Budget 2005

Budget 2005

Note: A lot of pre-Budget announcements were made. Some were covered in the May issue; others are included in this Budget breakdown.

Government Revenue and Spending

Government Revenue     Government Spending  
Area  

 Percent  

   Area  

 Percent
Individual Tax    43      Health    20
Corporate Tax    17      DPB    3
GST    19      Unemployment benefit    2
Other Indirect    9      Other benefits    16
Investments    5      Education    18
Other Income    3      NZ Super    13
Fees, fines    1      Law & Order    5
Sales: goods & services    1      Transport & Communications    4
Other    1      Defence    3
         Finance Costs   5
         Core services  
         Other   7

  Tax Thresholds

People will be able to earn slightly more before they cross into a higher tax bracket in three years hence. Also, thresholds are to be adjusted every three years. This means that at the time of the first triennial adjustment, 1 April 2008, the $9,500 threshold will move to $10,081, the $38,000 threshold to $40,324 and the $60,000 threshold to $63,672.

Retirement Savings

Budget 2005 commits a further $2.3 billion in 2005/06 to the Superannuation Fund. The Fund is now projected to have a balance of $19.4 billion by June 2009. Also introduced was a workplace savings scheme called KiwiSaver. KiwiSaver's basic features are:

  • automatic enrolment in a savings scheme at the workplace for new employees aged 18-65, with the ability to opt out;
  • an upfront contribution by the government on joining, plus low management fees;
  • a basic contribution rate of 4 percent of income deducted through the tax system; and
  • minimum compliance costs for employee and employer.

Apart from automatic enrolment, employees may become KiwiSavers at any time. A new employee can opt out by notifying IRD between weeks two and four after starting a new job (in this case IRD notifies the employer, otherwise deductions begin the next pay day after eight weeks with a new employer). Contributions to KiwiSaver will be at one of two levels. The standard rate will be set at 4 percent of income, but the employee can opt for a higher deduction rate of 8 percent.

The government will support KiwiSavers in three ways:

  • meeting the costs of administration through IRD;
  • a $1,000 upfront contribution will be provided to each new KiwiSaver (this contribution will be available to a member of an existing registered superannuation scheme that fully converts to a KiwiSaver product); and
  • a fee subsidy, at a yet to be finalised capped level, to savers in approved KiwiSaver products.

Normally, a KiwiSaver will have full access to their funds at age 65 or after five years in KiwiSaver, whichever is the later. Hardship provisions allowing withdrawal are being developed and permanent emigration will also trigger the ability to withdraw. A KiwiSaver can elect to take a contribution holiday for up to five years, with contributions resuming unless a further option to suspend is exercised. The self-employed will be able to become KiwiSavers, selecting their own contribution rate and frequency of contributions.

Employers will be able to make contributions on behalf of their KiwiSaver employees via Inland Revenue.

Raising Home Deposits

The KiwiSaver scheme will be linked to a new scheme to assist modest to middle-income families with the deposit for a first home. Those who are KiwiSavers for a minimum of three years will qualify for an additional subsidy of $1,000 a year up to a maximum of five years when they buy their first home. Participants would be able to draw down all of their accumulated savings as KiwiSavers except for the initial $1,000 upfront contribution. There would be conditions in relation to the total household income of the applicants and the value of the house being purchased.

The housing deposit subsidy will also be available to members of registered superannuation schemes if their employer is exempt from the automatic enrolment provisions or if their scheme converts to a KiwiSaver product.

Health

Total Vote Health reaches $9.68 billion in 2005/06 (accounting for about 20 percent of all government spending). There is new budget spending of $969.7 million in 2005/06 and $4.09 billion over the next four years. This budget increases the funds for inflationary and demographic pressures by $387.6 million over the next four years, taking the total to $2.6 billion.

There is a further roll-out of the Mental Health Blueprint to 2008/09 at a cost of $22 million, maintaining an ongoing increment of $22 million a year with a total increase of $222 million over the next four years.

DHBs get an additional $102 million in 2005/06 and a total of $549.5 million over the next four years, to pay for this year's nurses' pay rise.

Current hospital building/upgrading projects which will get over $500 million in funding include: Waitemata, Counties Manukau, Wellington, Kenepuru, Wairarapa, Horowhenua, Dunstan, Waikato, Thames, Kaitaia and Tauranga. New hospitals have already been opened in Auckland, West Auckland, Christchurch and Invercargill.

