Hughes Gareth: Appropriation (2012/13 Estimates) Bill — Third Reading Imprest Supply Debate 
Text is incorporated into the Bound Volume 
Hughes Gareth: Appropriation (2012/13 Estimates) Bill — Third Reading Imprest Supply Debate 
[Sitting date: 21 August 2012. Volume:683;Page:4554. Text is incorporated into the Bound Volume.] 
GARETH HUGHES (Green) 
: 
Tena koe Mr Assistant Speaker. Kia ora. Nga mihi nui ki a koutou. Kia ora. I rise to take a call on the third reading of the Appropriation (2012/13) Estimates Bill and the second reading of the Imprest Supply Bill—part of Budget 2012. When the Government was elected in 2008 it inherited a Budget and an economy that were seriously out of balance a country that was living beyond its means and a country that has been rocked by catastrophic earthquakes. Now in its second term we can measure how the Government has responded to these significant strategic challenges. This Government has had an opportunity to remake our economy placing it on a more sustainable footing environmentally but also economically. It could have invested in an economy that was more productive that invested in its people and that invested in education. We could have had an economy that invested in the new economy which is green energy and clean technology. This would have provided more lucrative jobs which would have boosted our economy without trashing our environment. We could have rebuilt Christchurch smarter and made it one of the most sustainable cities in the world.  
The Government had an opportunity. It was inheriting an economy that was broken and it had a huge number of challenges. But now we can measure how it has responded to the challenges and it is clear that it has failed. It is clear that what it has turned out to be is a poor economic manager. What we see from this Government is not embracing the opportunity of the new economy. Instead it is stuck looking towards the past and in fact it has purposefully undertaken a series of measures that have hurt our economy. 
One just needs to look at the statistics. We know that the Government deficit is over $8 billion. We know that gross Crown debt is in excess of $75 billion around 38 percent of GDP. What is even worse is New Zealand’s total foreign debt which is more like 75 percent of GDP. When it comes to growth—the main measure that this Government wants to measure itself on—we have seen the lowest growth in 50 years. We have seen the highest unemployment rates since 1994. We have seen inequality growing and a record number of Kiwis going overseas. Under the quantifiable measures of how this Government has responded to those challenges it is clear that it is doing an abysmal job. 
The fact is we have got opportunities and we have got options but all this Government has embarked on is the path of cut it sell it mine it drill it and frack it. It is the only plan we are seeing from this Government. Grant Robertson quite rightly pointed out that the only measures to increase tax revenue in New Zealand were to focus on the paper boys and the paper girls the changes around postgraduate allowances and the increasing of prescription charges. We see it has cut it. Because of those unaffordable tax cuts a few Budgets ago the Government has dug itself a gigantic fiscal hole. Those decisions which led to the head of Westpac getting $5000 extra a year were fiscally unsustainable and fiscally reckless and demonstrate what a poor economic manager this Government is. 
That tax cut hole has led to the Government now requiring the second leg of the plan which is to sell it. It does not make sense to be selling off these assets which were returning healthy dividends to the taxpayer. If you listen to the Government on some days it is to pay down debt on other days it is to invest in infrastructure and on other days it is to do different things. But it is mad under all those terms to be selling these highly productive assets. Now what we are seeing is that other mostly foreign companies are trying to play us off. Because of the Government’s asset sale agenda we see job losses potentially as a result of the Glenbrook steel mill’s decision. We are seeing Rio Tinto once again threaten to leave the country trying to get lower electricity costs from Meridian. But what we are missing out on is these healthy dividend flows in the future. 
What this Government is quite happy to do is spend taxpayer money to sell these assets. The public relations job this Government wants to do and the admin costs are around $120 million but it will not tell the country because it is officially secret. We know that the asset loyalty share offer could be in the order of $400 million—a $400 million wealth transfer from Kiwis who already own those assets to the richest New Zealanders who can afford to purchase assets. This loyalty share is simply welfare for Kiwis who need it the least and this is what we should be calling it—welfare for those Kiwis who can already afford to purchase these shares. We also know we are going to miss out on the dividends—up to $100 million a year. 
