Treasury's Half Year Economic and Fiscal Update shows more delay to getting the books back to black.  

The deficit's expected to deepen to a depth of $16.9 billion and not narrow to $60 million dollars until 2029-30. 

Economic growth is expected to be just 1.7% next year. 

NZ Herald Business Editor Liam Dann told Kerre Woodham that the problem isn’t in how much we borrow, but the efficiency of government spending.  

He says there's a big lack of trust in the government, as people would be able to cope with higher borrowing if it was going towards amazing infrastructure projects, but we haven’t seen that over the last decade.  

LISTEN ABOVE 

Treasury's Half Year Economic and Fiscal Update shows more delay to getting the books back to black. &nbsp;
The deficit's expected to deepen to a depth of $16.9 billion and not narrow to $60 million dollars until 2029-30.&nbsp;
Economic growth is expected to be just 1.7% next year.&nbsp;
NZ Herald Business Editor Liam Dann told Kerre Woodham that the problem isn’t in how much we borrow, but the efficiency of government spending. &nbsp;
He says there's a big lack of trust in the government, as people would be able to cope with higher borrowing if it was going towards amazing infrastructure projects, but we haven’t seen that over the last decade. &nbsp;
LISTEN ABOVE&nbsp;

Join Kerre Woodham one of New Zealand’s best loved personalities as she dishes up a bold, sharp and energetic show Monday to Friday 9am-12md on Newstalk ZB. News, opinion, analysis, lifestyle and entertainment – we’ve got your morning listening covered.

Kerre Woodham Mornings Podcast

Liam Dann: NZ Herald Business Editor on the state of the Government's books

https://api.omny.fm/orgs/7784f840-c291-422a-924b-ad9000bbad71/clips/5d1935ac-d1bb-48a3-8289-b3b501763735/transcript

Mark Mitchell is acknowledging the wins he had in 2025. 

It’s been a busy year, the Minister dealing with a range of emergencies across the country, plus the hefty police portfolio. 

He told Kerre Woodham that although there’s a lot of negative headlines throughout the year, we should be extremely proud of ourselves as a country. 

Mitchell says there’s a lot more going on than there is bad.  

LISTEN ABOVE 

Mark Mitchell is acknowledging the wins he had in 2025.&nbsp;
It’s been a busy year, the Minister dealing with a range of emergencies across the country, plus the hefty police portfolio.&nbsp;
He told Kerre Woodham that although there’s a lot of negative headlines throughout the year, we should be extremely proud of ourselves as a country.&nbsp;
Mitchell says there’s a lot more going on than there is bad. &nbsp;
LISTEN ABOVE&nbsp;

Mark Mitchell: Police Minister reflects on 2025, looks ahead to 2026

https://api.omny.fm/orgs/7784f840-c291-422a-924b-ad9000bbad71/clips/8ff89485-cda8-4963-96a2-b3b501877096/transcript

We're going to start this morning with the Half Year Economic and Fiscal Update, which was actually the Three-quarter Year Economic and Fiscal Update. It delivered news we all expected, and that is that we're getting there as a country. It's just taking longer than we thought. 

Treasury's half-year update, published on Tuesday, predicted a return to surplus in 2029/30, a year later than it forecasted in May. Finance Minister Nicola Willis said she'd continue to aim for 2028/29 and said we're on target to return the books to surplus faster than they will in Australia, the UK, Canada, and many other advanced economies, while maintaining a prudent debt position. 

She's doubled down on what she calls her disciplined plan for returning the books to surplus, and says she's not willing to implement more brutal spending cuts, as the Taxpayers' Union have been advocating for, warning that their prescription would deliver human misery and hurt frontline public services and depress already weak demand in a recovering economy. She points out that the Taxpayer Union proposed, among other things, scrapping all Working for Families tax credits, reducing the average weekly income of the recipients by about $180. She said beneficiaries and low-income families would be at the brunt of any change like that, delivering a level of human misery she was not prepared to tolerate. She said of Labour's criticism, that their approach to spending is reckless and would further delay a return to surplus. 

She said that the Government had delivered about $11 billion a year in savings during its term. Without this disciplined approach, she says the year's deficit would be $25 billion, and debt would be on track to blow out to 59% of GDP. So, according to Finance Minister Willis, she and her government are on track, and that being castigated by the Taxpayers' Union for being too soft, too wimpy, and being criticized by Labour for being too harsh, means she's charting the right course. 

