A combination of slightly higher than expected revenue and lower than
forecast spending left the Government’s operating deficit before gains
and losses almost $400 million smaller than expected at $1.75 billion in
the four months to 31 October.
“The result continues a trend over the past year of the Government’s fiscal results exceeding forecasts, as we remain on track to return to surplus in 2014/15,” Finance Minister Bill English says.
“As the Prime Minister and I have said, getting back to surplus remains a significant challenge. Although the economy is improving and revenue is increasing, there are a lot of other large influences on the Government’s books. These include a growing prominence of financial assets and liabilities, which expose taxpayers to greater volatility.”
The Half Year Update on 17 December will include a full set of new forecasts for both the Government’s books and the economy.
“The accompanying Budget Policy Statement will also confirm that the Government will continue to responsibly manage its own finances and the economy,” Mr English says.
In the four months to October, core Crown tax revenue at $19.34 billion was around $200 million above Budget forecasts. Core Crown spending was about $250 million lower than forecast at $23.32 billion.
“The Government will continue focusing on getting better results from resolving social issues to improve New Zealanders’ lives. This will also deliver better value from government spending in justice, education, welfare and health,” Mr English says.
Continued strength in sharemarkets was reflected in the ACC and New Zealand Super Fund investment portfolios, leaving an operating surplus for the four months of $1.83 billion - almost $3.3 billion better than forecast.
The Government has received the Constitutional Advisory Panel’s final report which recommends that the conversation about New Zealand’s constitutional arrangements should continue, Deputy Prime Minister Bill English and Maori Affairs Minister Pita Sharples say.
The 12-member independent panel spent more than six months having a conversation with New Zealanders about our constitutional arrangements. These included the role of the Treaty of Waitangi, Maori representation in Parliament and local government, the Bill of Rights Act and other matters.
“Alongside meetings and hui, the panel received 5259 written submissions indicating interest in the nation’s constitutional framework, although there is no sense of an urgent or widespread desire for change,” Mr English says. “The Government will now consider the CAP’s report and recommendations, including how the conversation might continue.”
Dr Sharples said he was pleased the panel considered a range of fundamental elements of New Zealand’s constitutional arrangements, including Te Tiriti o Waitangi.
“The Treaty is fundamental to our sense of nationhood, and to who we are as New Zealanders. The question is how we translate that in to increased participation and representation of Maori in our democracy. Those matters will be considered as part of the Government’s response to this report.”
Mr English and Dr Sharples thanked the panel members for their work.
“As the panel itself says, there has been a range of views expressed reflecting the diversity of New Zealand and we appreciate the care that has been taken to ensure New Zealanders’ voices have been heard.”
Copies of the report can be found at www.ourconstitution.org.nz
The managed wind-down of Learning Media has been completed, Finance
Minister Bill English and Education Minister Hekia Parata say.
“The Learning Media board has managed the wind down in a way that provided certainty of provision for publications such as the School Journal, as well as ensuring staff were treated fairly,” Mr English says.
Ms Parata says she is, “pleased that a New Zealand owned provider, Lift Education, has taken on the publication of the School Journal and Ready to Read series, and that other providers have picked up the other resources.”
Around $4 million of Government support has been provided to Learning Media since early September to enable an orderly wind-down to occur.
“Government contributions have meant all staff have been paid their entitlements in full,” Ms Parata says.
“The board and the Ministry of Education have worked hard to provide transitions for staff, with many moving to the new suppliers and some also moving to the Ministry.”
As a company in its own right, Learning Media’s debts were not guaranteed by the Government.
“Unfortunately, the company’s financial situation meant that its largest creditors, including its bank, have not been paid in full,” Mr English says.
“Learning Media highlights the risks the Government and taxpayers take in owning commercial assets.”
The Half Year Economic and Fiscal Update this month will revise the
estimated range of proceeds from the Government’s share offer programme
to $4.6 billion - $5 billion, Finance Minister Bill English says.
“The revised assumption of share sale proceeds is based on Solid Energy clearly being in no position to be sold anytime soon, and it takes account of other developments and the results of share offers to date,” he told Parliament’s Finance and Expenditure Committee today.
“This is cash the Treasury expects taxpayers to receive, which can be invested in new priority public assets without the Government having to borrow from overseas lenders.”