Health Research

Seventy million will be spent over the next four years to fund priority health research and to strengthen the health research workforce. The research will focus on key health areas such as cancer control, disability and diabetes. The remainder of the research funding will be allocated through the normal contestable funding pool to fund top research projects identified by scientific review. In addition, more than $9 million will be spent on initiatives to strengthen the health research workforce, including research fellowships for frontline health practitioners.

Health Care Visits: 18-24 Year Olds

Funding from 1 July for lower cost primary health care visits and lower charges on most prescription items for all 18 to 24 year olds enrolled in Primary Health Organisations ($17.2 million in 2005/06 and $74.4 million over the next four years). In July next year funding will be extended to 45 to 64-year olds enrolled in PHOs, and all other NZers in PHOs will be funded from July 2007.

Sickness and Invalid's Beneficiaries

$27.7 million will be invested over the next four years to help more Sickness and Invalid's beneficiaries move into work. The funding will allow for:

  • improved work assessments to prepare 2,500 people for a long-term return to work;
  • increased support for disabled job seekers and their employers;
  • a 76 percent increase in payments to designated doctors for GPs and psychologists, and a 62 percent increase for specialists (designated doctors are responsible for assessing an individual's eligibility for the Invalid's Benefit); and
  • the nationwide roll-out of a second-opinion programme to help doctors better assess Sickness Benefit eligibility.

Disability Support Services

An additional $59 million in 2005/06 for residential disability support services and the provision of assessments. An additional $29.6 million will be added to baseline funding for disability support services to cover demographic and inflation related adjustments. The remainder of the money will be allocated across three main areas:

  • $14.4 million for Kimberley Centre residents;
  • $8.4 million for younger people needing residential disability care; and
  • $6.6 million to improve Needs Assessment and Service Co-ordination (NASC).

Occupational Health

New funding of $730,000 (GST exclusive) for improving occupational health in NZ workplaces. The funding (for 2005/06) will enable the Department of Labour to strengthen its technical expertise and leadership in occupational health, and start to upgrade systems for reporting and measuring occupational disease. The Department will also receive $120,000 for new occupational health measurement and monitoring equipment.

Residential Aged Care

Additional funding for residential care for older NZers comes to $70.9 million. The money is for 2005/06 and will go to District Health Boards (DHBs) to pay for contracted providers of residential care services. It comprises $38.4 million to cover the cost of growing demand and inflation, as well as an extra $32.5 million. This is in addition to the $16 million for aged residential care announced in December 2004 (which rises to $16.4 from 2005/06 onwards) and extra money announced to allow for the Holidays Act earlier last month.

Home Based Care Services

Baseline funding for providing home based support increases by $18.7 million (for 2005/06). It will enable improvements in quality and working conditions, and cover increases in the prices of services funded by District Health Boards or contracted to the Disability Support Directorate of the Ministry of Health. The $18.7 million is in addition to new funding announced for residential care services for older and younger NZers with disabilities (see elsewhere).

Funding for home based care services provided to older NZers rises by $12.4 million, while services for younger people with disabilities receive a $6.2 million increase.

Depression Awareness

$6.53 million (GST exclusive) over four years for a National Depression Initiative. The Initiative, currently in its planning stages with the Ministry of Health, is likely to include the use of mass media, health workforce development and training, and community based programmes to help people with mild to moderate depression, as well as their families. The project will include a phone survey about depression, which will be used to monitor changes in public knowledge, attitudes and behaviours around depression.

Injury Treatment and Rehabilitation

ACC contributions towards treatment costs and rehabilitation go up by $19.4 million over the next four years. The new funding increases the Crown contribution to ACC's non-earners account, which covers the cost of injuries to people who are not in the paid workforce.

The package includes $9.5 million designed to ensure that ACC's contribution towards treatment consultations keeps up with the increasing costs of health care. A further $3.7 million, spread over four years, will be invested to extend the scope of clinical specialist groups, such as neurologists and gynaecologists, and treatments that are covered by subsidies. Another $1 million, spread over four years, will fund the full cost of counselling sessions that are required for ACC to determine cover on a sensitive claim. This change will remove some financial barriers for claimants to accessing the ACC scheme.

The Budget package also includes additional funding to start to address the shortage of support workers providing home-based rehabilitation, such as home help and attendant care. The amount ACC pays to contracted providers of these services will increase by $5.2 million over four years.

