Groser Tim: Budget Debate 
Groser Tim: Budget Debate 
[Volume:639;Page:9625] 
TIM GROSER (National) 
: 
 When one sits down and looks at the vast documentation of this Budget one sees that it contains a number of complexities. But as in most things in life the really important things come down to a few simple truths. The two simple truths that I wish to focus on in this call are these. The first truth is the very clear evidence that this Government has completely lost touch with New Zealanders even its own constituencies—or those which it would naturally claim to own. The second truth—much talked about by my colleague Dr the Hon Lockwood Smith—is that the Government simply and clearly does not as we see through its choices trust New Zealanders to make decisions in their own best interests. 
Let me start with the first simple truth which is that it has lost touch with New Zealanders. I will use the same typology that would appeal to Government members: the boss class or the companies and the workers—we all know that this is fantasy but let us use this typology. We will put aside by the way the underlying reality that nearly 90 percent of New Zealand companies employ six people or fewer—the exact figure is 86 percent. Nearly 90 percent of New Zealand companies operate in a social setting where there will be almost no discernible difference between the person who owns the company and the fewer than six employees he or she employs and works alongside. 
Maybe it is unreasonable to expect the Labour Party to be deeply in touch with those employers’ concerns and to understand what we in the National Party hear from small businesses every day of the week: that they are acting in effect as agents of the Government for this compliance issue or that compliance issue and have responsibility for discharging issues that frankly many of them are hard pressed to get their heads around let alone to employ specialist advisers to deal with them. Maybe it is a bit tough to expect the Labour Party to be in touch with that thinking. 
What struck me in all of the reactions was the statement made yesterday by the Employers and Manufacturers Association which is essentially a major organisation representing very small businesses in New Zealand. After surveying and giving lectures on KiwiSaver to 3000 different employers it reported as follows: “When told how the scheme is to work the employers instant response is laughter and disbelief.” 
Chris Auchinvole 
: Really? 
TIM GROSER 
: As I say it may be a bit tough to expect the Labour Party to understand intuitively where 90 percent of New Zealand businesses are coming from but I say to Mr Auchinvole I would argue that one would expect it to be in touch with its trade union roots. 
Chris Auchinvole 
: You’d think. 
TIM GROSER 
: You would think that. After all a fair number of them come out of that corner. I ask members to park that aside for just a minute and to go back to the statement made by Michael Cullen in his Budget statement that the Government contribution—to KiwiSaver obviously—will be offset in wage negotiations. 
Chris Auchinvole 
: Oh really! 
TIM GROSER 
: Well Mr Auchinvole he had to say that because if it was not offset in wage negotiations it would be yet another hammer blow on the heads of small businesses which as 90 percent of businesses essentially make up the private sector in this country bar a few and honourable large exceptions. So of course he had to say that it would be offset in wage negotiations. 
Chris Auchinvole 
: So he has decided the negotiations? 
TIM GROSER 
: He is trying to influence them. 
I will sketch for the member a scenario which I think will make him at least pause for some laughter. I will tell him about the “laugh test” in negotiations. This is a very brutal test in negotiations that I of course learnt from the international negotiation background that I have had. It is this: if one puts before a group of people whom one has to persuade about a proposition that is so lacking in credibility that they burst out into spontaneous laughter that proposal is dead in the water; it does not pass the laugh test. 
The specific circumstance that gave rise to this was the following. In about 1988 from memory the Japanese Government imposed a restriction banning the importation into Japan of Austrian and Swiss skis which are a major export item for these small European countries. When hauled before the court—in this case a technical court called the Committee on Technical Barriers to Trade—and asked to justify the reasons for this the Japanese representative said that Japan could not import Swiss or Austrian skis because it would be unsafe. When pressed further the representative said that that was because Japanese snow has different characteristics. 
Chris Auchinvole 
: Ha ha! 
TIM GROSER 
: Well exactly. Whereupon the entire audience broke out into similar spontaneous laughter as Mr Auchinvole’s. We never heard of that proposal again. 
We already know that the Cullen extension does not pass the laugh test for small employers. As I said when told how the scheme is to work the instant response of employers is laughter and disbelief. But I ask members how they think the trade unions would respond to that. Let us say a person is a trade union negotiator and he or she follows the script of this Budget—the script that Michael Cullen expects negotiators to follow—and let us say that his or her expectation was other things being equal that he or she would go for a 3 percent wage rise. That person goes back into this mythical smoko of Mr David Benson-Pope and he or she says: “Three percent? I don’t think we should press for 3 percent. I think it should be 2 percent because we’ve got to take account of the employer contribution.” 
I ask members this. Do they think that would pass the laugh test? Tracy Watkins is entitled to her opinion but I am actually following the opinion of Michael Cullen. The opinion of Michael Cullen is that the uptake is not likely to exceed 50 percent. So when that person goes as a trade union negotiator into the smoko this mythical room and he or she says that they should accept less when half the people in that room are not participating in KiwiSaver what do members think they will say? I will tell members: that person would be laughed out of his or her job. 
I think it is incredible that the Labour Party is so far removed and so deep in its third-term-itis that it could make such an elementary misjudgment—even in terms of the constituencies that one would expect it to understand and listen to. From National’s point of view there is a lot of water to pass under this bridge. We will have to listen again and again to the same nonsense that we have heard today: that if National wins we will steal workers’ savings. Let me quote literally word for word what John Key has said on this subject: “Depositors have nothing to fear from a future National Government raiding their accounts and of their contributions or the contributions of the Government.” We will have to repeat this over and over again as fear tactics are used by the Labour Government. But we will do that. We will keep hammering the point. 
The basic reality is that the details of KiwiSaver have yet to unfold. There is a lot of water to flow under this bridge. There is a case for improving the savings record of this country. There is no question about that but there are many different ways to achieve this objective. Although we will guarantee the contributions of those people who in good faith will contribute to this scheme we need to sit back and assess what the best way of meeting this objective is. That will take some time. 
As for these false tears Labour thinks it has a mortgage over concern for people at the bottom of the political and economic food chain. Labour members consistently deny the possibility that anyone other than the Labour Party could be genuinely concerned for the whole of New Zealand—just as they have denied the existence of an underclass just as they have used strange terms like “Tory charity” to try to destroy a scheme that weeks later they adopt in wholesale fashion themselves. 
 Labour members think they have a mortgage on concern for people at the bottom of the heap. Let me tell those members that the Labour Government is using fatally flawed mechanisms for policy delivery. It is pouring $3 billion extra into a health system where it has poured $4 billion over the last 6 years and failed to produce positive results—the results it is producing are going backwards. We cannot accept the roll. New policy mechanisms will be used by a future National Government to deliver far more bang for the buck. The Labour Government’s false belief that only it has a mortgage over concern for people at the bottom has been revealed most clearly of all over the terms of the KiwiSaver scheme.