Goodbye to all that: New Zealand takes pork out of public spending

Article Abstract:

New Zealand's 1993-94 budget increases government spending by only 0.7% and the deficit is forecasted to fall to 2.8% of gross domestic product. Reform of government accounting methods includes adoption of accrual accounting, the procedure that is used in the private sector, and more frequent reports on financial progress. A government balance sheet was introduced in 1991, and the the 1994-95 budget will take the form of an operating statement that coordinates with the balance sheet. Finance Minister Ruth Richardson predicts that growth of 3% will bring a budget surplus in 1997-98.

Budget, Budgeting, Budgets

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A tight leash

Article Abstract:

New Zealand's central bank expects slower GDP growth and falling business and consumer confidence to move inflation back into the mandated 0% to 2% range by mid-1997. However, pressures from the growth of 1993 and 1994 persist, with private-sector credit up 16% and M3 money supply up 18% in the year to June 12. Bank action and political risks with an election approaching have pushed up interest rates, slowing exports and worsening the balance of trade. A $752 million cut in income taxes could add inflationary pressure.

Administration of General Economic Programs, Domestic Monetary Policy, Monetary policy

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Sweet and sour

Article Abstract:

New Zealand plans to cut taxes in 1996 and still expects to run a healthy budget surplus of NZ$3.2 billion, but tight money policy to prevent inflation will hurt an already pained export sector. Economic growth in the year to June slipped to 5.5% from a year-earlier 6.2%, and the Treasury optimistically projects 2.6% growth in the year to Mar 1996. Net govt debt should fall to 18% of GDP by June 1999, from 38% in June 1995, but a strong NZ dollar has weakened exports, expanding the current-account deficit.

Economic indicators

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