With the budget just weeks away we’ve created a helpful (mostly) alphabetic introduction to the mysteries of the annual government Budget.
What every budget always is.
In budget-speak, this exclusively refers to accounts, often in relation to the balancing thereof, and disappointingly never to potboiler novels.
Michael Cullen’s 2005 budget was derided as the “chewing gum budget”, after promised tax relief was thought to be worth about a pack of gum. There’s always a race to attach a label to a budget, and sometimes, like chewing gum, they stick.
Deficit and debt
These two concepts are different in a crucial way. A deficit is how much more money is going out across a particular budget year; the debt is the total cumulative amount owed.
Budget-speak for ‘spending.’
How much money you have access to if you need to start borrowing. “Fiscal” is a catch-all term for government tax and spending; compare “monetary policy”.
Gross domestic product. In effect, the total economic output of the country.
The area of the Budget that can literally never get enough money to satisfy everyone.
If government debt gets too high, then the interest payments can be financially damaging.
A phrase that gets used when budgets are more austere, with the promise of further spending in future years. Completely coincidentally, jam years tend to also be election years.
Named after John Milton Keynes, an economist who theorised that governments can and should spend to stimulate the economy, particularly in times of recession.
How the opposition will invariably describe a budget with lots of new spending, especially anything looking like a pork barrel, although obviously that doesn’t make a very appetising lolly.
The overall strategy implemented by central banks, to target interest rates or the rate of inflation. Not directly within the purview of the budget.
People who are not in education, employment or training, and a key target for spending from Shane Jones’ billion dollar regional economic development fund.
Budget nerd heaven, this is operating balance, excluding gains and losses.
In the weeks leading up to Budget Day, governments these days always make various portfolio-specific announcements, which means greater attention for those decisions, and fewer surprises on the day itself. Sometimes, if you’re lucky, budget commitments get announced lots of times.
A method by which (in simplified terms) the government increases the monetary supply in the economy through a central bank, often described as “printing money”. Widely used overseas, but tends not to be in New Zealand.
Robertson, Grant. The finance minister who will be delivering his first budget. There are many questions about how Robertson will handle the budget, including: will he follow recent tradition and celebrate by eating a pie?
More important symbolically than in fiscal reality, but delivery of a surplus – in which there is more in the revenue column than the expenditure column, has become a defining measurement of the performance of finance ministers in the last decade.
No, really. The colour of a tie the finance minister wears while presenting a Budget supposedly sends a signal about how they want it to be interpreted. A bright colour means it’s a bold, big spending budget, a muted colour means the Budget will be austere and dignified. Or so the pundits say.
This word will be used a lot by Mr Robertson, as he makes the case that there hasn’t been enough spending by the previous government, which he needs to correct.
These are generally the key ways that Budget spending is communicated on the day, given the complexity of the figures being thrown around.
A measure the current government plans to introduce by the 2019 Budget to track how the country is performing socially, culturally and environmentally, rather than just economically.
It’s tax, but backwards. Next!
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The word the finance minister never says straight away when another minister asks them for some more money in the Budget
A budget in which there is no increase in spending. Typically used when governments are desperate to pay down debt
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