More tax, spending, debt: How the Greens plan to transform NZ's finances

The Green Party is promising to lift spending and taxation, push out surplus by a year, and hold debt at a higher level to spend more money on capital projects. 

Much of the additional spending will go towards health pressures, with the party promising funding above the rate of population and demand growth. 

After four years, the Greens expect their policy investments to increase productive economic activity and add an additional 1% to gross domestic product (GDP). 

“The investments in public transport, clean energy, food security, resilience, science, innovation and public services will lower the cost of living and support 64,000 new jobs, on top of the 220,000 modelled by Treasury, based on standard growth projections,” the party’s fiscal plan released today says. 

“The transport investments will decrease exposure to fossil-fuel driven inflation, by providing options for transport mode-shifts.” 

The political party’s fiscal plan shows it wants to grow total Crown revenue to 40.1% of GDP over the forecast period, or in real terms to $234 billion. 

That compares to the $172b or 37.8% of GDP that total Crown revenue was at over the past year. The Pre-Election Economic and Fiscal Update (Prefu) forecast it to rise to $226b or 38.8% of GDP, meaning the Greens want to bring in about $8b of additional revenue each year. 

The Greens say this will be the result of structurally increasing the tax base with a “responsible revenue strategy that rebalances taxation towards capital over work and consumption”. 

The fiscal plan says about $28.75b will be generated through the Greens’ tax initiatives, which include a wealth tax, increasing the corporate tax rate on large corporations and an inheritance tax. 

On the other side of the ledger, the party wishes to increase total Crown expenses from the current $183b (40.1% of GDP) to $233b (40% of a rising GDP) at the end of the forecast period. That would be about $16b more than what is currently forecast. 

The party says it will increase future operating allowances – essentially new money doled out at the Budget – to between $4.5b and $4.7b across the forecast period, which includes increases for health spending. 

The Government’s planned operating allowances, which the Prefu forecasts were based on, are about $2.4b. 

One of the Greens’ main spending commitments is on health, with it promising an additional $3 billion each year over four years. 

The party says this means “real increases in funding above the rate of population and demand growth, and provide the sustained investment needed for workforce, capacity, access and safe care, and work to deliver equity in health outcomes for Māori as envisioned in the Health Services and Outcomes Kaupapa Inquiry”. 

The surplus track the Greens have provided shows the party returning the books into the black in 2029/30, a year later than the Government’s track. 

While the Greens would keep New Zealand in surplus, the party’s plan shows the surpluses each year would be sizably smaller than currently forecast. 

For example, using the operating balance before gains and losses (Obegal) metric, the Greens would have a surplus of $400 million in 2029/30, compared to the $6.3 billion forecast in Prefu. A year later, the Greens’ surplus would be $300m, compared to the currently forecast $8.9b. 

Greens’ co-leader Chlöe Swarbrick said the Government’s current fiscal track is “made possible only through underinvestment in core public services”. 

That’s a reference to the Government’s planned public service cuts. If those cuts don’t eventuate or take longer to implement than anticipated, Treasury says it could affect the forecasts. 

Swarbrick said, “cutting public spending deepens economic downturns and inequality, pushes up unemployment and reduces output”. 

“Our sensible long-term investment approach turns this around and tackles real risks to fiscal sustainability head on with genuine investments such as lowering exposure to imported fossil fuels, in turn reducing New Zealanders’ cost of living and future imported inflation.” 

The Greens are willing to increase debt, arguing New Zealand has “comparatively low public debt in the context of many jurisdictions we compare ourselves to”. 

“After nearly 40 years, the pursuit of ‘prudent’ public debt levels have seen our public infrastructure and environment degraded, productivity stagnate, and resilience wane,” the party’s fiscal plan says. 

“With the Green Party’s revenue strategy in place, there is less need to use debt to fund current expenditure. Debt can instead be used to rapidly scale up capital expenditure in the transport sector.” 

If the net core Crown debt measure is used, the Greens want debt increased from about $187b (41% of GDP) to $256b (44% of GDP) over the coming years. That level of debt at the end of the forecast period would be about $26b higher than what is currently expected. 

Swarbrick said borrowing and spending that money on transport and infrastructure would “stimulate jobs, tackle climate change, build resilience and mean we’re much better placed against financial shocks”. 

Jamie Ensor is the NZ Herald’s chief political reporter, based in the press gallery at Parliament. He was previously a TV reporter and digital producer in the Newshub press gallery office. He was a finalist in 2025 for Political Journalist of the Year at the Voyager Media Awards.