Having criticised the Budget yesterday for failing to deliver to the poorest New Zealanders (you know, people who actually need the help - unlike the wealthy foreign beneficiaries of the business tax cuts), I think I should point out that there are things I am pleased about. The first, obviously, is the increase in foreign aid. I've blogged about this already, here, but its still worth mentioning again. The government is finally moving towards meeting its commitments, and hopefully the massive show of support for making poverty history will encourage them to move further in the future
Secondly, there's the changes to KiwiSaver. When this was first announced back in 2005, I called it "a solid, social democratic programme", and yesterday's changes make it even more so. The matching of contributions by the government will encourage people to participate while being aimed squarely at the poor (the maximum level is reached at $12.50 an hour - only slightly higher than where the government wants the minimum wage to be in a year - so wealthier New Zealanders don't benefit disproportionately), while the requirement for employer contributions is a solid redistributive measure. Sure, it will have some effect on wage bargaining, but it shouldn't be a large one - particularly as some of it will be offset by tax credits (and in any case, 4% over four years isn't much of a "wage rise").
Finally, there's the new regional fuel tax. Quite apart from making it clear that Aucklanders can pay for their own bloody roads (and giving them the tool to do it), to the extent that raising the price of petrol will discourage vehicle use and encourage vehicle efficiency it will also have an important secondary benefit in fighting climate change. The opposition (and more importantly, the government's support parties) haven't twigged yet, but we've just effectively gotten ourselves a carbon tax, by stealth, at up to triple the rate of the original proposal (the 2002 carbon tax of $15/ton was expected to add 3c/litre to the cost of petrol. This can go up to 10c/litre, or around $50/ton). Add in the cap on roading spending (and therefore push to spend on public transport), and we have some level of direct revenue recycling as well. Sure, it's quick and dirty, and doesn't make the link explicit, but it will work - and that's what's important.