Brownlee GerryHon GERRY BROWNLEE (National): This is the second reading of this bill. There's been an enormously wide-ranging second reading debate so far a debate that quite clearly I think has confused itself between this bill and the Budget itself.SPEAKER: Absolutely.Hon GERRY BROWNLEE: But then—but then—you wouldn't want to break sir with the—Hon David Parker: Point of order Mr Speaker. I was sat down for straying outside of the bill by the Speaker before dinner.SPEAKER: Yes yes. That is not a point of order. I think the member knows it's not a point of order. I was watching the debate and that happened far too late.Hon GERRY BROWNLEE: There is of course a loose connection to the debate at hand and then of course straying so widely as to be ridiculous. And I think that's what the previous person in your seat identified with the Hon David—SPEAKER: Right. Now we'll get back to the bill and not reflect on the Chair's ruling all right?Hon GERRY BROWNLEE: Oh no no I wasn't. I was being quite complimentary of the ruling.SPEAKER: No. It doesn't matter whether you're complimentary or not you're still reflecting.Hon GERRY BROWNLEE: So here's the problem everyone will be trying to make the case on the other side of the House that this is a good thing for New Zealanders who have jobs who earn but are still in receipt of family support. No one is going to deny that they need it. No one's going to say Look we're not going to have that." And no one wants to see the gap between someone who is living on a benefit and someone who is living in work so closed up that there is no incentive to go into work. So that's a pretty easy principle to support.The problem though is the fundamental reason why those people are on family support in the first place. The current Budget and the current initiatives from this Government do not see that number of people being recognised for the work—the contribution they make in the community.We've just seen a few minutes ago—we're to see I should say—the Prime Minister go on to TV and say that the benefit of this particular increase in family support won't get swallowed up by rent increases. Well why would anybody accept that when in the last three years rents have gone up by $100 average rents? And what's the reason for that? It's a bit hard to explain because we've had low interest rates. We've had relatively low inflation recorded and published. But in all reality the costs of providing that rental accommodation have risen and are going to rise even further. So when it comes to trying to claim that there is a material benefit for people in this particular policy that's coming out of this legislation it's wrong—quite wrong. When the next roll of rent roll comes round this will get swallowed up very quickly because the deductibility of interest is going to go and we've got rates that are going up across the country and we have the precarious nature of low interest at the moment.It's very interesting also to look at some of the daily costs that people face. And I heard speakers earlier saying that they know what it's like to be down at their last $2 going throughout the supermarket and having to make a choice about what to buy with that last $2. Well I don't have anything but sympathy for people who find themselves in that position. But just have a look at a simple basket of grocery products as demonstrated by interest.co.nz in their article today. Treat them as if they were a Consumers Price Index basket and you were assessing what the increase in those costs have been. It'll show that in the last 12 months inflation's running at about 7 percent. So it doesn't take much to soak all this up.The fundamental problem here is that whenever there is an effort to redistribute wealth there is a looking away from the idea that it should be expanded and that's what a bill like this—it's where a bill like this fails. If we are to raise the incomes of New Zealanders it has to be based on production. It's interesting going back and looking at great socialists of the past and perhaps the greatest of all—Michael Joseph Savage—who said that whatever is able to be afforded by way of the welfare State has to be paid for by production. That's the bit that's missing here. Just a bill to say we're going to lift the threshold of earnings by $520-something a year so that they can qualify for the family support and maintain it with a gap between those who are not in work. Well the first thing is there's a real problem with that. Perhaps there are too many people not having the opportunity to work because they are shut out of the economy for one reason or another. No one begrudges anyone the support of the welfare State when they need it. But some of the comments that have come from over the other side of the House today have suggested that there's some big nirvana out there where everybody can just quietly go about their life with any amount of increase coming on a regular basis and not being in a productive position. I don't think people who are genuinely in need of this support—and we saw some of them on TV tonight—will in any way not want to be part of that productive economy.So this bill is a band-aid on the fundamental problem that we've got in New Zealand which is an economy that does not accommodate enough people in the workforce. We are supporting this bill because it would be quite wrong to say that those people who are in work should not have a natural advantage over people who are not at work. And that's not to be pernicious against people who aren't in work; it's just recognising that in the workforce there is a productive base—it ultimately provides the basis for our economy.But I'd say again this is a redistributive bill looking at the collective wealth of the nation and deciding how it should be spread out. Well most of that spread in countries like ours is in the services that people expect to make their life better on a daily basis. This bill doesn't look at that; it simply looks at the idea of providing extra cash to those families who do need it. And I heard someone earlier saying "Well look there are two economic theories that are in place here that make it absolutely acceptable." The problem with all that is no one on the other side of the House has looked at where the funds come from. Yes they do go into the economy. Yes they do go round and round and yes there is a multiplier effect etc. etc. But where did the funds come from? It comes from a very very heavily indebted New Zealand.So there is a kind of a fool's paradise being promoted with a bill like this that I think does not should not be considered a problem for those who are in receipt of the benefit of this particular expansion of the family support thresholds but is the fault of politicians who are not looking at the root cause of our problems and the reason that we have so many people in this country in receipt of Government assistance whether it be for income supplement for accommodation supplement or for whatever it might be. The reality is that this bill comes because of a Budget that's looked away from expanding the productive sector."