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Budget 2012 - Source: ONE News -
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Tvnz.co.nz followed the Budget 2012 throughout the day.
7.28pm: Key says he does not think anyone should be despondent about New Zealand. "Our growth rate, according to most of the economic commentators, is likely to be better over the next three years that the euro zone, the United States, Canada and Japan. The only country that's equal with us is Australia.
7.23pm: Asked on Close Up if the Government actually has a plan for growth, Prime Minister John Key says the plan firstly is to get the economy back in surplus. "Why does that matter? Well the answer is if you keep borrowing money and spend more than you earn, you eventually not only have to pay that back, but you have to pay it back with interest," he said.
6.50pm: Check out Nadine Chalmers-Ross' opinion piece on the Budget. She says it does nothing to address the ticking timebomb that is superannuation.
6.17pm: Christchurch Mayor Bob Parker says the city is grateful for what they have got but "we'd always like more". Parker said he understood it was not the time to be asking for more.
6.15pm: Dann says it is a politically astute Budget. "Generally speaking, what the Government has done here, is they have nipped and tucked here, pulled little bits from here and here. They haven't done any wholesale slash and burning... politically I can't see this hurting them too much."
6.14pm: ONE News political editor Corin Dann is describing the Government's Future Investment Fund, where money earned from partial-asset sales is put into other state assets like KiwiRail, as a "bit of a cute political move". He said it would help quell some of the anger over asset sales.
5.50: The Post-Primary Teachers' Association
calls today's Budget "a king hit" on state secondary schools,
parents, teachers and students.
"On top of the frontline teacher staffing cuts already signalled by
education minister Hekia Parata, schools will have to make do with
a derisively small operations grant increase, that does not even
cover inflation," the PPTA said.
5.19: The Rail and Maritime Transport Union has
come out swinging over the KiwiRail turnaround plan. In a release
issued by First union, it criticises the Government's announcement
that proceeds of the partial sale of Mighty River Power would form
part of the funding of the 2010
KiwiRail 10-year turnaround
plan.
Wayne Butson, RMTU General Secretary, said that selling
one asset to pay for another made no economic sense.
"Taking highly profitable assets and flogging them off for a one-off gain is short term thinking at its worst," he said.
5.05: The
Public Service
Association is not thrilled with the Budget - "it's simply
a money go-round which will deliver more pain for no gain" it said
in a statement.
"The government is obsessed with this arbitrary surplus target it
has set and it is essential public services that are being
sacrificed to get it," says PSA National Secretary Brenda
Pilott.
4.44: The Budget debate has been formally adjourned and Gerry Brownlee calls for Budget bills to now be considered under urgency.
4.38: United's Peter Dunne is on his feet but seems to have lost his audience, a wide shot reveals many, many empty seats. He is applauding the Government for its boldness in making long-term plans.
4.33: ONE News' Political Editor Corin Dann says there are not many losers in the Budget but smokers are being stung as are people claiming tax credits over their holiday homes. He applauds the spending on science and innovation saying it's the one area of spending that may actually create some jobs.
4.29: John Banks is copping nonstop heckling as he pushes the Act message saying Government spending is still too high. He's valiantly fighting on, constantly reminding his audience that there is actually a lot of money being spent which he calls "middle-class welfare".
4.24: Horticulture NZ says its disappointed
with Government's failure to take
biosecurity
seriously in today's Budget, despite the recent episode with the
Queensland fruit fly. The industry group says it's looking for
stronger investment in securing our borders.
4.15: Mana's
Hone Harawira says
New Zealanders have been conned into thinking a zero budget is what
we need to get back into the global economy but
austerity does not work - that's been proven
overseas. He agrees with the Government that it is "Zero Budget"
because it offers exactly that to Kiwis - zero.
3.56: Winston holds up a series of portraits including John Banks, Peter Dunne, Tau Henare and Te Ururoa Flavell saying they will be all be booted out of Parliament because the Budget will be so disappointing to voters.
3.49: Winston Peters proves he is still reliable for a soundbite saying it's the "Back to the Future" Budget. He says "I heard it back in 1991 when Ruth Richardson had "the Mother of all Budgets" and I'm hearing it again".
Peters mocks it as a "great" Budget: if you aren't a pensioner, an exporter, a person with a student loan or someone needing the final push to decide to move to Australia.
