Defence Force to get Budget boost amid cuts

Finance Minister Nicola Willis says the Defence Force will get a “modest investment” in the coming Budget, despite the Government hitting its target of $7.5 billion in cuts across government spending.

“We face genuine threats, and we owe it to the countries we work with to be making our contribution. We owe it to our Pacific neighbours to be able to be there when they need us,” Willis said yesterday.

Willis delivered a pre-Budget speech to the Hutt Valley Chamber of Commerce yesterday morning, outlining her plans for the May 30 Budget. She confirmed the Government had finalised its spending cuts across government agencies, however, some agencies, such as police and possibly the Ministry of Foreign Affairs and Trade, would not reach a savings target of 6.5% to 7.5% of spending.

“Some agencies delivered on the targets, some agencies didn’t deliver on their targets, some agencies went above and beyond their targets,” she said after the speech.

“Some people when they put forward the proposals that we needed to meet that target, our judgment was actually we don’t want to progress all of that.”

While defence had made some savings, Willis said it was like education in that the overall investment would increase in the Budget. “So every dollar of savings that we have found, will be reinvested in new equipment, and increased funding for defence services. That is an area that we have prioritised for modest investment.

“In the longer term we want to see more significant pick up an investment in that area so that New Zealand can contribute effectively to our global partnerships.”

Asked why defence spending should be prioritised amid spending cuts, Willis said she recently had a “really sobering experience”.

“I went to a dinner in [Washington] DC with finance ministers from around the world. On one side of me was the Ukrainian finance minister, literally in an existential fight for his nation’s future, and on the other side of me was the Polish finance minister who was spending 4% of his GDP on defence.

“Those were not realities just a few years ago, and so New Zealand needs to be sober about that reality. We need to be safe, and so it's important that we take responsible decisions to make the investments required.”

The Government is reviewing the country’s defence capability plan, however, a new plan will not be produced until the months after the Budget. The defence capability plan outlines the types of defence assets the Government will invest in for the decades to come. “We’re looking at a modest uplift in this Budget, but we recognise there's a bigger piece of work to do about what are those long-term capability requirements that we have,” Willis said.

Willis would not confirm whether the foreign ministry was among agencies that reached the savings target, only confirming it had “delivered savings”.