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Welcome to Inside Politics on Budget Day 2025, the day of the big reveal.
Normally, all eyes would be on how big the deficit is, when we are returning to surplus, and what the net debt forecasts are climbing to. But this year, the big reveal will be how much the Government “saved” through its changes to pay equity.
The bigger the amount, the greater the ammunition Opposition parties will have to use against the Government from now until the election, comparing the amount cut from future settlements to any number of unpopular policies. Finance Minister Nicola Willis has promised she will reveal the pay equity savings – the difference between what was previously set aside and what is now set aside.
Multiple unions are organising a protest at Parliament today at 1pm, dubbed Protect Pay Equity.
It was an unusual decision by Willis to lead off the general debate yesterday with a speech on the Labour Party and whether it will have a core Crown debt ceiling of 50% of GDP, as advised by Treasury. There were discrepancies between what leader Chris Hipkins said this week – no decision – and what finance spokeswoman Barbara Edmonds said last week – she supported the ceiling. It was hardly the issue of the day, one day before Willis’ much-anticipated second Budget.
When she was at the Budget printers in Petone in the morning, Willis explicitly told media she was not focusing on the Opposition, then promptly went back into town and drafted a speech about them. The attack on the eve of her own Budget shows she will use anything that promotes her own sense of discipline. It also suggests she may be nervous about polling since the pay equity changes were passed under urgency.
It wasn’t just Labour in her sights. She ended her speech with a flourish against the big-spending Greens’ alternative Budget: “Just spare a thought also for Chlöe Swarbrick: she wants to save a planet that she doesn’t even live on,” Willis said.
Labour’s Kieran McAnulty immediately responded to Nicola Willis’ speech and her preferred nickname for the Budget as the “No B.S. Budget”: “A confident Finance Minister doesn’t talk about her opposite; she talks about herself and what they’ve achieved and they didn’t mention that once and New Zealanders know exactly why: because they have done bugger all, because they’ve buggered up the Budget.”
Andrea Vance, who used the c-word in the Sunday Star Times in describing the actions of women ministers over pay equity law changes, won the political journalist of the year award at last week’s Voyager Media Awards for work in 2024.
The other finalists were my Herald colleague Jamie Ensor and RNZ’s Guyon Espiner. The Herald on Sunday won weekly newspaper of the year and the overall newspaper of the year.
I was intrigued to see how Hansard, the record of Parliament, would handle the c-word after Act’s Workplace Minister Brooke van Velden used it in Parliament last week in a bid to convey her outrage at Andrea Vance’s column.
Curiously, Hansard spelled out the full word in reporting van Velden’s words, but put square brackets between the second letter and the last letter, like this: c[***] (asterisks ours).
After making an inquiry to the Office of the Clerk as to why the brackets were there, I was told the reason is that van Velden’s quote was not an exact quote from the Vance article; van Velden uttered the word, whereas the article used the letter c and three dots. Hansard handles all quotes the same way. If an MP claims to be quoting but it is not an exact quote, it gets the square bracket treatment.
The Government normally has control of what happens in Parliament, but not this week. The debate on the Privileges Committee report recommending the suspension of three Te Pāti Māori MPs had to be held as the first item of business following the tabling of the report last Thursday, which meant it had to be held on Tuesday after Question Time.
There was no way the debate could be delayed at the discretion of the Speaker, the Leader of the House or even by agreement among parties. The only way the debate could be adjourned was after the debate had begun, which is what Chris Bishop, as Leader of the House, moved after speeches by Privileges Committee chair Judith Collins and Labour leader Chris Hipkins.
It was a closely guarded secret until Bishop’s ambush, though why it was so secret is not evident. There is little sense of collegiality in the parliamentary complex at present. But Labour was not nimble enough, and having spent a couple of days calling for a delay in the debate so Te Pāti Māori leaders could take part in the Budget debate on Thursday, it got a minute’s notice to think about the delay motion and vote against it.
Hipkins thought that while the delay might let the MPs speak in the Budget, it might prevent them from voting on the Budget. It turns out they will be able to do both, although that is no guarantee they will.
The whole episode has been frustrating, and that is clear in the comprehensive comment piece by political editor Thomas Coughlan.
Winston Peters was thrown out of the House on Tuesday for the first time this term for a completely daft question to his benchmate, the Prime Minister. Peters had not read the room properly and did not pick up on the fact that Speaker Gerry Brownlee was at breaking point in his attempts to tighten the leash at Question Time, ahead of what he thought was going to be a fraught debate following it.