There is a better way and it does not involve drilling mining and fracking our environment which is the only plan this Government has got left. Even under the current economic conditions this is not going to benefit us in a massive way economically. Everyone assumes that we are going to strike it rich if we find a large oilfield or gasfield but it is simply that—an assumption not grounded in reality. This Government has the fourth-lowest royalty and tax rate in the world. This Government has pages and pages of tax exemptions for the oil industry. This Government is quite happy to put oil workers—12 positions—on the skills shortages immigration list to facilitate and expedite getting foreign workers into New Zealand. What we know is there is going to be a huge environmental risk; unfortunately the conservation Minister is not standing up for our marine and coastal environment. It will be a huge environmental risk and a huge economic risk but for 100 percent of that risk this Government is quite happy to sell us short with 5 percent royalty rates when we are going to see hardly any jobs hardly any taxes and hardly any royalties and we know the profit is going to flow offshore. So the only plan this Government has is not even going to boost our economy. 
In fact what we are going to see is that it comes with a massive opportunity cost. The opportunity cost is investing in the new economy investing in the smart economy and investing in the green economy. Internationally this is where the lion’s share of international investment is going. In fact in 2010 for the first time investment in clean energy outstripped fossil fuels. Instead this Government is looking to the 19th century for economic inspiration not the 21st century where we should be looking. 
Paul Goldsmith 
: Along with the trains! Along with the trains! 
GARETH HUGHES 
: The trains? The member Goldsmith from an inner-city Auckland seat is arguing against the trains. What we see is that this Government is quite happy to borrow billions to throw at motorways with poor economic returns. Half of them have low benefit-cost ratios. That member is quite happy to keep a third-rate rail system in his electorate in his city because he would rather encourage urban sprawl increased oil demand and an increased cost to council for his motorways—his motorways to nowhere which this Government is quite happy to borrow billions for. It is economically risky is economically reckless and shows that this Government is a terrible economic manager. 
What we should be embracing is the new economy: clean technology and green energy. The home insulation scheme which we are quite proud to be working with the Government on is a great example of that. We have worked with the Government despite disagreeing with a whole host of its plans. The Government says it is because we are against everything. We are only against stupid ideas; it just happens that most of them come out of the National Government. But one good idea where we were able to persuade it was the home insulation scheme. Now we have 230000 Kiwi homes that are warmer drier and healthier because of the Greens. We have seen 4000 people directly employed. We have seen 10400 people indirectly employed and downstream economic benefit because of that scheme. We have seen if you laid the pink batts or other batts end on end an amount that would stretch from Auckland to Invercargill and back again because of this Green scheme. It is a great project having real good economic returns really helping Kiwis and it is a shame the Government is not extending it and not providing more jobs considering we have got the highest unemployment rates since 1994. 
As we saw in the Pure Advantage report we are missing out on the race to be the ones who are embracing clean technologies and being at the forefront of the 21st century economy. It is a $6 trillion industry they predict but this Government as Grant Robertson pointed out rubbished it. In an absolutely rude manner the Government rubbished the Kiwis behind that report who I think have the country’s best interests at heart. Sadly we have got this Government picking winners. It is quite happy to help out its mates at Skycity and to gamble on extra casinos and quite happy to help out its mates at MediaWorks and do whatever it can for the international foreign oil drillers. 
What we should be doing is extending the insulation scheme. We need a capital gains tax to rebalance our economy and put capital investment towards more productive enterprises not more housing bubbles. We should be investing in greater research and development. We should be increasing the minimum wage to $15 helping those Kiwis growing up in poverty—those 200000 Kiwi kids growing up in poverty. We should be putting a real price on carbon not subsidising by more than $1 billion the greenhouse gas polluters in New Zealand sending the wrong signal to keep investing in the 19th century economy not in the 21st century economy. And we need to reprioritise our transport. We need to invest in safer roads. We need to invest in better public transport with real economic benefits. This is how we are going to boost jobs and boost the economy but most important take the opportunity with the new economy not throw it away. Kia ora.