Canterbury Mornings

An Economist is claiming Stephen Joyce is going to be proven right - there is a fiscal hole and a softening economy is making it wider.The former Finance Minister identified during last year's election campaign, that Labour would have to borrow an additional 11.7 billion dollars to cover increased spending.Economist Cameron Bagrie told Chris Lynch that's the case but the main pressure will be a weakening economy. He says Treasury's expecting growth to be around three to three and a half percent but it's more likely to be 1 and a half to two percent over the next 12 months which will knock in excess of a billion dollars off tax revenue.Cameron Bagrie says that will multiply over a number of years but the good news is the fiscal accounts are in good shape.