Goldsmith Paul: Budget Debate 
Text is incorporated into the Bound Volume 
Goldsmith Paul: Budget Debate 
[Sitting date: 29 May 2012. Volume:680;Page:2621. Text is incorporated into the Bound Volume.] 
PAUL GOLDSMITH (National) 
: 
 This Budget is a sensible one. It takes a firm line on spending and invests in our future during difficult times. Like households all around New Zealand this Government knows that it has to live within its means. That means paying down debt. It means going over all the spending and making sure that it makes good sense. It means looking for ways to get what we want for less and also figuring out how to improve our income. That is what households are doing and that is what this Government is doing and no wonder this Budget has resonated so well.  
I want to respond to a couple of canards that were heard from the other side. The first is that this is some sort of “do nothing” Budget. What a load of rubbish. This Government has stuck to a consistent line for the past few years of setting a path back to surplus. Consistency and stability are precious commodities in this world. True it does not represent a radical departure. That is quite right because a sensible direction was set out in 2010 in terms of the tax settings and subsequently the focus on rebuilding Christchurch and delivering better public services has continued. It makes sense to continue such a line. This represents an evolution of that strategy the wisdom of which is becoming more and more apparent with each passing month as we look around the world and see the situations that other countries have got themselves into.  
We should also consider for a moment some of the other proposals from the other side. Labour’s solution to every problem seems to be a capital gains tax. It still is beyond me how taking more tax from small businesses from farmers and from other businesses can be some way of growing the economy. That is no way to grow the economy as far as I can see. The Greens talk in a dreamlike manner about green industries as if somehow they will magically arise and lift our living standards.  
Well the National Party is much more realistic about what it takes to grow an economy. It is about at the end of the day the additional jobs and economic growth that come from companies being successful. Companies are successful only if they beat the competition and you beat international competition only if you deliver products that are either better or cheaper than the rivals. Ideally they will be even better; they will be cheaper and better.  
I can think of six drivers for business growth that we do not hear about much from the Opposition. It is about innovative ideas it is about capital it is about raw materials and it is about skills customers and infrastructure. I want to go through each of these six in turn. If we start off with ideas— 
Dr Megan Woods 
: Where are the technology teachers to teach the skills? 
PAUL GOLDSMITH 
: Well we will get there. We will start off with ideas. The innovation ideas reflect the genius of the people—young folk coming up with new apps or new products. The Government can help.  
One area where the Government is making a significant investment is in research and innovation. It is going to be spending over the next 4 years $166 million on the Advanced Technology Institute helping high-tech firms boost productivity $60 million for the National Science Challenges $100 million increasing the Performance-based Research Fund that is available to universities and $59 million more for science and engineering tertiary courses. The Government cannot come up with all the ideas but it can create an environment in the research and development area where this country will be producing more ideas that companies can draw on to be successful.  
If we turn to capital well you know we do have amongst the lowest interest rates that we have had for decades. It is helpful if you are trying to get access to capital is it not if you are not having to pay unreasonable amounts for that capital? Those low interest rates that companies have available to them are the direct result of consistent stable sensible economic policies that this Government has been driving over these last 4 years. Another area that is important in terms of capital is the mixed-ownership model which will give a fillip to New Zealand’s capital markets which have been thin and weak over the last past few decades. The Greens of course are protesting about this as usual. I see they are advertising on Student Job Search to pay people to go out and fill petitions.  
Todd McClay 
: Using taxpayers’ money. 
PAUL GOLDSMITH 
: I am not sure about that but it would be interesting to know. Contrast the National Party’s approach to getting access to more capital with that of the other side and what you will find is an inward-looking opposition to any foreign investment. Members opposite are opposed to that—especially if it is Chinese if you are dealing with New Zealand First—and turning inwards. That to me is no recipe for growth. National understands that successful companies need access to capital.  
What about raw materials? Well this Government recognises that New Zealand has rich resources on its land and throughout its vast exclusive economic zone. Labour and the Greens do not want to do anything with it; they do not want to touch it. They prefer to export our next generation to Australia to help them make use of its natural resources. Well that does not seem to make good sense to me. If we talk about primary industries as well growing production through irrigation and intensification is the sort of thing we need to do to make a better living in this world and that is what this National Government has been focusing on. So what have we got here? We have got successful businesses having greater access to ideas to capital and to raw materials.  
Before we close at 6 o’clock I can talk about skills and education. We all want our kids to leave school with the knowledge and skills they need to reach their potential in the 21st century. In education our focus is on increasing student achievement not just on pouring more and more teachers over the line without focusing on the result. Over the next 4 years we will be committing $511.9 million in the Budget towards new early childhood education and schooling initiatives as well as another $59 million invested in teacher quality to support professional development for teachers and principals. We are ticking off that one.  
Then if we move to customers customers are all about market access and free trade and thankfully the Labour Party—notwithstanding Mr Shearer’s anti - foreign investment rhetoric—still believes that actually having access to international markets through free trade is an important thing. I have no confidence whatsoever that the Green Party would be at all interested in maintaining New Zealand’s open access to international markets. It seems to be against trade but on that score— 
The ASSISTANT SPEAKER (Lindsay Tisch) 
: I am sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
PAUL GOLDSMITH 
: I was talking about how this Budget is a sensible one has taken a firm line on spending and has invested in our future during difficult times. I talked about the National Party’s understanding of what really were the drivers of economic growth and that came down to having companies that are successful internationally making money and beating the competition. I talked about what they needed for success which is access to good ideas access to good strong capital flows and access to raw materials primary industry skills and customers. We talked about market access and the fact that thankfully Labour—notwithstanding Mr Shearer’s anti - foreign investment rhetoric—still believes that market access is an important thing and that there has been a measure of bipartisanship in the House on that subject. I was not so sure about the Greens.  
The final area that I think is obviously clearly important for economic growth is good sensible investment in infrastructure. Here we are talking about electricity transmission the ultra-fast broadband building and construction and transport—roads for a start. In Auckland where I come from lives have been transformed by the second Manukau Harbour crossing by the Victoria Park Tunnel relieving pinch points in Auckland’s arterial road network. The Greens and the Labour Party tend to oppose everything that we do on the roads. They are in the thrall of public transport at the expense of everything else even when there is a very poor return. We saw in the  
New Zealand Herald 
 this morning yet another story of only a handful of commuters using the $81 million rail line to Manukau. That is how the State can spend your money if it is in the wrong hands. This Budget it seems to me is continuing a sensible line which the Government has outlined since it came to office in 2008 showing stability and sensible management at a time of difficulties.  
The other thing I just wanted to mention was the canard that we hear time and time again that the National Party has simply given tax cuts to the rich. This has been a line that the Greens have used time and again when it is factually incorrect when you look at the numbers. That is what happens when you look at only two out of the 13 components of the 2010 tax package. Mr Norman tends to pick out personal tax cuts and GST and ignore all the other parts such as changes to depreciation loss attributing qualifying companies and thin capitalisation rules. I suppose it is because they are not quite sure how they work but depreciation changes alone raised $1 billion in extra revenue each year mostly affecting high-income earners. When you look at the 2010 tax changes overall the burden of that has been borne very evenly across all income groups. This is a very sensible Budget that we have brought here and I fully support it. Thank you very much.