Finance Minister Grant Robertson continues to dampen down expectations for his first Budget, due on May 17, saying yesterday nine years of neglect cannot be fixed in one go.
The Government's commitments were for three years of Government and beyond.
“This means some things will be phased or will not start until next year. But the commitments of our coalition and confidence and supply agreements, and Speech from the Throne stand.”
Health Minister David Clark on Sunday indicated cheaper GP visits would be delayed, breaking a key election promise.
Under Labour's policy, New Zealanders with a community services card would be charged $8 to see the doctor - $10 cheaper than National's proposed $18 fee. Charges for teens would reduce from $12 to $2, and under-13s would still see the doctor for free.
The policy was due to come in on July 1. Labour claimed its wide-sweeping policy would cost $259 million a year, while, at the same time, spending more than $300 M this year on its free fees for tertiary education.
The cheaper GP visits are unlikely to be the only disappointments contained in Budget 2018, being delivered at 2 pm on May 17.
Robertson said it was time for a better balance in the economy to reflect the desires of New Zealanders to live up to the values and principles of fairness and equality of opportunity.
One of the first things Robertson did as Finance Minister was ask ministerial colleagues to look through their budgets for spending that could be better invested elsewhere. Within five months, the Government had been able to find different priorities for about $700 M of funding over the next four years.
“Combined with our moves to crack down on speculators, tax dodgers and ensuring multinationals pay their fair share of tax, we have freed up $1.4 billion worth of funding.”
Every responsible government should be reviewing policies and spending regularly to ensure taxpayers were getting the best value for money and that policies would benefit the greatest number of people, he said.
One lesson he could draw from his first Budget process was a lot of time was spent debating new proposals while comparatively little time was spent on the substantial baseline allocations.
That was why, in the next phase of the finding different priorities exercise, Robertson would work with ministers to take a further look into their allocations to ensure the best value for money was received from the investments the Government made on behalf of all New Zealanders.
During the next two weeks, and on Budget Day, every investment announced was fully accounted for within the operating and capital allowances set with Budget Responsibility Rules in mind.
The Taxpayers Union congratulated Robertson for sticking to the Budget Responsibility Rules in face of criticism.
Executive director Jordan Williams said using debt to fund new spending would obscure the real cost to the public, and pass the buck on to future generations already set to be taxed hard to pay for increasing superannuation costs.
It would leave New Zealand ill-prepared with another natural disaster or economic crash.
“The new Government's increased tax take has made it considerably easier for the Government to stick to the Budget Rules, but taxpayers will only tolerate so much revenue grabbing. The challenge Robertson faces in the coming Budget is to cut wasteful expenditure, in order to avoid even more tax on hard-working New Zealanders.”
*Dene Mackenzie is business and political editor of the Otago Daily Times.