Clark David: KiwiSaver Budget Measures Bill — First Reading Second Reading In Committee Third ReadingText is incorporated into the Bound VolumeClark David: KiwiSaver Budget Measures Bill — First Reading Second Reading In Committee Third Reading[Sitting date: 21 May 2015. Volume:705;Page:3795. Text is incorporated into the Bound Volume.]Dr DAVID CLARK (Labour—Dunedin North):This is a Budget of broken promises. It is short on vision and it fails to deliver a surplus. People around the country watching that speech from the Hon Gerry Brownlee will be saying to themselves: “I wonder—did those Ministers on the National benches take that $1000 themselves before they cut it off for hard-working families around the country?”. They will be asking whether the member for Ilam banked that $1000 before he cut it off from his hard-working constituents. They will be asking whether he encouraged his family members to take that $1000 before the Government cut it off from hard-working constituents. They will be talking to the member from Hamilton West and asking whether he took the $1000 before he cut it off from his hard-working constituents.David Bennett: He wouldn’t take a thousand bucks.The member from Hamilton East: did he take it from his family members for himself before he cut it off for the rest of hard-working New Zealand? They will be going into the office in Rodney and saying to the member there: did he take the $1000 before he cut it off from his hard-working constituents? There are some guilty faces opposite and I am not surprised. They will be going into the Rotorua office and saying to the Minister: did he take the $1000 before he cut it off from hard-working families? And I would be interested to hear what answers they get. I wonder whether the journalists will ask members opposite whether they took the $1000 KiwiSaver kick-start before they cut it off from hard-working New Zealand families. Over there they are quite happy to cut out the lunch for everyone else when they have got a big lunch for themselves and that is indicative of this Government’s attitude to the future of New Zealand.The Government has hit the panic button. It has hit the panic button and we can see it right there in the regulatory impact statement on the front page. On the front page: “The advice was requested in advance of Budget 2016 and therefore has been prepared urgently.” How long has the Budget been coming? Why did it need to be prepared urgently? The analysts have “not focussed on the effect of policy options on national saving”. They say it there in paragraph four. In paragraph two it is urgent; in paragraph four they have not focused on savings. And then paragraph five if we skip forward: “There has been only limited consultation”. And now we are passing it through urgency. Members opposite know what answer they would get. They know the hard-working New Zealanders who come into their offices would be furious that they took the $1000 and then said it is gone. It is gone. But it is what we get from this Government. It is out of touch. It has lost touch with middle New Zealand. It is looking after the interests of a very wealthy few and it is robbing Peter to pay Paul.Although there are a few good things in the Budget—and we on this side have acknowledged some good changes in the Budget—we see that there is sleight of hand and they are taking with the other hand and middle New Zealanders are the ones who are squeezed yet again. The Government is robbing Peter to pay Paul. Those improvements should not come at the cost of those who are just one or two rungs further up the ladder but that is what we see from this Government—a Government short on vision. There is no doubt that this change will reduce savings for New Zealanders and at the very time we need to be increasing them. This is a short-term plan and not a long-term vision. But it is what we have come to expect from this Government: a Government that is neglecting the regions that has failed to diversify the economy that has failed to address the housing bubble in any meaningful way and that has failed to diversify the skills of New Zealanders to prepare for tomorrow.We know—I remember from my time in Treasury—that one of New Zealand’s challenges is capital debt. It is actually having enough money for businesses to access for them to grow. That is a very serious problem. Treasury had an analyst on it in the 1970s. Treasury has still got an analyst on it and members opposite are doing nothing about it but cut cut cut when it comes to savings. They do not care about business in New Zealand—not small businesses and not medium sized businesses anyway. Across there all we see them doing is cutting. They have cut the contributions to the Cullen fund. They have cut the contributions to KiwiSaver on several occasions. This is one of a number of cuts. Last night my colleague David Parker outlined seven or eight cuts I think it was that they have made to KiwiSaver. This is a Government that does not care.In Australia they have got a superannuation fund that has got $1.3 trillion in it. That would have happened across here if Muldoon had not cut it. This is the same attitude as the Muldoon Government—this Government though has borrowed more than Muldoon. It is up to $88 billion in debt. It is drowning us in debt because $10 million a day is spent just paying off debt. Taxpayers are paying $10 million a day just to pay off the Government’s debt. That is the attitude it has. That is short-term thinking from a Government that is out of ideas.Half a million Kiwis are going to miss out on this $1000 over the next 4 years. Those are the Kiwis who should be going into the offices of those members opposite and saying: “Did they take the $1000 before they cut it?”