, NEW ZEALAND FIRST AND OLD SCHOOL, HEAVY-HANDED, PATERNALISTIC PARTY. THE COALITION PARTNER IN THIS GOVERNMENT IS ACT, WHICH IS A FREE MARKET PARTY. DAVID SEYMOUR WILL BE JOINING SHORTLY. SOME POLITICAL ANALYSIS COMING UP FROM OUR PANELLISTS DURING THE AD BREAK. LET'S BRING IN ACT LEADER AND ASSOCIATE FINANCE MINISTER DAVID SEYMOUR. TENA KOE, NICE TO HAVE YOU WITH US. WHAT BUDGET LINES IS ACT PLEASED ABOUT? I THINK THE FACT THAT WE ARE REDUCING THE SIZE OF GOVERNMENT, COMPARED WITH THE REST OF THE ECONOMY. THE GOVERNMENT IS INCREASING ITS BUDGET BY ABOUT 1%. IF YOU LOOK AT INFLATION AND POPULATION GROWTH, THAT IS GOING UP ABOUT 3.5%. AS WE REDUCE OUR SPENDING COMPARED TO EVERYTHING ELSE, THAT FREES UP CASH FOR FIRMS AND FARMS AND FAMILIES THAT HAVE BEEN DOING IT TOUGH FOR A LONG TIME. ONE WAY THAT IS TRANSMITTED IS THAT AS THE GOVERNMENT SPENDS LESS AND BORROWS LESS, YOU SEE LESS PRESSURE ON INFLATION, LESS PRESSURE ON INTEREST RATES, AND PEOPLE START TO SEE MORE CASH FLOW, WHETHER IT IS FOR THEIR BUSINESS, FOR THEIR HOUSEHOLD, THEIR MORTGAGE, LOWER INTEREST RATES ARE GOOD. CAN WE TALK ABOUT GROWTH? GROWTH PROJECTIONS ARE LOWER THAN THEY WERE IN THE HAYFU LAST YEAR, WHAT IS GOING ON THERE? IS THAT A SIGN OF AN ECONOMIC MANAGEMENT PROGRAM THAT IS WORKING? NO, I THINK MOST PEOPLE, AND I HAVE TRIED TO BE HONEST ABOUT THE FACTORS THAT LEAD TO GROWTH FORECAST. WE ALL KNOW THAT THERE IS A CHALLENGING TIME OUT THERE WITH THE UNCERTAINTY AROUND TRADE POLICY, FOR EXAMPLE. COMMODITY PRICES GO UP AND DOWN. THOSE THINGS CAN AFFECT WHAT NEW ZEALANDERS CAN EXPECT TO GET FROM THE ECONOMY. YOU ALSO HAVE TO ISOLATE WHAT THE GOVERNMENT IS DOING. WHAT WE ARE DOING WITH OUR SPENDING IS $4.9 BILLION HAS BEEN TAKEN OUT OF SOME PURPOSES AND PUT INTO THINGS THAT WE BELIEVE ARE BETTER FOR THE FUTURE OF OUR COUNTRY, LESS ATTACKS ON FIRMS THAT INVEST IN NEW MACHINERY AND EQUIPMENT, SO THEY CAN PRODUCE BETTER GOODS AND SERVICES AND ULTIMATELY PAY THEIR WORKERS MORE. MORE ON LAW & ORDER, SO PEOPLE CAN USE THE STREET AND NOT FEEL INTIMIDATED. MORE ON EDUCATION, PARTICULARLY MATHS. THESE WILL MAKE NEW ZEALAND BETTER IN THE LONG TERM. WE HAVE TAKEN ALMOST $5 BILLION OUT OF STUFF THAT WASN'T WORKING, JUST LIKE SO MANY FAMILIES HAVE HAD TO RECENTLY. IT HAS BEEN A HUNGRY TIME FOR JUST ABOUT