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[WELLINGTON] The New Zealand government is expected to return to budget surplus next year, the first in eight years, although the fiscal position will be less robust than previously expected because of low dairy prices and a reduced tax take, Finance Minister Bill English said on Thursday.
English said a deficit of NZ$684 million (S$668.4 million)was expected for the year to June 2015 compared with a shortfall of NZ$572 million forecast in the December half year economic and fiscal update.
A surplus of NZ$176 million is forecast for the year to June 30 2016, against a forecast of NZ$575 million in the half year update last December.
He said future surpluses would be smaller than previously forecast, but there would be no move to cut services or programmes just to chase a surplus.
The budget's forecasts showed net debt peaking in the coming year, and a slower level of reduction than previously forecast.
The budget contained a package to support low income families, and higher spending for education, health and research and development, but also cut an incentive for retirement savings and imposed a new border security levy.