Luxon had been answering questions from Te Pāti Māori co-leader Debbie Ngarewa-Packer about his interview the previous day with Newstalk ZB’s Mike Hosking. Hosking had used the term “Māorification” in a question around Stop/Go signs being in te reo (Taihoa/Haere). Ngārewa-Packer questioned him about what he thought it meant and why he had not pushed back on the question, to which Peters made the following contribution: “ ... on the issue of ‘Māorification’, would it be ‘Māorification’ if every Thursday I went down and got myself a suntan?”
Brownlee, having issued a warning two minutes earlier that he was not in a mood to be trifled with, told Peters to leave the House, although he let him back in at the end of Question Time. If you’re going to get thrown out of the House, Winston, it is better for it to be on a point of principle, or at least something clever.
Perhaps Peters’ equilibrium had been disturbed. Earlier in the day, while making a KiwiRail Budget announcement at Wellington Railway Station, Peters had been heckled by a staff member of Tonkin + Taylor on his way to work, including the term “You f***ing moron.” The heckler was wearing his work lanyard and the company has contracts with KiwiRail.
Peters yesterday showed no sympathy for the staffer, whose conduct is being reviewed by his company and whose actions are being defended by the Free Speech Union.
Perhaps following the example of the hanging judges on the Privileges Committee, the heckler could get a three-week suspension with no pay – and maybe some discount if he showed some contrition to Peters.
• Winston Peters puts on his Foreign Minister’s hat tomorrow and leaves for a trip taking in Adelaide, the home city of his Australian counterpart, Penny Wong, Sri Lanka, Nepal and India. It will be the first visit ever by a New Zealand Foreign Minister to Nepal and coincides with the 72nd anniversary of the summit of Mt Everest by Tenzing Norgay and Sir Edmund Hillary.
• Parliament is set to go into urgency after the Budget today and is expected to stretch into a Saturday sitting. We know this because the cafeteria staff have been asked to open at 8am on Saturday.
“It is not a Budget filled with rainbows and unicorns. It is a reality Budget that will deliver genuine hope for the future.” – Finance Minister Nicola Willis at the Petone printers yesterday.
What year was the so-called Mother of All Budgets presented? (Answer below.)
Goes to ACC Minister Scott Simpson, who said in response to a question from Labour’s Camilla Belich about a particular ACC programme that has been stopped: “ACC is an independent Crown entity, and I, as minister, stand at arm’s length from operational decisions.” You don’t hear the ministers of Health, Housing or Transport say that about Health New Zealand Te Whatu Ora, Kāinga Ora or NZ Transport Agency Waka Kotahi.
Goes to Eric Crampton, the chief economist of the New Zealand Initiative think-tank, who refused to accept Treasury’s invitation to today’s Budget lock-up unless it lifted its ban on Council of Trade Unions economist Craig Renney – which it did.
OPINION – Budget 2025: KiwiSaver changes, tax write-offs and other “surprises” – Jenée Tibshraeny on what to watch out for in today’s Budget.
Budget 2025 – debt debate: In the final days before the Budget, Finance Minister Nicola Willis has been turning up the heat on Labour for its flip-flopping on debt.
Budget 2025 preview: The Government needs to find billions of dollars for the numbers to add up in today’s Budget. Derek Cheng outlines what we know so far.
Budget 2025 – health spending: Prime Minister Christopher Luxon and Health Minister Simeon Brown have announced that $164 million will be spent on urgent care across the country.
OPINION – MPs’ punishment: MPs’ failure to compromise on the punishments meted out to three Te Pāti Māori MPs after last year’s haka in the House bodes ill for Parliament, writes Thomas Coughlan.
Regulatory Standards Bill: Implementing the Regulatory Standards Bill will cost a minimum of $20 million per annum across 20 years, government officials estimate.
Digital Services Tax: The Government has binned a tax worth an estimated $100 million each year after threats of retaliation from US President Donald Trump.
Greens’ Budget: Labour leader Chris Hipkins has called the Green Party’s alternative Budget “unrealistic”, but says he agrees with some elements.
ANALYSIS – think-tank 101: What is a political think-tank and who are the key players in New Zealand? Audrey Young explains.
ANALYSIS – social sector shake-up: “We need a different model” - Andy Coster talks to Audrey Young about his new role in reshaping social sector funding.
Stay with us for comprehensive coverage of today’s Budget, including live coverage from 2pm, with interviews with major players, in-depth analysis and commentary. Parliament will go into urgency later today to debate Budget-related legislation. Parliament will be in recess next week.
Quiz answer: 1991, by Ruth Richardson
For more political news and views, listen to On the Tiles, the Herald‘s politics podcast.
The Government considered a 5 percentage point cut to the corporate tax rate.