3.42: Ernst and Young tax partner Jo Doolan
slams the
tax changes in the Budget saying it
is "premised on New Zealanders stumping up with a lot more tax
without any clear growth agenda".
"We are so over the excuses of the global financial crisis, the
Canterbury earthquakes and the ongoing financial insecurity. These
are realities we live with," she said.
"Winston Churchill once said a country trying to tax itself into
prosperity was like someone standing in a bucket of water and
trying to lift themselves up by the handle. The tax measures
adopted to make the tax system fairer can be likened to the
Government trying to squeeze the last of the toothpaste from a
dangerously empty tube".
3.36: Greens' co-leader Russel Norman delivers a
predictable, measured - and rather boring - response to the Budget
saying it is hurting average Kiwis like pensioners being
forced to pay more for prescriptions.
"Budget 2012, with its mix of increased user pays charges, student
allowance cuts, bigger state school class sizes and increased costs
for early childhood education has simply made life a little more
expensive for those least able to afford it," he said.
He then attacks
asset sales, saying they will only
hurt the economy.
3.28: Mark Lister from Craigs Investment Partners said the Government's Budget is "safe and steady" and will not spook anyone in markets because it holds no surprises.
3.23: A "very sensible Budget for uncertain times" says Key as he runs through the spending for health - which did get the lion's share of "new money". He then goes on the front foot over class sizes saying "let's have the conversation on national television". Apparently it's "our chance to focus on quality outcomes for our kids" although how those outcomes are "lifted" is not entirely clear.
3.16: Shearer's speech failed to impress Ray Miller with the commentator saying it sounded like it could have been written a few days ago as it focused on everything that had already been annouced. Key continues to mock Labour to loud yelling from his fellow MPs and back-benchers.
3.11: John Key starts his speech for mocking
people living on "Planet Labour" where he says they imagine the
global financial crisis never happened, nor did the Christchurch
earthquakes. But he says "back in the real world" Key says Kiwis
understand the global crisis and Kiwis are saving and paying off
debt, just like the Government.
3.05: Peter Townsend from Canturbury's Chamber of
Commerce said he is pleased to see the Government's "verbal and
financial commitment" to the Christchurch rebuild.
3.01: Political commentator Raymond Miller told TVNZ it's a confusing mix of messages.
"I keep forgetting it is a zero Budget with all the money going around. It is a case of taking from the left hand and giving to the right," he said.
He said people will start asking if a surplus is worth sticking to for all the sacrifices.
2.52: Opposition Leader David Shearer starts speaking and immediately slams budget cuts for the police and Mfat job cuts. He reminds people that English has fallen short on all of his growth predictions for the last three years.
2:46: English is stressing the Government's continued commitment to rebuilding Christchurch . However, it is relying on a serious uptick in construction activity to deliver its new forecast economic growth goals. Westpac chief economist Dominick Stephens told TVNZ the projection was for an "extraordinary level" and he thinks it will be very difficult to acheive without pushing up inflation and therefore interest rates.
2:42: Health gets $435 million available for health spending with the biggest chunk of that - $358 million - being new money.
That will pay for better, faster cancer treatments, more elective surgeries, a boost for maternity services and the Plunket helpline and give more money to dementia care, support services for people with disabilities and free after-hours doctors' visits for under-sixes.
2:30: Rating agency Standard and Poor's confirms no change to New Zealand's credit rating after the Budget. NZ dollar fell slightly after - now below 75US cents.
2:23: Science gets $385 million of new money including a special institute for high-tech firms, a series of national science challenges, financial support for university-led research projects and boost to funding for science and engineering courses.
2.14: English commends Kiwis for finally lifting the national savings rate but says it needs to continue to get the economy back on track.
2.02: Finance Minister Bill English says his Budget will chart a path back to surplus by making savings in welfare, and driving down the costs of the public service.
2.00 The Government confirms a "zero budget"
with $4.4 billion in spending matched by the same amount in
spending and increased tax take.
Key points:
Zero Budget that stays on track for a small surplus by
2014/15.
10% increase in excise on cigarettes every year for the next four year.
No changes to KiwiSaver or Working For Families credits but "soft" enrolment plan for 2014 deferred.