Children in Need

Programmes aimed at children and families in greatest need will get a $47 million funding increase. The initiatives complement targeted support offered to over half of all families through the Working for Families package, which continues its roll-out this year. Initiatives include:

  • expanding Family Start to provide advice and support services to an additional 300 high needs families in rural communities ($6.2 million);
  • study awards to increase the qualifications of Family Start workers ($4.2 million);
  • pilot a Parenting Support Service to provide practical support and advice for parents with young children ($2.1 million);
  • new services for children who witness family violence ($12 million, previously announced);
  • improved access to Early Childhood Education for children in Family Start families ($8.4 million);
  • providing parent education and information programmes through the Family Court and piloting ECE centre-based parent education ($10.8 million);
  • continuation of the Families Innovation Fund for regional and local initiatives to support community-based programmes ($1.8 million);
  • study awards for NGO staff studying towards social work degrees ($5.4 million); and
  • increased paid hours of work for Strengthening Families co-ordinators from 25 to 30 ($2.3 million).

Early Childhood Education

New funding of $152 million over the next four years, to ensure early childhood education services cope with increasing costs. The services will receive $125 million over four years, of which $95 million is new money. The increases will apply from 1 July. Other Budget early childhood education initiatives over the next four years include:

  • $28.4 million to further expand the early childhood Discretionary Grants Scheme. This will fund the building of 55 to 65 more community-based centres over the next four years; and
  • $16 million for Foundations for Discovery, the new Information Communication Technology (ICT) framework for early childhood education launched in April this year.

Technology in Schools

An additional $30.2 million in Information and Communications Technologies (ICT) over the next four years to improve teaching and learning in schools. ICT funding will increase by $8.2 million in 2005/06, then by $7.4 million and $5.9 million in the following two years. The new funding over four years includes:

  • $14.2 million to supply laptops to teachers, extending the opportunity to lease laptops to permanent, full-time teachers of years 1-3 students at state and state-integrated schools;
  • $8.2 million to increase the number of ICT professional development clusters from 80 to 100;
  • $7.4 million for the development of e-asTTle, an online version of Assessment Tools for Teaching and Learning; and
  • $345,000 to upgrade Te Kete Ipurangi ( http://www.tki.org.nz ) the Ministry of Education's web portal for schools, which provides teachers with bilingual access to educational tools and curriculum materials.

A Q&A on the government's school ICT investment is available from Pete Coleman, press secretary, (04) 471 471 9685 or (021) 811 003

Effective Schools Funding

Highly effective schools will receive $28.5 million over the next four years to encourage them to continue their high standards and share best practice across the sector.

Further information about this initiative can be found on: www.minedu.govt.nz

Tertiary Education

An additional $341.3 million over the next four years across the tertiary sector, including a further $44.6 million over the next four years to expand Modern Apprenticeships and industry training (see elsewhere). Total spending on tertiary education in 2005/06 will be $2.85 billion. New funding this year includes additional money for the Performance-Based Research Fund, which supports world-class research. The fund will increase by $75.5 million over the next four years, raising it to $193.7 million by 2008/09. Other elements of the tertiary education budget are:

  • $132.7 million to increase funding rates for "strategically relevant subject areas", including science, trades, technical subjects, agriculture and horticulture (the new rates, which follow a review of funding categories, are set out on http://www.tec.govt.nz
  • student component funding rates will increase by 2.6 percent; and
  • an additional $57 million over four years will improve the tertiary student support system, including $13 million for the new bonded merit scholarships (see below).

New Bonded Merit Scholarships will help pay the course fees of up to 500 of NZ's most academically capable students a year. The scholarships will provide $3000 per academic year for course fees, from the student's second year for up to four years study. Following graduation, students will be bonded to work in NZ for a period as long as the duration of their scholarship.

