Cunliffe David: Questions for Oral Answer — Questions to Ministers 
Cunliffe David: Questions for Oral Answer — Questions to Ministers 
[Volume:676;Page:21792] 
4. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
 to the  
Minister of Finance 
: Does he stand by his statement that “the New Zealand ship is more seaworthy than it was three years ago” despite an extra 56000 unemployed $37 billion more debt and lower GDP per capita? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 The member should cheer up a bit. 
Mr SPEAKER 
: I recently remonstrated with the questioner for prefacing a question with unnecessary language and now the Minister has added to difficulties by prefacing his answer with unhelpful language. It would be more helpful if he just answered the question. 
Hon BILL ENGLISH 
: Yes. 
Hon David Cunliffe 
: Does his 2011 Budget forecast the net international investment deficit to increase in each of 2012-13 2013-14 and 2014-15 and was this raised as a concern in the Standard and Poor’s and Fitch Ratings downgrade reports issued last week? 
Hon BILL ENGLISH 
: I think the Budget does forecast some deterioration in both the current account deficit and the net international investment position. That is as I understand it driven partly by the Canterbury earthquake because there will be significant importing of materials to rebuild Christchurch and partly by a view Treasury has that New Zealand households will probably go back to their bad old habits of spending a lot more than they earn. We are a bit more optimistic that New Zealanders understand how the world has changed and understand what they need to do to improve this economy and there is a track record now that shows they are getting on with spending carefully saving more and paying off their debts. 
Hon David Cunliffe 
: Does the New Zealand Income Survey released today confirm that the median wage increase last year was just 1.9 percent and inflation was 5.3 percent implying a cut in real terms in the median wage of 3.4 percent over the last year? 
Hon BILL ENGLISH 
: Every time the member uses figures in that way it confirms that he is not getting to grips with what is actually happening in the real world as opposed to in his own head. The fact is that the inflation figure is 5 percent because of the tax switch. When we take into account the impact on take-home pay of the tax changes the after-tax median income has in fact risen by about 7 percent which is higher than the rate of inflation. Real incomes have gone up. 
Hon David Cunliffe 
: Does the New Zealand Income Survey show that the real median income has fallen 6 percent after 3 years of his Government and that real median incomes for Maori and Pasifika people have fallen by 16 percent and 21 percent respectively? 
Hon BILL ENGLISH 
: In respect of the Maori and Pacific figures there must be some question marks about the plausibility of the measure if it shows that for some reason Maori who are earning income are earning 16 percent less yet the population as a whole is earning 2 or 3 percent more. In any case in the case of after-tax incomes Maori and Pacific people who are working have higher real incomes than they did 3 years ago. 
Hon David Cunliffe 
: Can the Minister explain when in the last week he has received objective reports from Standard and Poor’s from Fitch Ratings from the Auditor-General and from the New Zealand Income Survey—all of which have shown either a downgrade or negative economic statistics—why he continues to make excuses including blaming the weather the previous Government seismic activity and the colour of people’s ties? 
Hon BILL ENGLISH 
: The fact is that whether the Labour Party likes it or not under this Government’s economic management we have been able to make considerable progress with moderate economic growth moderate growth in incomes and significant growth in new jobs. This is despite the fact that there was a world recession and an earthquake that brought damage equal to 10 percent of GDP making it the largest natural disaster proportionate to an economy. But in Labour’s parallel universe none of that occurred. As long as Labour members remain in that parallel universe voters will find it hard to vote for them because the voters live in this universe. 
Dr Russel Norman 
: Is the Minister confident that the structural elements of the New Zealand economy have turned round in light of the fact that over the last 2 years household lending is up farming lending is flat and business lending is down? How can the structural transformation happen in light of that basic underlying activity? 
Hon BILL ENGLISH 
: A structural shift I would say is just under way. I certainly would not claim that the structure of this economy which has been locked in for the last 25 years or so would change in a couple of years. But we do need to stick to the direction of growing our ability to earn income from the rest of the world and reducing our debt. I thank the member for his sensible and insightful questioning on economic matters—a sharp contrast to other— 
Mr SPEAKER 
: It is just as well it is the last day of term I think or the Speaker might have to get tougher. 
Dr Russel Norman 
: What has Treasury got wrong? When Treasury predicts that the current account deficit will increase to over 6 percent of GDP by 2014-15 what does the finance Minister know that Treasury does not? 
Hon BILL ENGLISH 
: Well it could take me all afternoon I think to outline the things I know that Treasury does not. It knows a few things that I do not and one of them is how to put together the detail of economic forecasts—that is Treasury’s forecasts. As I have said before this Government is a bit more optimistic that New Zealanders understand that the world has changed and that their economic behaviour needs to be different. We think there is ample evidence that they have changed in terms of how they see savings spending and debt. If we are re-elected as a Government I hope that the results would be better than Treasury’s forecasts. 
Amy Adams 
: What economic problems did the Government inherit from Labour? 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. I think you can anticipate the point of order. The Minister has no responsibility for Labour policy either present or past. 
Hon Simon Power 
: The question asked what the new Government inherited. That was quite different to the way it was put by Mr Cunliffe and I suggest that the Minister of Finance does have some responsibility for the state of affairs he inherited. 