EVERYONE. WHEN YOU WANT TO DO SOMETHING NEW, YOU HAVE TO ECONOMISE. WE ARE REDUCING THE SIZE OF GOVERNMENT COMPARED WITH THE REST OF THE ECONOMY. YOU SAID IT HAS BEEN A HUNGRY TIME FOR JUST ABOUT EVERYONE. THE HUNGRIEST OTHER CHILDREN IN POVERTY. THERE IS A SPECTACULAR FAILURE TO MEET CHILD POVERTY REDUCTION TARGETS. CHRISTOPHER LUXON SPOKE BRILLIANTLY ON ELECTION NIGHT AND SAID HE WANTED TO BE A GOVERNMENT FOR ALL NEW ZEALANDERS. TALK TO ALL THE NEW ZEALANDERS WHO LIVE AT THE BOTTOM OF THE INCOME HEAP. WHAT IS IN THIS BUDGET FOR THEM? WHAT IS GOING TO GET I OUT OF THAT? A GROWING ECONOMY WITH LOWER INTEREST RATES, WITH LESS INFLATION. YOU CAN ONLY DO THAT IF YOU HAVE A GOVERNMENT THAT IS RESPONSIBLE WITH ITS OWN FINANCES. THE FIVE OR SIX YEARS PRIOR, WHEN PRICES WENT UP 7% A YEAR, THAT INFLATION HURTS YOU THE MOST IF YOU HAVE NOT MUCH MONEY. LOWER INTEREST RATES, WHETHER YOU ARE RENTING OR OWN, THOSE HIT YOU THROUGH YOUR RENT OR MORTGAGE. WE ARE GETTING OUR OWN SPENDING UNDER CONTROL AND INVESTING IN THINGS THAT MAKE IT EASIER TO GET ALONG. BETTER EDUCATION, BETTER SCHOOL ATTENDANCE, , MORE SUPPORT FOR PEOPLE WHO HAVE SPECIAL LEARNING NEEDS MORE MATHS SUPPORT. IF YOU WANT ME TO SAY WE WILL BORROW MORE AND GIVE IT TO PEOPLE AND SAY THE PROBLEM IS SOLVED, NEW ZEALAND HAS HAD THAT APPROACH. IT MADE THE PROBLEM WORSE. THE ONLY THINGS THOSE POLICIES DO FOR THE POOR IS GIVE THEM MORE COMPANY. YOU SOUND LIKE YOU NEED VITAMIN . C YOU SOUND LIKE YOU HAVE A SNIFFLE. I AM ALWAYS FIGHTING, USUALLY AGAINST GOVERNMENT WASTE, BUT SOMETIMES AGAINST TINY MICROBES AND IRRITANTS. THANK YOU FOR JOINING US THIS AFTERNOON. WHAT ARE WE DOING NOW? WE ARE HAVING A CHAT. I WILL BRING IN THE PANEL. DAVID CUNLIFFE. POLITICALLY, IS IT TOO SOON TO TALK ABOUT THE POLITICS? I READ A GOOD OP-ED. IT SAID THIS MAY BE ONE THAT TAKES A WHILE TO DIGESTIVE. THE DEVIL MAY BE IN THE DETAIL. IS IT TOO SOON TO HAVE A POLITICAL RESPONSE TO THIS? THE DEVIL IS ALWAYS IN THE DETAIL. LOOK AT THE UNSPECIFIED FISCAL RISKS AT THE BACK OF THE DOCUMENT. WE HAVE SOME GOOD LINES HERE. DAVID SEYMOUR IS SAYING IT IS RESPONSIBLE FISCALLY, AND THAT WILL MAKE US RICHER. RESPONSIBLE FISCAL MANAGEMENT IS NECESSARY. IT IS NOT SUFFICIENT ON ITS OWN. WHERE IS THE PLAN FOR GROWTH? NICOLA WILLIS IS SAYING AND I AGREE WE NEED TO