. Did they take the $1000 before it was cut? I will be interested to see. I would like them to put up their hands to show that they took the $1000. I would be interested to see whether members opposite have the courage to put up their hands to show that they took the $1000. Let us see: how many of them took the $1000? How many took the $1000 across there? None of them! They are all saying that none of them took the $1000. I bet that is wrong. I bet we will learn in coming days that that is wrong. Those members opposite should own up. They took the $1000 and then they took the ladder away. That is just typical of this Government.We know this plan works. That is the crazy thing—2.5 million Kiwis have signed up for KiwiSaver; 2.5 million Kiwis have signed up for Labour’s KiwiSaver programme. And the Inland Revenue Department says in its recently released fairly thick and comprehensive evaluation report that this is an excellent scheme basically: 36 percent extra savings on top of the savings that would ordinarily have happened in our economy. It is because of course there are member contributions that encourage people to get involved. There is an opt-out clause so people are in the scheme and there are no overheads no hassle to get involved. People find themselves saving before they know it. Of course they are encouraged because there is a thousand bucks in there to start with.As my colleague David Parker outlined last night that makes a difference for somebody on $15 an hour with a part-time job when they are saving a couple of bucks a week: $1002 is much easier to be proud of than $2 in your account. It makes you feel good. Behavioural economics have happened. We are not still in the 1980s. Those people over there need to read a few new economics textbooks get the Hayek out from under their pillows get a few new books under their belts and get the spray-misters out to dry them off. Those people opposite need to have an up-to-date understanding of just how economics works. Thank goodness the Inland Revenue Department has a few insights because it is telling the Government that this policy works. This policy works.The beautiful thing of course is that people are signed up to the scheme already. A lot of people have got this and they will be thankful. But it is the half a million Kiwis who are going to miss out over the next 4 years we should be thinking about. Those half a million Kiwis—I hope just a few of them go and ask these National MPs and Ministers opposite whether they took the thousand bucks before they got rid of the scheme. They already cut the member tax credit in 2011 cutting savings. Cutting savings is not the way to manage the economy. It is what Muldoon did and this is the Government that has created more debt than Muldoon. It is the same plan and it did not work then and it will not work now and Kiwis can see that.We do not even know whether it can be implemented. The Inland Revenue Department says it is going to cost $210000 to implement this scheme. That is 210 Kiwis who could have had the extra thousand bucks. And will the Government be able to do it? Or will members opposite be coming back again like they have done with so many bills that have adjusted the tax system—to reverse the changes out because they cost so much under the old system in the Inland Revenue Department that they still have not fixed after nearly 7 years of Government? Seven years 7 long years and they still have no new ideas. They have not fixed the tax system. I doubt very much whether they will be able to do it.They are costing New Zealanders’ future. They are stealing from the future generations from the pockets of kids. This is what it has come down to. Members opposite will claim high and mighty. They will say they have made some positive changes and no one on this side of the House begrudges them that. But we do not want to do it by stealing out of the pockets of those who are one or two rungs further up the ladder. It is always the middle class and the lower class those who are struggling those who are really working hard those who go out to work every day on modest wages those who are on median incomes who are feeling the squeeze. It is not those at the very tip-top not those who benefited from the 2010 tax package not the top 1 percent.But we will see. Let us see whether Mr Bennett stands up shortly to say that he took the $10000 and he is proud to see that no one else—[Interruption] Sorry $10000—whatever even better. Let us see whether he took the $1000 and then cut the scheme. I bet Mr Bennett will tell us that he did take the $1000 and that he encouraged everyone he knew. This is retrospective legislation because members opposite know that if they pushed this out a whole bunch of people would sign up no matter what they say. This is a Government that is out of vision out of ideas and out of touch.