Ardern doubles down on Budget rules in face of criticism

Jacinda Ardern has doubled down on her commitment to the Budget Responsibility Rules. Photo by Lynn Grieveson in February.

Prime Minister Jacinda Ardern doubled down on the Budget responsibility rules at her post-cabinet press conference today.

The Prime Minister said that she would not be looking to review the rules before the next election, due to be held in 2020.

“I have no expectation of them changing at this present point in time and we’ve campaigned for them to hold over for the entire three years,” she said.

Asked whether she would review the rules going into the next election, she again expressed confidence in the Government’s ability to balance investment commitments with the rules, which have been described as a ‘fiscal straitjacket’.

“It is as important for us to make sure we meet the competing needs that we have around strong services for health and education as it is to also make sure that we keep the books in good shape, that we are ready for any economic shocks we might experience as a small isolated vulnerable nation. That is what a competent Government does and that is what we are doing,” she said.

Ardern has come under increased pressure to loosen the Budget Responsibility Rules, which have again been thrust into the spotlight after announced it would break its first election commitment. Health Minister David Clark announced this weekend that Labour’s promise to reduce GP visits by $10 from July 1 will now be phased in over the next three years.

The Budget Responsibility rules have a little-known carve out, which allows Labour and the Greens to reassess them before going into the next election.

Speaking to, Green Party co-Leader James Shaw said that it was always the intention to review the Budget Responsibility Rules during the Government’s first term.

“We will want to review those closer to the election,” Shaw said.

“We said that we would stick through them in this parliamentary term and we might end up end up sticking with them in the next parliamentary term,” he said.

This makes it even more likely the Government will look into novel forms of financing for infrastructure, like SPVs, which Transport Minister Phil Twyford has discussed in relation to transport infrastructure.