FIGHT MONOPOLIES TO GIVE CONSUMERS BETTER VALUE AND TO GET BETTER PROACTIVITY IN THE ECONOMY. DAVID SEYMOUR IS TRYING TO PUSH THROUGH THE REGULAR TORY STANDARDS BILL, WHICH WOULD MAKE IT IMPOSSIBLE TO REGULATE MONOPOLIES WITHOUT COMPENSATING THEM. THE GOVERNMENT HAS A POLITICAL PROBLEM. IT IS A DOG WITH TWO TALES, BOTH ON THE RIGHT-HAND SIDE OF ITS BUM. IT IS HAVING TROUBLE WALKING, AND I FEEL SORRY FOR CHRISTOPHER LUXON AND NICOLA WILLIS AND CHRIS BISHOP... YOU DO NOT FEEL SORRY FOR THEM! EVERY TIME THEY HAVE A DECENT CRACK, WINSTON AND DAVID SEYMOUR GO INTO RIGHT WING MODE. AN ALTERNATIVE COALITION, ON THE OTHER SIDE, YOU HAVE THE GREENS ALTERNATIVE BUDGET, WHICH WAS COMPLETE UNFEASIBLE. LET'S TALK ABOUT THIS BUDGET. WHAT THEY ARE SAYING IS HELP IS ON THE WAY. WHEN YOU CALL THE HELP, YOU WANT IT QUICKLY. FOR SOME PEOPLE, HELP IS A BLOODY LONG WAY AWAY. WHEN WE START TALKING ABOUT EDUCATION, THE CHILDREN WHO ARE HUNGRY RIGHT NOW, HOW DO YOU SELL THAT? IS ALL POLITICS NICHE POLITICS NOW? YOU HAVE A RESPONSIBILITY TO LOOK AFTER OUR MOST VULNERABLE. ONE OF THE DETAILS IS THEY HAVE INCREASED FUNDING TO GET ELDERLY OUT-OF-HOSPITAL INTO APPROPRIATE AGED CARE FACILITIES. $24 MILLION. THAT IS NOT GOING TO GO VERY FAR AT ALL. YOU STILL HAVE A DIFFERENCE IT WILL MAKE YOU HAVE TO BE CAREFUL. YOU CAN'T SAY THE MONEY ISN'T ENOUGH, BUT YOU APPRECIATE A FISCALLY SENSIBLE BUDGET. YOU CAN'T LOOK PURELY FOR WHAT IS THE ENTIRE PLAN. IT IS BUDGET DAY. WITH A CENTRE-RIGHT GOVERNMENT, THE BUDGET IS NOT WHERE ALL THE MONEY GOES. YOU LOOK AT A CENTRE-LEFT GOVERNMENT, THEY THROW THE MONEY AT EVERYTHING. CENTRE-RIGHT GOVERNMENTS DO IT BY UNTANGLING BUREAUCRACY. SO IT IS THE WORK AROUND THE BUDGET THAT MAKES THE BIGGEST DIFFERENCE. THAT IS A HARSH CHARACTERISATION OF CENTRE-LEFT GOVERNMENTS. I BROUGHT WITH ME THE LAST BUDGET THAT I HELPED WRITE. MASSIVE SURPLUSES. NEXT YOU WILL BE TELLING ME ELVIS IS OUT THE BACK. LABOUR GOVERNMENTS HAVE OFTEN INVESTED FOR GROWTH AND GOT SUSTAINABLE RESULTS. I HADN'T EVEN GRADUATED UNIVERSITY THEN. THAT IS A FANTASTIC PANEL. STAY WITH US. AFTER THE BREAK WE WILL HEAR FROM TE PATI MAORI AN SHARON ZOLLNER HAS BEEN CRUNCHING THE RESPONSE TO SOME OF THE FISCAL NEWS WE HAVE RECEIVED THIS AFTERNOON. STAY WITH US. YOU ARE WITH THE ONE USED Q&A BUDGET SPECIAL. CRAIG