Fonterra's Chairman John Wilson stepped down for health reasons, potentially re-opening a debate about Fonterra's future structure. Various community leaders and economists called on the Government to relax its debt limits to invest in infrastructure, but Winston Peters and Grant Robertson say they aren't planning any relaxation until after the 2020 election.
Public debt is back in the spotlight with Opposition accusations of a 'toilet tax'. Thomas Coughlan finds something's off within the debate over off balance sheet borrowing.
Tempers flared in Wellington on Wednesday as Grant Robertson fronted up to a select committee to defend his first Budget, but the dispute yet again highlighted the political positioning of both parties over debt.
Treasury reported the Government's surplus was $910 million better than expected in the nine months to March 2018, largely because solid economic growth drove higher corporate tax receipts, higher income taxes and higher GST receipts. Treasury said tax revenues were $1.1 billion better than it forecast in December and this was expected to hold for the rest of the financial year.
The Government is looking at new and novel ways of financing infrastructure without breaking its strict budget responsibility rules.
8 things that mattered this week
The last week has seen the Labour-led Government confirm it is not going to deviate far from National’s fiscal policies, and will continue to fund public services at similar levels. How do we explain this insistence on fiscal conservatism in the face of clear and urgent need, and growing calls for change? Victoria University’s Dr Bryce Edwards argues that the Finance Minister and his colleagues have become so immersed in pragmatic electoral calculations they’ve lost touch with the shift away from orthodox economics.
The new Government's self-imposed debt target is limiting its ability to borrow to fix growing infrastructure deficits. Bernard Hickey reports it will be forced into fancy and expensive financing tools such as PPPs and infrastructure bonds.
In today's email we check out the size of the kitchen sink finance minister Steven Joyce may lob at the electorate with the upcoming Budget.
The Government has lowered its target for the debt to GDP ratio, effectively shifting one of the anchors of its economic policy. Bernard Hickey looks at why the Government made the change and how it might restrict its choices over the long run around tax cuts, infrastructure spending and social spending.