Budget 2011: What the Government says

Benefits of mixed ownership

The Government owns about $220 billion of assets, and expects to invest another $34 billion over the next five years. In proposing the ‘Mixed-Ownership’ concept, the Government would own most of a Company, offering minority stake to shareholders.

This would allow investment of about $7 billion in assets such as schools, hospitals, and broadband, reducing need for extra debt.

Kiwi investors would have a chance to own assets in large and proven companies.

Working for Families

Weekly Gain for Low-Income Family: $14.18

Weekly Gain for Average Family: $2.68

Weekly Loss for High Income Family: $12.66

Inland Revenue will contact Working for Families recipients in February 2012 to inform them of their likely entitlement for the 2012-2013year.

For more information, visit www.ird.govt.nz/wff-tax-credits/

KiwiSaver

Number of Members: 1.68 million (May 2011)

New Members each month: 20,000

KiwiSaver will be worth $60 billion by 2022

Changes will ensure its survival

Reduce Government debt by $2.6 billon in four years

Reduce external borrowings to 2% of GDP over ten years

The employer and Government contributions will continue

Student Loans

Amount lent in 2010-2011: $1.58 billion

Amount written off: 45 cents in every dollar

Overdue debt: About 55% living overseas

Changes Made:

Students should pass 50% of their courses over two years

Limited borrowing to seven full-time studying years

Should be Permanent Residents

Australians two years residence

Administration fees

Voluntary Repayment Bonus

2005

2007

2008

2009

2011

KiwiSaver cost/savings

$600m cost (over 4 years)

$3.2bn cost (over 4 yrs)

$560m net saving (over 5 years)

$2.6b saving (over 5 years)

Government operating balance

(four year forecast)

+$5bn per annum

+$5bn to $6bn per annum

> +$1bn per annum

-$8bn to $9bn per annum

-$16.8bn in 2012 year but back in surplus by 2015 year

KiwiSaver Table by KPMG New Zealand

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