National’s promised surplus looking doubtful

Budget figures for the first quarter of the financial year released today by Treasury show the Government’s goal of achieving a budget surplus is looking doubtful, the Green Party said today.

“National has staked its credibility on achieving a budget surplus this year, but even that limited goal is looking increasingly dubious,” Green Party Co-leader Dr Russel Norman said today.

Treasury said today the operating budget deficit for the first three months of the financial year was $725 million, $79 million above forecast.

Treasury’s Pre-election Fiscal and Economic Update (Prefu) predicted the Government’s budget forecast surplus would only be $292 million.

“For six years, during which National has racked up $50 billion of extra net debt, they have blamed the previous Government and the Global Financial Crisis,” Dr Norman said.

“But during that six years export prices have been the highest for 40 years. It’s time for National to stop blaming circumstances and take responsibility.

“National enacted tax cuts targeted at the top 10% in 2010 that were irresponsible and expensive. During the election they dangled more tax cuts in front of voters that never looked affordable,” Dr Norman said.

Treasury figures today showed Government net debt was at $62.3 billion. The Prefu forecast that net debt will rise to $67.9 billion in 2018, almost $3 billion more than forecast in the May budget.

“National castigated other parties for their promises during the election, but their fiscal track record is woeful,” Dr Norman said.

“Economists forecast the economy to turn down from here.

“National will likely blame the fall in dairy prices if their surplus never materialises, even though it was clear dairy prices could never hold at historic highs. It is time John Key and Bill English stopped making excuses,” Dr Norman said.