Prime Minister John Key is ruling out ''election bribes''
either in the Budget next month or in the election campaign,
saying anything more than a modest increase in spending means
higher interest rates.
In a pre-Budget speech in Auckland yesterday, Mr Key said
while some increase in interest rates was an inevitable
consequence of a healthy and growing economy, the Government
needed to do everything it could to help keep rate rises to a
''And we believe we have the support of New Zealanders who
can remember the dashed hopes of debt-fuelled growth and
floating mortgage rates above 10%.
''So there is not going to be a lolly scramble in this year's
Budget. And we also won't be doing that in the election
campaign later this year.''
In this year's Budget, the Government would stick to its new
spending allowance of $1 billion, he said.
Together with some savings, that allowed the Government to
focus new spending mainly on health and education - which
were always at the heart of National-led government Budgets -
and on families and children.
Sticking to the allowance would enable a small Budget surplus
to be posited in 2014-15, something long promised, Mr Key
''In future Budgets, we will be posting consistent and larger
surpluses. Those surpluses will allow us to begin reducing
debt as a proportion of GDP.
''We need to get on and reduce our debt instead of using
taxpayers' money in a series of election bribes - which is
the Opposition's approach.''
The Budget would show the Government remaining on track to
reduce net government debt to below 20% of GDP by 2020, Mr