Key John: Budget Debate 
Key John: Budget Debate 
[Volume:631;Page:3270] 
JOHN KEY (National—Helensville) 
: 
 I always thought this Labour Budget would sink faster than the  
Titanic 
 but even I did not think that the Government would dispatch its chief head-kicker—or the person who used to be its chief head-kicker—down here to try some diversionary tactic. The only question that members over here are asking is what baby vomited on his shirt? I thought he used to be a duck not a chicken. 
Hon Trevor Mallard 
: I raise a point of order Madam Speaker. The member would know the difference well—this is a Karitane colour not vomit. 
The ASSISTANT SPEAKER (Ann Hartley) 
: OK that was not a point of order. 
JOHN KEY 
: Government members have come to the Chamber on day 2 of the Budget debate and in the first Government speech all the member could do was raise some spurious email of people who went to the Electoral Commission months earlier. This Government has nothing to say about its Budget whatsoever. Trevor Mallard the man who begs Helen Clark week after week to let him be the Minister of Finance is so ashamed of that Budget— 
Hon Bill English 
: At least he’s getting somewhere. 
JOHN KEY 
: Well he is getting somewhere and here is the reason. We are in an interesting position now. When Helen Clark is awaiting a Michael Cullen Budget she wakes up every day and looks forward to that Budget about as much as a rabbit looks forward to getting myxomatosis. She is not happy with a Michael Cullen Budget and I will tell members why. 
What happens is that year after year the Budgets are shockers. I did not personally think that this year’s Budget could be worse than last year’s—which was the Budget that nearly cost Labour the unlosable election. In private circles the Budget is not referred to as “Labour’s Budget” or as the “chewing gum Budget” as we affectionately know it; they refer to it as “Michael’s Budget”. Michael put that Budget together. What is interesting is that it is not a Budget— 
Hon Tau Henare 
: He’s gone. 
JOHN KEY 
: That is right. It is a death warrant. Last Sunday I picked up the  
Sunday Star-Times 
 like many people in my caucus and what did I see? I saw the list of people on the execution list. They are gone for the new talent. They are gone because they lost their seats and they know exactly why they did—because Michael Cullen year after year comes into this House and delivers Budgets that are so shocking and sink so quickly that the chief head-kicker has to come to the Chamber with some diversionary tactics. Mr Mallard did not even mention the word “Budget” until 8 minutes into his speech. That is an absolute shocker. My deputy leader referred to Mr Mallard the other day as “stuffing looking for a shirt to fill”. I think Mr Mallard has found the shirt. I do not know where he bought it; it must be unique. I do not think I have ever seen one that colour before. Trevor Mallard is an embarrassment. 
What can we say about the Budget other than that it has cost yet more Labour back-benchers their seats? The first interesting thing was the response received by the Labour back bench when this Budget was read out. I note that when my leader got up to say a few words on the Budget within 30 seconds he had three claps and he had the three lead items on the news. That is what happened when my leader spoke for 30 seconds. Michael Cullen went for 14 minutes before he even got a clap and he got it for saying that the blowout in the student loan bribe would be slightly less than Labour originally thought it would be. He got only two other claps—one was for sitting down and the other was for kissing Helen Clark. I do not blame him for getting a clap. Those were the three things he got a clap for. [ 
Interruption 
] That is because they are members of a back bench who know when they are toast and when they are out. 
Let me raise a few questions. The first is a serious question for Michael Cullen. If current conditions do not make tax cuts affordable when there is an $8.5 billion surplus a $7 billion operating balance excluding revaluations and accounting changes and a $1.7 billion cash surplus and that size of surplus has been running every year for at least the last 4 years exactly when will tax cuts be affordable? What are the conditions? Michael Cullen has tried to play a game with the financial media of this country and he has lost as badly as he lost to Tony Gibbs at Guinness Peat Group. As my honourable colleague Mr Williamson rightly pointed out when it came to Guinness Peat Group and Tony Gibbs Michael Cullen lost and Tony Gibbs won and Michael Cullen will have to eat that. 
