Budget 2020: Grant Robertson defends debt, says now is the time to spend 'rainy day' savings

The Finance Minister has defended the debt New Zealand is taking on in Budget 2020, saying now is the time to use the Government's surpluses from previous years that were saved for a "rainy day".

The 'Rebuilding Together' Budget is designed to get New Zealand's economy ticking over again, with a $50 billion fund to extend the wage subsidy, provide free trades training, and boost infrastructure.

Grant Robertson told Newshub Nation the level of debt the country is taking on is lower compared with the rest of the world. 

"The whole point of us saving for a rainy day, the fact that our Government kept net debt below 20 percent, was to use it when the rainy day arrived. That's what we're doing here. Our debt levels still remain low compared with the rest of the world."

He didn't confirm whether he was concerned the debt will bake in generational inequality, but he instead hopes young people will be supported. 

"The way that I look at it is I want those young people to grow up in households where their parents are in work, where there's food on the table."

In terms of paying the debt back, Robertson says that will be done by building up the economy again post-COVID-19.

"[We do that] by building a sustainable economy that grows, that adds value. And New Zealanders will face some tough choices in the future about those, but it is vitally important to me now that we use our balance sheet to be able to do this."

He added the conditions are there for the Government to borrow money because there's a "good track record" of paying down debt.

Much of Budget 2020 is yet to be allocated. Some has already been spent - $15 billion - and $20 billion is left to roll out. 

Treasury forecasts up to 140,000 jobs could be saved over the next two years thanks to the fiscal stimulus, with unemployment to return to 4.2 percent by 2022. 

Robertson says that unemployment figure is one of three scenarios Treasury put up, but it will depend on how the economy grows and changes nationally and internationally.

"We're certainly going to be working to keep unemployment as low as possible, and I think the jobs focus of this Budget will help us do that."