Hon David Cunliffe 
: Speaking to the point of order— 
Mr SPEAKER 
: I will hear briefly the Hon David Cunliffe again. 
Hon David Cunliffe 
: Were the question worded in terms of whether the Minister had seen reports of historical aggregates I submit that that would have been within the Standing Orders but as the question was phrased—using the word “Labour” and referring to the past policies of the current Opposition—I submit to you that it is outside the Standing Orders. 
Mr SPEAKER 
: I do not believe that that is the case. It has been longstanding practice that economic Ministers because they have to deal with an economic situation inherited by a Government are entitled to report on what they have found on coming into office. It is in order for the Minister to report on what the Government inherited. But he must not ascribe to Labour any policies now or criticise any policies now. He is entitled to report on what he understands to be the situation the Government inherited. 
Hon BILL ENGLISH 
: Well this Government by nature and aspiration looks forward not backward. But it does help occasionally to note those things that we inherited which were Government spending out of control an export economy on its knees a shambles of a tax system— 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. You rightly I think warned the Minister that in order to be within the Standing Orders—and you were giving him I think some good grace and latitude in allowing him to answer the supplementary question—he would have to avoid ascribing motivation or characterising the actions of the current Labour Opposition. To start with language like “things were out of control” is pure hyperbole— 
Mr SPEAKER 
: Forgive me but the current Labour Opposition was in Government at the time the Minister is describing. Therefore he is not describing anything to do with the current Labour Opposition. It would be helpful if the Minister were a little more careful with his language but he is entitled within reason to describe the situation inherited. If it is not accurate other members can question him about it. But I have been listening carefully and the Minister has not alluded in any way to current Labour policies at all—and he must not. 
Chris Hipkins 
: I raise a point of order Mr Speaker. With regard to your ruling on the substance of the supplementary question that was just asked I wonder whether you would consider Standing Order 371(1)(a) and (b) which basically makes it very clear that a question cannot contain arguments inferences imputations etc. etc. I argue that the entire supplementary question did exactly that. 
Mr SPEAKER 
: I am not sure how asking about the situation a Government inherited is making an imputation. Forgive me if there was some language in there that was making an imputation and maybe I was in error if I did not pick up language that was condemnatory of the situation. But certainly a question that asks—[ 
Interruption 
] The member must resume his seat. Maybe I should get to my feet to make it clear that the member should resume his seat. If I missed some language in the question I apologise for that but the substance of the question is in order. If I missed an implied criticism—at least a stated criticism—in the question then I apologise for that. But the fundamental question was in order. The Minister is entitled to report to the House on the economic situation inherited by the Government—any Minister is entitled to report—but he must not cross the line of ascribing to another party in the House current policies and criticising them in any way. I do not believe that the Hon Bill English has finished answering. Has he finished his answer? 
Hon BILL ENGLISH 
: It is a long list. 
Mr SPEAKER 
: Let us not make it too long please. 
Hon BILL ENGLISH 
: Housing speculation was out of control; per capita GDP was falling; finance companies were collapsing left right and centre; households were spending a lot more than they earned; and I could go on. 
Hon David Cunliffe 
: Which of the following economic aggregates was the Minister referring to when he described the record of the previous Government as out of control: 3.4 percent unemployment the lowest in the Western World; zero net Crown debt despite his urging to provide tax cuts to people who did not need them; rising GDP every year for 9 years; fiscal surpluses every year for 9 years when he has run deficits every year for the last 3 years; or the fact that real median wages rose consistently every year under the Labour Government in contrast to the last 3 years when they have gone backwards by 6 percent? 
Hon BILL ENGLISH 
: One reason that both of the people who turn up to that member’s meetings do not listen to— 
Mr SPEAKER 
: The question leaves the Minister a lot of latitude in answering and I am prepared as Speaker to give the Minister a lot of latitude in answering a question like that. But to start the answer that way is to go beyond reasonable latitude. There is plenty of latitude in just answering the question because the question asked the Minister what was out of control about a whole lot of things. I am sure the Minister has all sorts of views about what was out of control. But to criticise the questioner about the number of people attending meetings is not in order. The Minister can do better than that. 
Hon BILL ENGLISH 
: Just to pick— 
Hon David Parker 
: I raise a point of order Mr Speaker. The Minister has flouted your rulings four times by my count today. The same lame joke that was used against me yesterday has been used against Mr Cunliffe. I seek an extra supplementary question for the Opposition in the circumstances because we seem to have no other effective remedy. 
Mr SPEAKER 
: We will see. If the Minister ignores my ruling right now that may just happen. 
Hon Annette King 
: I raise a point of order Mr Speaker. I feel a need to defend you in this Mr Speaker. While you were ruling on that point of order the Minister of Finance laughed giggled and talked right through it. Should he not be listening to what you are saying instead of acting like a schoolboy? 
Mr SPEAKER 
: The House will come to order. I realise that it is the last day of term but the House will come to order. It will be the actions that the Speaker takes more notice of. The Minister is on notice. 
Hon BILL ENGLISH 
: Just to pick up one figure that the member used he referred to New Zealand’s low unemployment in 2008. That was the result of the previous Government’s job scheme and their job scheme was the Government. When we untangle the figures we find that almost all of that drop in unemployment was caused by growth in Government jobs. There were no new jobs in the private sector.