Anyone who says NZ shouldn't borrow money is 'fiscally illiterate', says top economist after Government changes debt target

With just days until the Budget is delivered Finance Minister Grant Robertson revealed yesterday he's open to borrowing more in the future if re-elected.

Yesterday Mr Robertson announced the Government's changed it’s debt target from 20 per cent of GDP to 15 to 25 per cent of GDP.

The National Party claims the Government can't manage its books properly but economist Shamubeel Eaqub told TVNZ1's Breakfast it doesn't matter what party is in charge - New Zealand has been fiscally responsible for decades.

"There is this obsession in New Zealand that we shouldn’t borrow any money, even though we have the lowest interest rates in living memory and we have a long list of projects that we need to invest in," Mr Eaqub said.

"Anybody who tells you that we should not be borrowing money at this point in time to invest in the future of New Zealand is fiscally illiterate".

Yesterday Mr Robertson said that "fiscal intentions in this Budget will signal a shift to a net debt percentage range, rather than a single figure".

"A range gives Governments more capacity to take well-considered actions appropriate to the nation's circumstances.

"It establishes boundaries within which debt is kept to sensible and sustainable levels and where fiscal choices are driven by impact and value."

National's finance spokesperson Amy Adams told TVNZ1' Breakfast today the Government is breaking a promise by changing the debt target.

"I think the Government should stick to the promise they made New Zealand which is that they could deliver everything they’ve promised within 20 per cent of GDP.

"So, I think they should stick to commitment they’ve made. They told New Zealand they could do everything they promised within that number, they should stick to it."