Maintaining the illusion of growth - the Budget

Budget 2015: What you need to know

Radio NZ,

21 May, 2015

Key points from the Government's 2015 Budget include a significant boost to benefit payments for families, a deficit and the end of the KiwiSaver kickstart

Prime Minister John Key and Finance Minister Bill English on the bridge-run to the debating chamber for the formal presentation of the Budget.   Photo: RNZ / Alexander Robertson

Surplus versus deficit

The Budget is forecasting a $684 million deficit for 2014/2015, moving to a surplus of $176 million in 2015/2016, growing to $3.6 billion in 2018/2019.

Economic growth is forecast to grow by an average 2.8 percent during the next four years.

Average wages are expected to rise by $7000 to $63,000 a year by mid-2019.

Unemployment is forecast to fall below 5 percent next year.

New spending on child poverty

Beneficiary families will receive an extra $25 a week, after tax, from 1 April 2016 - the centrepiece of a $240 million a year 'hardship reduction' package.

This will be the first time in 43 years that rates have been increased outside of annual adjustments for inflation.

Solo parents who receive a benefit will need to be available for work when their youngest child turns three - two years earlier than the current requirement.

Non-beneficiary families with low incomes will receive increased payments through Working for Families, and more childcare support.rt.

Tertiary Education, Skills and Employment Minister Steven Joyce (left), Social Development Minister Paula Bennett and Finance Minister Bill English arrive at the lock-up at Banquet Hall, Parliament.

Photo: RNZ / Alexander Robertson

Savings on KiwiSaver

The $1000 kick-start for starting a KiwiSaver account is gone - from 2pm today.

As RNZ Political Editor Brent Edwards put it today, Finance Minister Bill English generally tries to find savings to balance spending increases - which is where this may fit in.

The Government will still match savings up to $521 per person per year.

Child support penalties scrapped

The Budget also scraps $1.7 billion of penalties owed for child support.

Revenue Minister Todd McClay said child support debt was currently $3.2 billion and rising, and only about $700 million of that was actual child support.

He said scrapping the penalties would encourage parents to pay what they actually owed.

In studio: Radio New Zealand's education correspondent John Gerritsen, host Susie Ferguson and economics correspondent Patrick O'Meara

Photo: RNZ

Education: "Slim pickings"

"Slim pickings", as RNZ Education Correspondent John Gerritsen put it - with no extra money for most tertiary institutions and all early childhood service.

Schools will get an operations funding increase of just 1 percent.

However, as outlined in an earlier announcement, the Government will spend $243 million over four years for seven new schools and expansion at others.

Health: "Flat-lining"

The Government will spend $76 million of new money on hospice care for the terminally ill over the next four years.

It has already announced $98 million over four years for more elective surgery.

There is no funding to take a bowel cancer screening programme in Auckland nation-wide - although funding for the scheme in Auckland will continue.

Overall, year-on-year, the health sector budget has increased by just $311 million.

From the NZ Herald

Budget 2015: The give-and-take Budget

Here is the Washington Post’s take on it

New Zealand fails to deliver promised budget surplus