A strong case can be made for loosening the target and borrowing more now to make additional investment in infrastructure that will drive our economic growth.
It's worth noting that faster GDP growth effectively lowers the debt burden anyway.
Both the previous National Government and the new Government have kept borrowing even as they target debt levels.
Nominal government debt continues to rise, just at a slower pace at which GDP growth ensures the debt ratio keep improving.
The argument for this conservative approach is that New Zealand needs lower government debt than its larger peers because we are small and vulnerable to global economic shocks and natural disasters.
Prudent fiscal management by the Helen Clark Government meant John Key had scope to borrow more when dealing with the global financial crisis and Christchurch Quakes.
New Zealand also faces risk around private debt levels – which are high by global standards.
Labour is spending on new social programmes and infrastructure. But it is facing some tough choices.
It would be a shame if Government plans for much-needed development of roads, rail, housing, schools and hospitals were hampered by arbitrary fiscal constraints.
As the nation gears up for what will already be a huge phase of building and construction, it makes sense utilise the economies of scale available.
The economic pay-off from forging ahead with vital and inevitable projects, like a second harbour crossing or four lanes to Whangarei, could provide the impetus for additional GDP growth that keeps debt ratios in balance.
We would create momentum to see us through the next downturn and put the structures in place to allow further population growth.
On top of that there is the social pay-off for generations to come.
The biggest hurdle is not financial - it is political.
Labour made a promise which was designed to reassure voters who might have had doubts about it having a sensible outlook on economic decision making.
That promised played an important role in getting the party vote high enough to enter into coalition talks as a realistic contender.
Political promises mean something. The Government knows that and must stick to its commitment for now.
Nobody wants to see a return to the bad old days of the 1970s.
Borrowing by wasteful and inefficient governments is always disastrous. But for more than 30 years governments on both sides the political divide have delivered sound economic management.
Perhaps when this one has cemented its credentials, and if economic conditions remain favourable, we could see it dare to think bigger.
