PQ 6. Government Financial Position—Return to Surplus [Sitting date: 09 December 2014. Volume:702;Page:5. Text is subject to correction.]

6. GRANT ROBERTSON (Labour—Wellington Central) to the Minister of Finance : Does he stand by his statement that he is not going to do “anything sort of random and unpredictable with government spending” in order to get to surplus in 2014/15?

Hon BILL ENGLISH (Minister of Finance): Yes. In particular I stand by my full statement, which was: “we believe the strength of the economy and constrained government spending can deliver a surplus when the final accounts are published late next year. The Government has a track record of sticking to our spending plans to protect the most vulnerable and to provide certainty for public services. We won’t be changing that approach.”

Grant Robertson : If he is not on track to make surplus in 6 months’ time, what will he do that is not random and unpredictable to fulfil his promise to post a meaningful surplus in 2014/15?

Hon BILL ENGLISH : The member will just have to wait and see how much on or off track we currently are. But I can reassure the member that if a forecast, for instance, showed that we might not reach a surplus, we are not going to overreact to that forecast and do what he would like us to do, which is go around cutting services to people who really need them.

Grant Robertson : Is it random and unpredictable to hike up ACC premiums simply to achieve a surplus on paper, and will he rule out doing that again, as he did in Budget 2014?

Hon BILL ENGLISH : Actually, ACC levies have dropped. I think that in the next 12 months we will collect about a billion dollars less than 3 or 4 years ago. Every New Zealand business and taxpayer benefits from that, and given the progress we are making both with ACC and the Government books, there is potential for further reductions over the next 2 or 3 years. We look forward to the opportunity to deliver those.

Grant Robertson : Is it random and unpredictable to include in the Budget an unprecedented loan for a major transport project simply in order to give the impression of a surplus in the Government’s books, and will he rule out doing that again, as he did in Budget 2014?

Hon BILL ENGLISH : I am not exactly sure what the member is referring to, but there have been some financing arrangements entered into with the New Zealand Transport Agency precisely to enable the kinds of projects that the member, the Labour Party, and the Greens want to see happen, and we will certainly continue with our programme of investment and infrastructure. I know it is frustrating to the member, but even under quite tight fiscal constraints, the Government has been able to deliver a very extensive infrastructure investment programme, more schools and hospitals, and better value for public services, and we expect to keep doing that.

Hon Ruth Dyson : Is it random and unpredictable to remove $500 million from the original allocated budget provision for horizontal infrastructure rebuild in Canterbury, and does he now accept that there is not sufficient funding for the required work?

Hon BILL ENGLISH : Again, on the detail of that matter, the Minister for Canterbury Earthquake Recovery could fill it in. There has been ongoing discussion about what it was going to cost for the horizontal infrastructure, because at the start you could not see what damage had been done. We now have a growing understanding of the finances of Christchurch City Council, and we will continue negotiations, which are bound to be tense, between the Government and Christchurch City about a fair share of the burden. I might say that the taxpayers’ contribution to the earthquake recovery has now reached $16 billion, which has been generous and effective, and we want to make sure that Christchurch City can come through this whole process in sound financial shape.

Hon Ruth Dyson : What business case, if any, has been made to him for the anchor projects in the central business district of Christchurch City, and when will they be made available to the public?

Hon BILL ENGLISH : Again, I could not be specific about where each one is in the pipeline, but I can say that the Minister and the Canterbury Earthquake Recovery Authority are prosecuting, as quickly as they can, the process of getting the facilities in the central business district rebuilt, and the Government will consider those business cases as they come forward. We are certainly trying to move as fast as is reasonable to get Christchurch rebuilt, but also ensure that we follow good process because it is taxpayers’ money that is involved.

ENDS

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