NZ on Track for Worse Than Predicted Deficit Despite Slashing Government Spending

The reduction in expenditure isn’t enough to balance a sharp fall in the tax take from an economy officially in recession.

National Party deputy leader Nicola Willis speaks at the National Party election campaign launch at Manukau Events Centre on September 03, 2023 in Auckland, New Zealand. New Zealand will go to the polls in a general election on October 14. Photo by Fiona Goodall/Getty Images

Although it has slashed public service numbers and ended some programmes, New Zealand’s coalition government is heading towards its first budget with forecasts of a higher-than-expected deficit.

The National-NZ First-ACT government took office with an ambitious agenda centred on major cuts to public servant numbers.