Grant Robertson promised, and has delivered, a balanced budget.

We’re getting used to ‘balanced’ having a different meaning than it used to from Finance Ministers on Budget day. Balance, these days, means a wider focus than spending on hard infrastructure like “shovel-ready projects”, and a recognition that investments in people, social and natural capital are necessary, good for New Zealand and (by the way) good for business.

So has the Government delivered on these objectives? Some of the key challenges facing Government are “how transformative?” and “can we execute effectively?”.


Business has long understood that investment in public roads and bridges is important. Most are also awake to the risks to business, communities and regional and national economies if we neglect those other forms of capital, underinvest in them, and allow them to crumble. Society increasingly expects that government investment supports the most vulnerable and protects the environment in which we live.

However, the key questions remain – is it enough, appropriately targeted and, most importantly, how will it be delivered?

Human Capital

The Government initiative saved for Budget day is an increase in benefit levels to those recommended in last year’s Welfare Expert Advisory Group review. The Budget commits to implementing those recommendations in two stages – 1 July 2021 and 1 April 2022 so that weekly main benefit rates increase by between $32 and $55 per adult.

There will always be those who consider the increases either not enough or too much.  By targeting the Advisory Group recommendations, the Government is following an expert lead while balancing competing demands to address other gaps in the four capitals.  

Human capital
Social capital

Social Capital

Part of the Government’s immediate response to the Covid-19 pandemic was an investment in shovel-ready physical infrastructure. This Budget includes elements of that same kind of investment in social capital.

We’ve seen a clear endorsement of ‘by Māori for Māori services’ with the creation of a Māori Health Authority. Its sole focus is to drive hauora Māori, with the necessary mana and commissioning power, to help provide the much-needed uplift in Māori Health outcomes.

According to the World Health Organisation, the health outcomes of an entire society are adversely affected by the level of inequality.

Natural Capital

One of the five priority areas announced this year is ‘Securing a Just Transition as we shift to a low-emissions economy’. Some climate initiatives feature in the Budget. A further $300m for the Green Investment Fund is one of those.

As we transition, investment in climate change education is required to ensure people are redeployed into the green economy, shifting them over time from jobs in oil and gas, to alternative sectors.

Significant spending is also required to decarbonise priority sectors (namely transport and process heat) and investing in climate-resilient infrastructure. Transport makes up over half of our country’s carbon emissions.

Natural capital
Physical capital

Physical Capital

The housing crisis isn’t going away given spiralling house prices, rising housing insecurity and homelessness, unsustainable use of transitional housing, and lack of easy answers on supply. With crowded and cold houses being a key determinant of health issues, and housing insecurity disrupting education, employment and other outcomes, the impacts are far reaching.

A $3.8bn Housing Acceleration Fund, announced pre-budget, will help New Zealand build more houses quickly. It involves unlocking a mix of private sector- and government-led developments in locations facing the biggest housing supply and affordability challenges, including the Kainga Ora large scale projects.