No lolly scramble likely today

Bill English.
Bill English.
Finance Minister Bill English is playing down the chance of any election-year bribes in his sixth Budget, being released this afternoon.

Chances are there will be something to encourage voter support but any lolly scramble will see fewer sweets on the ground than in past election years.

The main thrust of Budget 2014 will be to point to next year's small financial surplus, while playing down the level of government debt.

The most important issues for the Government, such as affordable housing and the Christchurch rebuild, will dominate the election campaign and Mr English will be under pressure to deliver some relief in both areas, while continuing to show fiscal restraint.

In contrast to the Australian Federal Budget, which saw Treasurer Joe Hockey slash spending in several areas, Mr English has some room in which to expand spending.

Although the Government's mixed ownership sales model, in which three electricity companies were listed on the NZX and the Government reduced its shares in Air New Zealand, was not a complete success, the funds raised can go into building schools, hospitals and roads.

Dunedin, which is battling the reduction in AgResearch's Invermay facility, was thrown some money last week when the University of Otago got a multimillion-dollar boost for science.

Both Prime Minister John Key and Mr English have been keen to hose down expectations of an election-year spend-up in the Budget. Keeping a lid on government spending is seen as an important way of keeping interest rates down.

In recent Budgets, the emphasis has been on cost-cutting and keeping a close watch on government spending.

However, economic growth is set to translate into an upgraded revenue forecast, leaving the Government some room to announce modest new spending initiatives beyond 2015 - at the same time as reducing debt and continuing the message of fiscal responsibility.

Any increased spending is likely to be subtle. The Government has indicated its preference for spending on healthcare, education, safe communities and less welfare dependency.

Extended parental leave could be one area where the Government could upstage the Opposition, after it turned down Labour's Bill to extend the current rules.

Also, some help could be afforded to first-home buyers not building their first home. The Reserve Bank's high loan-to-value rules are restricting first-home buyers, while allowing investors to still borrow and buy. The Christchurch rebuild, which remains slow, due to constant fall-outs between the city council and the Government, will receive more money, but not from the $1 billion earmarked by Mr English for ''new'' spending in the next financial year.

Christchurch remains pivotal to the Government's re-election chances and Mr Key, and his ministers, will be keen to lift the already substantial Government investment of $15 billion to ensure more progress is made before polling day on September 20.

Announcements before the Budget have been relatively minor as the Government saves something for today.

The largest pre-Budget announcements so far are the $100 million of new money for the Defence Force and $132 million to bolster tax compliance.

Other smaller spending initiatives already announced include new funding for sexual violence victims, apprenticeships and cochlear ear implants, cash incentives for beneficiaries to move to Christchurch and more money for New Zealand Trade and Enterprise operations.

Opposition parties say any surplus should not come at the expense of the poor or vulnerable, such as Maori and Pacific Island communities. Children in poverty remains a key button for the Opposition.

It is likely Mr English will point to a return to surplus providing increased job opportunities and higher wages as a way of helping those most in need.

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