Topic: BUDGET

Govt must loosen Budget Responsility Rules say Trade Union Economists

NZ Council of Trade Unions say the new Budget released by the Coalition Government yesterday is adequate for meeting population costs of funding, however, BERL Chief Economists Dr Ganesh Nana says the Government will have to loosen its strict Budget Responsibility Rules if the country is to see significant changes.

 The first Government Budget has hit all the right notes according to NZ Council of Trade Union. Economists and policy director Dr Bill Rosenberg of the Council of Trade Unions and BERL Chief Economist Dr Ganesh Nana addressed media and unions in a post-budget briefing at Victoria University on Friday.

Dr Rosenberg said, “This was the first budget I’ve attended since 2010 where funding has been adequate to meet the rising costs and population pressures as well as for paying politician’s promises.”

According to Dr Nana the “catch up” budget was a sigh of relief but more was needed in the long run. "I think I'll wait for next year's budget to see some significant changes in terms of people's lives and opportunities and in terms of the services delivered in health and education."

But economists say the Government will have to increase its overall revenue in a way that supports working people and local businesses. 

"Yes there's good spending increases in health and presumably some allocations there for nurses pay and education- for teacher's pay and teacher aid and those sorts of things but there's a niggling feeling that those are just are catch up for the years of neglect and so it could have gone a lot further."

Dr Nana says the Government will have to loosen its strict operational spending of roughly 30% GDP to see significant changes for New Zealanders.

"The Government has chosen to restrict itself with its own debt targets in which in my opinion are too constraining.”

“The Government could choose if it was courageous enough to borrow some more to actually make a significant difference to people's lives and to the hospitals and the schools that we face."

NZ Council of Trade Union will release a full report later this year.