Details of the rest of the $54 million package, effective from next year, include:

  • The amount students can earn per week before their student allowance is affected will rise from $135.13 to $180. Instead of losing their entire allowance if their income goes above the limit, there will be a dollar-for-dollar abatement. The allowance of a student earning $185 a week, for example, would be reduced by $5. (Cost: $6.3 million over four years).
  • More students under 25 with separated parents will be eligible for allowances with the introduction of a new $3400 annual adjustment to the parental income threshold for these students. This recognises the additional costs separated parents have in running two households. (Cost: $5.2 million over four years).
  • More students under 25 with siblings who are also studying will be eligible for allowances. The annual adjustment to the parental income threshold for these students will rise from $2200 to $7000. This recognises the additional costs faced by parents supporting more than one child in fulltime tertiary study. (Cost: $14.3 million).
  • The pilot StudyLink financial information and advice service, aimed particularly at first-year students, will be enhanced. (Cost: $5.8 million).
  • Trainee Medical Intern Grants increase by $10,000 to $26,756 a year for sixth year medical students, to reduce their need to borrow and encourage them to stay and work in NZ. (Cost: $8.8 million).

Early Childhood Teacher Training Scholarships

An extra $4.1 million over four years (of which $3.4 million is new spending), for an additional 200 TeachNZ scholarships for prospective early childhood education teachers are now available for July 2005 enrolments in teacher education. This is on top of the 700 scholarships already going to early childhood education student teachers who are beginning their study this year. The scholarships cover fees and could be worth up to $20,000 over the full duration of study. People are bonded to teach in NZ for the same amount of time as they received the scholarship for. Until this year 175 scholarships were available in this area.

Business Tax

The business tax proposals are expected to cost $1.42 billion, equivalent to a cut of around 2 percent in the corporate tax rate. Specific themes of the budget business tax pack are to encourage savings, ensure a more productive use of capital, improve NZ's access to worldwide capital, skills and labour, and reduce compliance costs.

To encourage savings and support work-based savings:

  • Ensuring portfolio investment by financial intermediaries, such as collective funds, is not overtaxed relative to direct investments.
  • Ensuring that income from these funds is taxed at the individual's correct tax rate, thereby preventing the over-taxation of members earning less than $38,000 a year.

To ensure a more productive use of capital:

  • Changing the depreciation rules so that rates better reflect how assets decline in value and to reduce the compliance costs to business.
  • Removing barriers to R&D investment (announced previously)

To improve NZ's access to worldwide capital, skills and labour:

  • Assisting the recruitment of top talent by providing a temporary tax exemption on the foreign income of new migrants and of NZers who have been non-resident for tax purposes for at least 10 years and who come here to work.
  • Making NZ more attractive to international investment by aligning our tax rules on securities lending more closely with those of other countries.

To reduce compliance costs: (Announced last month):

  • Changes to Fringe Benefit Tax to reduce the fringe benefit valuation rate applying to motor vehicles, raise the minimum value thresholds for unclassified fringe benefits and exempt the private use by employees of work tools where the tool in question costs less than $5000 each.
  • Aligning GST and provisional tax payments to reduce the number of tax payment dates and allowing businesses to base their provisional tax payments on a percentage of their GST turnover.

Tax Changes: Low Income and Small Investors

New rules, to come into effect on 1 April 2007, will apply to registered superannuation schemes, group investment funds, widely held unit trusts and other entities which have savings as their primary function. Currently gains from the sales of NZ shares tend to be taxed if the shares were bought through a collective fund but not if they were bought directly. This anomaly disadvantages collective funds and will be removed. The second rule change will allow the income from investments through managed funds to "flow through" to the saver's normal income tax rate, whether that be 19.5 percent, 33 percent or 39 percent.

Jobs

The long term unemployed will be helped into jobs through a $21 million funding increase. The increase is part of a larger $100 million jobs package, the other components of which were announced pre-budget and relate to Sickness and Invalids Beneficiaries and to support for working parents. This new funding will provide intensive case-management, wage subsidies and an Urban Employment Service for clients who have been unemployed for more than three years. Other aspects of the package announced earlier this month include:

  • service for Sickness and Invalids Beneficiaries: $27.7 million over four years for a new service to support Sickness and Invalids Beneficiaries moving into work; and
  • work choices for parents: an extra $55.2 million over four years for quality childcare and Out of School Care and Recreation (OSCAR).

Housing

An additional $134 million over the next four years to provide 1300 new homes for those in need. The funding, comprising $130.6 million capital and $3.7 million operating, will help reduce waiting lists and waiting times in areas of high housing demand - particularly Auckland. There is also $10 million in new capital funding to complete the resettlement of the remaining residents from the Kimberley Centre near Levin.