RENNEY, ECONOMIST AND DIRECTOR OF POLICY AT NEW ZEALAND COUNCIL OF TRADE UNIONS. HE WORKED FOR FORMER FINANCE MINISTER GRANT ROBERTSON AND IS CURRENTLY A MEMBER OF THE LABOUR PARTY'S POLICY COUNCIL. THANKS SO MUCH FOR JOINING US. WHAT IS YOUR TAKE ON THIS BUDGET? REALLY SURPRISED BY THE SIZE OF THE CUT THAT IS A PAY EQUITY TO $12.8 BILLION. THAT IS THE RANGE AND $60,000 AN HOUR, $6000 A MINUTE OUT OF THE POCKETS OF LOW INCOME, FEMALE WORKFORCES ACROSS THE COUNTRY, REMOVING BENEFITS FROM 18 ALSO 19. IT IS SURPRISING WHETHER MONEY IS COMING FROM, BUT AT THE SAME TIME, WE HAVE GOT MONEY TO SPEND ON HALF $1 BILLION TAX CUT FOR GOOGLE, FACEBOOK, FOR OTHER MULTINATIONALS, AND WE ARE SPENDING LARGE AMOUNT OF MONEY AND CORRECTIONS. IT IS A BUDGET WITH ITS PRIORITIES IN THE WRONG PLACE. YOU SPEAK ON BEHALF OF A SIGNIFICANT AMOUNT OF LOW-INCOME PEOPLE. WHAT IS A BUDGET FOR THEM? VERY LITTLE, IS THE HONEST ANSWER. RECEIVING INVESTMENT IN HEALTH AND EDUCATION NOT RISING WITH THE COST OF LIVING. WE ARE SEEING SOME MONEY FOR WORKING FAMILIES, BUT WE ARE SEEING THAT TAKEN AWAY. WE ARE EXPECTING 60,000 FAMILIES TO BE WORSE OFF. INCREASES IN ECE FUNDING ONLY GO UP BY 0.5%, SO REAL TERMS CUTS TO ECE FUNDING. NOT REALLY A GREAT DEAL FOLLOWING FAMILIES, FOR VULNERABLE FARMERS, FOR THOSE FAMILIES WHO NEED PUBLIC SERVICES ACROSS THE COUNTRY. THANKS, CRAIG. LET'S BRING IN SHARON ZOLLNER AGAIN. WELCOME BACK. NICOLA WILLIS WONDERS THERE WOULD BE NO UNICORNS, NO LOLLY SCRABBLES. YOU DO THE TOUGH STUFF, THE STUFF THAT CRAIG REGARDS AS HIGHLY UNPALATABLE. WILL THAT BE ENOUGH ROOM TO GO TO THE MARKET WITH A LITTLE BIT MORE, ELECTION YEAR NEXT YEAR? IT WILL BE GOING TO THE VOTERS RATHER THAN THE MARKET. THE MARKET IS ALL FOR AUSTERITY, BUT THE VOTERS MAY BE LIKE SOMETHING A BIT SOFTER. I THINK GIVEN THE FISCAL STRATEGY REMAINS THE SAME, IT WAS REITERATED IN THE DOCUMENTS, AND NATURALLY THEY ARE MISSING THEIR OWN TARGETS TO GET BACK TO SURPLUS BY 2027, 2028, YOU CAN DO THAT ALONG THE WAY, BUT WHEN IT GETS CLOSER, YOUR GOT TO FRONT UP AND SAY WE ARE GOING TO MISS OUR TARGET. THAT IS NATURALLY QUITE AN INCENTIVE TO STICK TO YOUR GUNS AND HAVE ANOTHER TIGHT BUDGET. IS GOING TO DEPEND ON HOW THE ECONOMY GOES, WHICH IS CONSEQUENCES ON THE TAX TAKE AND OUTGOINGS, AND THE TREASURY HAS BUILT IN