This submission to the Finance and Expenditure Committee highlights issues with the 2024 Budget Policy Statement.
Under the Public Finance Act 1989, the Budget Policy Statement (BPS) is meant to set out the government’s fiscal strategy, its fiscal objectives, its wellbeing objectives for New Zealanders, and how the forthcoming Budget will accord with these intentions. The CTU’s view is that the 2024 BPS fails to sufficiently meet some of these objectives.
The 2024 BPS provided little clarity on the operating allowances for the forecast period, set arbitrary targets for the total level of core Crown expenditure, did not clarify how the government’s tax cuts programme will be financed, and did not adequately show how the government’s “wellbeing” objectives relate to social, economic, environmental, and cultural wellbeing.
The submission also discusses New Zealand’s government debt position, and the need for government to use its borrowing capacity to help close the infrastructure deficit in New Zealand.