It is a fine balance she has to strike. You, me, everybody can see where she can make cuts. The winter energy payment, making it a needs-based payment, making a number of allowances needs-based, the fees free, that sort of thing. There's a lot of low-hanging fruit you could pluck off and save a few cents here and a few cents there. What a lot of households have done over the past few years. But she is bound by her agreements with coalition partners. There are some things she cannot touch. She's working in an MMP environment. There are plenty of things I'm sure she'd love to do, things that Ruth Richardson could do, but even allowing for the human misery factor, there are coalition partners she has to placate, and the Government wants to get re-elected.  

It is utterly pointless steering the right course, but only for three years. It is utterly pointless saving a few billion here, only for it to be squandered next time round. So what do you suggest she does? I'm sure she gets plenty of reckons from all sorts of people – the most recent and the most high profile was former Finance Minister Ruth Richardson, who really should pipe down. I'm glad that debate's off. That was just farcical. But Ruth Richardson needs to pipe down because she could do things, and did do things, that simply aren't possible for this Finance Minister to do under MMP. 

And also, it's a lot harder to get elected under MMP and to have a big say in the direction of the government unless you've got a big platform. So anything Nicola Willis does has to be with an eye to being the biggest party to form a government. 

So, I tend to think she's right, that if you've got the Taxpayers' Union going, you're too soft, you're too wet, you're too pathetic, you've got Labour going, you're too cruel, you're too harsh, you're too brutal, then she's pretty much on the right track. 

We're going to start this morning with the Half Year Economic and Fiscal Update, which was actually the Three-quarter Year Economic and Fiscal Update. It delivered news we all expected, and that is that we're getting there as a country. It's just taking longer than we thought.&nbsp;
Treasury's half-year update, published on Tuesday, predicted a return to surplus in 2029/30, a year later than it forecasted in May. Finance Minister Nicola Willis said she'd continue to aim for 2028/29 and said we're on target to return the books to surplus faster than they will in Australia, the UK, Canada, and many other advanced economies, while maintaining a prudent debt position.&nbsp;
She's doubled down on what she calls her disciplined plan for returning the books to surplus, and says she's not willing to implement more brutal spending cuts, as the Taxpayers' Union have been advocating for, warning that their prescription would deliver human misery and hurt frontline public services and depress already weak demand in a recovering economy. She points out that the Taxpayer Union proposed, among other things, scrapping all Working for Families tax credits, reducing the average weekly income of the recipients by about $180. She said beneficiaries and low-income families would be at the brunt of any change like that, delivering a level of human misery she was not prepared to tolerate. She said of Labour's criticism, that their approach to spending is reckless and would further delay a return to surplus.&nbsp;
She said that the Government had delivered about $11 billion a year in savings during its term. Without this disciplined approach, she says the year's deficit would be $25 billion, and debt would be on track to blow out to 59% of GDP. So, according to Finance Minister Willis, she and her government are on track, and that being castigated by the Taxpayers' Union for being too soft, too wimpy, and being criticized by Labour for being too harsh, means she's charting the right course.&nbsp;
It is a fine balance she has to strike. You, me, everybody can see where she can make cuts. The winter energy payment, making it a needs-based payment, making a number of allowances needs-based, the fees free, that sort of thing. There's a lot of low-hanging fruit you could pluck off and save a few cents here and a few cents there. What a lot of households have done over the past few years. But she is bound by her agreements with coalition partners. There are some things she cannot touch. She's working in an MMP environment. There are plenty of things I'm sure she'd love to do, things that Ruth Richardson could do, but even allowing for the human misery factor, there are coalition partners she has to placate, and the Government wants to get re-elected. &nbsp;
It is utterly pointless steering the right course, but only for three years. It is utterly pointless saving a few billion here, only for it to be squandered next time round. So what do you suggest she does? I'm sure she gets plenty of reckons from all sorts of people – the most recent and the most high profile was former Finance Minister Ruth Richardson, who really should pipe down. I'm glad that debate's off. That was just farcical. But Ruth Richardson needs to pipe down because she could do things, and did do things, that simply aren't possible for this Finance Minister to do under MMP.&nbsp;
And also, it's a lot harder to get elected under MMP and to have a big say in the direction of the government unless you've got a big platform. So anything Nicola Willis does has to be with an eye to being the biggest party to form a government.&nbsp;
So, I tend to think she's right, that if you've got the Taxpayers' Union going, you're too soft, you're too wet, you're too pathetic, you've got Labour going, you're too cruel, you're too harsh, you're too brutal, then she's pretty much on the right track.&nbsp;