The Treasury’s early estimates of share offer proceeds in 2011 were between $5 billion and $7 billion, based on five companies being in the programme – including Solid Energy. And, for the purposes of forecasting, the Treasury has assumed sale receipts would be at the $6 billion mid-point of the range.
Excluding Solid Energy from the programme, those earlier assumptions put the estimated proceeds from the share programme at between $4.4 billion and $6.1 billion.
“So we are on track to be within that range,” Mr English says.
The sale of minority stakes in Mighty River Power, Meridian Energy and Air New Zealand has raised almost $4 billion for taxpayers. Genesis Energy’s share offer is planned for the first half of next year, subject to market conditions.
“The share offers are generating billions of dollars of cash for taxpayers, which are being invested in new public assets such as schools and hospitals. The alternatives were not to build these new assets or to borrow the money from overseas lenders – options this Government rejected,” Mr English says.
Deputy Prime Minister Bill English leaves tomorrow to lead New
Zealand’s ministerial delegation to the annual Australian New Zealand
Leadership Forum in Sydney.
He will be accompanied by Economic Development Minister Steven Joyce, Foreign Affairs Minister Murray McCully, Trade Minister Tim Groser and Commerce Minister Craig Foss.
The ninth Forum, which brings together senior politicians, business and academic leaders from both countries, takes place on Wednesday.
“One of the objectives of this year’s Forum is working together to access opportunities in Asia,” Mr English says.
“It’s now 30 years since CER was established and I’m looking forward to meeting leaders from both sides of the Tasman so we can work together to maximise our opportunities in the region.
“From New Zealand’s perspective, the Forum will allow us to engage with ministers in the new Australian Government and agree on the direction of the trans-Tasman work programme for the coming year. That is important as we agree on the next steps in the Single Economic market between our two countries.”
Mr English will speak at the Forum luncheon on Wednesday, along with Australian Treasurer Joe Hockey. While in Sydney, he will also meet a number of business and political leaders, including New South Wales Treasurer Mike Baird.
He returns to New Zealand on Thursday.
New Zealand will be among the strongest developed economies in the world over the next few years, according to the Organisation for Economic Cooperation and Development’s latest annual Economic Outlook published overnight.
The OECD is forecasting annual economic growth in New Zealand of 2.4 per cent and 3.6 per cent over the next two calendar years, and for the current account deficit to narrow to less than 4 per cent of gross domestic product.
“This is the latest in a series of encouraging reports on the New Zealand economy, which confirms that we are well placed compared to most other countries,” Mr English says.
“The OECD’s growth forecast of 3.6 per cent in calendar 2014 puts New Zealand in the top six developed economy growth rates. It’s above the OECD average of 2.4 per cent and better than Australia at 2.7 per cent.
“As the OECD notes, although the severe drought earlier this year depressed agricultural production and exports in the second quarter, underlying growth in the New Zealand economy has been strong.
“And it describes the Government’s fiscal prudence in setting a path back to surplus in 2014/15 as appropriate.”
The OECD is also forecasting an improvement in the current account deficit.
“Although this longstanding imbalance remains a vulnerability for New Zealand, the OECD expects some improvement over the next three years,” Mr English says. “It forecasts the deficit will narrow from 4.3 per cent of GDP to 3.6 per cent of GDP in 2014.
“We still have more work to do, but this is significantly better than the current account deficits of more than 8 per cent of GDP five years ago and shows that we are making progress towards paying our way in the world.
“Overall, the OECD forecasts confirm the Government’s economic programme is taking New Zealand’s economy in the right direction and that we are well placed compared to many other countries,” Mr English says.
“This is the best way to support jobs and raise New Zealanders living standards.”
The OECD Economic Outlook is available at:
The Government’s comprehensive Business Growth Agenda is helping New Zealand build a productive and competitive economy to deliver more jobs and higher growth for people around New Zealand, Finance Minister Bill English and Economic Development Minister Steven Joyce say.
The two lead ministers today released the 2013 Progress Report on the Business Growth Agenda, which is an integrated programme of work focusing on the six key inputs businesses need to succeed, grow and add jobs: export markets, capital markets, innovation, skilled and safe workplaces, natural resources, and infrastructure.
“New Zealand is one of the fastest growing economies in the OECD this year. Business and consumer confidence levels are high, with wages and household incomes growing. The Government is on track to return to surplus by 2014/15,” Mr English says.
“The BGA is all about creating the conditions for businesses to invest for jobs and growth, and for regions to take advantage of the enormous opportunities available to them,” Mr Joyce says.
