Budget 2021: The significance, the pressure and the expectations

Opinion: The Budget can have a dramatic impact on all of our day-to-day lives. New roads, new taxes or new funding for classrooms can all have a ripple effect around the country.

Jessica Mutch McKay - file. Source: 1 NEWS

For months, the Finance Minister has lobbied about where he should spend money and on Budget day it is revealed. That’s why we care. That’s why it is a big deal. That’s why it’s highly anticipated in this place.

This year there is an extra layer of pressure.

Firstly, it is the first budget where there is no New Zealand First tail-wagging-the-dog — no $1 billion for defence, no $3 billion for the Provincial Growth Fund.

Labour has freedom it has never had before. Labour will throw a bone to the Greens but it’s Labour’s pot of cash to play with.

Secondly, last year the cash was splashed in the wake of Covid-19, so when it came to Budget day it wasn’t as exciting.

Budget 2020 - socially distanced. Source: 1 NEWS

The wage subsidy and the top up for beneficiaries had already been announced.

This year it will be a good meat and veges kind of Budget, back to the big Budget day announcements.

So here are the expectations:

1. It will be centred around recovery and perhaps it’s already been labelled 'The Recovery Budget'. Not quite as catchy as the 2005 'Chewing Gum Budget', so maybe I’ll think of something better on the day.

2. We’ll see something dynamic to help us recover. We want some innovation. Transformation seems out of reach but we need something exciting.

3. A back to basics announcement, like a boost to dental care for example. Something that middle New Zealand will think, 'Oh, that’s good for me.'

4. I’d also expect something to target low income earners who will really be feeling the effect of Covid-19.

There are several Budget day traditions.

1. The Finance Minister will wear a new tie (almost definitely red).

2. On the eve of the Budget there is always a photo opportunity showing the Budget going through the printing press. Watch for this on Wednesday. But in recent years they've been so nervous about anyone getting a glimpse of the actual Budget that they use last year's version. So it is really just designed for the cameras.

3. Media, Treasury staff and economists are able to see the Budget so we can study it before the embargo lifts at 2pm. We all gather in the banquet hall in the Beehive. The media get a delicious lunch that features lamingtons in political party colours.

4. Q+A also does a two-hour special on Budget day from 2pm. My job will be to jog at a slow but swift pace to the live point so I can relay the main points of the Budget. I will do my best to catch my breath.

Source: 1 NEWS

There will be a lot of Budget talk this week. Let’s see what 2021 has to deliver.  

Budget 2021 will be released at 2pm on Thurday, May 20. Watch TVNZ1 for the Q+A Budget special and follow for the latest news.