December 15, 2025 • 5 mins
The Finance Minister's still aiming for a surplus this decade, despite today's bleak economic news.
Treasury's Half Year Economic and Fiscal Update shows more delay to getting the books back to black.
The deficit's expected to deepen more to a high of $16.9 billion and not narrow to $60 million dollars until 2029-30.
Nicola Willis says a 2029 surplus is very achievable.
"What that will take is just a small revision to the growth upwards, combined with fiscal discipline. And those are two things that our Government is committed to."
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Speaker 1 (00:09):
You're listening to a podcast from newstalk ZEDB. Follow this
and our wide range of podcasts now on iHeartRadio.
Speaker 2 (00:16):
First, the government's going to stay in debt longer than
it thought it would back in May. This is the
hayfer that's come out today. The surplus delayed again for
another year out twenty thirty. We won't start paying down
our debt in this country until then. Growth is coming on,
but slower than expected. So point back points six percent
four twenty four to twenty five, Ford three point three
(00:38):
for twenty five twenty six and three percent for twenty
six twenty seven, Tariffs, inflation, tourism, numbers, population, all contributing factors.
Nicola Willis is the Finance Minister.
Speaker 3 (00:49):
Good evening, Good evening.
Speaker 2 (00:52):
Do you take responsibility for our lackluster growth?
Speaker 3 (00:56):
I take responsibility for turning it around, And what we
have shared in today's forecasts is accelerating growth next year,
low inflation growth throughout the forecast period, two hundred and
seventy thousand jobs being created, low interest rates, in all
the conditions for New Zealanders to get ahead.
Speaker 2 (01:13):
Labour wants you to take responsibility for the fact that
we haven't had significant or meaningful growth in the last year.
You've been the Minister of Growth all that time. Do
you take accountability well?
Speaker 3 (01:25):
In Treasury's assessment, the effect of Donald Trump's tariff announcement
in April on our economy was significant, and of course
it came off the back of what was already a
difficult recovery following Labour's period of sky high inflation and
the very high interest rates that were used to arrest that.
It's significant that even in the midst of that, the
(01:45):
government has taken pro growth measures, including, for example, the
investment boost tax policy to encourage business investment, moves to
replace the Resource Management Act, to cap rates, to ensure
that we can deliver more housing, to boost tourism. We've
been at it as a government taking pro growth measures
and maintaining fiscal discipline, which is something that you want
(02:08):
here Labor talking about.
Speaker 2 (02:10):
So when it comes to pushing the surplus out and
you know this says basically you won't achieve it when
that you have the fiscal intention that you want to
achieve it, but you're saying you will stick to twenty
twenty nine not twenty thirty. How do you do that
when the books say you can't.
Speaker 3 (02:24):
Well, A forecasts do show us reaching a surplus over
this period, and the question is whether we get there
in twenty nine or twenty thirty. The twenty nine deficit
that's being forecast relative is very small, and so I
remain confident that we can get there. What that will
take is just a small revision to the growth upwards
(02:47):
combined with fiscal discipline, and those are two things that
our government has committed to. So we're sticking to our
surplus target.
Speaker 2 (02:53):
You've committed to keeping new borrowing to two point four
billion dollars next year. Given we're not bringing in as
much cash as we had hoped, would it not be
prudent to cut that figure further?
Speaker 3 (03:04):
No, because that is what is required to ensure we
can make the investment months needed to increase health service delivery,
to ensure our schools have the resources they need to
pay their teachers and deliver learning, that our police have
the resources they need on the front line, and to
continue our build and defense force capability. It's a very
small number, though relative to recent budgets. Ran to give
(03:28):
you a sense of context, in the twenty twenty two budget,
under the previous government, New operating spending was nine point
seven billion a year. We're proposing two point four. So
this is a much more modest level of spending than
was the case under the previous government. And we can
achieve it by continuing our rigor around, constantly finding savings
(03:48):
and efficiency.
Speaker 2 (03:49):
There's a vicious cycle thing that happens here, isn't there
When the economy does bad, people leave. When people leave,
we can't tax them. Fifty thousand fewer taxpayers in the
country than expect it. How do you turn that? How
long does it take to turn that around?
Speaker 3 (04:01):
Well, I was really pleased to see the most recent
update from Stats which showed the number of people leaving
is actually the lowest in three years, and so that
is starting to turn around. On the latest stats, the
census data updated the underlying assumptions on population, and yes
that is slightly lower. But I'm confident that as our
economy recovers, as there are more jobs available which is
(04:23):
being forecast, as there's more growth and comes arising, that
more new Zealanders will see they can have a great
future here and they will choose to stay.
Speaker 2 (04:31):
You've said in your speech today, there are a lot
of things the government can't control.
Speaker 3 (04:37):
Do you?
Speaker 2 (04:37):
As a party and labor both need to be a
little more honest with New Zealanders about what it is
you actually can fix in what you can't, because I
feel like we're getting taken for a ride. One of
you says we will get we will fix this, the
other says we will fix that, and actually then you
turn around when the books come out and say it's
not fixable, it's not in our hands.
Speaker 3 (04:57):
Well, I disagree with that. I do think there is
a lot that we can control. We can control our
discretionary spending decisions and the impact that has on inflation
therefore interest rates. I stand by our track record in
that regard. We can control whether the policies we deliver
a pro growth or anti growth. And in that sense,
(05:19):
we've said yes to replacing the Resource Management Act. We've
said yes to tax relief, we've said yes to backing businesses,
which are all the things consistent with supporting growth in
this economy. On the other hand, my opponents on the
other side consistently say no to those things, and so
they have to take responsibility for those positions.
