3. Question No. 3—FinanceCATHERINE WEDD (National—Tukituki) to the Minister of FinanceQuestion No. 3—Finance3. CATHERINE WEDD (National—Tukituki) to the Minister of Finance: What reports has she received on the challenge of inflation in New Zealand?SPEAKER: Just before the member answers we need to have—I know that was a loud burst; it's a technical issue—a bit of quiet while people are asking questions.Hon NICOLA WILLIS (Minister of Finance): The reports I have received confirm that inflation remains a major challenge in New Zealand at a rate of 5.6 percent even while inflation falls rapidly overseas. The Reserve Bank has said in their most recent Monetary Policy Statement that non-tradable inflation is easing only gradually highlighting the challenge facing the Government and the Reserve Bank as we look to win the fight on inflation in coming months. I want to reassure New Zealanders who are struggling with the cost of living that beating inflation is this Government's top priority. Our first act in Parliament was to introduce and progress legislation returning the Reserve Bank to a single mandate ensuring New Zealanders can have confidence that our commitment to beating inflation is rock solid.Catherine Wedd: How does inflation in New Zealand compare to other countries overseas?Hon NICOLA WILLIS: Well while inflation remains very high at home at 5.6 percent other countries offshore are already making significant progress. Inflation in the United States fell to just 3.1 percent overnight.Rt Hon Chris Hipkins: How's the UK going?Hon NICOLA WILLIS: Inflation in Canada is also down at 3.1 percent. Mr Hipkins asks what the inflation rate is in the UK and I can inform him it is down at 4.6 percent so he managed to do an even worse job than the UK.Catherine Wedd: What factors have led domestic inflation to remain so high?Hon NICOLA WILLIS: According to the OECD's latest economic outlook Up until late 2023 too much weight has been put on monetary policy to reduce inflation requiring higher interest rates" and that "The fiscal deficit is contributing to this imbalance." The incoming Government will not be able to fix in one Budget an imbalance of spending that has built up over six years. However the outgoing Government has left us with a forecast deficit this year of $11.4 billion—and that's in the Pre-election Economic and Fiscal Update. But we are already taking early action as part of the 100-day plan to end wasteful spending and I look forward to giving many speeches on that.Catherine Wedd: What next steps is the Government taking to support New Zealanders with the cost of living crisis?Hon NICOLA WILLIS: We know that New Zealanders are struggling which is why the Government is committed to delivering fiscally neutral tax relief next year. After years of watching their money squandered on wasteful projects like Lake Onslow light rail the Auckland bike bridge project that cost millions and went nowhere like the TVNZ-RNZ merger the jobs tax the income insurance scheme and all of the other items in the policy bonfire our Government is committed to reducing wasteful spending and delivering income tax relief for New Zealanders.Rt Hon Winston Peters: Can I ask the Minister of Finance as to whether or not in her previous answer that is the greatest disparity ever between a forecast surplus and an actual deficit?Hon NICOLA WILLIS: What I would also highlight—the member is correct to highlight—Hon Grant Robertson: Answer the question.Hon NICOLA WILLIS: Well the Deputy Prime Minister is correct to highlight that the gulf between the rhetoric of a Government and the actual numbers it delivered—I don't think has ever been wider. Because we had a finance Minister who repeatedly promised a return to surplus and yet every time he arose to announce his next Budget the surplus would mysteriously slip slip slip away."