Nicola Willis: Finance Minister says more details will come regarding billion dollar pre-Budget allocation

The Finance Minister is promising more detail is coming regarding a billion dollar pre-Budget allocation.

The funding's been labelled 'secret spending' by Labour.

Nicola Willis says this reflects the Government's provision for a potential capital to operating forecast change in transport spend - that can be subject to future decisions.

"That is literally what it is, and we will be taking policy decisions on that over the next few weeks and months." 

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Episode Transcript

Speaker 1 (00:00):
Good evening and welcome to the program. She's all go
on the south coast of Wellington right now, so stay
safe and joining us for Wellington. It's welcome to the
Finance minister Nicola will Us.

Speaker 2 (00:09):
Hello Nicola, Hi Andrew.

Speaker 1 (00:11):
Very good to see you on Friday night at Matt
Bellinger at the Holy Trinity Cathedral, letting your hair down
and enjoying some very fine music.

Speaker 2 (00:18):
Indeed, yeah, and I got to catch up with my
brother and my brother in law, so it was a
good night.

Speaker 1 (00:24):
Was Now what's with that one billion dollars pre allocated
in the budget? The Prime Minister this morning said it
had something to do with provisions for accounting. Jordan Williams
reckons it's solar. I've got someone texting me right now
asking if it's a bribe for Winston Peters. So what
is it?

Speaker 2 (00:39):
It is none of the above, and I'm afraid it's
very boring. So are you ready for the boring explanation please?
It reflects our provision for a potential capital to operating
forecast change and transport spend that is subject to future
decisions and may or may not eventuate. So that is
literally what it is, and we will be taking losty

(01:00):
decisions on that over the next few weeks and months,
will be very clear about what those decisions are, so
that by the pre election update when we open up
the books, we can be clear whether that money is
in fact required or not.

Speaker 1 (01:12):
So it's for a road, what road.

Speaker 2 (01:15):
No, it's about the forecasting of transport spending and how
much of that will be capital spending and how much
of that will be operating spending. So what we did
at the budget was we were transparent that some money
that had previously been provisioned as capital spending may need
to be seen as operating spending, so we provisioned for
that against the operating allowance. However, this all came up

(01:38):
quite late in the budget process, and so we want
to work through a few more questions and issues before
we make that allocation permanent.

Speaker 1 (01:46):
And is it because you're sort of negotiating public private
partnerships or go through you might have to actually put
some of your own money in.

Speaker 2 (01:54):
No, No, it's literally that we've been going through the
books of the land transport fun Some issues came up
late in the piece and so we wanted to be
upfront about that.

Speaker 1 (02:04):
It's only a couple of weeks since the budget. Why
can you have said it then? Because it is a
transparency issue, and if Labor did this, you'd jump up
and down about holes and a lack of transparency.

Speaker 2 (02:15):
Well, no, we were completely transparent, which is that we
provisioned for it for exactly that reason. I'd just like
to give you a bit of context. Andrew and their
pre election update in twenty twenty three, Labor had pre
allocated more than half of the twenty budget twenty twenty
four budget and about that much of the following two budgets.

(02:37):
They had allocated almost nine billion dollars worth of spending
from the budget twenty four budget. That is not what
is happening here. It's a very small pre allocation relative
to that, and as I say, we're intending to take
further work on that, So it may be that we
unwind some of it, but either way will be completely upfront.

(02:59):
You've changed those costs.

Speaker 1 (03:00):
Look how you've changed being in this job. You say
it's a very small allocation. It's one billion dollars your reference.

Speaker 2 (03:08):
Nine billion dollars, okay, Well, compared to Labour's nine billion
dollars that they pre allocated. I just think it's a
little bit hypocritical in arms about it.

Speaker 1 (03:18):
So fresh from Labour saying, well, what's happening with this
dodgy one billion dollars which you've told us the boring
reason for it, they now say you've got four hundred
and fifty million dollars set aside for the Middle East
crisis if it escalates, and they're calling that a slush
fund available to you all the way up to the election.
Is that a fair point?

