Bennett Paula: Appropriation (2014/15 Supplementary Estimates) Bill Imprest Supply (First for 2015/16) Bill — Second ReadingsText is subject to correctionBennett Paula: Appropriation (2014/15 Supplementary Estimates) Bill Imprest Supply (First for 2015/16) Bill — Second Readings[Sitting date: 17 June 2015. Volume:706;Page:4502. Text is subject to correction.]Hon PAULA BENNETT (Associate Minister of Finance)on behalf of theMinister of Finance: I move That the Appropriation (2014/15 Supplementary Estimates) Bill and the Imprest Supply (First for 2015/16) Bill be now read a second time. The Appropriation (2014/15 Supplementary Estimates) Bill relates to the financial year about to end on 30 June 2015 and seeks parliamentary authority for variations to appropriations authorised by the Appropriation (2014/15 Estimates) Act 2014 and for new appropriations that were not in that Act. The Imprest Supply (First for 2015/16) Bill relates to the new financial year starting on 1 July 2015 and seeks parliamentary authority or supply for Government expenditure during the first 2 months of that financial year in advance of the passing of the Appropriation (2015/16 Estimates) Bill which was introduced of course on Budget day. On behalf of the Minister of Finance I thank the Finance and Expenditure Committee and the Intelligence and Security Committee for their prompt consideration of these supplementary estimates.Budget 2015 was delivered against a backdrop of sustained economic growth rising wages more jobs low inflation and low interest rates. It focused on sticking to a plan that is working: careful management of public spending going hand in hand with investment in public services and support for the country’s most vulnerable. Budget forecasts show an annual GDP growth of 2.8 percent on average over the next 4 years keeping New Zealand among the faster-growing developed economies. That growth is of course working for New Zealanders. By mid-2019 a further 150000 people are forecast to be in work and the average wage is expected to rise by $7000 to $63000 a year. Unemployment is expected to drop below 5 percent in the next 2 years and then fall further. Inflation and interest rates are expected to be significantly lower than previously forecast. This is good news of course for consumers because their income will go a bit further. But as I have outlined previously lower than expected inflation is impacting the Government’s revenue.The Budget forecasts a deficit of $684 million for 2014-15 which is $2.2 billion less than last year’s deficit. But my are not things already changing? A surplus of $176 million is expected in 2015-16 with increasing surpluses in following years. Of course you may have noticed that these are forecasts with some degree of uncertainty around them and we saw this with the $448 million surplus in the 10 months to 30 April—around a billion dollars better than forecast in the Budget.Grant Robertson: Don’t get too excited.Hon PAULA BENNETT: Let me assure the member that I am not excited yet. The surplus target has been successful in applying greater discipline to Government spending which has turned the Government’s books round and the fiscal outlook remains very positive.What really matters is the overall trajectory of improvement. We have come a long way from a deficit of $18.2 billion just 4 years ago following the global financial crisis and the Canterbury earthquakes. We are focused on ensuring that that trajectory continues by delivering better public services which will reduce vulnerable New Zealanders’ long-term dependence on Government interventions. We have got 10 Better Public Services results and we are seeing improvements. There has been a 38 percent reduction in youth crime since 2011. The number of teenage sole parents on a benefit has dropped by 40 percent since 2011 and immunisation rates for Māori are now almost as high as for the rest of the population. Budget 2015 builds on that with a $790 million package to reduce hardship among children in New Zealand’s poorest families and that is the next step in the Government’s commitment to addressing the long-term drivers of deprivation.This package includes several important initiatives such as increased work obligations for sole parents on a benefit more childcare support for low-income families a $25-a-week increase in benefit rates for families with children and an increase in Working for Families payments to low-income families not on a benefit. That entire package really is targeting around 160000 families—with 300000 children—earning less than $36350 a year. As in previous Budgets we have been able to spend a bit more on this because we are focused on reprioritising spending to programmes that deliver results. We have continued to increase spending on health and education but with a growing focus on the effectiveness of programmes for those in need.I will not go through all the Budget initiatives here today but I will highlight on behalf of the Minister a couple of other key programmes. Budget 2015 includes a $1.7 billion health package taking the total annual health spend to $15.9 billion. This includes $1.3 billion for district health boards for extra services cost pressures and population growth. The Budget also provides an additional $680 million for compulsory education taking the annual early childhood education and schools’ budget to $10.8 billion. Outside the child hardship package the Budget also provides over $100 million for further initiatives to support vulnerable children. This is a responsible Budget delivered by a responsible Government. New Zealand is well placed but there is more to do. We will focus relentlessly on a strong economy and jobs continue investing to support families in need manage spending and revenue responsibly and increase resilience to global risks. We will build on a plan that is already working.