SOME OF THE HITS FROM THIS GLOBAL STUFF, BUT ACKNOWLEDGES THAT THE REST OF THE STUFF TO THE DOWNSIDE OF THAT, WHICH SEEMS QUITE SENSIBLE. THAT'S ANOTHER CONSTRAINT POTENTIALLY. IN THEORY, YOU CAN STILL CUT THEM FURTHER, BUT YOUR GOT TO SAY THE LOW HANGING FRUIT HAS BEEN CUT IN TERMS OF SAVINGS, AND BEEN THROWN. THAT IS REALLY IMPORTANT, WHAT YOU SAID. 1.3 BILLION AS THE NEW SPENDING, THE REST OF THE SPENDING HAS COME FROM ELSEWHERE, AND MOST CONTROVERSIALLY, ACCORDING TO ARGUS, FROM PAY EQUITY. THAT HASN'T CHANGED AT THIS POINT, ACKNOWLEDGING THAT SAVINGS ARE PUBLIC TO GET HARDER. ACKNOWLEDGING THAT SAVINGS ARE GOING TO RDER. THEIR OWN FORECAST OF A MISSING RETALLICK, EVEN IF THE ECONOMY PERFORMS AS WELL AS THEY THINK IT WILL. THAT SURPLUS IS PRECARIOUS IN TERMS OF THE VULNERABILITIES OF THE ECONOMY AT PRESENT? IS NOT ALL DOWNSIDES TO THE ECONOMY. SOMETIMES YOU GET POSITIVE SURPRISES, THE CHALLENGES THEN TO NOT RUSH OUT AND SPEND THAT, WHICH IS ALWAYS THE TEMPTATION. THE KANTIAN ECONOMICS IS SUPPOSED TO BE ABOUT YES, SUPPORTING THE SPANNING MORE WHEN IT IS WEAK.. THAT IS THE PART THAT IS OVERLOOKED BY POLITICIANS WHO WANT TO GET RE-ELECTED. SO THAT MODEL IS ESSENTIALLY STIMULUS. STIMULUS AND THE BAD TIMES, SAVINGS TIMES. STIMULUS AND THE BAD TIMES, SAVINGS TIMES.NOBODY MENTIONS THAT. WHAT ARE WE NOW? AND ASTIR BUDGET WOULD BE A STEP DOWN. IT IS GONE FROM 18.6% TO 46%, WE GOT DOWN AS FAST AS POSSIBLE, SO THAT MEANS INTRODUCING TAXES. THERE IS A REAL DRIVER AROUND GETTING IT DOWN, NOT THAT QUICKLY, IT HAS TO BE SAID. IT IS CONTAIN GROWTH IN SPENDING AND WAIT FOR THE ECONOMY TO GROW FASTER, WHICH WILL IMPROVE THE RATIO, BUT IT IS NOT A RAPID FIX. IT IS NOT A 1991 CUT BENEFITS, CUT SPENDING. IT IS INCREASE SPENDING MORE SOLID, WHICH IS A BIT DIFFERENT. YOU DON'T WANT TO TALK ABOUT THE POLITICS, BUT THE PAY EQUITY THING SOME PEOPLE WOULD SAY THAT IS ANALOGOUS WITH 1991. WHAT ARE THE MARKET SAYING? THE MARKET SEEMS QUITE SATISFIED. WHAT DOES THAT MEAN? BOND YIELDS .ARE DOWN. MOST PEOPLE DON'T BORROW THAT FAR, ONLY THE GOVERNMENT, IT DOESN'T MEAN YOU'RE GOING TO GET A LOWER MORTGAGE RATE. IT DOES MATTER FOR TAXPAYERS, BECAUSE THE GOVERNMENT HAS A BIG STOCK OF DEBT, AND THE BIGGER YOUR DEBT IS, BIGGER CHUNK OF YOUR BUDGET GOES ON PAYING DEBT. GOVERNMENTS PREFER LOWER