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Budget 2010: Still some new spending despite tight fiscal grip

The government's new tax package may be the centerpiece of this year's budget, but there is also still some new money to spread around the country, even with a tight control on the quality and quantity of government spending.This year's budget has freed u

Robert Smith
Thu, 20 May 2010
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.

The government's new tax package may be the centerpiece of this year's budget, but there is also still some new money to spread around the country, even with a tight control on the quality and quantity of government spending.

This year's budget has freed up another $1.8 billion over the next four years to put into "high priority areas" such as healthcare, education, law and order and scientific innovation.

With another $1.1 billion annual operating allowance for new spending, new budget intitiatives will see a $1.55 billion boost ever year for the next four years.

Unsurprisingly, much of the new funding has gone into core concerns such as health and schools, while the government has also continued its focus on infrastructure.

There is another $1.45 billion in infrastructure capital spending in the second year of the government's $7.5 billion infrastructure funding plan, covering roads, broadband, rail, prisons and schools.

Despite repeated claims that there would be no lolly scramble in this year's budgets, there are still a few treats here and there, with bump ups in funding for defence, social services, Maori inititatives and new research and development.

New spending in the 2010 budget includes:

• $2.1 billion in extra health investment over the next four years – including $1.77 billion in new operational funding, $186 million in reprioritised operating spending and $142 million in capital investment

• $500 million for electrification of Auckland rail lines and another $250 million for the wider rail network and rolling stock

• $248 million in further funding for broadband initiatives as part of the Government's $1.5 billion spendup. $200 million has been allocated for investment in ultra-fast broadband infrastructure by Crown Fibre Holdings, following a similar $200 million investment last year, while another $48.3 million is earmarked for getting ultra-fast broadband into schools.

• $1.4 billion in extra investment in the education sector over four years, which includes $349.3 million in new operating and capital funding for school property, $107 million extra funding for early childhood education and a $155.9 million increase in operational funding.

• $69.3 million over four years to create more prison beds, with an additional 2270
needed in New Zealand prisons by 2019

• $35 million a year to fund increased costs and new equipment for the New Zealand Defence Force

• $321 over four years for new research science and technology initiatives

• $75.9 million over the next four years for a new joint border management system to replace the current aging system

• $2.4 million - rising to $5 million by 2012/13 - for the government's new Productivity Commission

• $4.5 million allocated to grow Maori productivity and export growth, with another $4.5 million set aside to help strengthen and promote Maori tourism

• $19.8 million over four years for building and operating two new 16-bed Whare Oranga Ake - reintergration units for prisoners - by 2011/12

• $93 million over four years for disability support services and $6.8 million over the next three years to "improve the lives of people with disabilities"

• $5 million developing new or improved campgrounds and three seperate cycle trails, with the work funded by the $424 million conservation part of the budget

• $20 million to extend the Housing Innovation Fund for another year, with $4 million needed to cover loan impairments

• $26.7 million to expand the Jobs Ops programme, doubling the number of placements for 16-24 year ols with low or no qualifications from 6000 to 12,000

• $90.5 million over the next four years for non-government social sector organisations

• $4.8 million in operating funding over the next four years for the Pacific Economic Development Agency

• $6.5 million over the next three years to ensure all historical Treaty of Waitangi claims are settled by 2014

• $2 million to allow the Department of Labour to provide "more robust ACC policy advice"

• $5.9 million in operating funding over the next two years to top up community law centre funding

• $119.3 million over four years to enhance Inland Revenue compliance activities such as audit and debt collection, with an estimated net positive impact on the operating balance from this investment expected to be $745 million

Robert Smith
Thu, 20 May 2010
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.

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Budget 2010: Still some new spending despite tight fiscal grip
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