Budget 2018: Grant Robertson affirms $42 billion of capital spending over next 5 years

Finance Minister Grant Robertson confirmed plans for $42 billion of net capital spending over the next five years in his latest pre-budget speech to the Wellington Chamber of Commerce this afternoon.

Robertson said the spending, which was first announced with the half-year economic and fiscal forecasts (HYEFU) last December, would be funded from a number of sources, including repaying debt at a slower rate than the previous government, as it has already announced, along with higher-than-expected tax revenue.

On Tuesday, Treasury reported that the operating balance before gains and losses (obegal) was a surplus of $3.3b in the nine months ended March 31, beating the forecast $2.38b in the half-year economic and fiscal update.

The government has also "reprioritised" about $700 million in funding over four years from the previous government's budgets, he said, including winding down Crown irrigation subsidies which were announced last month and would save $40m to $50m.

He wouldn't be drawn on specifics about other spending cuts before the Budget but said it included "some departments just identifying small projects or things they didn't end up implementing but they'd been given some funding to do. I think New Zealanders will be pleased that we've undertaken an exercise to see that they are getting value for their taxpayer dollars. We're committed to continuing that process."

In his speech, Robertson said the government will provide a "boost" to housing, including $100m for homelessness announced last week and "other housing-related initiatives." That's on top of the $2b spending it announced for KiwiBuild last year.

Robertson told the Wellington audience the capital investments to be announced in the budget next week would include increases in health and education spending, along with transport and the $1b Provincial Growth Fund. Wellington public transport needs to be improved and "you can see from our ambitions plans in Auckland what is possible", he said.