Bakshi Kanwaljit Singh: Questions for Oral Answer — Questions to Ministers 
Text is incorporated into the Bound Volume 
Bakshi Kanwaljit Singh: Questions for Oral Answer — Questions to Ministers 
[Sitting date: 05 December 2012. Volume:686;Page:7135. Text is incorporated into the Bound Volume.] 
2. 
KANWALJIT SINGH BAKSHI (National) 
 to the  
Minister of Finance 
: What progress is the Government making in managing its finances so it can return to surplus and start repaying debt? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 The Crown’s financial statements for the 4 months ending 31 October were issued today showing a $2.87 billion operating deficit for the first 4 months of the financial year. This was close to expectations being $169 million larger than the Budget forecasts. It reflected lower than expected expenses and lower than forecast revenue. Our net core Crown debt was 27.1 percent of GDP or $55.5 billion. This was in line with Budget forecasts. It remains a considerable challenge to get the Budget back to surplus by 2014-15. 
Kanwaljit Singh Bakshi 
: According to the Crown accounts for the 4 months to October what were the main factors behind the Government’s latest financial results? 
Hon BILL ENGLISH 
: The figures confirm that the Government is continuing to control its new spending and that is because the Government is continuing to focus on getting better results from existing Government programmes. Tax revenue for the 4 months was $17.9 billion which was a bit below Budget forecasts reflecting the flatter economy in the second half of this year. However it was good to see that the Inland Revenue Department’s tighter collection and enforcement policies resulted in higher effective tax rates for non-incorporated businesses. 
Kanwaljit Singh Bakshi 
: In light of difficult global economic conditions what will the Government’s approach be to managing its finances over the next few years? 
Hon BILL ENGLISH 
: It will be important that we remain focused on prudent and careful spending and in particular on making sure that the money we do spend achieves the results that the community wants to see and the Government wants to see. We will also continue to focus on assisting our businesses to be as competitive and productive as possible because the Government’s principal sources of revenue will come from a faster-growing economy. 
Hon David Parker 
: If the Minister of Finance to use his words believes he is sticking to a plan that is working can he confirm that the operating deficit for the first 4 months of this financial year is 6.3 percent higher than forecast in his Budget that the tax take is $292 million down and that unemployment is at the highest rate in 13 years? 
Hon BILL ENGLISH 
: I can confirm the numbers that are published in the accounts which show that the operating balance excluding gains and losses is about $169 million larger than the Budget forecasts. That reflects the flatter economy which has also helped to produce a higher unemployment number. However these numbers do go up and down from month to month and we are on track to surplus for 2014-15. 
Kanwaljit Singh Bakshi 
: Compared with the other developed countries how is the New Zealand Government placed in reducing its deficit and returning to surplus so that it can start repaying debt? 
Hon BILL ENGLISH 
: We are going through a somewhat similar process to other developed countries. In fact pretty much every developed country is trying to get back to surplus so that it can stop its Government debt levels rising further. We remain on track to achieve that although I would have to say we are going through a more moderate adjustment than many other Governments. For instance the Government of the state of Queensland which is very similar in size to the New Zealand economy announced in the last month or so the redundancy of 14000 public servants in a Public Service roughly the same size as ours. We have not had to take that kind of drastic measure. 
Hon David Parker 
: How can it be a moderate outcome when export values have declined 11 percent over the past year next year’s current account deficit is forecast to be the worst in the developed world income— 
Hon Steven Joyce 
: Oh what a load of rubbish! 
Hon David Parker 
: That is correct. That is correct— 
Mr SPEAKER 
: Order! The member—[ 
Interruption 
] Order! Order! This must stop. The member must just ask his question. The more statements that are inserted into a question the more risk there is of interjection. 
Hon David Parker 
: —income inequality is at its highest level ever recorded in New Zealand and household savings have turned negative again? 
Hon BILL ENGLISH 
: We have learnt to divide all the member’s numbers by seven and then we can—seven is the magic number in the Greens-Labour Government—rely on them. I just disagree with the member. I think that it is pretty clear that the New Zealand economy is going through a more moderate and actually a more successful adjustment than many developed economies.