Can the Government return the budget to surplus by 2014-15?

8:53 AM Tuesday Apr 3, 2012

Digital image / P.K. Stowers

The Government took in $1.57 billion less tax than expected in the first nine months of the fiscal year, reflecting a tepid economy, Treasury figures show - reflecting what the Finance Minister says has been a 'difficult year'.

The Crown took in $39.8 billion in tax in the nine months ended March 31, against a forecast in the Pre-election Economic and Fiscal Update estimate of $41.3 billion, according to the government's financial statements.

Core Crown spending was $1.75 billion below forecast at $50.99 billion, which the Treasury said reflected revenue variances and spending delays.

The operating balance before gains and losses (OBEGAL) was a deficit of $6.13 billion, or $800 million more than forecast.

Can the Government return the budget to surplus by 2014-15? Here is the latest selection of Your Views:

Provincial Curmudgeon (Hastings) | 09:55AM Tuesday, 03 Apr 2012

Not by cutting expenditure - that way lies an ever increasing spiral dwnwards. He has to increase the tax take from those best able to withstand it. So rather than upset his mates, it's the gurgler for the rest of us.

Chieftain (West Auckland) | 09:55AM Tuesday, 03 Apr 2012

It was never going to happen, so I do not know why people would find this to be a surprise. This Government was not elected on the basis of sound economic policy, but rather on the basis of Brand Key. Well, New Zealand, you got the government you voted for: and while the rest of the world climbs out of this global economic recession, our country will be spinning its wheels, selling off its family silver.
Brilliant. Just brilliant!

Gandalf (St Heliers) | 09:55AM Tuesday, 03 Apr 2012

Getting into surplus by 2015 is completely impossible. Growth has been poor for 3 years now, despite good commodity prices, company profitability isnt great so the tax take is down, wages are stagnant eroding the tax take, the building industry is on its knees, and the earthquake rebuild wont really kick in until next year and will be gradual.

Get real, 2020 is more likely. However Labour left low government debt, so there is room to move.

I agree tighten up tax loopholes. The government have to use every possible device to stimulate growth, so far their tax changes have failed to do this. Slashing bureaucrats has its place but slashing government spending will cause the economy to contract, so its a balancing act. They need to be very carefull.