Kerre Woodham: The Finance Minister is charting a tough course

https://api.omny.fm/orgs/7784f840-c291-422a-924b-ad9000bbad71/clips/d984bc59-ab4a-4635-9424-b3b5016d0df2/transcript

I remember back when I first started talkback, a million years ago at nighttime, it must have been the semicentennial of the waterfront workers strike of '51, or the lockout, depending on which side you're on. It was the biggest industrial confrontation in New Zealand's history for those who don't know of it. It was 151 days from February to July, and at its peak, 22,000 waterside workers, or wharfies, and associated unions were off the job, out of a population of just under 2 million. 

It took place at a time of Cold War tensions, so name calling was rife. The opposing sides denounced each other as Nazis or commies, traitors and terrorists. Not all unions were on board with the Waterside Workers Union. Some of them thought they were way too militant, way too stroppy, so the unions weren't completely aligned. There was even the difference between the strike, which is what the employers and government called it. For the unionists, it was a lockout. 

Things got so bad that a railway bridge near Huntly was dynamited at the time of the tensions. An act of terrorism, basically – that's certainly what the Prime Minister at the time Sid Holland called it. No one was hurt, but coal supplies were severely disrupted. So, we've got bridges being blown up, we've got people on strike, we've got families who would have starved were it not for supporters feeding them. But if you were found out that you were supporting a wharfie's family, you could be ostracised, even if you were a working-class family, it hit you. Your union had to be aligned with the waterfront workers. So it was incredibly divisive. 

On the 1st of June, police dispersed up to 1,000 marchers in Queen Street, using truncheons and heavy-handed, fairly heavy-handed tactics. There was a lot of argy-bargy. There were fractured skulls and lacerations and concussions. The Government broke the strike really by bringing in new unions, and new unions of workers. They were denounced by the unionists as scabs, and the wharfies' position was becoming increasingly hopeless. Eventually, after five months, they conceded defeat on the 15th of July. So after 151 days. 

But the ugliness and the bitterness remained, because we were talking about the strike, and a man rang me from Huntly, and he said there was a scab living in his town, and he wouldn't be in the same shop, he wouldn't be in the same pub, and he would cross the street. 50 years later, that bitterness and that anger remained. 

Then we had in '81, probably the only comparable thing in recent times, was the Springbok tour, and the protests over that. That was the largest civil disturbance seen since '51. More than 150,000 people took part in more than 200 demonstrations. 1,500 were charged with offences that resulted from the protests. It was a clash between baby boomers and war veterans, between city and country, between young versus old. It's the Britain of the South versus an independent Pacific nation. There were real tensions and families were divided within themselves. 

And then along came Covid, more recently. 

I guess what I'm wondering about is how do we heal ourselves? Because we're at a time in history and at a time globally where tensions are running really, really high. Can we learn any lessons from our past? Our own past. We can't look at the world and try and fix that, but we can certainly try and heal ourselves here. We can look at the civil, not civil wars here, but civil division, civil fractures. 

I mean, if you look back and you and your family were divided over the Springbok tour, not expecting anyone still to be around from 1951, but if you look at the division you might have had with your parents during the Springbok tour, you can't cut ties forever with your parents, can you? You can't cut off your kids because they went on a protest march. So surely on a micro level, if you can heal your differences and still come together at Christmas and birthdays and things, despite the pain and the anger and the absolute incomprehension of each other's stances, then surely we can do it on a national level, can't we? 

And the same with Covid. There probably wasn't as much violence, physical violence, but certainly the violent rhetoric online was painful and awful. And it was probably more, I don't know, those who did not get vaccinated feel they were very much othered by the whole of society, that they were outcasts and punished unfairly and unnecessarily. But that was more an anti-authority, in my mind anyway, when it comes to Covid. You didn't agree with all the decisions being made, or you did. And anybody who dissented was a traitor and wanted to kill old people. 

We're at a really tricky time, but we have been at tricky times before. We have thought how on earth are we going to get over this before, many times in our history.  I guess I'm looking at stories from a micro level. If there were real differences within your family, how did you get past them? How did you get past the pain and the hurt and come together as a community again? 

