Leary IngridFinanceINGRID LEARY (Chairperson of the Finance and Expenditure Committee): Thank you Mr Chair. It's a privilege to lead off with a summary of what happened at the Estimates hearing recently held with the Minister of Finance. As is usual the Minister gave a brief overview of the aims of the Budget and the committee made of members from different political stripes asked questions.I'd note that the system we have in New Zealand in an election year is a pre-election fiscal update gets produced the Treasury and Inland Revenue do their best to try and forecast what it looks like and the Minister prepares a Budget based on that information. Of course since the Budget Policy Statement in December there have been significant unanticipated costs associated with the weather events that occurred—the Auckland Anniversary Weekend floods and Cyclone Gabrielle—with estimates between $9 billion and $14.5 billion and those events represent the second-largest natural disaster that New Zealand has ever faced. There was damage to communities the economy's productive capacity and damage to assets like infrastructure orchards horticulture and so on. So the Minister told us at the outset of the hearing he needed to pivot that while recovery and resilience was one of the four priorities of Budget 2023 the focus on recovery needed to be much greater. He said he needed to provide certainty to affected regions for recovery and rebuild and hence there was a billion-dollar cyclone recovery package. He said it was a first response package and it was stitched together through savings and reprioritisation. So a net change of $300 million in the Budget operating allowance compared to the Budget Policy Statement and that was a Budget allowance of $4.8 billion.He also talked about priorities for the cost of living delivering services to New Zealand that had both short- and long-term policy objectives especially with the cost of living. He referenced $5 copayments on the prescription charges; removing those which would be instant cost relief as well as preventing chronic or more severe ill health due to delayed medication and he also referenced transport charges. There were references to the resilience theme in some of the Budget allocations.The select committee asked about specific income tax measures. These were ruled out of order. Since then of course the Government has proactively released tax papers and there has been considerable water under the bridge regarding taxation in these House debates.Other members asked whether the Minister could provide better value for money in the context of a 30 percent long-run average of spending as a percentage of GDP in terms of health safety school attendance education outcomes and so on. The Minister told us that rebuilding after natural disaster meant trade-offs and hard decisions. He would have liked to have done more but that would not be fiscally responsible. This was against Treasury forecasts highlighting the Budget priority of fiscal sustainability and a projected return to surplus in the 2025 to 2026 year which is the same time frame as after the global financial crisis (GFC) and Canterbury quakes. The Minister also said it compared favourably below the 30 percent GDP ceiling and internationally with comparators like Australia the US and the UK.Members asked about value for money given what one member according to their maths described as A 25 percent increase in costs per head of Government spend over the course of this term." The Minister spoke about free lunches and the contribution that had to lifting 77000 children out of poverty on the after-housing cost measure that's used that school attendance was improving but there was more work to do and that measures supporting small business were also important—hence apprenticeships free trades training and other initiatives.There was a discussion about the increase in taxation as a proportion of the economy and debt ratios. The Minister responded referencing a 34 percent Government spend after the GFC. He said the level of spend or restraint was a political question and he wasn't prepared to cut services.There were a number of other discussions and questions about interest costs about the tax excise projections on the Government's smoke-free goals and why New Zealand would not achieve surplus until next year. The Minister said New Zealand had been on track to until the weather events and that had delayed things by about a year.There was also discussion about climate change with the Minister saying that a comprehensive review was under way on the emissions trading scheme to better understand the market in which it operated. The Minister also told us this was the first full Budget that had a fully costed gender analysis done to ensure equity for women.I think it's fair to say it was a feisty meeting. We covered a lot of territory. There was an opportunity for written questions but none were forthcoming. I'd like to thank the Minister for his appearance and for members' participation in this important democratic process."