MY Blogs

WHY 2025 BUDGET IS SO WELCOME

A lot of people are talking about how small this Budget seems — with only $1.3 billion in new spending, it's the smallest in decades. But that misses the bigger picture. When you add up all the actual decisions, like changes to tax credits and more money for learning support, the government is really spending about $6.7 billion a year. That’s a huge amount — possibly even more than what Labour spent in some of their recent budgets.

What’s different this time is where the money is coming from. About $4.8 billion was found by cutting spending in other areas and redirecting it. Around $600 million is from new fees or charges, and only $1.3 billion is borrowed. That’s a big change from the last Labour Government, where Grant Robertson borrowed more to pay for new spending - and what's more it was the lack of accountability that drove hugely wasteful spending that actually achieved very little.

Personally, I much prefer paying for priorities by cutting wasteful spending rather than by borrowing huge amounts of money.