I remember back when I first started talkback, a million years ago at nighttime, it must have been the semicentennial of the waterfront workers strike of '51, or the lockout, depending on which side you're on. It was the biggest industrial confrontation in New Zealand's history for those who don't know of it. It was 151 days from February to July, and at its peak, 22,000 waterside workers, or wharfies, and associated unions were off the job, out of a population of just under 2 million.&nbsp;
It took place at a time of Cold War tensions, so name calling was rife. The opposing sides denounced each other as Nazis or commies, traitors and terrorists. Not all unions were on board with the Waterside Workers Union. Some of them thought they were way too militant, way too stroppy, so the unions weren't completely aligned. There was even the difference between the strike, which is what the employers and government called it. For the unionists, it was a lockout.&nbsp;
Things got so bad that a railway bridge near Huntly was dynamited at the time of the tensions. An act of terrorism, basically – that's certainly what the Prime Minister at the time Sid Holland called it. No one was hurt, but coal supplies were severely disrupted. So, we've got bridges being blown up, we've got people on strike, we've got families who would have starved were it not for supporters feeding them. But if you were found out that you were supporting a wharfie's family, you could be ostracised, even if you were a working-class family, it hit you. Your union had to be aligned with the waterfront workers. So it was incredibly divisive.&nbsp;
On the 1st of June, police dispersed up to 1,000 marchers in Queen Street, using truncheons and heavy-handed, fairly heavy-handed tactics. There was a lot of argy-bargy. There were fractured skulls and lacerations and concussions. The Government broke the strike really by bringing in new unions, and new unions of workers. They were denounced by the unionists as scabs, and the wharfies' position was becoming increasingly hopeless. Eventually, after five months, they conceded defeat on the 15th of July. So after 151 days.&nbsp;
But the ugliness and the bitterness remained, because we were talking about the strike, and a man rang me from Huntly, and he said there was a scab living in his town, and he wouldn't be in the same shop, he wouldn't be in the same pub, and he would cross the street. 50 years later, that bitterness and that anger remained.&nbsp;
Then we had in '81, probably the only comparable thing in recent times, was the Springbok tour, and the protests over that. That was the largest civil disturbance seen since '51. More than 150,000 people took part in more than 200 demonstrations. 1,500 were charged with offences that resulted from the protests. It was a clash between baby boomers and war veterans, between city and country, between young versus old. It's the Britain of the South versus an independent Pacific nation. There were real tensions and families were divided within themselves.&nbsp;
And then along came Covid, more recently.&nbsp;
I guess what I'm wondering about is how do we heal ourselves? Because we're at a time in history and at a time globally where tensions are running really, really high. Can we learn any lessons from our past? Our own past. We can't look at the world and try and fix that, but we can certainly try and heal ourselves here. We can look at the civil, not civil wars here, but civil division, civil fractures.&nbsp;
I mean, if you look back and you and your family were divided over the Springbok tour, not expecting anyone still to be around from 1951, but if you look at the division you might have had with your parents during the Springbok tour, you can't cut ties forever with your parents, can you? You can't cut off your kids because they went on a protest march. So surely on a micro level, if you can heal your differences and still come together at Christmas and birthdays and things, despite the pain and the anger and the absolute incomprehension of each other's stances, then surely we can do it on a national level, can't we?&nbsp;
And the same with Covid. There probably wasn't as much violence, physical violence, but certainly the violent rhetoric online was painful and awful. And it was probably more, I don't know, those who did not get vaccinated feel they were very much othered by the whole of society, that they were outcasts and punished unfairly and unnecessarily. But that was more an anti-authority, in my mind anyway, when it comes to Covid. You didn't agree with all the decisions being made, or you did. And anybody who dissented was a traitor and wanted to kill old people.&nbsp;
We're at a really tricky time, but we have been at tricky times before. We have thought how on earth are we going to get over this before, many times in our history. &nbsp;I guess I'm looking at stories from a micro level. If there were real differences within your family, how did you get past them? How did you get past the pain and the hurt and come together as a community again?&nbsp;

Kerre Woodham: How do we heal our country's divisions?

https://api.omny.fm/orgs/7784f840-c291-422a-924b-ad9000bbad71/clips/105d2f2f-51e5-4cdc-afc1-b3b5000d1d6a/transcript

Liam Dann: NZ Herald Business Editor on the state of the Government's books

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