Transport Minister Michael Wood says cutting spending in his major portfolio isn't on the cards, despite New Zealanders being told to stop splashing cash ahead of Christmas.
But the senior Labour MP said the Government was taking "a responsible approach to our spending" - after New Zealand this week was tipped to plunge into a recession in 2023.
The recession forecast released on Wednesday came after the Reserve Bank raised the official cash rate (OCR) by 75 basis points to 4.25 percent - the biggest jump on record. And the OCR's predicted to rise even higher and hit the 5.5 percent mark next year.
Wood, during an interview with AM on Friday, was asked whether he would rein in spending in his portfolio ahead of the predicted recession.
It comes as Kiwis grapple with rising inflation, which accelerated to an annual rate of 7.2 percent in October. New Zealanders have been told this week to rein in spending and not push for a pay rise, by Reserve Bank Governor Adrian Orr.
"We always apply a careful lens to where spending is going in across our investments," Wood said of the Government's fiscal approach.
"I'm not intending to make any specific cutbacks and you look at an area like transport and, actually, one of the things we're dealing with is an infrastructure deficit that's built up over 30 years.
"No one would thank us for cutting back on critical roading projects or rail projects but what we do, across the board, is take a responsible approach to our spending.
"What we are heading back to is actually a level of Government spending, as a percentage of the economy, that is actually broadly similar to what we've had over the last 15 years and broadly similar to what the National Party had when they were in Government."
Wood said the Government would continue focusing on taking care when it came to spending.
"It is something that we take care with and will continue to look at carefully as we roll out Budgets but, within that, we will not be cutting core services that New Zealanders rely on," he said. "New Zealanders can trust the Labour Party with that - that's at risk with National."
Paul Goldsmith, a senior National MP, rejected that.
"He could probably cut the floors of office space he's got available for the cycleway over the Harbour Bridge," said Goldsmith, making a tongue-in-cheek comment about the Government's earlier plan to construct a standalone bridge alongside the Auckland Harbour Bridge for cycling and walking, which was later ditched due to public opposition.
"There's an unbelievable waste [of money] across the transport sector," Goldsmith said, appearing on AM alongside Wood.
Wood's comments about fiscal responsibility echoed those repeatedly made by Finance Minister Grant Robertson, who has said cutting Government spending on key services wouldn't solve New Zealand's economic woes.
"If Government spending was to truly exacerbate inflation, it would need to be something like across-the-board tax cuts that were going to the wealthiest New Zealanders, or the member might like us to stop our state house building programme… or stop our spending in the health sector," he said in Parliament on Tuesday, under questioning from National Party Finance spokesperson Nicola Willis.
The Reserve Bank said Wednesday's 75 basis point OCR hike was to get interest rates higher "sooner than previously indicated, to ensure inflation returns to within its target range" because consumer prices were still "too high, employment is beyond its maximum sustainable level and near-term inflation expectations have risen".
