Brad Olsen: Infometrics Principal Economists on all parties fiscal plans for Election 2026

Is there anything in there that took you by surprise?

Not necessarily, and to be clear, given that we're, you know, getting quite close to the election date, that was probably comforting in a sense.

If there was some sort of big revelation or a huge amount of additional spending, uh, available, that would've probably concerned.

The most encouraging part though is that, uh, there is still an extra $7.5 billion over the forecast period that the National Party have kept aside for funding pressures.

That's important because at the moment there's still gonna be some very difficult choices for government going forward.

With the high cost of living, of course, that hits households and businesses, it also hits government, and so unless you leave some mon- uh, some f- money and some funds aside for that, uh, it becomes very difficult to deliver the services that Kiwis want.

So there's a balancing act, right? Some parts of politics are gonna say there's not nearly, uh, enough of a cut back, others are gonna say there's not nearly enough spending.

Uh, realistically there's not a lot of new changes coming through, and that's probably right when there's also, of course, coalition agreements at some point that every party's gonna have to make, and there's never a line item for that in the budget.

Would you say that the fiscal...

I mean, if we're comparing major parties, the fiscal plan is more credible than Labor's because the headroom doesn't have the cost pressures that Labor's does through the pay equity?

Well, there's, there's fewer, I think, uh, o- o- or there's, there's more options that, uh, the National Party plan has relative to the Labor Party plan simply because there's, uh, with Labor, there's more that, uh, that unallocated amount of money has to go towards.

It has to be split up between, uh, the pay equity, whatever that sort of turns out to be.

Uh, there is some additional, uh, health cost, uh, pressures in the system there that aren't necessarily, uh, there in the Labor plan.

But also, uh, those additional cost pressures from government.

Now, to be clear, Labor can still fund their plan.

That's absolutely fine, but they will have more difficult choices than otherwise.

Uh, the National Party plan doesn't have quite that same pressure, uh, but equally they haven't sort of offered up nearly as many policies in terms of larger commitments.

Again, depending on your politics, that'll either be good news or, or otherwise.

I think the most important thing though when we look through it is that there is still an expectation from all the major parties that we are gonna have this expectation of, of a surplus still coming back.

That is fairly vital because the longer we keep spending, the longer we run down our, our ability to then recover after the next disaster, whenever it comes, right? That is important that there seems to be at least a, a, an agreement f- with political parties that we do need to bend that debt curve down-

Mm

... and that that willingness is actually coming through in the fiscals, it's not just a pipe dream anymore.

You disappointed to see Nationals walked away from any planned changes to superannuation?

Oh, I mean, always as a young person.

Am I surprised though, given the political environment? Not necessarily.