KiwiSaver providers' fees and returns must use standardised formats so people can compare.
Tax credits removed - childcare and housekeeper, income under $9,880.
Tax loopholes closed for holiday homes, boats and livestock valuatons.
No extra money for Christchurch rebuild.
1.34: Auckland's Symonds Street has been closed off due to the "Blocade the Budget" protests.
Arena Williams, the President of the Auckland Universitys Students' Association said thousands of students will not be able to finish their degrees because of the changes to student allowances.
"The Minister hasn't made it clear, but it seems that around 5000 students in the system right now will find they're unable to get student allowances to finish their degrees," she said.
12.53: Auckland University students part of the "Blockade the Budget" activist group will gather at 1.00pm to strike against changes to loans and allowances.
12.33: David Shearer takes a swipe at Prime Minister John Key over new data showing exports are down by 17%.
12.12: Students from Wellington's Victoria University are marching to Parliament in protest of changes to loans and allowances.
12.00: Auckland's media lockup gets underway.
11.46: Budget 2012 will be revealed in just a couple of hours. Right now the New Zealand dollar is hovering around a six-month low. It recently traded at 75.24 cents against the greenback and analysts will be looking for any reaction in currency markets as Bill English reveals the exact details of his planned path back to surplus.
11.03: Another piece of poor economic news for the Government. Statistics NZ new figures show exports fell $799 million - or 17% - compared to April last year. Exports of dairy, meat, oil, logs and wood all showed "notable decreases" the government agency said. The trade balance for the month of April this year was a surplus of $355 million but annually, its running at a deficit of $541 million.
10.30: Wellington-based journalists and
economists are reluctantly surrendering their smartphones and
heading into the Beehive's Budget lock-up right now. They will get
all the Budget documents to pore over and are allowed to prepare
their articles and stories for on-air but can't communicate with
anyone outside the room.
ONE News' Political Editor Corin Dann will be ready with a snap
analysis on the TVNZ website right on 2pm.
9.39 : Online predictor says the Government will fail to return to surplus by 2015, according to nearly 7000 registered share traders.
9.03: ONE News Business Presenter Nadine Chalmers-Ross said the Government will continue to be a big spender in the New Zealand economy despite the zero Budget.
8.28: Labour MP Jacinda Ardern told
Breakfast this year's Budget needed to not only focus on
returning to surplus by 2015 but the unemployment rate and the
rising number of Kiwis moving to Australia. National MP Simon
Bridges says he is "optimistic" about the way the Budget will be
received and it's not a "slash and burn" Budget.
8.06: ONE News Political Editor Corin Dann said today's Budget will be unlike the austere budgets seen in economically troubled countries such as Greece as the Government will look to make small changes across the board instead of targeting big spending initiatives such as Working for Families.
7.31: Canterbury Chamber of Commerce chief executive Peter Townsend told Breakfast the Christchurch rebuild needs to be a top priority in this year's Budget as he expects it will boost New Zealand's GDP by 1% every year for at least the next three years.
7.21: Enviroschools national director Heidi Mardon told Breakfast the extra $8 million earmarked for the sustainability programme in this year's Budget will be used to train teachers and facilitate co-ordination between schools.
7.10: Victoria University students are planning to march to Parliament today to protest against proposed Budget changes to student loans and allowances.
6.35: ASB chief economist Nick Tuffley told Breakfast the New Zealand economy will still be running a deficit for the next six years and the Budget needs to reassure international creditors there is an economic recovery plan in place.
So far the Government has announced it will:
- Give $287.5 million over the next four years to get more beneficiaries into the workforce. This breaks down as a fresh injection of $81.5 million for Social Development, combined with around $200 million of savings to be found within the department.
The funding also includes a controversial $1million for a contraception scheme for beneficiaries.
- The disability sector is to get $144 million over four years, including $58 million to boost the number of people using residential support services, and $55 million for home services that enable disabled people to live at home.
Health Minister Tony Ryall said the funding will mean an extra 600 people will get help at home, although Labour says the funding will mean cut backs in other areas.
- $3 million a year will be spent helping to stop rheumatic fever and,
- $2 million a year will be set aside to teach school children about the environment.
The Government's changes to other areas like the tax system, early childhood education subsidies and tobacco prices will be unveiled at 2pm.