Skip to content.
Updated at 9:23 pm on 5 March 2010
Finance Minister Bill English is warning of a tough Budget in May despite figures showing the Government's finances are improving.
The operating deficit for the seven months to the end of January was nearly $900 million lower than predicted in December.
Once gains on the Government's investments are included, the deficit is $1.4 billion better than forecast, according to figures issued on Friday.
The $3.4 billion operating deficit was better than the $4.2 billion forecast at the time of the Half-Year Fiscal Update last December.
Once the Government's investments were taken into account, the deficit was $630 million, compared with the $2 billion predicted.
Higher than expected GST receipts and delays to Treaty of Waitangi settlements boosted the Crown's coffers. GST receipts were $258 million, or 3.9% higher than forecast, while Treaty delays meant spending was nearly 2% lower.
The opposition Labour Party and the Council of Trade Unions say the figures represent a significant improvement in the Crown's books and believe the Government should loosen its purse strings and allow New Zealanders to benefit.
But Mr English says one-off factors mean the public finances could worsen later this year and is setting the scene for an austere budget in May, saying he will stick with a $1.1 billion limit for new spending.
Mr English says this needs to be maintained if the Government's accounts are to return to surpluses any time soon.
Copyright © 2010, Radio New Zealand
Audio is categorised based on the frequency of the programme it was heard in. Click on the headings below to access the programmes. For the most recently published audio, go to the latest audio page.
Streams are in Windows Media format. Mac and Linux users may need to install additional software. Get help with audio
A selection of music interviews, reviews, videos, concerts, sessions, and performances.
Downloads and podcasts are available for selected programmes. Our podcast page has a complete list of feeds.
Help on using online audio: formats, software, podcasts, downloading, and troubleshooting.