David Farrar: Anyone who calls this an austerity budget is lying

I suspect the usual suspects will call the Budget just released an austerity budget. They are lying. Austerity has a specific meaning. It is when you cut overall expenditure. It doesn’t mean they have increased it less than what we would like.

Anyone who claims the government has an austerity budget is dishonest or dumb or both.

There is a very simple way to determine if this is austerity. You can compare the spending in the budget for the 2025/26 financial year to the spending Grant Robertson announced in his 2023 Budget for the very same 2025/25 financial year.

So this is comparing like for like. This is what Robertson said he would spend in 2025/26 with what Willis has said she will spend in 2025/26. Core expenses are $2.6b higher and total expenditure is $6.8b higher. So again anyone who claims this is austerity is a liar.

In four key areas of social policy, spending is greater in this budget than Robertson said he would spend.

There have been cuts to spending in some areas – to fund higher priority spending in other areas. This is the normal job of Government – to redirect spending from one area to another. But that is not the same as cutting spending overall.

Pleased to see they are means testing the KiwiSaver subsidy from taxpayers. Giving $500 a year to people earning over $180,000 is just robbing Peter to pay Peter.

The projected surplus in 2028 is very very small, and there is no doubt the government will need to keep discuss discipline very tight next year also, despite it being an election year. We have to get back into surplus and start repaying debt before the next global economic shock hits.

David Farrar runs Curia Market Research, a specialist opinion polling and research agency, and the popular Kiwiblog where this article was sourced. He previously worked in the Parliament for eight years, serving two National Party Prime Ministers and three Opposition Leaders.