Other housing initiatives include:

  • continuation of the Rural Housing programme to address sub-standard housing in rural areas ($22.6 million operating over the next three financial years);
  • continuation of the Community Renewal programme to improve housing and social conditions in deprived areas ($7.4 million operating over the next three financial years);
  • continuation of the Healthy Housing programme to reduce housing and health risks in overcrowded homes ($2.7 million operating over the next three financial years); and
  • Housing Innovation Fund ($440,000 operating in 2005/06 to work with Wellington City Council on management of the city's housing stock).

Realising Mā Potential

The Kapohia nga Rawa initiative provides funding of $14.8 million over four years for outreach and community workers to work with whanau to provide information and advice on education, career planning, financial management and housing. Earlier this month additional funding for Mā radio was announced: $3.4 million will be allocated over the next two years to upgrade outdated broadcasting equipment.

Mā Education

Increased funding of $3.2 million over four years for Whakaaro Matauranga, to maintain the Te Mana information programme and increase the number of Mā liaison officers (pouwhakataki) working between communities and the education sector.

Ethnic Communities

Support and advocacy work with NZ's ethnic communities gets a $4.1 million package of new funding for the Office of Ethnic Affairs. These extra resources will allow the department to expand its policy, liaison, and advisory work with ethnic communities into new areas of the country. An additional three ethnic advisors will be employed in Auckland, Wellington and Christchurch. Also, it's been decided to permanently fund Language Line.

Immigration Services

The Immigration Service gets over $12.7 million over four years to strengthen border and offshore security. Over $10 million has also been set aside for improving immigration services and $303,000 for a review of the Immigration Act in 2005/2006.

Biosecurity

This year's Budget includes new funding of:

  • $227,000 a year to pay for two extra dog handlers and an inspector to ensure that all courier mail is screened for potential biosecurity breaches;
  • $889,000 a year for post-border pest detection in high-risk sites, improving the number and quality of detections by targeting the most probable pathways for establishment and spread;
  • $1.11 million a year to continue and maintain the new organism enforcement capability;
  • $450,000 a year for the next two financial years to ensure NZ meets World Organisation for Animal Health guidelines for BSE surveillance, including increased notification incentives to farmers and payments to veterinarians and for laboratory tests.

There is also new funding for the purchase of the National Centre for Disease Investigation at Wallaceville. Other government agencies intend to increase their involvement at the Upper Hutt site, which will become a National Centre of Biosecurity Excellence.

Police

  • An increase to the Police budget for 2005/06 of $73.6 million (taking the Police Vote to $1.03 billion). The four-year amount of new initiatives approved in this Budget is $172.9 million.

Liquor Licensing Enforcement

$1.88 million (GST exclusive), over the next four financial years, to enable the Police to better enforce liquor licensing laws. The money will go on additional liquor licensing officers, and beefed-up administration support to these officers.

Reducing Demand for Drugs

A further five Community Action on Youth and Drugs or CAYAD programmes are to be funded by $3.23 million (GST exclusive) over the next four financial years for at-risk communities where illicit drug use is highest. The locations for the five new CAYADs are likely be determined by July, with contracts in place by October this year.

Also included are measures to improve access to treatment in three ways:

  • $68,000 (GST exclusive) will go on a free alcohol and other drug service directory (so that people don't have to pay to find out where to go for help);
  • $60,000 (GST exclusive) to go toward an evaluation of an online alcohol and other drug treatment service trial (this service, if successful, could be a more user-friendly way for victims of drugs to gain immediate access to treatment); and
  • a further $50,000 for training in the use of an early intervention resource so victims of drugs can be better identified and helped.

Courts, Justice

Additional funding of $156.5 million over the next four years. Includes:

  • $25.2 million for court operations;
  • $17 million on catch-up maintenance to improve facilities for court users;
  • $59 million on upgrading IT infrastructure and capability;
  • $14 million on policy development (Ministry of Justice); and
  • $25.3 million on staff and management resources.

The funding will be targeted at streamlining court processes and improving the timeliness of hearings through better scheduling and technology. More resources will be put into training management and staff in decision-making; the judiciary will get more research assistance and administrative support, and all court users can expect clearer information. There is also funding for 18 more security officers to work in courts around the country.

Tourism

This year, Tourism NZ receives $8.9 million to continue promoting NZ overseas (via the 100% Pure NZ campaign) in three key tourist markets - the United States, Britain and Japan.

