For the Government, today’s Budget is about consolidating the gains from its policies to date and making the most of the opportunities from a growing economy. We call this setting a glide path to prosperity.
The twin focuses of this Budget are early interventions in the health, education and justice areas to achieve significant long term economic and social outcomes and creating and sustaining a favourable business environment, with additional investment in infrastructure, R&D and skills, and through prudent debt and fiscal management by Government.
Many of the tough decisions, including reining in Government spending and some bold tax reform measures, were taken at the start of its first term. The Government has also had to deal with a few unexpected challenges, in the form of the Canterbury earthquakes and the rebuild. They’ve navigated these challenges well.
In the main, the Government will be satisfied with its approach to date and today has shown it is continuing with its previous direction. Budget 2014 shows growth, spending, tax and debt are all on the right track with a return to surplus in 2014/15 achieved. There is additional funding in the Budget for core areas, like health and education and infrastructure, but this is within the Government’s restraints on new spending each year.
This is a Budget for the times, not election year largess.