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Hon Steven Joyce

Minister of Finance

25 May 2017

$7b to build better public services for a growing country

The Government is allocating $7 billion over four years in Budget 2017 to sustain and expand public services in health, education, law and order and social development, as part of our commitment to deliver better public services for a growing country, Finance Minister Steven Joyce says.

“This investment reflects our commitment to meet the requirements of a growing population while also investing prudently in the core services Kiwis rely on in order to live successful independent lives,” Mr Joyce says.

“We are a small but strongly growing economy. As a result of the Government's clear and consistent economic plan, we have the capacity to invest more in public services while at the same time getting better results for the money we are already spending.”

The $7 billion in new operating funding in Budget 2017 includes:

  • $3.9 billion over four years in New Zealand's health sector, including $1.76 billion in direct new money for District Health Boards, $1.54 billion for care and support workers, plus increased investments in Disability Support Services, ambulance services, pharmaceuticals, mental health services, elective surgery and primary health care.
  • $1.1 billion over four years for schools and early childhood centres, including $767 million for funding roll growth and demand, a $61 million increase in operational grant funding for schools, and $35 million in targeted additional funding for early childhood centres.
  • $1.2 billion over four years for law and order, including funding for a 10 per cent increase in police staff numbers (previously announced) and funding to meet increased demand for justice, courts and corrections services, plus new initiatives in burglary prevention, reducing youth reoffending, and supporting at-risk prisoners.
  • $803 million over four years for other social services, including $185 million for social housing services, $64 million for supporting people into employment, and $424 million for the new Ministry for Vulnerable Children Oranga Tamariki (MVCOT), which together with Budget 2016 initiatives amounts to a 18 per cent increase in funding on pre-MVCOT baselines.

The public services funding includes $321 million in funding for 14 cross-agency Social Investment initiatives that are designed to tackle long term social issues for vulnerable New Zealanders.

“The combination of these new initiatives and the Government's Family Incomes Package will allow us to make some serious progress with some of the longer-term challenges faced by our most vulnerable New Zealanders,” Mr Joyce says.

Mr Joyce says it is crucially important that public services maintain a constant focus on lifting productivity.

“These are big funding increases in the social sector that reflect the needs of a growing country. However, it is my clear expectation that public services continue to focus on lifting productivity so we can do more to help New Zealanders for each additional dollar of taxpayer money,” Mr Joyce says.

“As well as setting clear expectations around the results expected for increased expenditure, I am today announcing that the Government is asking the Productivity Commission to conduct an investigation into measuring and improving core public services - to ensure all New Zealanders continue to achieve better results from the investment of their tax monies in these services.”

Media contact: Anna Lillis 021 683 282


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