Climate spending on NZ budget scrapheap
New Zealand's Finance Minister is warning of a "sobering" budget next week, with previous priorities scrapped and debt set to skyrocket as Kiwi leaders cushion the blow from COVID-19 with new stimulus.
With an election due in September, Grant Robertson is pushing ahead with the 2020 budget on May 14 that will form the cornerstone of the country's response to the pandemic.
Mr Robertson has already announced more than $NZ24 billion ($A22.5 billion) worth of stimulus, including $NZ10.6 billion of spending on wage subsidies that has already been paid out to employers representing 1.7 million Kiwi workers.
"I will not sugar coat what the scale of these investments will mean," he said.
"We will be running operating deficits for an extended period and allowing net core Crown debt to increase to levels well beyond our previous targets."
New Zealand's budget was at a $NZ7 billion ($A6.6 billion) surplus before the crisis.
"Right now, being responsible means investing our money," he said.
"This is a necessary and responsible move as we fight the virus, reduce the impact on businesses and workers, and rebuild our country."
New and vast spending measures are forthcoming in next week's budget, but not where they were previously planned.
Projects in five previously announced areas, including New Zealand's transition to a low-carbon economy and Prime Minister Jacinda Ardern's pet area of child wellbeing, have been "re-assessed".
"Unless they are meeting a core cost pressure, we have put them on ice," Mr Robertson said.
"We went back, we re-assessed each of those, and we decided our focus had to be on COVID-19.
"We will be continuing to work very hard to make New Zealand into a low-carbon economy to reduce our emissions. That's still important. It's just the specific projects under those priorities for this budget will be put on ice."
While Mr Robertson's comments are likely to alarm climate advocates, the Labour minister maintains his government's commitment to fighting inequality in the face of a "one-in-one hundred year shock".
"In the wake of this dreadful and devastating crisis we have a shot at making things better. And we will take it," he said.
"As someone said to me the other day, 'if your house were to burn down, you probably wouldn't build it back exactly the same, would you?'
"Budget 2020 gives us the chance to begin this rebuild, better and together.
"There are few times in life when the clock is reset. Now is the time we should address these long-term issues. It is a privilege many countries won't have. It's not one we should squander."
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