Former Reserve Bank Governor Don Brash is downplaying the large Government surplus.
On Tuesday, Treasury announced a surplus of $7.5 billion, roughly $4 billion ahead of what was forecast in Budget 2019.
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However, those numbers were affected by one-off factors that are not likely to continue over time, such as changes in how KiwiRail is valued, inflating its growth numbers.
Brash, a former Reserve Bank Governor and National Party leader, says that is making the surplus look better than it really is. Without the railway numbers being included, the surplus is about $4 billion.
"Roughly half of it is one-off things like revaluing railways, you can't do that every year, but $4 billion of it is real," Brash told The AM Show.
"It is not all there and it is not huge relative to the size of the Government sector. The Government sector is spending about $80 or $90 billion a year. So $3 or $4 billion is not exactly a rounding error, but it's not huge.
"The question really is, how do you spend that money if you can't be sure it is on-going. If you cut taxes or increase welfare or whatever, and it is not there the year after next, you're in trouble."
While economist Shamubeel Eaqub believes the surplus is good for New Zealand, he says the public will now be expecting big things at next year's election.
"It is a big surplus and it going to create all the political pressure for them to spend ahead of the election," he told The AM Show.
If he had to choose two big things for the Government to spend the money on, he would advise it goes towards roads and state housing - two things he says New Zealanders need and which would garner votes for the governing parties.
"My frustration is more around stuff like state housing... There are some clear areas where you can get some real relief by spending money, throwing money at it. On infrastructure, government financing," Eaqub said.
"Housing is so unaffordable and people's ability to pay for it is so limited. The pressure is mounting at the bottom.
"I think if they want to win the election they are going to offer tax cuts for the poor. I think they are going to have to put some big flagship policies around infrastructure spend."
But while the Government has already had some success in building state houses - having built more than 2000 in the year to June - the waiting list is over 13,000.
The Government has also faced challenges in the private housing market. Both Brash and Eaqub agree that won't be fixed by just spending money, but zoning and density rules need to change. The Government is currently working on a rejig of the Resource Management Act.
They said the private housing market is a long-term, structural issue resulting from years of inaction by previous Governments.
"It is crazy, absolutely daft... It is not just Labour, it is National and Labour, have both failed," Brash said.
Brash said his fear is that Finance Minister Grant Robertson will raise spending in all Government sectors, without having any meaningful impact.
"What I fear all he will do is simply increase everything a little bit and that makes everyone feel slightly better but doesn't make any structural changes."
Robertson said on Tuesday that the books should the economy was in a "good shape" to face any global economic uncertainty.
"Unemployment, interest rates and Government debt are all low, giving the economy a solid platform to keep growing and face any global headwinds."
While he said tax cuts may be looked at next year, cutting GST is not on the agenda.