They weren’t sugar coating it and agreed the Government’s recent conservative Budget for 2025-2026 is an appropriate one for the tough economic times. The two main speakers at Business East Tamaki’s highly informative business breakfast last Friday at Pakuranga United Rugby Club, Minister of Health Simeon Brown and Forsyth Barr investment strategist Zoe Wallis, both talked of the importance the Government needs to have in “fiscal discipline” as the country addresses its rising debt levels and strives to grow the economy, productivity and people’s and businesses’ prosperity. After introductions by Brendan Kelly, the Business East Tamaki chair, and Liz Brown-Douglas, the Auckland East manager and investment manager for Forsyth Barr, sponsors of the breakfast, Wallis opened her presentation with a subject heading, “Fiscal order in a disorderly world”. As a “global backdrop” for New Zealand businesses trading internationally, she highlighted how influential the United States economy is to the rest of the inter-connected world including this country. Her commentary began with a comparison of the Donald “Trump 2.0” US presidency, compared to “1.0”. “He came into office this time much more organised and prepared and came out swinging,” said Wallis. “Then there was the raft of policy announcements including deregulation, immigration and trade tariffs, and the reduction in corporate tax rates.” Wallis said a lot of what Trump is leading in the US is “growth denting and inflation growing”, and on the whole, “the fundamental thing is it creates uncertainty”. She says that makes it difficult for New Zealand businesses who are exporting to the US to know how much they’re paying on tariffs for their goods and services entering that market. When Trump memorably announced the US’s new global tariff regime, New Zealand was hit with a cross-the-board 10 per cent increase. “Everybody is nervous. There’s lots of volatility. That environment is really hard to plan in.” When reviewing the Government’s recent Budget for 2025-2026, she acknowledged the difficult job the Minister of Finance Nicola Willis had, because of “fiscal constraint” caused by the “recession, slow GDP growth and lower tax take”. She acknowledged the strategy of the Government – “fiscally responsible is the right approach”, and that Willis’ Budget was a “real balancing act” addressing its borrowing because “core Crown debt is still rising” and the need for public spending in key areas. “We are net borrowers from the rest of the world, both as households and Government.” Wallis said “two key policies have moved the dial in the right direction” by the Government in tackling the nation’s debt levels, with the longer-term goal of getting back to surpluses by the end of the decade. Investment Boost, the Government’s new incentive for businesses to buy plant and equipment “is a step in the right direction”. Another “longer-term challenge” is “how we fund retirement as the natural rate of population has a falling birth rate as what’s happening in most developed countries”. “NZ Super is only getting more expensive. By 2060, over 25 per cent is expected to be over 65,” Wallis said. Brown, the MP for Pakuranga and Minister of Health, State Owned Enterprises, and Auckland, was next up, giving the east Auckland business leaders his commentary of the Budget. He described it as “The Growth Budget, a responsible budget that supports New Zealand’s economic recovery”, and praised “the immediately available new tax incentive, Investment Boost”. Brown acknowledged the Finance Minister was “incredibly tough” in getting all the Ministers to “go line by line” through their respective portfolio areas of spending, and “we are going to do it over and over again” for future Budgets. He explained the changes made to KiwiSaver, where the Government’s annual contribution to individuals will be halved from next year, from about $500 to $250, and minimum contributions made by employers and workers will also rise gradually by about 1 per cent, “makes the scheme more fiscally sustainable”. “There is new investment in healthcare, education, law and order – front-line public services,” Brown said. “There are savings being made across Government – fiscal discipline. “Real GDP growth of 2.9 per cent is expected in 2025-2026. It’s a challenging pathway to recovery, to surpluses, for a small, exposed economy. “It’s incredibly important we address net core debt. Our job as Government is restoring discipline to public sector spending. This Budget 2025 is within $1.3 billion.” Brown described the merits of Invest New Zealand, the new “one-stop shop for foreign direct investment”, the “$200 million set aside of Crown co-investment in new gas fields”, new investment in the Elevate Fund “to grow tech start-ups”, and the new $577m spending to support the film and TV production industry. Of his own health portfolio, Brown was pleased to able to extend the maximum length for medical prescriptions from three months to 12 months, freeing up patients and doctors’ time, and acknowledged the healthcare budget is $5.5b for hospital and specialist services. He also talked of the changes to pay equity, more spending in education for students with additional learning needs, raising the annual investment in Defence to 2 per cent of GDP, and the additional money being put towards infrastructure investment.