Budget 2025: The great Spinoff hot-take roundtable

The Spinoff

22-05-2025

Finance minister Nicola Willis says her budget is 'responsible' and 'strikes the right balance'. But what do the experts think?
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Nicola Gaston: Nothing to compensate the science system for drastic funding cuts
A couple of years ago I told the Labour government, in an RNZ interview regarding university funding, that we couldn't eat their ghost chips. I stand by that.
But it also means that, in the face of a government that is both 'going for growth' and in charge of a once-in-a-lifetime science system reform process, I have no compunction saying in response to a budget that has NOTHING to compensate the science system for drastic cuts to funding both last year and this: Bro. Monique says you're dumb.
Nicola Gaston is a professor in the department of physics at the University of Auckland and co-director of the MacDiarmid Institute
Belinda Himiona: 'Nuggets' won't relieve the crisis children and whānau are in today
There are little nuggets scattered throughout the budget, but let's be clear: they are small scale and will not relieve the crisis children and whānau are in today. Budget 2025 fails to deliver the bold investment required to build the foundation for a thriving future. The real challenge for the government is to match its investment rhetoric with being brave and investing comprehensively in services that we know improve lives.
There are clear indications that things are not OK. Lest we forget: recently Aotearoa scored towards the bottom in all child wellbeing rankings according to Unicef, there's been a 35% increase in reports of concern for children in the last year, and there's a worsening picture for children in rates of poverty, violence, education and mental health according to the Salvation Army's State of the Nation Report.
We can't keep waiting for investment, it is needed now in interventions for children and whānau at risk, poverty reduction, and fair pay that recognises the value the social sector workforce brings. Community must have a revitalised role with services devolved to community, iwi and hapū.
Governments choose where to invest. There are trade-offs. Once you improve the lives of whānau, you set the foundation for all our future.
Belinda Himiona is chief executive at Te Pai Ora SSPA (Social Service Providers Aotearoa)
Holly Bennett: Plenty of positive initiatives
Budget 2025 might have been light on 'record levels of investment' but there is still plenty to explore. One of the flagship announcements – Investment Boost – will see businesses able to make an immediate 20% deduction of the cost of a new asset from taxable income. A welcome signal that government is actively considering how better policy, rather than more money, can make enduring change.
On the other side of the coin, the government has declared war on 'tax cheats who deliberately evade their obligations'. With our national tax debt clocking in at $8.5bn, the government has allocated new funding of $35 million a year for IRD to undertake more tax compliance and collection activities. Equivalent to 0.4% of the debt balance, however, will it be enough?
One thing I didn't see coming but fully support is the $28 million investment in overhauling how emergency services respond to mental distress. The intention is to move New Zealand's mental distress 111 calls away from a police-led response to a 'mental health response'. Of course the devil will be in the detail: how this vision will be operationalised will be the true marker of success.
Finally, I'm particularly enthused by the prime minister's personal commitment to support start-up tech businesses. As a founder who is about to embark on my first capital raise for a SaaS (software as a service) platform, it's a timely reminder that an ambitious, bold and properly funded idea executed in the private sector, rather than by state, is where we most often see the biggest drivers of change.
Holly Bennett (Te Arawa, Ngāti Whakaue, Ngāti Pikiao) is the managing director of lobbying firm Awhi and a former adviser to National ministers.
Oliver Hartwich: Budget 2025 raises serious questions about New Zealand's financial future
Budget 2025 raises serious questions about New Zealand's financial future. Although the government says it plans to balance the budget, its approach makes this difficult to believe.
By leaving out the Accident Compensation Corporation (ACC) from the main budget figures, the government isn't showing the full financial picture. Even with optimistic forecasts, the government is still expecting to spend more money than it receives right up to 2029. This kind of accounting makes it hard for taxpayers to see clearly how much money the country is really spending.
On KiwiSaver, it makes sense to stop government contributions for higher earners. However, increasing the default contribution rate from 3% to 4% means both employees and employers pay more. At a time when the economy is struggling, this extra cost could make it harder for businesses to employ people and reduces individuals' choices on how to spend their money.
Another concern is the finance minister's suggestion that more KiwiSaver funds should be invested in New Zealand. Although well-intentioned, it goes against good investment practices. To keep people's savings safe and growing, investing in many different countries is far better than putting most of it into New Zealand's small economy.
Budget 2025 needs better financial management and smarter economic decisions to ensure New Zealand's future prosperity.
Oliver Hartwich is the executive director of The New Zealand Initiative
Jo Monks: Commercial gain prioritised over science motivated by environmental goals
The science system funding plan outlined by the government in Budget 2025 sends a clear signal about prioritising investment in science that is likely to result in commercial gain over science motivated by environmental goals.
Key initiatives announced include the establishment of a 'bioeconomy' organisation and promoting gene technology. The government's focus has been rapidly shifting away from ecological and social science rooted in environmental health, and towards science that will make more money, over recent months.
While all investment in science is positive, the New Zealand Ecological Society is concerned that the commercial focus of today's science funding announcement will result in further erosion of ecological science in Aotearoa. Meanwhile, strong investment in te taiao and applied ecological research has never been more important.
Dr Jo Monks is acting president of the New Zealand Ecological Society
Gabrielle Baker: Not much to benefit Māori
Feels like a great budget if you want to expand your business (Investment Boost), if you have too much money in your take-home pay cheque and need help to save it (KiwiSaver), or if you make your money building and planning hospitals.
I have a toxic relationship with budget days. I can't wait to get into the details but, when I attempt it, I'm usually left bewildered. Same again this year. I did note down a couple of things though:
• With Vote Health there are proposed savings under 'equity and evidence' and 'performance monitoring', which might give an indication of the perceived value of everyone getting good outcomes.
• Vote Disability Support Services requires time and patience to decipher because last year's funding was all included in Vote Social Sector and Community Sector, and not under this new Vote. And, for some unclear reason the government plans to spend about $10m less in community-based supports – though spending increases slightly in the other disability support service categories.
Unsurprisingly, given the current climate, there is not much in this budget that will benefit Māori, outside very small investments in Māori wardens. Still, I would have liked to have been pleasantly surprised.
Matthew Roskruge: A bland, arguably bleak, budget with little vision in the numbers
Budget 2025 was billed as a no-BS budget, and it delivered no-frills austerity. The government framed it as a 'growth' budget, but there's little vision in the numbers. The focus is on fiscal discipline, with new spending tightly contained and balanced by cuts and reprioritisations.
Headline winners include small businesses, with modest tax relief for capital investment, and the health sector, which receives a significant boost – especially for infrastructure and access. Defence also fared well, possibly reflecting US-aligned priorities and overdue investment.
But savings came at a cost. The cancellation of pay equity was a major loss, and emergency housing was scaled back. Māori were virtually invisible. Vote Māori was cut again, with funds pushed into general pools. There's little here that speaks to Māori priorities or the Māori economy.
Education saw multiple tweaks – some welcome, like learning support and literacy – but little new money. A clear trend emerged around 'tough on youth' policies: truancy services, youth justice, bootcamps, and cutting Jobseeker access for most 18 to 19-year-olds.
It's a bland, arguably bleak, budget. NZ First and Act were surprisingly muted. The bigger question is whether this signals a longer-term turn to austerity – or just a tactical reset ahead of election year 2026.