Hide Rodney: Questions for Oral Answer — Questions to Ministers 
Hide Rodney: Questions for Oral Answer — Questions to Ministers 
[Volume:618;Page:13553] 
8.  
RODNEY HIDE (Leader—ACT) 
 to the  
Prime Minister 
: How big would the operating balance need to be for her to recommend to her Minister of Finance that he drop the top tax rate of 39c? 
Rt Hon HELEN CLARK (Prime Minister) 
: 
 Dropping the 39c rate is not on the Government agenda at this time regardless of the operating balance. We prefer to invest in economic development and infrastructure better health and education reducing child poverty and in many other economically and socially useful endeavours. 
Rodney Hide 
: Does she still believe that New Zealanders earning over $60000 are rich; if so why is her Government’s Future Directions package propping up the income of working families earning $60000 when they have as few as two children? 
Rt Hon HELEN CLARK 
: The Working for Families package is about ensuring that families with dependent children on low and middle incomes get a fair shake and that is what it does. Those people on $60000 do run into the 39c tax rate but many of those families will still be materially assisted by this package. 
John Key 
: Is the Prime Minister aware that last year Treasury provided written advice to the Minister of Finance indicating that the operating surplus was large enough to allow tax cuts to encourage growth for the benefit of all New Zealanders; if so why was that advice rejected? 
Rt Hon HELEN CLARK 
: What Working for Families does is target tax cuts into where they are most needed—which is into our working families so that we take kids out of poverty. 
Sue Bradford 
: Can the Prime Minister advise how big the operating balance would need to be for her to recommend to the Minister of Finance that benefits be restored to the levels they were at in 1991 before National cut them and adjusted in line with theconsumer price index? 
Rt Hon HELEN CLARK 
: The benefits are adjusted each year in line with the consumer price index but the Government has attended to the needs of beneficiary families through some of the measures in the Working for Families package. Of course what this Government will not do is ensure that the gap required between benefits and wages is achieved by slashing benefits. That is what the “mother of all Budgets” by the National Party did in 1991 but it is not a path we will take. 
Gordon Copeland 
: Has the Prime Minister received any reports as to which parties in the House would support a cut in the top tax rate from 39c to 33c or 20c and has she received any reports about any changes in these views over say the last 8 months or so? 
Rt Hon HELEN CLARK 
: No I am not sure that I have received any reports but what I think most members of the House are rather confused about is exactly what the National Party’s tax policy and tax rate proposals are at the present time. We are all ears waiting for the tax discussion document referred to in Ms Rich’s—an appropriate name—welfare dependency document of a little while ago which said that a discussion about abatement rates would be dealt with in that paper. 
Mr SPEAKER 
: The member must not make any comment in the House about a member’s name. The Prime Minister will withdraw that comment. 
Rt Hon HELEN CLARK 
: I withdraw. 
Mr SPEAKER 
: And apologise. 
Rt Hon HELEN CLARK 
: And apologise. 
Rodney Hide 
: How does the Prime Minister explain putting low to middle income earners on an effective tax rate twice that of taxpayers earning over $60000 per year and are the disincentive effects of her high tax high income top-up policy the reason that she has dropped any pretence that her goal is to return New Zealand to the top half of the OECD—a goal that she promised as Prime Minister? 
Rt Hon HELEN CLARK 
: I am advised that most of those families would be already on such high effective marginal tax rates. With respect to the OECD it is worth pointing out that I understand there is only one country in the OECD that has a lower top tax rate than New Zealand and that is Mexico.