New Zealand Budget 2022

This year’s Budget promised to straddle two worlds – addressing the here and now created by the impacts of the Covid-19 pandemic alongside other economic drivers, and the longer-reaching goal of supporting and resourcing an equitable and prosperous future for all New Zealanders, with a focus on embedding health reforms and addressing climate change.

Does Budget 2022 support the impact needed to make a difference in these key areas? Is it enough? And what does it mean for New Zealanders and New Zealand businesses?

KPMG thought leaders and keynote speaker Hon James Shaw shared their views and insights on the 2022 Budget and its potential impact for New Zealand and New Zealand businesses. View the webinar recording here using the passcode KPMGBUDGET1!

Budget 2022 has recognised business with a $100m Business Growth Fund (BGF) to improve access to capital for small- to medium-sized enterprises. However, this may not go far enough to support the many SMEs who are struggling with Covid recovery, cost increases and supply chain challenges. Many of these businesses are on the brink of collapse. It is unclear how the BGF will help businesses facing immediate challenges with inflation, skills shortages, and supply chain challenges.

The structure of the new health and disability system represents a seismic shift and Budget 2022’s investment in this has the potential to make a real impact but with the caution that more funding doesn’t automatically translate to better health outcomes, more services, easier access or improved equity for everyone. The level of impact from this Budget will depend on how it is applied, and the capacity in the system to change and meet the ambitions of the reforms.

Transforming outcomes for Māori means addressing existing inequity across the board while empowering Māori to participate in developing solutions that work for them. Budget 2022 invests into these key themes through the following: $580m for Māori health and whānau ora, $354m allocated towards language and cultural revitalisation initiatives, including Māori language education and Māori media, $155m for Māori economy initiatives, and $162m for Māori adaption to climate change.

Funding of projects is critical for providing both public and private housing and growing New Zealand’s urban areas. There is an opportunity for infrastructure innovation and sustainable infrastructure practices to come to the fore. From an infrastructure perspective, the Emissions Reduction Plan highlighted exactly what will help create a real and positive impact for Aotearoa: cross-government planning and alignment. For initiatives to start addressing issues like the housing crisis, we need to see master planning that pre-empts growth and prioritises equity.

Budget 2022, alongside the Emissions Reduction Plan earlier this week, sends a clear message that New Zealand won’t be left behind in the global transition to a low-emissions, climate-resilient economy. The improvements to resource planning, low-emissions infrastructure and renewable energy announced with cross-party support, provide much needed certainty for business and mean that New Zealand businesses will be well positioned to compete in the economy of our future.