20 May 2023

Budget 2023: bare bones, blowout, or both?

From Focus on Politics, 10:00 am on 20 May 2023
Finance minister Grant Robertson showing the cover of Budget 2023

Grant Robertson with the 2023 Budget Photo: RNZ

'It is a Budget that does exactly what it says on the tin' - Grant Robertson

The 2023 Budget has proven difficult to define: neither the belt-tightening exercise that was promised, nor the blatant bribery sometimes seen in election years.

Certainly, it is no election clincher, but it has not lost Labour the election either, and backs National into an uncomfortable corner where the opposition must now explain what policies or services it would do without.

Finance Minister Grant Robertson hailed it as a Budget for the times we're living in, and its title highlighted the two main focuses: Support for Today, Building For Tomorrow.

The first part signalled cost-of-living relief, like extending the free 20-hours a week childcare subsidy to two-year-olds, saving parents about $133 a week. The policy, however, doesn't begin until March - not exactly Support for Today.

Then there's the decision to scrap the $5 fee for prescriptions and make public transport free for under-13s and half price for those aged 13-24. On the other hand, the half-price fares currently offered to everyone else and the fuel excise discount are set to expire from the end of June.

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The offerings largely target young families - a demographic courted by both National and Labour - but many "middle" New Zealanders will be asking what's in it for them. Charities and anti-poverty groups, along with the left-leaning Green and Māori parties, were demanding more for the most vulnerable.

At the same time, the right-leaning National and ACT were complaining the Budget contained too much spending. This year's deficit is set to hit $7 billion - much more than expected - and the books stay in the red for a year longer.

National Party Christopher Luxon after the Budget 2023 announcement.

National Party leader Christopher Luxon Photo: RNZ / Samuel Rillstone

Much of the expense was focused on that second plank: "Building for Tomorrow", with a whopping $71b set aside for infrastructure  - roads, rail, schools and hospitals - over the next five years. That compares to the $45b Labour has spent over the past five years.

Robertson argues the criticism from both left and right proves he's struck the right balance, but it could just as well leave most everyone disappointed.

It was Chris Hipkins' first Budget as prime minister and, coming just months ahead of an election - which polling suggests will be neck-and-neck - it could be his last.

He and opposition leader Christopher Luxon have both been finessing their attack lines: National warning of an irresponsible coalition of chaos on the left, Hipkins of a corresponding coalition of cuts on the right.

Chris Hipkins and Grant Robertson both point at the ACT Party during the budget debate.

Prime Minister Chris Hipkins defends his first Budget as Prime Minister.   Photo: VNP / Phil Smith

While this Budget splashes little cash on vote-winning policy it does deliberately back National into a corner, forcing Luxon to highlight which policies he'd cut - like the removal of that $5 prescription fee.

In that sense then, this very basic Budget has laid the groundwork for a thrilling election campaign.

Many New Zealanders may have felt under-served this week, but there's still plenty of time for more bread and butter - and maybe even a little cream - before 14 October.

In this week's Focus on Politics, Deputy Political Editor Craig McCulloch breaks down Grant Robertson's supposedly no-frills Budget. 

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