Speaker 2 (03:37):
At the opposite is the case? They're absolutely wrong. What
we have done is we've said we acknowledge that events
in the Middle East are beyond our control. It is
possible that over the next twelve months fuel prices could
spike again, or they could stay a lot higher for longer.
If that happens, we acknowledge that we may consider further temporary,

(04:00):
timely and targeted responses. So rather than wish that away
and pretend it would never happen and then just wrap
it up on the debt, instead, we took the prudent
step of provisioning for that in our budget. This is
us being really upfront, really transparent. It's something we hope
won't happen, hope is not a strategy, so we've prepared accordingly.

Speaker 1 (04:23):
So money that has been targeted, if you need it,
it's nearly half a billion dollars, it must be something
because you've costed it. What are you imagining might be happening.

Speaker 2 (04:33):
It's no, it's us planning for the worst case scenario,
which would be fuel prices going higher again and staying
higher for longer. What would happen to a side funding, Well,
at that point we would consider temporary and targeted measures
to respond to that. And you've seen the sorts of
things that we've done already. So, for example, we provided

(04:55):
that increased to the in work text credit for low
income working families. We provided additional support for the mileage
for those health and community workers who have to travel
around in their cars for work. We've provided additional funding
for a number of government agencies who faced fuel costs.
So those are the responses we've already taken that have
already been budgeted for. But we're acknowledging, Look, if there

(05:17):
was another big spike, we might need access to some
funding rather than just do a labor and wrack that
on the debt. We've provisioned for that.

Speaker 1 (05:25):
All right, now, mister Luxeon. I went over to see
mister Alberines and they seem to have a jolly good
old time and they seem to get on quite well,
and there was a lot of to and throw, and
of course there was some talk that when you attacked
Australia on Labour's tax reform that that was a bit
vicious and we're just a little bit heavy. But Anthony
Alberanese called it bentter. So was it bnter or did

(05:47):
you have a real gripe?

Speaker 2 (05:49):
Yeah? Look, Prominister Albanesi and Prome, Minister Luxe and get
along very well. And I get along very well with
my counterpart Jim Charmers as well. We've got a healthy
rivalry Australia New Zealand, just as it is on the
sports field, so it is between us as countries. You know,
the Aussies come here and they compete for our police
and our skilled workers from time to time. Equally, I've

(06:11):
been putting out the welcome Matt saying, look, if you
want to do a startup in New Zealand, good news
is no capital gains tax here, so come here to
create your jobs and then comes we'd love to have you.
And as Anthony Alberizi acknowledges that kind of banter is
all in the spirit of a healthy competitive relationship.

Speaker 1 (06:28):
And let's just get back, of course, to the fuel crisis,
which is still the dominant force in the world's economy.
You've got an additional ninety three million liters of diesel
storage at Marson Point.

Speaker 2 (06:39):
Yeah, that's right, and we have fuel and a tanker
already on its way. It's less than a fortnight away
to fill up those tankers and then another shipment due
in July, and that's to provide an additional nine days
worth of fuel, so that we've got a bigger buffer.
If everything took a turn for the worst and we
were thinking there were challenges get diesel, that would mean

(07:01):
that we had a bigger reserve here in New Zealand. Again,
it's us as a government being prudent. We hope for
the best, we plan for the worst.

Speaker 1 (07:08):
All right, And Nicola, I'll see you is another gig.
I'm going to leave on Thomas on Tuesday, so I'll
look out for you if you're there letting your head down.

Speaker 2 (07:15):
Well, I'm afraid me going to a gig is a
rear review. But I really hope you enjoyed it.

Speaker 1 (07:19):
Thank you so much. And that is our Finance Minister,
that is Nikola Willis.

Speaker 2 (07:23):
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