The point is that if we cannot have tax cuts under conditions when tremendous surpluses are running across the board—an $8.5 billion surplus a $7 billion operating balance excluding revaluations and accounting changes and $1.7 billion of cash—and every operating surplus and capped loan has been paid for when can we? Maybe Michael Cullen would like to answer this question for the people of New Zealand. Why does the Government in these good economic conditions get to keep everything? Why will New Zealanders who on their way home tonight will fill up their cars pay more than double what they paid 12 to 18 months ago? Why are New Zealanders paying energy prices that have substantially risen and why are they paying the highest interest rates in the OECD? According to Michael Cullen he needs all the money and the people of New Zealand do not get anything. I think the people of New Zealand know shared prosperity when they see it and they know they are not getting that from a Labour Government. I predict quite firmly that when the poll results come out in the next few months we will see the response of the public of New Zealand to this Budget. 
The second question I have for Michael Cullen is a pretty simple one. Can he explain why in 2005 he came to the House and read that shocking “chewing gum Budget”—a Budget with billions raised spent and wasted like in every single Budget that Michael Cullen reads out? He told the people of New Zealand in no uncertain terms that in 2008 they would get the chewing gum—they would get the indexation of their personal taxes. Now they might have had to wait 10 years to get that. They may have got to the situation where 5 percent of New Zealanders used to pay the top rate and now 13 percent do. They might have had a situation where the amount of tax they are paying has doubled gone up by 50 percent in the last 10 years. There are many conditions but Michael Cullen finally relented and said we can have a bit of the chewing gum in the “chewing gum Budget”. The interesting thing was that when he came back after the election and did not have the numbers to pass the tax he wanted on climate change the first thing he told the people of New Zealand was that what was in Budget 2005 was not to be believed. 
The interesting question is whether what is in Budget 2006 is not to be believed. The interesting thing is this: if tax cuts were unaffordable and if the situation were so dire that having got rid of the carbon tax he was forced to renege on the indexation situation in 2005 why 2 hours after he delivered the Budget did he wander out of the debating chamber down to  
Campbell Live 
 in his office and tell  
Campbell Live 
 that tax cuts might be on the agenda and might be affordable? Two hours after he delivered a Budget that said tax cuts were not affordable he said that in 2007 or in 2008 miraculously they could be though we do not know what will happen in those years. Michael Cullen had had a little word from Helen Clark and from the back bench that refused to applaud him and from everybody else that this Budget is sinking like a stone. 
This is the last question I have for Michael Cullen and Clayton Cosgrove and a few others who have had a go at the National Party for being unpatriotic about New Zealand. Let me ask them this question. How many people need to leave New Zealand before this Government gets its head out of the sand and admits it has a problem? At the moment 680 a week are leaving New Zealand for Australia. That is net 20000-odd. So if it is not a problem at 680 is it a problem at 980 or 1280 or 1580? As I said on  
Eye to Eye with Willie Jackson 
 yes 150000 Maori did get a tax cut—the ones who live in Australia. It is wrong when a Budget keeps so much and gives so little to everybody else. 
I simply want to finish on this note. Over the weekend my deputy leader Mr Brownlee announced to the conference what I thought was some very interesting information. It was a background document to the Otago/Southland division of the Labour Party regional conference and it gave advice in relation to tax. I want to read a little bit of it out. The first thing it said to do is to tell the truth: “When you are talking about tax tell the truth.” Maybe Michael Cullen should take a bit of that advice. There was another bit of advice in the “don’ts”. I do not think Michael Cullen got to this but some of the major “don’ts” were: “Don’t be confrontational. Don’t buy into the language of other side.” A “do” was: “Ask open-ended questions you don’t have to answer.” and another was: “Practise with your family friends and colleagues before you go down there.” So we know that when this Budget was put together with those famous words of investment it was done with the compliments of  
Language Matters 
 the latest spin document from the Labour Party. No wonder it sank like a stone.