Understanding the Budget delivered by Finance Minister Bill English this week in this light, it is easy to see the Government's eye on next year's election. The message to the electorate is clear. We are a responsible, careful Government which has done a sterling job steering the nation through the storms of the past five years.
We coped with the international financial crisis, the Christchurch earthquakes and the drought, and a surplus is in sight. Although we might not be exciting, we are responsible stewards, capable managers and have the safe hands on which New Zealand's future can be built.
It is as if Mr English deliberately revels in playing up to his stereotype - dull but dependable, boring but wise.
In the same week came details of Australia's large Budget deficit, while the United States' colossal deficits stretch into the never-never. With the pain of austerity and soaring youth unemployment casting a blight over much of Europe, the state of this Government's finances are remarkable. There is even a little money here and there for various housing and other projects. As Bill English said: ''The Government's books are the envy of most developed countries.''
In hindsight, the balance between austerity and spending would appear to have been about right. Vicious cuts create a downward employment and tax spiral, while high spending escalates debt and leads to serious trouble long term. New Zealand has avoided both positions. This country's version of belt-tightening, however, has not been without its casualties, for example post-graduate allowance cuts. Every hard decision upsets someone somewhere.
It is recognised that as any government marches on it steadily accumulates disaffection, and John Key and the National party are well into their fifth year. Tax cuts and ''positive'' measures are quickly absorbed, forgotten or taken for granted. The ''negatives'', meanwhile, are focused on and emphasised by affected individuals, Opposition parties, lobby groups and the media.
Yet, firm decisions do add up financially. The prospective surplus has been achieved, in part, by many incremental policies and lots of whittling, while the massive outgoings from basic social welfare, health, family support and interest-free student loans are largely intact.
Fortunately for National, the economy has been udderpinned by healthy milk prices. It should also be acknowledged that tax revenue increases slowly and steadily through fiscal drag as taxpayers' incomes inch into higher tax brackets.
As well, the partial sale of assets makes the Government books appear better than they really are. In reality, the money allocated from their sale for schools and hospitals had to come from somewhere. And the public, the former 100% owners of the power companies, are poorer for the loss of 49% of Mighty River Power and the planned sell-down of Meridian.
Notwithstanding the prospect of a balanced budget, National has only succeeded around the edges in ''rebalancing'' the economy so that New Zealand as a whole can earn more than it spends. Labour is justified in highlighting the massive foreign exchange deficits - lower than under later Labour years but forecast to continue to grow - as dark clouds looming over the country's future. Every year, that fiscal hole has to be filled in some way. Inevitably, that means more overseas ownership of businesses and land and more private international indebtedness.
Although the Government itself might be making progress, the nation collectively still lives well beyond its means. The long-term consequences of this are grave.
Winning the next election will be especially difficult for National because of the way MMP operates and the lack of natural coalition partners. Bribing voters in a Budget splurge next year will be too little and too late - as well as being bad for New Zealand and counter to National's current course.
Thus, as is apparent in this year's Budget, National will again sell itself as the prudent, sensible economic manager, as being tough but fair. It will then have to hope enough of middle New Zealand buys into the line.
