15 May 2024

Watch: PM Christopher Luxon speaks to business leaders ahead of Budget 2024

2:31 pm on 15 May 2024

Prime Minister Christopher Luxon says do not expect any curveballs in this month's Budget, nor any bells-and-whistles, but he has reaffirmed a commitment to tax relief.

Luxon made the comments in a speech to the Auckland Business Chamber on Wednesday afternoon.

Chamber chief executive Simon Bridges - and former National leader - introduced the prime minister to the "sell-out crowd" and said he was impressed by Luxon's ambition for the country.

The address contained no grand reveal, instead setting the expectations for what will be the National-led coalition's first Budget on 30 May.

"I'm not expecting this year's Budget to be a surprise. And that's exactly the way it should be. We will do exactly what we said we would do.

"No bells. No whistles. Just the basics done brilliantly to rebuild the economy, to restore law and order, and to deliver better public services."

Luxon also used the speech to bat away criticism of the Coalition's promised tax cuts, saying "the squeezed middle" deserved support given the tough cost-of-living.

"We were elected on a platform of delivering tax relief to those families, and I don't plan on breaking that promise."

Luxon highlighted "some promising signs of progress" in the economy with inflation falling to 4 percent and mortgage rates slowly showing signs of softening.

But he warned that relief would not be immediate.

"Unwinding those pressures has been and will continue to be tough. And when government puts its foot on the spending gas, as has been the case in recent years, the job becomes that much harder.

"It might feel good at Budget time, but there's absolutely no kindness in spending up large, only to see businesses close and families go without as the consequence of inflation."

Following the speech, Bridges put a series of questions to Luxon, beginning by asking whether the coalition was going far enough in cutting waste.

Luxon said he would not be delivering an austerity Budget, but he believed the Coalition was "plotting the right course".

"We are not going to fix six years of economic vandalism in one Budget."

Luxon repeated his commitment - questioned by many economists - that the Coalition would not be borrowing to fund tax cuts. He said the government had generated savings and raised money in other ways to ensure the tax package was "fully-funded".

Bridges also posed a question from the audience: What was the one thing Luxon would like to do in this Budget that he could not?

Luxon said he was comfortable with where the Coalition had landed, falling back on a line used frequently by former Labour finance minister Grant Robertson that the government had "got the balance right".

Bridges and Luxon - former rivals for National's leadership - also exchanged banter over their respective hairstyles. Luxon commended Bridges on his new haircut, saying it deserved its own social media following. Bridges replied that he wished he could say he was an admirer of Luxon's hair in return.

Luxon's address was in a similar vein to Finance Minister Nicola Willis's first pre-Budget speech to the Hutt Valley Chamber of Commerce last week, where she too reiterated a commitment to tax cuts and ruled out an austerity Budget.

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