7 Dec 2011

Removal of spending cap up to future governments - Key

7:14 am on 7 December 2011

Prime Minister John Key says future Governments will be able to change the law and ditch a proposed spending cap, if they choose to do so.

National and ACT have agreed to legislate for a cap, based on the rate of inflation and population growth.

Labour and the Greens question the merit of such a cap, which has several exemptions.

They say it's an ideological approach that will affect how future governments manage their books.

Mr Key says a cap would provide economic discipline, but would also be flexible in response to changing circumstances.

He says future Parliaments can remove the cap, but would have to justify their reasons for doing so to the public.

on Morning Report