Credit downgrade warning shows Willis must rein in debt

Fitch Ratings has placed New Zealand’s credit rating on a negative outlook.

Responding, Taxpayers’ Union spokesman James Ross said:

“It’s no surprise that credit rating agencies are starting to lose confidence in the Government’s fiscal credibility. Debt has more than doubled as a share of the economy since 2019, and looks to be going nowhere.”

“Even before escalating global tensions, Treasury forecasts showed not a single surplus this decade. Persistent overspending is becoming a bipartisan consensus.”

“Growth assumptions are already outdated, and weaker growth means lower tax revenue and larger deficits. At the same time, spiking bond yields mean the cost of servicing those extra borrowed billions will soar. This isn’t sustainable.”

“The Fitch move simply reflects what the bond market has been saying for some time: that New Zealand’s risk profile has got even worse over the last two years. But if this shot across the bow isn’t enough for Willis to reduce spending in Budget 2026, what will it take?”