Willis Nicola; Robertson GrantNICOLA WILLIS (Deputy Leader—National): There has been growing speculation about just how bad the financial situation is for New Zealand and that is emerging in these Crown accounts. In these Budget documents we are discussing after six years of deficit it is forecast that New Zealand would under this Labour Government return to a wafer-thin surplus in 2026. My question is very specific: does the Minister have reason to believe that surplus date is now in doubt?Hon GRANT ROBERTSON (Minister of Finance): The ability to know that will only come when the pre-election fiscal update (PREFU) is produced. As the member knows that pre-election fiscal update is the Treasury's document and they will produce that and we'll all be able to make our judgments.What we were discussing earlier before the dinner break is that anyone who's been taking notice of the Government's accounts as they've been released in recent times will notice that the revenue forecasts that are in this Budget haven't been met in the Crown accounts to the end of May. On 5 July I put out a press release about that exact subject and noted that the Government's spending was in fact coming in under what had been forecast but the revenue that the Treasury forecast was also down. So from the Government's point of view when you look at measures like real Government consumption when we look at the GDP figures or through the monthly account the Government's doing its bit to make sure that our spending is being careful and being managed and is in fact under what is forecast. But unfortunately in those Crown accounts to the end of May you saw revenue coming in lower.What Treasury will be doing is working out over time what that looks like how baked in that is and so that will be something that as we come towards PREFU there will need to be discussions about. From the Government's perspective we've made really clear that our fiscal rules are that we keep net debt below 30 percent of GDP and that we achieve an operating balance before gains and losses surplus across the forecast period. So that's what guides me in my consideration of what happens. But as we've seen over the course of the last little while there can be a lot of volatility when it comes to the Government accounts to the global economic environment—but as I noted in July challenging times; and the Government as it announced at the Budget it would do needs to keep looking for efficiencies and savings.NICOLA WILLIS (Deputy Leader—National): Now that the finance Minister has acknowledged that—I would characterise them as emergency meetings; he may characterise them differently—significant meetings have occurred today with Public Service heads in which they have been asked to find savings can he please outline for the committee what precipitated those meetings? Is it simply a declining revenue position which is already known as the Crown accounts have shown the recession has driven down tax take or is it also a combination of emerging fiscal risks?Today we had one bomb go off which was that the Government had not provisioned enough funding for the teacher settlement and is now having to raid future Budgets in order to reach that settlement. Is the Minister aware of any other risks of that sort that have now come to pass that have contributed to the need for the meetings today which we are told are responding to a multibillion-dollar hole in the Government accounts as compared to what was set out in this Budget?Hon GRANT ROBERTSON (Minister of Finance): The member's imagination is most definitely getting away on her here. What the Government does and what the Government has said it will do both at this Budget—and in these Estimates—and in previous ones is that we will continue to look for savings and efficiencies. We actually outlined—we gave it a name. We said it's a sustainability and efficiency programme that we wanted to develop. That requires us—Nicola Willis: Why don't you call it KiwiBuild or SavingBuild"?Hon GRANT ROBERTSON: Well because the member if she was reading all of the Budget documents and had made it all the way to page 64 of the Budget documents she would've seen it there: the "fiscal sustainability and effectiveness programme." That is to drive better value for money; that is to look for how we can be more sustainable. So there will always be ongoing discussions with Public Service chief executives and others about how we do that.I've already answered the member and referred her back to 5 July where I was talking about this in response to the May accounts. I repeat again that the Government's expenditure is actually running under where it was forecast so we will see where that gets to but it does behove everybody to be able to be very very clear about how they're paying for what they're committing to.Which brings me to the second part of the member's question which we've actually already covered in a previous question around the teacher settlement. Just to say that quite clearly once one gets into an arbitration process that means you have to take seriously what happens there. We told the teachers when we met with them that we had exhausted the allocation we had which is now being utilised but we prioritised making sure our kids get back into the classroom making sure that parents have certainty about that making sure that our teachers actually do get pay increases that will be I think very attractive for people. We're doing that by finding some further savings within the education area and also by looking at the cost pressures that would've gone to education in the next Budget. That will make for some challenging discussions in Budget 2024 but we have prioritised that. It is not the hyperbolic way that the member has described it."