“New Zealand’s regions have lifted New Zealand out of the global financial crisis – with the whole of the South Island having lower unemployment than Auckland and growth rates are strong in regions like Taranaki, the West Coast, and Canterbury.
“Increased exports and international linkages are vital for New Zealand. Key achievements in the last year include signing an economic partnership agreement with Chinese Taipei, the recent launch of the New Zealand Story, progress on the new $402 million New Zealand International Convention Centre, and significant policy and legislative reforms to grow New Zealand’s $2.6 billion international education sector.”
Mr English says New Zealand firms need access to capital to take advantage of opportunities to grow their businesses.Read full article
New Zealand has been ranked 4th in the 2013 Global Open Data Barometer, released in London by the World Wide Web Foundation and Open Data Institute.
“This is a real coup for New Zealand. The Barometer is the first survey of global trends which ranks 77 countries on how they release their public data and the benefits those initiatives have for citizens and the economy,” says Mr English.
“This is proof we are lifting the performance of the public sector through transparency and shared information. New Zealand was commended for its Declaration on Open and Transparent Government, its release of open data, in particular, maps, land ownership and census data and for regular reporting to Ministers.”
“The open government data work aligns with the Government’s better public service targets that New Zealand businesses have a one-stop online shop for all government support and can complete their transactions with the Government easily in a digital environment,” says Mr Tremain.
“The Government Chief Information Officer (GCIO) is leading this work through the ICT Strategy and Action Plan which was launched in June last year.”
Land Information New Zealand (LINZ) is a lead agency in terms of making public data available for reuse, innovation and enterprise.
“A great example ofthis is the internationally-acclaimed LINZ Data Service (LDS), which has set the benchmark for the release of public data and is a testament to the value of the Government’s open data programme and geospatial strategy,” says Mr Williamson.
“The Government is committed to meeting the changing needs of New Zealanders through digital technologies. However this does not mean all data is open and freely available. The key focus will remain on maintaining privacy and security for restricted information.”
For further information go to: http://www.opendataresearch.org/dl/odb2013/Open-Data-Barometer-2013-Global-Report.pdfTweet
The Government’s Half-Year Economic and Fiscal Update will be issued
on Tuesday, 17 December, Finance Minister Bill English announced today.
“The Government is aiming to return to surplus in 2014/15 and we are seeing good momentum building in the economy,” he says.
“Over the past five years, the Government’s economic programme has ensured the most vulnerable New Zealanders have been protected, while at the same time building a more productive and competitive economy capable of providing more jobs and higher incomes.
“We’ve also invested in the rebuilding of Christchurch and ensured we map a path back to surplus so we can avoid the acute debt problems seen in many other countries in the aftermath of the global financial crisis.”
“Having more than halved the operating deficit before gains and losses to $4.4 billion in the latest year to 30 June, the Government is focused on continuing to responsibly manage its finances and getting back to surplus next year.”
The Budget Policy Statement accompanying the Half-Year Update on 17 December will set out some of the Government’s priorities following the return to surplus, Mr English says.
“Surpluses will give us choices about repaying debt, rebuilding EQC, resuming contributions to the New Zealand Superannuation Fund and investing further in priority public services,” Mr English says.
Deputy Prime Minister Bill English has today announced that he will seek nomination for the National Party list and step down as MP for Clutha-Southland at the election next year.
“This afternoon I met with my electorate committee in Gore to inform them of my decision,” he says.
“It has been a privilege to represent the electorate since 1990 and I have particularly enjoyed working for my constituents.
“I will continue as MP for Clutha-Southland until the election next year. I am strongly committed to the re-election of a John Key-led Government in 2014 and to my roles as Deputy Prime Minister and Minister of Finance. We have made considerable progress since our election in 2008 and there is still plenty of work to do.
“However, representing one of New Zealand’s largest electorates has required considerable travel and time away from my family, particularly since becoming a minister. I have therefore decided that it is a good time to strike a better balance between my family and government commitments.
“I wish to thank the people of Clutha-Southland – and before that Wallace – for electing me as their representative in eight elections. I also thank my electorate team, including my electorate committee and my office staff in Gore, Balclutha and Queenstown, for their hard work and support over the years.
“I will continue to take a strong interest in issues affecting Southland and Otago and I’m confident the National Party will provide strong representation for the area into the future,” Mr English says.