5. Question No. 5—FinanceHon BARBARA EDMONDS (Labour—Mana) to the Minister of FinanceQuestion No. 5—Finance5. Hon BARBARA EDMONDS (Labour—Mana) to the Minister of Finance: Does she stand by her statement we won't have to borrow extra to provide tax relief and we won't be adding to inflationary pressures"; if not why not?Hon CHRIS BISHOP (Acting Minister of Finance): Yes. Budget documents including the Budget at a Glance document clearly show that the $3.7 billion per annum of tax relief is fully funded from savings and revenue initiatives so the Government is not borrowing to fund tax relief and it won't add to inflation. On this side of the House as I said in answer the last question we're proud to be ensuring that hard-working Kiwis keep more of what they earn.Hon Barbara Edmonds: What was net debt forecast to peak at in the pre-election fiscal update and is it higher in her Budget?Hon CHRIS BISHOP: If the member wants a specific answer in relation to that she'll have to put it down. But net debt continues to increase as the member knows because we have inherited a fiscal mess from the previous Government and we are having to work as hard as we can to get debt under control. That is one of the reasons why Budget 2024 reprioritises low-value expenditure towards the front line and makes sure we get back on a fiscal track to get the Government books back in order.Hon Barbara Edmonds: Does she agree with economist Shamubeel Eaqub who said "Borrowing in this Budget to fund tax cuts and operating spending is like earning less and living off the overdraft … This increase in borrowing chooses to rack up debt for future generations to give tax cuts now."; if not why not?Hon CHRIS BISHOP: Well I don't often agree with Shamubeel Eaqub although I have respect for him and I don't agree with him in this circumstance. There is no doubt that the Government is not borrowing for tax relief in this Budget. I invite the member to read the Budget at a Glance document which she is clearly unfamiliar with. It outlines the five changes in the Budget 2024 tax package which total $3.68 billion in average annual cost. And I also invite her to go down to the next table—it's only a couple of bars down—which outlines the savings and revenue to fund the tax relief.SPEAKER: Before the member asks her question can I just say that when a question is asked it's presumed that the people asking it or on whose behalf it's asked want to know the answer. Just yelling at the answer doesn't in any way make it any more palatable to those who are listening to it. It is the answer the Government decides to give so just calm it down a little bit.Hon Barbara Edmonds: Does she agree with the head of BNZ research that the fiscal position will make the Reserve Bank more nervous and that "It's not the tax cuts per se but the fact that the fiscal impulse is larger"?Hon CHRIS BISHOP: No and I refer the member to the Treasury's analysis in the Budget update which says and I quote "The decisions taken through Budget 2024 will on balance reduce the contribution fiscal policy is making to inflation pressure. Tax policy changes will boost aggregate demand but this is more than offset by lower government spending and lower allowances compared to the Half Year Update." The member cannot have it both ways: she cannot argue that debt is too high and also that we should go back on a spending spree. That sort of mentality has led us to the fiscal disaster that we have inherited from the previous Government. Unlike the last Government this Government is taking a responsible path getting debt back under control and getting our fiscal books back in order.Hon Barbara Edmonds: Does she agree with the leader of the ACT Party who said "net debt is forecast to reach $100 billion by 2025. They've given up on New Zealand and New Zealanders need to give up on them." and has she given up on New Zealanders given net debt at its peak will be higher due to her Budget decisions?Hon CHRIS BISHOP: Well I often agree with the leader of the ACT Party who I've found to make incisive and cogent remarks about public policy. And if members opposite when they were in Government had listened to the leader of the ACT Party and the leader of the National Party and indeed the leader of the New Zealand First Party when they had the opportunity we wouldn't be in the fiscal mess that we are in right now. We are working hard as a Government to get inflation back under control and be a friend to monetary policy which is quite a contrast from the last three years when inflation peaked at over 7 percent forcing the governor to hike interest rates very rapidly which has put enormous pressure on households. We are taking the tough decisions as a Government to get our books back in order.Hon David Seymour: Can the Minister confirm that the Government is committed to spending reductions of over $13 billion over four years and an operating allowance of over only $2.4 billion or 1.7 percent of total spending for the next four years and has the ACT Party leader said anything about how excited he is about that prospect? Hon CHRIS BISHOP: Yes I can confirm that and one of the things that is notable about the Budget is that it sets lower operating allowances for Budget 2025 and onwards than the one that we have just gone through. And I would contrast that and compare it to the large operating allowances set by the previous Minister of Finance which were notable by the fact that he never once met them. He always exceeded them every single year and that is why Government spending went up by such a large amount in such a short amount of time and that is of course one of the reasons why inflation peaked at 7 percent and one of the reasons why we have net debt at a higher level now than would otherwise be the case. Hon Barbara Edmonds: Does she agree with Chris Bishop's characterisation that $104 billion in debt is a blowout and if so what does that make the $114 billion of net debt under her watch? Hon CHRIS BISHOP: Oh well I've always found Chris Bishop to be a very incisive and cogent commentator on the Crown books and I often take his advice and I will continue to do so. Hon Barbara Edmonds: How can she say the Government is not borrowing extra for tax cuts when her own Budget shows that the income tax cuts cost $10 billion and the Government is issuing an additional $12 billion of debt bonds?Hon CHRIS BISHOP: Because as I have said twice already I think in this answer—and I invite the member to listen—it is very clear that every single dollar of the Budget 2024 tax package which includes a lifting of the thresholds and changes to the independent earner tax credit to allow New Zealanders to keep more of what they earn—and I again remind the House that that member voted against it; tax relief for the first time in 14 years. Every single dollar of that is funded from baseline savings: closing stupid Labour programmes like industry transformation plans; a climate dividend; commercial buildings depreciation; taxing online casino operators which the Minister of Internal Affairs issued a press release about just this morning I believe; revenue from immigration levies; replacing first-year fees-free with final-year fees free; and investment in tax compliance activities. All of these on the Treasury's numbers add up to more than the cost of the tax package so it is simply fallacious to claim the Government is borrowing for tax cuts. Hon David Seymour: Can the Minister confirm that some of the people browsing on the Treasury's tax calculator have been found by analysis to be Labour voters from Wadestown browsing in incognito mode? SPEAKER: No that's not something you would know anything about at all."