What’s in the Budget

Bill English, the Minister of Finance, read the Budget in Parliament yesterday. As expected, most of the money this year will be used for health, education, NZ superannuation and social welfare. Smaller amounts of money will be used for business, especially science and special projects in the regions. The police will have a pay increase and there will be more money for transport, especially new roads. The army will get more money for military equipment. However, DOC, the Department of Conservation, will get $34m less than last year. DOC has to rely more and more on volunteers.

Bill English is pleased that this year there will be a surplus – more money than is needed – and this money will be used to repay debt. Like many governments, our government borrows money.

However, most government money comes from tax which we pay from our wages or salary. GST also provides money to the government. Taxes on cigarettes will bring in $425m in the next 4 years as the cost rises 10% each year. By 2020, a packet of cigarettes will cost $30. The increased cost is to try to get more people to give up smoking. Now only about 15% of our population smokes.

This Budget does not have many new policies. Next year, however, is an election year so we can expect tax cuts in the Budget to encourage us to vote for the same government.


• Superannuation – pensions for retired people
• Conservation – looking after nature, our native birds, national parks etc.
• rely on – need the help from
• wages – paid weekly; salary – a yearly amount divided into 12 or 24 equal pay amounts
• GST – goods and services tax; sales tax and tax on services like hair cuts, house repairs etc

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