Apprentices and Industry Skills

A $44.6 million four-year package in Budget 2005 for Modern Apprenticeships, skills development and industry training. This package includes additional funding for industry training and Modern Apprenticeships, as well as new funding to support foundation learning, specifically literacy and numeracy, in the workplace. The skills package over four years comprises:

  • $6 million to expand Modern Apprenticeships - providing an additional 500 Modern Apprenticeship places;
  • $31.6 million to increase participation in industry training (expected to provide about 10,000 new industry training places annually from 2006); and
  • $7 million to fund foundation learning in the workplace, specifically for literacy and numeracy.

Innovation: Research Science and Technology

An additional $204 million in research, science and technology over the next four years. New funding over the next four years includes:

Funding for industry:

  • $41 million to expand Technology NZ - an initiative that supports business research and development;
  • $16.2 million increase to industry-based research through research consortia; and
  • $14.7 million to expand Technology for Industry fellowships.

Programmes for researchers and scientists:

  • $17.8 million in new capability funding for Crown Research Institutes;
  • $17.1 million to expand the International Investment Opportunities Fund;
  • $10.2 million in additional project funding for the Marsden Fund; and
  • $2.7 million to increase the number of Fulbright scholarships.

Other initiatives:

  • $70.2 million more for health research (announced pre-Budget); and
  • $6.6 million to improve access to environmental research for councils.

The Digital Strategy

Nearly $60 million is to be provided through the Growth and Innovation Framework (GIF) to put in place the Digital Strategy. This includes $44.7 million of contestable seed funding over four years which will be available directly to communities and partnerships. Also set up is the Community Partnership Fund of $20.7 million to support grassroots initiatives that will build ICT skills in communities and regions, and help create distinctive NZ material in digital form.

The Broadband Challenge, a fund of $24 million, will be made available to enable affordable broadband roll-out based on competitive open-access principles. This fund will promote high-speed capacity in regional centres and support innovative ways of making broadband available to smaller communities. A further $10.4 million will support ICT productivity in businesses and $3.9 million will support the development of a cultural portal to provide an online presence for NZ's creative sector.

Sustainable Business Practice

New spending of $12.4 million over the next four years to promote sustainable business practices. New work areas include:

  • voluntary tracking and take-back programmes for electronic and hazardous wastes;
  • developing ways to ensure environmental issues are addressed during oil and gas exploration within the exclusive economic zone;
  • projects to encourage innovative product design that minimise environmental impact;
  • possible partnerships with the banking, finance and insurance sectors to reward sustainable business practice through eased access to credit, capital or insurance;
  • building capacity and delivering environmental programmes through partnering with non-government organisations focused on waste; and
  • working with other agencies to promote litter reduction.

Among the programmes that will continue to expand are:

  • the NZ Packaging Accord to reduce packaging waste and increase the amount of packaging recycled;
  • the Dairying and Clean Streams Accord to improve the health of waterways in dairying areas;
  • the national collection of agrichemicals, in particular those containing dangerous persistent organic pollutants;
  • the Govt3 programme to make the government sector more sustainable in how it operates;
  • the Tyre Track and Used Oil Recovery schemes;
  • the eco-efficiency in tourism project; and
  • developing a legislative framework to support industry to put in place product stewardship schemes.

Arts and Heritage Organisations

There are increases to baseline funding for leading arts, culture and heritage organisations:

  • Te Papa: an additional $12 million in capital funding over the next four years to support Te Papa's projected five year capital plan to maintain the optimum museum experience;
  • Creative NZ: an additional $950,000 per annum (GST exclusive) for baseline funding from 2005/06 for organisational capacity (including a mix of increased revenue to sustain current activity levels and new positions to advance a key arts marketing and development initiative); and
  • NZ Symphony Orchestra: an additional $1.6 million in 2005/06 increasing to $2.2 million in 2006/07 (GST exclusive) and out years, to maintain the orchestra's current capacity and performance.

Creative NZ will also receive:

  • $2.6 million (GST exclusive) as a one-off appropriation in 2005/06 to enable it to provide funding for some of NZ's key performing arts organisations; and
  • $788,000 as a one-off appropriation for upgrading Wellington's Old Public Trust Building.

Top-up Funding: Lottery Grants Board

$2. 6 million (GST exclusive) as a one-off appropriation in 2005/06 to maintain funding levels for agencies funded by NZ Lottery Grants Board (Creative NZ, the NZ Film Commission and the NZ Film Archive) to cover the anticipated reduction in their income from the Lottery Grants Board.

