New Zealand Delivers Tight 2025 Budget Amid Global Economic Risks

New Zealand's Finance Minister Nicola Willis is set to deliver a tightly controlled 2025 budget focused on fiscal prudence amid global economic uncertainties and domestic recovery challenges. The government forecasts a narrower budget deficit of NZ$14.74 billion, down from an earlier estimate, and aims to reduce operating spending to the lowest level in a decade while prioritizing investments in health, education, defense, and social services. Despite plans to boost capital expenditure, critics including unions and opposition parties warn that cuts, especially to wage increases for women-dominated sectors, risk undermining public services and social equity. The government defends the budget as a necessary response to previous high spending during the COVID-19 pandemic and aims to manage debt peaking at 46% of GDP by 2027/28. Initiatives include a $190 million Social Investment Fund and expanded healthcare services, but the budget also avoids introducing new compensation schemes for survivors of state care abuse. The debate reflects broader tensions over balancing fiscal responsibility with social needs in the face of global trade risks and economic slowdown.