BOND YIELDS, BUT THE USA REALLY DRAGS ALL MARKETS WERE, AND THAT BOND YIELDS HAVE GONE UP A LOT, AND I WAS HAVE BEEN DRAGGED WITH IT. WHAT DOES THIS MEAN FOR HOUSE PRICES? THERE ARE PEOPLE IN THE HOUSING MARKET WHO ARE MORTGAGED AND WANT TO PROTECT VALUE, THERE ARE THOSE WHO ARE EXCLUDED WANT TO ENTER IN THE HOPE THAT THE MARKET MIGHT RETREAT TO MEET THEM. WHAT IS YOUR SENSE OF THE IMPACT ON THIS OF THE HOUSING? WE ARE LIKELY TO SEE THE OCR A LITTLE BIT LOWER. THAT'S A POSITIVE FOR HOUSING. THE BIG POSITIVE FOR HOUSING IS THAT THIS GOVERNMENT STILL REFUSES TO ENTERTAIN THE POSSIBILITY OF A CAPITAL GAINS TAX, AND AS LONG AS THAT IS THE CASE, THEN HOUSING HAS ADVANTAGES. THERE SPEAKS NEW ZEALAND'S BIGGEST BANKS CHIEF ECONOMIST. MY GOD. ARE EXPECTING THE OCR TO MAKE ANY DIFFERENCE? THAT SETS THE OCR RESPONSE TO INFLATION. WHAT DIFFERENCE MAY THIS MAKE TO THE RESERVE BANK'S DECISION? THE MARKETS BEEN STICKING STICK A LOT OF VOLATILITY IN THE MARKETS. EVERYBODY EXPECTS THE MARKET IS PRICING IT. BEYOND THAT, THE JURY IS OUT. GOING TO DEPEND ON HOW MUCH WE GET DERAILED BY THIS GLOBAL STUFF. IT SEEMS TO HAVE CALMED DOWN, BUT I DON'T THINK ANYONE WOULD SAY IT IS OVER. A LOT OF THESE TARIFF REDUCTIONS ARE TECHNICALLY STILL TEMPERATURE, AND THERE IS STILL SOME UNCERTAINTY ABOUT ALL OF THAT. SLOWING STUDY FROM THE RESERVE BANK, WHILE REASSURING EVERYONE THAT IF IT DOES TURN TO CUSTARD, THEY CAN AND WILL CUT THE INTEREST RATES RAPIDLY BECAUSE INFLATION IS UNDER CONTROL. THANKS SO MUCH, ARON ZOLLNER. LET'S HAVE A LOOK AT SOME OF THE FISCAL PROJECTIONS. THESE WERE COMPLETED IN EARLY APRIL. IN EARLY APRIL, DAYS AFTER U.S. PRESIDENT DONALD TRUMP ANNOUNCED 'RECIPROCAL TARIFFS' ON THE WORLD, AND MARKETS WERE IN A BIT OF A PANIC. THE ECONOMIC FORECAST IS WORSENING. GDP IS FORECASTED TO GROW 0.6% THIS YEAR. AT THE END OF LAST YEAR, TREASURY WERE LOOKING AT 1.6% GROWTH. NO SURPLUS FOR 2029. EVEN THEN IT IS ONLY $200 MILLION. TO DESCRIBE THAT AS THIN, DENTAL FLOSS SPRINGS TO MIND. THE OBEGAL IS FORECASTED TO STAY IN DEFICIT IN 2028-2029. IS THAT OBEGAL x OR JUST OBEGAL? OBEGAL. OBEGALx, WHICH PAINTS A MORE OPTIMISTIC PICTURE, AS IT EXCLUDES ACC'S DEFICITS. USING OBEGALx, WE WILL RETURN TO A 200 MILLION SURPLUS BY 2028-2029. CORE CROWN DEBT IS EXPECTED TO HIT 42.7% GDP WAS FORECASTED IN