Wellington, May 28 (IANS) The New Zealand government on Thursday delivered a restrained 2026 budget focused on fiscal discipline, increased health spending and gradual deficit reduction, while avoiding pre-election giveaways.
Delivering the last budget to parliament ahead of the November general election, Finance Minister Nicola Willis said the budget aims to return the government to surplus by 2028-29, a year earlier than previously forecast, driven by tighter spending and rising tax revenue.
New spending of 3.8 billion NZ dollars (about 2.24 billion US dollars) is partly offset by 1.7 billion NZ dollars in savings, according to the budget.
Health was the largest beneficiary, receiving 5.8 billion NZ dollars in new funding, including support for frontline services, hospital upgrades and medical equipment. However, primary care funding saw no significant increase.
A fuel crisis looms over the government’s agenda, with 450 million NZ dollars set aside as a contingency fund to manage sustained fuel price pressures, reports Xinhua news agency.
Willis said infrastructure investment includes 1.77 billion NZ dollars to extend the Waikato Expressway in the North Island and more than 1 billion NZ dollars for rail upgrades.
The budget also introduces a levy on banks and financial institutions expected to raise over 200 million NZ dollars, and a 400-million-NZ-dollar housing incentive fund for local councils.
Prime Minister Christopher Luxon described the budget as “fiscally responsible,” saying it balances debt reduction with maintaining frontline services amid global uncertainty.
The opposition Labor Party criticised the budget as failing to ease cost-of-living pressures, with leader Chris Hipkins saying it leaves New Zealanders “worse off” and accusing the government of prioritising cuts over support.
Labor’s Finance spokesperson Barbara Edmonds said rising unemployment and higher living costs showed the government was “shrinking” the economy rather than strengthening it.
–IANS
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