The Government’s extension of fuel tax and road user charge cuts, along with the public transport subsidy to the end of June, has come with an estimated price tag of $718 million

This is not the sort of money one finds down the back of the couch. It is about 0.05 per cent of the Crown’s total forecast expenses this year and over 10 per cent of the $5.9 billion operating allowance of the most recent budget.

Finance Minister Grant Robertson said the money came from the October baseline update, when the Government looked over its spending to date and in future and looked for savings. This means the funding could have come from underspending on projects, but also by cutting future projects and reallocating the funding elsewhere.

Robertson’s office confirmed the money has been found from both from past projects and future projects. Prime Minister Chris Hipkins has announced he is keen to focus the Government’s policy agenda, and potentially axe expensive policies like the TVNZ-RNZ merger, or Social Unemployment Insurance.

However, any decisions on focusing the Government’s policy agenda have not yet been made by Cabinet so funding for those projects cannot be explicitly reallocated yet.

Robertson told the Herald the “funding for the extension came from savings that were identified in the October Baseline Update”.

“The purpose of the update, which is carried out every six months, is to look at money previously allocated and see whether that funding is still required. This process allowed us to find sufficient funding to be able to fund the extension. We will continue to look through the budget process to identify the best ways to continue supporting New Zealanders with the cost of living.”

The savings will come from projects that will now no longer proceed. On Newstalk ZB, Robertson said some of these projects related to Covid-19.

 “We found some significant areas where we don’t need to spend - largely around Covid-related spending but some other areas as well. Normally that would get put on the balance sheet and we’d look at it when it came to the Budget. In this case we’ve decided there is a pressing need to help New Zealanders with the cost of living and so we’re spending some of that money now,” Robertson said.

National’s finance spokeswoman Nicola Willis said that the quantum of funding was so large the Government should be more upfront about where the money was coming from.

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“$700m is an awful lot to find down the back of the couch, which is essentially what has happened here,” Willis said.

“The Finance Minister, in order to preserve his own and the Government’s economic credibility, must be transparent about where that money has been found,” she said.

“This underscores National’s argument which we have made for many months now that public spending has become loose and wasteful under Labour and with more discipline, New Zealanders could keep more of what they earn,” she said.