DECEMBER TO BE 45.1%. NET CORE CROWN DEBT IS FORECASTED TO GROW EVERY YEAR TILL 2028, WHERE IT WILL PEAK AT 46% OF GDP. UNEMPLOYMENT IS FORECAST TO PEAK AT 5.4% THIS YEAR. NICOLA WILLIS MADE A GREAT DEAL OF THAT. LET'S BRING IN TE PATI MAORI COLEADER DEBBIE NGAREWA-PACKER. THANKS SO MUCH FOR JOINING US. WHAT'S YOUR TAKE ON THIS BUDGET? FIRST OF ALL, I NEED TO SAY THAT CHRIS LOOKS IN AND I AGREE WHOLEHEARTEDLY ON SOMETHING, AND TE PATI MAORI WOULD GO IN TAX THOSE OF HIS MATES THAT HE'S BEEN LED TO SAY CHANGES AND PROTECT. THIS IS A BUDGET THAT HAS NOT ONLY LEFT OUT, IT HAS IGNORED MAORI, TAMARIKI, IWI AND ALL THE TRANSFORMATIONAL SOLUTIONS THAT THEY PROVIDE THE NEW ZEALAND. THAT IS A BUDGET THAT IS LOOKING TO BUILD MORE PRISONS, MORE HOSPITALS, AND ALL THE SYSTEMS THAT HAVE FAILED MAORI. BUDGET THAT FORGETS THIS NOTION HAS TANGATA WHENUA. YOU'RE REFERRING DIRECTLY TO MAORI VERSUS NON-MAORI. YOU'RE TALKING ABOUT THE CHILD POVERTY REDUCTION TARGETS, WHICH ARE AN OBJECTIVE MEASURE. THE GOVERNMENT IS FALLING SPECTACULARLY SHORT ON ACHIEVING THEM. PAY EQUITY. WHAT NICOLA WILLIS WOULD SAY IS WE ARE PRIORITISING OTHER THINGS, INCLUDING JOB CREATION. IS NOT WHAT SHE WOULD SAY, IT IS WHAT SHE DID SAY. THIS ISN'T LIFTING ANYBODY OUT OF POVERTY. THEY ARE PROPOSING THAT 18 ROLES NO LONGER GO ON UNEMPLOYMENT BENEFIT, THEY RELY ON MOM AND DAD. THAT IS A SCENARIO THAT ASSUMES THAT EVERYBODY LIVES THIS LIFESTYLE WHERE MOM AND DAD ARE ABLE TO DO THAT. WHETHER SHE LIKES IT OR NOT, WE ARE A COUNTRY THAT HAS UNPRECEDENTED POVERTY AND EXTREME HARDSHIP FOR FAMILIES THAT HAVE, FROM GENERATIONS OF INEQUITY. ONE OF THE THINGS THAT WE SHOULD BE DOING IS WORKING OUT HOW WE INVEST IN THAT IN A FUTURE FOCUSED WAY, HOW WE ARE ABLE TO BRING ABOUT EVERYBODY UNDER THE TREATY TO LOOK AFTER A UNITED NATIONS, WHO ARE ABLE TO USE THE SKILLS AND NOT ONLY THE ENVIRONMENTAL WHAT THE ECONOMIC STRENGTH OF THE IWI POWERHOUSES. I THINK THIS BUDGET SHOWS WHAT CIVILITY LOOKS LIKE FOR NATIONAL, ACT, NEW ZEALAND FIRST, AND EXCLUDES THOSE WHO ARE REALLY IMPORTANT TO THOSE NOTION. EXCLUDES THOSE WHO ARE REALLY IMPORTANT TO A THIS NATION. IT IS A BUDGET AUSTERITY. IT IS NOT A BUDGET FOCUSED ON THE FUTURE. THANK YOU SO MUCH FOR YOUR TIME THIS AFTERNOON. YOU ARE WITH THE ONE USED Q&A BUDGET SPECIAL. STAY WITH US.