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Opponents of the Government’s mixed ownership programme need to explain to New Zealanders why it would be better to borrow an extra $5 billion to $7 billion from overseas lenders, Finance Minister Bill English says.

Speaking to an Auckland Chamber of Commerce and Massey University business lunch today, he said the challenge was how the Government pays for forecast growth in taxpayers’ assets over the next few years.

The Government has completed consultation with Maori on removing the mixed ownership companies from the State Owned Enterprises (SOE) Act and will make decisions on new legislation in coming weeks, Finance Minister Bill English and SOE Minister Tony Ryall said today.

"We've completed 10 hui around the country and received about 200 written submissions. It's been an excellent process where Ministers and iwi and hapu have been able to exchange views," the ministers said.

Lower Government spending has offset lower than expected tax revenue, helping keep the Government's finances on track in the six months to 31 December 2011, Finance Minister Bill English says.

The Crown accounts show tax revenue was $400 million below forecast and revenue $743 million lower overall. However this was offset by lower core Crown expenses of $887 million, leaving the operating balance before gains and losses close to forecast.

The Budget Policy Statement issued today confirms the Government’s clear economic plan for the next three years – including a return to budget surplus and starting to reduce net debt, Finance Minister Bill English says.

“The Government has a comprehensive policy agenda, which will guide Budget priorities over the parliamentary term,” he says.

The main priorities are:

Land Information Minister Maurice Williamson and Associate Finance Minister Jonathan Coleman said today’s High Court judgment on the judicial review of Shanghai Pengxin’s bid to acquire the 16 Crafar farms provides a new judicial interpretation of complex legislation.

The High Court considered the case on two grounds. These were:

Land Information Minister Maurice Williamson and Associate Minister of Finance Dr Jonathan Coleman have accepted the recommendation of the Overseas Investment Office (OIO) to grant consent to Milk New Zealand Holding Limited (Milk New Zealand), a subsidiary of Shanghai Pengxin Group Co. Limited, to acquire the 16 Crafar farms.

"It is clear that all criteria under sections 16 and 18 of the Overseas Investment Act 2005 have been met, therefore we accept the recommendation of the OIO to grant consent," Mr Williamson said.

Core Crown tax revenue was about $500 million below forecast in the five months ending 30 November, reinforcing the need for ongoing spending restraint and responsible fiscal management, Finance Minister Bill English says.

“The Government is committed to reducing its deficits over the next two years and returning to surplus in 2014/15,” he says. “This won’t be easy, particularly with ongoing debt problems in Europe reducing forecasts for global growth.

The Government has announced a series of hui to consult with Maori on legislative changes it considers are necessary for the float of minority shareholdings in four State Owned Enterprises to New Zealanders.

Finance Minister Bill English and State Owned Enterprises Minister Tony Ryall will lead the February consultation process with iwi around the country, which will be facilitated by Sir Wira Gardiner.

The economy posted solid growth in the September quarter, despite considerable global uncertainty, Finance Minister Bill English says.

Statistics New Zealand today confirmed gross domestic product (GDP) grew by 0.8 per cent in the September quarter. The economy has grown in nine out of the past 10 quarters. GDP grew by 1.9 per cent over the last year.

IAG's agreement to purchase AMI Insurance, announced today, will strengthen the Canterbury insurance market and reduce the Crown's liability, Finance Minister Bill English says.

As part of the deal, the Crown will take over ownership of AMI Insurance’s Canterbury earthquake related claims.

"The part of AMI dealing with earthquake claims – along with its reinsurance for those events - will be retained as a new Crown company and will continue to manage AMI's customers' earthquake claims," Mr English says.

The Government has confirmed the next steps in its mixed ownership programme to offer New Zealanders minority shareholdings in four state-owned energy companies and Air New Zealand.

Cabinet has agreed that Mighty River Power should be the first company prepared for an initial public offering (IPO), most likely in the third quarter of 2012, subject to market conditions, Finance Minister Bill English and State Owned Enterprises Minister Tony Ryall said today.