Wilkinson Kate: Questions for Oral Answer — Questions to MinistersText is incorporated into the Bound VolumeWilkinson Kate: Questions for Oral Answer — Questions to Ministers[Sitting date: 27 May 2014. Volume:699;Page:18300. Text is incorporated into the Bound Volume.]2.Hon KATE WILKINSON (National—Waimakariri) to theMinister of Finance: How is Budget 2014 as part of the Government’s wider economic programme helping New Zealanders to get ahead?Hon BILL ENGLISH (Minister of Finance): It has been received positively especially the $500 million support package for families and children. It is helping New Zealanders to get ahead in several ways. For instance the economy grew by 3.1 percent in 2013—the fifth-highest growth rate in the developed economies. Growth is forecastto reach 4 percent next year a far cry from the deep domestic recession that we inherited in 2008. Average wages have increased by $3000 in the past 2 years and the average wage is forecast to rise by $7600 to $62300 by 2018.Hon Kate Wilkinson: How are the benefits of the Budget and the Government’s wider economic programme being reflected in the labour market and how do average wage increases compare with cost of living changes?Hon BILL ENGLISH: In the past year another 84000 jobs were created across New Zealand. Treasury forecasts 172000 jobs being created over the next 4 years. As some members of the House will recall—Andrew Little: You promised that 6 years ago.Hon BILL ENGLISH: —or as that member recalls—Budget 2011 did in fact forecast 171000 jobs to be added to the economy by mid-2014. That member will be pleased to know that we are exactly on track to achieve 171000 jobs as forecast in Budget 2011. These new jobs will help bring unemployment down to 4.4 percent according to Treasury forecasts. Of course low cost of living increases are helping. Inflation was just 1.5 percent in the year to March and the average weekly wage increased by 3.2 percent in the same period.Hon Kate Wilkinson: How have the Budget and the Government’s wider economic programme helped to address the twin fiscal and current account deficits this Government inherited 6 years ago?Hon BILL ENGLISH: When the Government came to office the previous Government’s final Budget set a course for a $3.9 billion deficit in 2008-09. The current account deficit was running at record levels of between 7 and 8 percent having doubled over the previous 9 years. Budget 2014 confirmed that the Government is on track for a small fiscal surplus next year and increasing surpluses to follow on. The current account deficit has fallen to 3.4 percent from 7 to 8 percent of GDP and is forecast to fall further over the coming year before extending after that.Hon David Parker: Does he agree with the New Zealand Institute of Economic Research and Treasury that on his economic settings the current account deficit will blow out to more than 6 percent of GDP by 2017 according to Treasury and to more than 7 percent by 2018 according to the New Zealand Institute of Economic Research close to $20 billion; or are the New Zealand Institute of Economic Research and Treasury wrong?Hon BILL ENGLISH: On recent forecasting history yes they probably are wrong. Over the last 4 years they have been forecasting that deterioration and it has not occurred. The current account is currently 3.4 percent in deficit. I think that forecasts in 2010 had it at 7 percent by now. But we do not follow the same policy settings as the previous Government which blew out the current account deficit and it is likely that the current account deficit certainly will not go back to record levels as it did under Labour.Hon David Parker: Does he agree with the New Zealand Institute of Economic Research in its recent report that “The current boosts to growth are from a post-drought rebound in farming acceleration in the Canterbury rebuild and net migration. All of these are likely to fade from next year.”?Hon BILL ENGLISH: The Government has been saying exactly the same and that is why we are focused on lifting the long-term supply capacity of this economy particularly through the wide range of policy initiatives in the Business Growth Agenda all of which are building confidence in businesses to invest for future growth and create more jobs. We are pretty pleased with progress on that.Hon Kate Wilkinson: How are the Budget and the Government’s wider programme helping to keep interest rates lower for longer and what reports has the Minister received suggesting more New Zealanders are supporting its programme?Mr SPEAKER: The Hon Bill English in as far as there is ministerial responsibility for the second part.Hon BILL ENGLISH: The Government is going to keep interest rates lower for longer first by constraining its own spending—if Government spending blew out now interest rates would be pushed higher—and secondly by focusing on influencing councils in their decisions about the housing market to ensure there is more supply of more houses. In answer to the second part of the question data from Statistics New Zealand shows that more New Zealanders are voting with their feet and coming home or staying home. There was a net loss of only 200 migrants to Australia in April—the lowest since the series began in 1996.