My Stuff budget column

Stuff now have online a column I did for them on the budget. A couple of extracts:

The borrowing the Government does is effectively on behalf of the 1.2 million families in New Zealand. Its debt is their debt. So when the Government borrows $380m a week, that means it is effectively borrowing just over $300 per family per week. 

It was clearly unsustainable. How nervous would your bank manager be if you were borrowing $300 a week to pay the bills?

Such high debt also becomes a high expense. Every week you borrow $300, your annual interest charge increases by $18, so by year end you have $900 less money to spend and $15,000 more debt. What household would want to put up with that for long?

And I conclude:

2014/15 will fall in part after the 2014 election. A lot can happen in that time. In 2014 New Zealand may elect a Government with John Minto as Minister of Finance. You don’t want the books to still be in deficit then.

So my challenge to the Government is to not sit back and say the hard work is done. Aim to turn that $700m deficit forecast for 2013/14 into a surplus, so Kiwi taxpayers are not facing higher debt and higher interest charges longer than they need to.

You can comment on my column over at Stuff. They also have a column from John Pagani.