John Armstrong: Steady-as-she-goes budget

A major question mark over Govt accounts is the ever escalating cost of rebuilding Christchurch - some $2.1 billion more than anticipated in December. Photo / Geoff Sloan

The theme of Bill English's fifth Budget is "Building Momentum". The finance minister should have added the words "slowly" and "cautiously".

The Budget is a "steady-as-she-goes" document which will not win any accolades for being ground-breaking. It instead seeks to scratch as many political itches as possible while having little in the way of extra cash to be able to do so to major effect.

The biggest itch is affordable housing, with urgent legislation to be rushed into Parliament to enable central and local government to hammer out "housing accords" and designate "special housing areas" where land supply can be increased and resource consents streamlined.

Whether this will result in a whole lot more houses a whole lot sooner remains to be seen. But it is important for National to be seen to be in heavy action mode on this front.
There are few surprises in the document. Having emphasised that New Zealand is on the right track, English is reluctant to stray from it.

The biggest shock is the size of the Budget surplus in 2014-15 - the target date National has set for getting the Government's finances out of the red and into the black.

At $75 million, the surplus is only marginally higher than the $66 million forecast in the half-yearly fiscal update last December.

Moreover, had English not sliced $200 million off the sum of money allocated for new spending initiatives in that year, the Budget would still be in deficit.

However, English's willingness to cut ACC levies to the tune of $300 million suggests he feels confident about reaching the target.

The other major question mark over the accounts is the ever escalating cost of rebuilding Christchurch - some $2.1 billion more than anticipated in December.

National is now dipping ever deeper into the Future Investment Fund set up to distribute the proceeds from the Government's partial asset as as means of financing the rebuild.
The other major talking point of the Budget is a series of piecemeal measures to address poverty - or rather improve the lives of those living in poverty.

Some steps - such as a trial of a warrant of fitness system for rental properties - is a direct steal from the Greens and Labour.

Further initiatives are waiting in the wings. But English will win few plaudits for his efforts so far from those organisations working on the frontline in alleviating poverty.