Economy to get a $1b boost

  • 16/12/2015
Finance Minister Bill English (Simon Wong/3 News)
Finance Minister Bill English (Simon Wong/3 News)

There will be an extra $1 billion capital spending in next year's budget and the economy could need it.

Finance Minister Bill English's decision to put the money in was revealed in the Treasury's latest economic update, released yesterday.

The update forecasts the economy growing more slowly than expected next year, by 2.1 percent, and at an average 2.7 percent over the next five years.

Capital spending will now reach a total of more than $5b next year, with the money likely to go on big construction projects.

Mr English isn't admitting he's doing what opposition parties have been calling for and giving the economy a boost.

He's keeping his extra budget spending - apart from capital expenditure - at $1b next year and $2.5b the year after.

The Greens, while blaming the government for the slowing economy, say increased capital spending is welcome.

"It's the right thing to do to give the economy a push," said co-leader Metiria Turei.

"But we need to make sure the spending goes on the right things, such as transformational infrastructure projects that would kick-start the clean economy and create jobs."