National has released its fiscal plan ahead of the election. It promises to return the books to surplus in 2028/29 and rules out new taxes, but it also confirms there will be no income tax cuts over the next four years.

Finance spokesperson Nicola Willis said the plan put paying down debt first. “Getting debt down is essential to delivering lasting prosperity for New Zealand.

“Less debt helps keep inflation and interest rates down, which means lower mortgage and business borrowing costs. That gives households more breathing room in their budget, and businesses the confidence to invest, build and hire.”

The plan includes several Canterbury projects in its capital commitments. National has set aside $800 million to fund the Belfast to Pegasus motorway and Woodend bypass, $70 million for Christchurch Hospital’s Tower Three and $50 million for the Rolleston intermodal freight hub.

Health makes up 88 per cent of National’s spending commitments. The biggest new commitment is a fourth year of funding for health cost pressures, the money needed to keep pace with inflation, wages and an ageing population.

Treasury’s pre-election update had pencilled in three years of that funding. Both major parties have adopted those three years, but National has also funded a fourth year, bringing its total to $14.57 billion. Labour’s fiscal plan funds the same period at $13.02 billion, leaving the fourth year to be decided later.

Labour has instead put money into new health initiatives, including free GP visits and scrapping the $5 prescription charge, which lifts its overall health spending above National’s.

National has also set aside $604 million to increase Pharmac’s medicines budget and $178 million to lower the bowel screening age to 50.

Other costed promises include extending paid parental leave from 26 to 30 weeks, a $1500 KiwiSaver Baby Boost payment for every newborn and lower compulsory student loan repayments. Those would be partly offset by savings of $431 million from cutting foreign aid and $583 million from what National calls stronger welfare expectations and case management.

National’s plan leaves $7.5 billion of operating funding unallocated over four years to cover cost pressures and new spending, including yearly increases for education and policing. Labour’s plan has $10.4 billion of headroom, but that money must also cover the cost of restoring the previous pay equity regime.

The plan follows Treasury’s forecasts, which show an operating surplus of $4 billion in 2028/29, growing to $11.7 billion in 2030/31. Net core Crown debt is expected to peak at 43.9 per cent of GDP in 2027/28 before falling to 39.5 per cent by 2030/31.

Willis has previously signalled more income tax cuts once the books return to surplus. She said the plan showed a pathway to that, but now was not the time.

“National’s priority is to get on top of the debt first so that our kids and grandkids aren’t left with a bigger bill and to ensure we have a bigger buffer to withstand future global shocks.”

Willis also took aim at the opposition, claiming Labour and its potential coalition partners had proposed at least nine new taxes that would cost the average household $2263 a year.

“National’s approach has got us this far, but our plan needs three more years to bed in.”