Budget 09: Govt's razor gang finds $2b in savings

Reviews of departmental spending have found $2 billion in cuts over the next four years which Finance Minister Bill English says will be ploughed back into areas the Government feels are of higher priority.

Mr English said $454 million had been found in the current financial year and 2009/2010, rising to more than $500 million by 2012/2013.

Areas identified in budget documents included:

* Reducing the funding subsidy for hobby courses in adult community education - $54m;

* the previously announced decision to not reduce early childhood teacher-child rations - $275m;

* reducing tertiary tripartite funding - $55 million;

* cutting support function spending in the Education Ministry - $55m;

* ending enterprising communities subsidies - $32.3m;

* reconfiguring the Market Development Assistance Fund - $101m;

* cutting the New Zealand Innovation Centre - $15m;

* cutting conservation spending over four years - $54m;

* reducing overseas development assistance over four years - $166m;

* cutting at the Foreign Affairs Ministry over four years - $105m;

* productivity gains at the Social Development Ministry - $354m;

Mr English said the money would be better used elsewhere.

"It is an extra $454 million the Government has put into key policies like more police, more probation officers and training more doctors and nurses," Mr English said.

"It is on top of the $1.45 billion increase in operating spending announced in budget 2009, meaning New Zealanders are effectively getting $1.9 billion in new initiatives."

Click here for the Budget documents

Mr English identified a number of areas where the money had been diverted to, including:

* Funding new schools and maintaining existing ones including operational funding;

* more money for special education services;

* $81.6m over the next four years for the Government's Fresh Start initiatives for young offenders.

- NZPA