Opening of Govt's books expected to show dire economic numbers

Author
Newstalk ZB,
Publish Date
Wed, 16 Sep 2020, 9:45AM
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Opening of Govt's books expected to show dire economic numbers

Author
Newstalk ZB,
Publish Date
Wed, 16 Sep 2020, 9:45AM

The opening of the Government's books is set to reveal fiscal numbers that reflect the response to the urgent health and economic situation.

Treasury will today unveil its Pre-election Economic and Fiscal Update - or PREFU - something it's required by law to do ahead of every New Zealand election.

It'll include a number of important sets of economic data, such as the expected level of Government debt, expected tax revenue numbers as projected deficits going forward.

Economist Cameron Bagrie says we're borrowing big and putting an awful lot on the credit card.

“That’s the right policy response in the near term - to try to help the economy get back on its own feet, but that's going to take a bit of time.”

Bagrie says what the update won't tell us - is what the adjustment looks like on the other side of Covid-19.

‘If you leverage up the balance sheet by taking on a lot of debt, you're borrowing off the next generation.

“That will be a story beyond today's update,  but something that we need to keep in mind.”

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