Land Transport

Increased land transport funding by $100 million a year for the three years from 2006/07. The new capital funding will raise the amount available to be spent from the National Land Transport Fund to more than $8.4 billion over the next four years.

Public Broadcasting

Thirty million over the next four years. NZ on Air will receive an additional $17.8 million for local television programming hours, as well as an extra $4.4 million to support the role of local and regional non-commercial broadcasters (previously announced). Radio NZ also receives a funding boost of $2.84 million to:

  • increase the amount of regional and culturally diverse programming available;
  • ensure valuable audio heritage is archived and protected;
  • provide audio-on-demand through www.radionz.co.nz; and
  • expand Concert FM to the West Coast.

Remote communities will also be able to enjoy better coverage of Radio NZ with an investment of $99,000 to improve transmission services across the country.

Pacific Broadcasting

Niu FM - which broadcasts news and information in English and key Pacific languages - will receive $12 million over the next four years. The funding represents an increase of $1.26 million a year on funding allocated to pilot the service from 2002/03 to 2004/05.

Building Services

New funding of $22.6 million to give the Department of Building and Housing the capacity to gather information about the sector, analyse it, identify potential building and housing issues, and develop solutions to them.

NZ's Overseas Aid

Spending on overseas aid expands by 21 percent ($59.4 million in 2005/06), taking NZ's spending on official development assistance to around $383 million in 2005/06. There is a funding increase of $33.87 million for aid to the Pacific for programmes with Vanuatu, Papua New Guinea, Solomon Islands and Fiji. Pacific programmes targeting governance and leadership, economic growth and livelihoods, and education and health will also get more support. Bilateral programmes with Indonesia and Vietnam will be strengthened significantly, reflecting our increasing partnership with Asia in trade, security and travel. An extra $15 million for disaster and emergency relief, over the coming three years, is provided for. Funding for work with multilateral partners, such as the UN's Population Fund and UNICEF, will double, with an increase of $28.8 million over three years.

Trade Negotiations

A further $31.1 million over the next four years will be allocated across government departments and agencies involved in trade agreements negotiations and implementation and will be used to support initiatives including:

  • outreach and promotion activities, such as trade missions, road shows, publications and inwards business missions;
  • development of key agency-to-agency relationships at the government level (e.g., CRIs, education, agriculture, competition regulators, tourism); and
  • putting in place the necessary monitoring and compliance requirements.

Funding will also be used to foster co-operative mechanisms between governments:

  • to deliver on labour and environment commitments;
  • to resolve problems such as sanitary/phytosanitary issues, non-tariff barriers and regulatory issues; and
  • to make trade easier by enhancement of regulatory regime understanding (e.g., Customs procedures).

Security for Overseas Posts

A range of measures are being introduced to ensure that all NZ diplomatic staff, and their families, working overseas have a level of protection that is in keeping with today's heightened security environment. The measures include improved perimeter security, such as more robust external walls and doors, and such things as installing anti-shatter glazing, security cameras, metal detectors, alarms, x-ray machines, access control systems, perimeter fencing, improved lighting, and a few guard houses. The security improvements are being funded by an allocation of $19.2 million in this year's Budget. The money includes a one-off capital injection of $10 million for work already undertaken, and a further $9.16 million over four years to ensure that physical and personnel security measures are maintained.

Global Disarmament

Over $3 million over the next four years to combat the spread of weapons and materials of mass destruction (specifically to the G8 Global Partnership Against the Spread of Weapons and Materials of Mass Destruction). Projects include securing and disposing of nuclear material, the destruction of chemical weapons stocks, and dismantling decommissioned nuclear submarines.

Tsunami Warning

Land Information NZ gets $2 million over 4 years to improve tsunami-warning systems through sea-level monitoring.

Sport and Recreation

An additional $6.5 million over four years to develop training resources and a campaign aimed at recruiting, retaining and recognising volunteers. Also, an extra $7.1 million over three years, from 2006/07, on establishing regional sport development officers within national sports organisations. The aim here is to stimulate the growth of sport, by increasing participation rates within local communities and in particular, encouraging young people to keep playing sport after they leave school.

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The Ministry of Agriculture and Forestry
Pastoral House
25 The Terrace
PO Box 2526, Wellington

Tel: 0800 00 83 33
Fax: +64 4 894 0720
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