Wellbeing Budget 2023

Support for today
Building for tomorrow

A sustainable fiscal strategy

The Government borrowed in response to COVID-19 and will support households and businesses to recover from the North Island weather events

Since 2020, New Zealand has faced significant economic challenges including COVID-19, the effects of the war in Ukraine and most recently the North Island weather events. The Government’s fiscal strategy has adapted each year to reflect the challenging and changing economic context and support the wellbeing of New Zealanders. The Government’s fiscal performance for each year has been consistent with our fiscal strategy as set out in the annual Fiscal Strategy Reports.

Our prudent fiscal strategy of running surpluses and reducing net debt before COVID-19 put us in a stronger fiscal position than many countries to use our balance sheet to protect lives and livelihoods during the pandemic. While the Government’s fiscal response to the pandemic led to higher net debt and a period of operating deficits, it also led to a stronger-than-expected economic recovery. New Zealand also has the lowest excess mortality rate in the OECD across the full period of the pandemic.[14] The strength of our policy response to COVID-19 helped to prevent a deeper and longer-lasting recession as well as the associated impacts on New Zealand’s wellbeing and living standards.

The recent North Island weather events have battered communities and highlighted the need to invest in climate resilience. The stronger-than-expected recovery from COVID-19 means the Government is in a fiscal position that better enables us to support households and businesses in the response to the North Island weather events, and to begin a longer-term programme of investing in the resilience of our transport networks and communities at risk from climate change-exacerbated extreme weather events.


  • [14] Cumulative deaths per 100,000 population.
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