Anderton Jim: Debate on Prime Minister’s Statement 
Anderton Jim: Debate on Prime Minister’s Statement 
[Volume:660;Page:8664] 
Hon JIM ANDERTON (Leader—Progressive) 
: 
 On Monday 20 October 2008 National leader John Key told a press conference that morning that if National was elected and did a “half-decent job” at growing the economy then increasing GST would not be necessary. Well presumably it has done not even a half-decent job. National has done no job at all. This is the man who used to taunt the previous Labour Government that it had to do what it said and so on. John Key who had been overseas all those years working and shuffling money around speculating against the New Zealand dollar and all the rest of it told us we had to keep our word. Where is this word? He said that if National did a half-decent job it would not have to increase GST. So presumably it has done a lousy job; why does it not resign now and go back and have another press conference? 
John Key said to the  
Wall Street Journal 
: 
“we can use this time to transform the economy to make us stronger so that when the world starts growing again we can be running faster than other countries we compete with.” Running faster? We are actually crawling backwards. That is what has happened. Mr Key in Opposition used to taunt the previous Labour Government about Australia. We were stagnant in terms of our research and development last year. Worse still the $2000 million Fast Forward fund was cancelled. The Government said that it would make a leap forward a step change. We found out about the step change at the select committee when I asked how much money had been invested in research science and technology in the most important agricultural and horticultural sectors of the New Zealand economy. The answer from the chief executive officer of the Ministry of Agriculture and Forestry was zero—nothing. That would be bad if it was a mistake but when in the House I asked the Hon David Carter the Minister of Agriculture why the Government had made zero investment in agriculture and horticulture where we earn 65 percent of our overseas exchange he said that it was part of his plan. So it was not just a mistake it was not something he forgot; he meant not to spend any money. 
When we look at the Budget this year $40 million is to be spent—that is over 2 years so that is $20 million—compared with the $700 million we put into the Ministry of Agriculture and Forestry which would have built itself up with private sector and interest to $2000 million. That is called “running” when coming out of a recession? Oh really! How does putting up GST make us run faster than the other countries we compete with? 
I was one who opposed GST. That is a matter of record so no one can taunt me on that. One of the reasons I did so was that it is the most regressive form of tax known to mankind. Does Mr Key know that the introduction of GST and the halving of the top rate of tax that New Zealand introduced—dare I say that a Labour Government introduced—in the 1980s led to the greatest increase in the wealth gap between rich and poor in New Zealand’s history? It was the greatest increase. I would have thought that people might learn a bit from that. The top tax rate was 66c in the dollar. It was halved to 33c so the people on the top rate got and still get a huge windfall in comparison with what they used to pay. They got 33c on every dollar over the threshold and that was a lot of dollars whereas the poorest people in New Zealand were paying 20c in the dollar and they went down to 15c. So they got 5c the richest got 33c and then they all paid 10 percent GST. That is fair is it not? The richest people have discretionary income and they do not have to spend it all whereas the poorest people have to spend all of their money on goods and services. 
Mr Key is either disingenuous or he thinks we are all thick because he said that it is just a small increase in GST. A small increase—2.5 percent! If we look at the records we see that GST income revenue for the Government is about $12 billion. A 2.5 percent increase on $10 billion is nearly another $2 billion. That is $2000 million. That is just a small increase to Mr Key—he is a slow learner—but that means that every single New Zealander will face an increase on all the goods and services he or she pays for. That is particularly so for people on low incomes and medium incomes—which represents 75 percent of the country I might tell members. Seventy-five percent of the country is on around or below the average wage. Those people will face a $2000 million increase on all the goods and services they pay for. 
How does that work? And if we are to compensate those people with the $2000 million that we are forcing them to pay then what is the point? There is a point only if they are not going to be compensated because otherwise we do not have any money. If we do not have the money then we cannot spend it. I used to be told that and it was on one of those TV programmes. But no Mr Key thinks that we can take $2000 million out of the pockets of most New Zealanders many of whom are below the average wage and we will compensate them with the same amount of money that we charge them for GST and that somehow it will all work out on the night. If one believes that then one believes in voodoo economics. 
The Labour-Progressive Government had a research and development tax credit that would have amounted to about $380 million for science and technology and we had to fight very hard to get that. I thought that that would be one of the policies that National would be sure to steal. Why would it not? No it cancelled it. The agricultural and horticultural sector had $2000 million for research and development. National cancelled it. In the speech we heard today there was talk about improving productivity and all the rest of it in the agricultural and horticultural sector. Actually while we were in Government the agricultural and horticultural sector had the highest productivity of any sector of the economy as a matter of fact but it will not have it for much longer because all of that research and development investment has gone. 
Here is what John Key said again in January 2008. It was a prolific year for John that year! He stated: “Do you really believe this is as good as it gets for New Zealand?”. I read that and I thought after I heard that speech: “Is that it? Is that as good as it gets for New Zealand?”. He went on to ask: “Or are you prepared to back yourselves and this country to be greater still?”. Greater still by increasing GST canning investment in research and technology for the future and not providing a skill base for tens of thousands of young Kiwis who will make a contribution to Australia I presume because that is where they will end up! We used to get hammered for that but just watch this space as we go through this lot. 
John Key’s statement lacks ideas. If one reads the 23 pages of it—I went through it and it is a big ask I can tell members—one sees that there is not an original idea in it. In terms of a strategic plan for New Zealand to do the sort of stuff he talks about such as catching up with Australia he mentions among other things rebuilding the Kopu Bridge. I know that Queenslanders will be terrified at the thought that we will say that they may well have signed a contract for $100 billion of coal exports to China but we are building the Kopu Bridge so they should watch out! I mean is he serious? 
While we are going through all this Australia is up and running which is the very thing we should have been planning for. We should have had a strategic plan. I know that late in 2008 if we had won the last election there would have been meetings of Cabinet over Christmas after that election. I think that the previous Prime Minister would have had meetings at her place over a roast chicken and would have used Christmas Day for an emergency Budget and we would have had plans to get New Zealand through this and out of it with everything running. 
What did we get from the new Government? Those members all went on holiday and they stayed there. We were almost wondering whether we would ever meet again and whether there would be a Parliament. One would have thought that everything in the world was hunky-dory yet the rest of the world was melting down. This is the result: a “no think” strategy. When I was in the Labour Government of the day I used to say that there was one thing worse than a Think Big strategy and that was a “no think” strategy. We had that then and this is it now. The thing is that this is like  
A 
Nightmare on Elm Street 3 
. One would think that someone would have learnt something from what did not work. This did not work. If it had worked then we would not be in the problem we are in now. If all this had worked well then why are we in the hole we are in? 
We did not go through all that meltdown in the financial sector that people in America went through so we had a great chance here. We had good public finances low public debt a strong financial balance sheet and all the rest of it. That is what got us through. That lot have no plan to deal with the crisis we face with our own people. This is the thought that I think I should leave National members with: 150 relatively unskilled jobs available in a supermarket in South Auckland and 2500 people queuing up for them. If that does not register if those members do not know what that means then they know nothing about New Zealand.