11 May 2011

PM to lay groundwork for Budget

3:34 pm on 11 May 2011

Prime Minister John Key will on Wednesday lay the groundwork for next week's Budget, saying New Zealanders have to be aware of the tight financial conditions under which the Government is operating.

The latest financial statements reveal an operating deficit of $10 billion, excluding investment gains and losses, for the nine months to the end of March.

Mr Key has already flagged changes to KiwiSaver, Working for Families and interest-free student loans, saying they are unsustainable in the long term.

However, Labour says Mr Key is preparing the electorate for unpopular spending cuts and that many economic problems are the result of Government policy, for example National's tax cut package.