The deterioration in the Government’s accounts because of low economic growth and some one-off problems is not surprising, says BusinessNZ.

Chief Executive Phil O’Reilly says it increases the urgency for actions that will create a more dynamic economy.

“Government spending should be aimed at getting the right funding in the right places and better using all potential sources of equity.

“For example, the economy would benefit from greater use of the value held in Crown-held assets, by allowing mum and dad investors to play a part.

“Viewing SOEs as ‘sources of equity’ could unlock much economic growth.”

Mr O’Reilly said a fresh look at no-go areas in the economy would also help boost the economy.

“BusinessNZ and other organisations have stressed the importance of taking action to constrain costs and get more dynamism in the economy, including increasing the entitlement age for superannuation, reducing the cost of KiwiSaver and making changes to interest-free student loans.

“The Government also needs to move on introducing a Regulatory Responsibility Act to help improve the quality of regulation and constrain wasteful spending.

“A fresh look at assets and spending could help achieve a more dynamic economy,””Mr O’Reilly said.