Speaker 2 (05:39):
Minister, appreciate your time. That's Nicola Willis's Finance Minister.
Speaker 1 (05:42):
For more from News Talks B Listen live on air
or online, and keep our shows with you wherever you
go with our podcasts on iHeartRadio
You're listening to a podcast from newstalk ZEDB. Follow this
and our wide range of podcasts now on iHeartRadio.
Speaker 2 (00:16):
First, the government's going to stay in debt longer than
it thought it would back in May. This is the
hayfer that's come out today. The surplus delayed again for
another year out twenty thirty. We won't start paying down
our debt in this country until then. Growth is coming on,
but slower than expected. So point back points six percent
four twenty four to twenty five, Ford three point three
(00:38):
for twenty five twenty six and three percent for twenty
six twenty seven, Tariffs, inflation, tourism, numbers, population, all contributing factors.
Nicola Willis is the Finance Minister.
Speaker 3 (00:49):
Good evening, Good evening.
Speaker 2 (00:52):
Do you take responsibility for our lackluster growth?
Speaker 3 (00:56):
I take responsibility for turning it around, And what we
have shared in today's forecasts is accelerating growth next year,
low inflation growth throughout the forecast period, two hundred and
seventy thousand jobs being created, low interest rates, in all
the conditions for New Zealanders to get ahead.
Speaker 2 (01:13):
Labour wants you to take responsibility for the fact that
we haven't had significant or meaningful growth in the last year.
You've been the Minister of Growth all that time. Do
you take accountability well?
Speaker 3 (01:25):
In Treasury's assessment, the effect of Donald Trump's tariff announcement
in April on our economy was significant, and of course
it came off the back of what was already a
difficult recovery following Labour's period of sky high inflation and
the very high interest rates that were used to arrest that.
It's significant that even in the midst of that, the
(01:45):
government has taken pro growth measures, including, for example, the
investment boost tax policy to encourage business investment, moves to
replace the Resource Management Act, to cap rates, to ensure
that we can deliver more housing, to boost tourism. We've
been at it as a government taking pro growth measures
and maintaining fiscal discipline, which is something that you want
(02:08):
here Labor talking about.
Speaker 2 (02:10):
So when it comes to pushing the surplus out and
you know this says basically you won't achieve it when
that you have the fiscal intention that you want to
achieve it, but you're saying you will stick to twenty
twenty nine not twenty thirty. How do you do that
when the books say you can't.
Speaker 3 (02:24):
Well, A forecasts do show us reaching a surplus over
this period, and the question is whether we get there
in twenty nine or twenty thirty. The twenty nine deficit
that's being forecast relative is very small, and so I
remain confident that we can get there. What that will
take is just a small revision to the growth upwards
(02:47):
combined with fiscal discipline, and those are two things that
our government has committed to. So we're sticking to our
surplus target.
Speaker 2 (02:53):
You've committed to keeping new borrowing to two point four
billion dollars next year. Given we're not bringing in as
much cash as we had hoped, would it not be
prudent to cut that figure further?
Speaker 3 (03:04):
No, because that is what is required to ensure we
can make the investment months needed to increase health service delivery,
to ensure our schools have the resources they need to
pay their teachers and deliver learning, that our police have
the resources they need on the front line, and to
continue our build and defense force capability. It's a very
small number, though relative to recent budgets. Ran to give
(03:28):
you a sense of context, in the twenty twenty two budget,
under the previous government, New operating spending was nine point
seven billion a year. We're proposing two point four. So
this is a much more modest level of spending than
was the case under the previous government. And we can
achieve it by continuing our rigor around, constantly finding savings
(03:48):
and efficiency.
Speaker 2 (03:49):
There's a vicious cycle thing that happens here, isn't there
When the economy does bad, people leave. When people leave,
we can't tax them. Fifty thousand fewer taxpayers in the
country than expect it. How do you turn that? How
long does it take to turn that around?
Speaker 3 (04:01):
Well, I was really pleased to see the most recent
update from Stats which showed the number of people leaving
is actually the lowest in three years, and so that
is starting to turn around. On the latest stats, the
census data updated the underlying assumptions on population, and yes
that is slightly lower. But I'm confident that as our
economy recovers, as there are more jobs available which is
(04:23):
being forecast, as there's more growth and comes arising, that
more new Zealanders will see they can have a great
future here and they will choose to stay.
Speaker 2 (04:31):
You've said in your speech today, there are a lot
of things the government can't control.
Speaker 3 (04:37):
Do you?
Speaker 2 (04:37):
As a party and labor both need to be a
little more honest with New Zealanders about what it is
you actually can fix in what you can't, because I
feel like we're getting taken for a ride. One of
you says we will get we will fix this, the
other says we will fix that, and actually then you
turn around when the books come out and say it's
not fixable, it's not in our hands.
Speaker 3 (04:57):
Well, I disagree with that. I do think there is
a lot that we can control. We can control our
discretionary spending decisions and the impact that has on inflation
therefore interest rates. I stand by our track record in
that regard. We can control whether the policies we deliver
a pro growth or anti growth. And in that sense,
(05:19):
we've said yes to replacing the Resource Management Act. We've
said yes to tax relief, we've said yes to backing businesses,
which are all the things consistent with supporting growth in
this economy. On the other hand, my opponents on the
other side consistently say no to those things, and so
they have to take responsibility for those positions.
Speaker 2 (05:39):
Minister, appreciate your time. That's Nicola Willis's Finance Minister.
Speaker 1 (05:42):
For more from News Talks B Listen live on air
or online, and keep our shows with you wherever you
go with our podcasts on iHeartRadio
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