Key not sure of surplus goals

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Key not sure of surplus goals

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John Key's now not so sure he'll reach surplus by 2014/15

John Key's now not so sure he'll reach surplus by 2014/15

By Political Editor Duncan Garner

Troubles in Europe will inevitably have their impact here too.

Prime Minister John Key appears to be having second thoughts about whether he'll achieve one of his Government's centrepiece goals – to return the books to surplus in two years.

They called today's election results a "victory for all Europe" and politicians now have a chance to save Greece.

“They know we have a hand grenade in our hands and no one wants it to explode," says former Greek finance minister Petro Doukas.

But Greece is broke. Two years of austerity measures have left the economy in tatters.

Its people are bewildered about the future for their children. Youth unemployment is at 50 percent not only in Greece, but Spain too.

Back here, John Key says the meltdown will impact on New Zealand. He's now not so sure he'll reach surplus by 2014/15.

“I'm now a little less confident of reaching a surplus,” says Mr Key.

Already Reserve Bank governor Alan Bollard says the Government's surplus target in 2014/15 of $197 million won't be reached.

He says the surplus will be pushed back to 2016/17.

“We take another two years for the Government to get back into surplus," says Dr Bollard.

Mr Key says he's still hoping he can get there, but not at all costs and not if it means huge cuts.

“We're not going to hell in a hand basket to get there. It'll force a recession.”

“Bollard was just being honest,” says Green Party co-leader Russel Norman. “The truth is the outlook for economy isn't anything like the Government said it was in the Budget."

With uncertain economic times and faltering markets, the Greens want the asset sales to go on hold.

“You'd have to be a mug to sell large assets in the middle of an ongoing financial turmoil,” says Mr Norman.

Mr Key wants to plough on.

“I can't see a reason not to sell,” he says.

Mr Key has been bullish about reaching a surplus. But today he was less than certain.

Of course to get there, he may be forced to cut Government spending and that could force New Zealand back into recession.

That's unlikely to be acceptable to anyone, including the Prime Minister.

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Comments

19/06/2012 3:25:34 p.m.

Greg wrote:

Time for a revolution and we become a state of Australia, the pretty much own us anyway without any of the benifits.
Then we can dump our corrupt party delagate selection system.

19/06/2012 10:37:21 a.m.

Kim wrote:

Sorry mike but the reasons noone remembers that is because it never happened. The truth is..without those 2 funds our defecit would be twice as much..thats fact. Oh and by the way in that 4th paragraph you reveal yourself as Alien as thats the same bs line he use to come out with, with no proof. Don't you think if there was any basis for your accusation National would be yelling it from the rooftops?

19/06/2012 7:58:16 a.m.

Mike wrote:

Did we see anyone held accountable for the 'Cullen Fund' which directed ACC and Kiwisaver to invest in risky investments like Madoff?

Remember the $29 billion that was lost prior to the 2008 election under Labours/Greens watch? How much finders fees was paid to Labour members involved?

Or do Labour/Greens value lives? Take the Sanlu disaster where they decided that keeping quiet was okay as it was only costing Chinese babies lives - and its not like Chinese babies can vote, so is unimportant to Labour/Greens.

What about Labours take on Justice? Take a suspected criminal in the USA on sex charges who couldn't use commercial transport due to those charges. But wait, the suspect was connected to Labour at the highest level, so they sent a RNZAF plane stateside to collect this individual and pervert the course of justice!

@Jockey While the EU (outside the UK) we dont trade much with due to their restraint of trade, they do a major amount of spending worldwide. That spending or lack of it will see a decrease in world spending, which will see less paid to NZ. NZ can still grow, but it will be harder. We also need to get our own country in order incase the EU problems grow, eg the EU countries in trouble are growing, not being solved.

19/06/2012 6:18:14 a.m.

alison wrote:

I think Key will be remembered for the biggest mistakes any govt has made. Resign and take Bill with you. How can anyone run the countries finances with guestimates, outright porkies and no experience. And key ya smiles drooping. Admit you are wrong and let someone with experience take over.

18/06/2012 9:35:04 p.m.

Mike wrote:

Sell what ever you can John at fire sale prices then later we can get to see your mates who own part of these assets make record profits, you know the usual routine that you guys pull of we suckers fall for every time. For the National fanboys just becauses its national doing this they shouldn't get away scot free just like neither should Labour if they were in power doing the same things.

18/06/2012 9:07:49 p.m.

jockey wrote:

He got the tax cuts for the rich right. (Like every national government that has ever held power in NZ) that's all he was elected on so technically he is a success...

China is our biggest trading partner and they are growing at how much every year? Oh that's right. NINE PERCENT!

But our minor trading partner in europe is having trouble so we can't grow either?

18/06/2012 8:50:09 p.m.

Bruce wrote:

So. What is Key saying exactly here? and what is the Reserve bank proposing? Is key finally admitting that Austerity measures are not working? Is he going to promote stimulation measures? surely not! thats common sense. Cutting government spending will throw the country back into recession. Money was designed to go round. not to be blocked.

18/06/2012 8:12:28 p.m.

atrout wrote:

The election results in Greece provided the opportunity for the PM to retreat from the obvious in a very convenient manner. John Key certainly has a good sense of the use of distractions in his PR. A clever chap is John. He relies on the public being a little less cogent. And it works nicely!

18/06/2012 7:28:43 p.m.

jeremy anderson wrote:

He ,Key obviously doesn't have not only a clue but not even the first clue. He has the worst finance minister in my living memory and he appears to be doing what he is told. Resign John just resign.

18/06/2012 6:56:17 p.m.

Josh wrote:

Surprised.....I think not! Time to go John!