The Finance Minister believes our 4.1-billion-dollar ACC deficit has distorted New Zealand's books

Today's half year economic and fiscal update paints a dismal picture of the economy - and predicts the books will be deep in the red until at least 2029.

But Nicola Willis has also accused Treasury of being overly optimistic before the election - affecting the current outlook.

She says removing the ACC deficit from the equation isn't about making the Government look better - it's a sensible thing to do.

Willis says ACC is a long run insurance scheme that needs to fund itself over the long term.