The Government's failure to cater for the country's ageing population is "fiscally irresponsible", says Hawke's Bay economist Aaron Drew.

He was disappointed the Government would keep its 2009 promise to resume contributions to the NZ Superannuation Fund once the nation's books were in surplus.

"We know a large fraction of the population aren't adequately preparing for their retirement and I think it is fiscally irresponsible, from a long-term point of view, to be talking about tax cuts when we know New Zealand as a whole is not adequately preparing for its retirement," he said.

Surpluses would increase faster than predicted because the economy was growing quicker than Treasury's "growth assumptions" based on out-of-date figures.


He said a lot of Government plans relied on outdated assumptions, as evidenced by the Education Ministry's recent assertion Havelock North did not need a new primary school because Hawke's Bay's population was not fast-growing.

"That might have been the case a few years ago but that is not consistent with what we know has been happening in the last year-and-a-bit with Aucklanders moving here.

"Even though there is a lot of funding in this Budget for new schools the Bay is not getting that funding, largely because they are relying on outdated numbers."

He said the Government's focus on reducing debt while there were record-low interest rates was a lost opportunity to provide low-price inter-generational infrastructure.

"We have probably the strongest fiscal accounts now in the OECD and are talking of strengthening the accounts further, when we know we have this population growth pressure and we know that the cost of buiding infrastructure is cheaper now than it has pretty-much ever been."

Pan Pac managing director Doug Ducker said the Budget would have a limited effect on primary industry, except for increased funding for apprentices and research and development.

"We certainly endorse the support and are appreciative of that," he said.

Implications of the scrapping of a carbon credit subsidy would take time to digest "but the implications seem to be broadly positive provided we don't see an escalation of fixed costs into supplies, particularly of fossil fuels".

Property analyst Pat Turley said Budget spending would help offset effects of the the slump in the dairy industry and keep the property sector buoyant.

"Economic fortunes and confidence are the big drivers of property performance," he said.

"The Budget's additional $2.2 billion for health, $2.1 billion for public infrastructure, $761 million for innovation and $652 million for social investment will cause economic stimulus countering dairying headwinds.

"These and Government housing initiatives - historically low interest rates, economic growth and positive net migration - paint a pretty rosy picture for good-attributes commercial/industrial and most other property.

"Any fresh regional development initiatives would assist provincial house values and regional wealth, and investment. Auckland boom ripple effects seem to be broadening, including people flows to Hawke's Bay."

Business Hawke's bay CEO Susan White welcomed an $8 million boost for the Regional Business Partners Programme, which enables know-how and research and development expertise for small and medium-sized companies.

Now CEO Hamish White and Hawke's Bay Chamber of Commerce CEO Wayne Walford both hailed tax changes as the most significant Budget items for businesses.