Finance Minister Nicola Willis says the government's not planning an "aggressive fiscal consolidation" and is taking a deliberately predictable approach in the medium term.
Willis delivered a speech to Business Canterbury in Christchurch on Tuesday afternoon, running through the government's priorities for the Budget delivered last week.
She highlighted reform across five key areas of activity: infrastructure, education, regulation, overseas connection, and innovation - saying that while New Zealand was in a "very challenging" downturn, forecasts suggested inflation and interest rates would come down in the latter part of this year.
"I really feel for families and businesses across the country who are undoubtedly doing it tough."
The coalition government's first Budget shows expectations of a lower tax take because of the weak economy, while expenses remain elevated, with the deficit peaking this year and staying higher for longer.
Business Canterbury chief executive Leeann Watson previously said businesses had asked for infrastructure, health, education, and law and order to be prioritised.
"We would like to see some of the additional $1 billion announced in Budget 2024 used to leverage the opportunities that brings to better connect us to the rest of New Zealand and the world.
"The real proof in the pudding will be on the delivery of outcomes from this Budget, and all eyes will be on how quickly the Government can complete its so called 'turnaround job' for the economy."
Willis said managing within the lower operating allowances she had set for future Budgets would be "challenging, but we view it as essential".
"If we were to stick to the larger operating allowances left to us by the outgoing government, I'm advised that New Zealand's finances would remain in deficit until 2031 and New Zealand simply can't afford to go on accumulating debt for that long."
Willis said she thought the tax package would give a "welcome boost to confidence this winter", saying she earlier visited the owner of Lyttelton Lights, who started the business in her living room and was happy her workers would get tax cuts, and was hopeful it would mean a few more Kiwis willing to buy her candles.