Parker David: Questions for Oral Answer — Questions to Ministers 
Text is incorporated into the Bound Volume 
Parker David: Questions for Oral Answer — Questions to Ministers 
[Sitting date: 13 March 2013. Volume:688;Page:8469. Text is incorporated into the Bound Volume.] 
7. 
Hon DAVID PARKER (Labour) 
 to the  
Minister of Finance 
: By how many dollars has the gap between New Zealand and Australian average weekly wages grown since December 2008 based on the methodology tabled by Hon John Key on 28 July 2010? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 I cannot actually answer the member’s question on the actual dollars for two reasons. One is that the Government has never updated that table because it believes the methodology has proven to be flawed and I will explain why. The wage series is not an official measure. The calculation did not take account of tax cuts and the purchasing power parities that are used are quite volatile. Nevertheless I understand that the Parliamentary Library has a series that attempts to replicate it. Based on those numbers the member put out a press release claiming that “The median weekly wage gap with Australia has ballooned by $60 to $180 a week”. That refers to the median weekly wage rather than the average and that is the other reason that I cannot answer the member’s question because he has made a mistake by confusing average and median. 
Hon David Parker 
: Can he then confirm that the median wage gap with Australia on a purchase price parity basis has increased by NZ$60 a week—50 percent more than when he took office—and now sits at $180 a week; and does he agree that the Government will not achieve its aim of closing the wage gap with Australia? 
Hon BILL ENGLISH 
: No I cannot confirm it because I think the member is comparing an average with a median and that is not a valid way to compare statistics. What I can tell the member is that I believe we are making progress in closing the wage gap with Australia despite the fact that Australia has had higher economic growth rates than we have had through our recession. Real after-tax wages have grown 12 percent in New Zealand under this Government. In the same time in Australia real after-tax wages have grown 9 percent so we are closing the gap on real after-tax wages. 
Hon David Parker 
: Is he aware that the gap between the take-home pay of Australians and New Zealanders has not closed once Labour’s 2008 tax cut is removed from his calculation and once National’s 2010 GST increase and its ACC increase are included? 
Hon BILL ENGLISH 
: No I am not aware of those calculations but what I can tell the member is that obviously when Australia was growing at 3.5 percent and New Zealand was in recession it made it harder to close the gap. New Zealand went into recession under the Labour Government before the global financial crisis. We have made every effort possible to dig New Zealand out of recession and get New Zealanders’ wages growing again and the good news is they are growing again. 
Hon David Parker 
: Has he seen the Treasury advice that was provided to the Government in 2010 that stated that the wage gap between New Zealand and Australia grew by 50 percent in the 1990s under National and shrank by 9 percent during Labour’s 9 years of Government; if so why does he think that New Zealanders do so badly under National Governments? 
Hon BILL ENGLISH 
: I did see the advice. The reason New Zealanders are doing better now is because the Government is making moderate and considered change over time consistently and it is focusing on everything that can be done to get businesses investing and employing. That has been difficult in the face of recession earthquakes and now drought but the good news is that the New Zealand business community is much more resilient than the Opposition believes and we are beginning to close the gap on Australia. 
Hon David Parker 
: Given the—[ 
Interruption 
] 
Mr SPEAKER 
: Order! Allow Mr David Parker’s supplementary question to be heard. 
Hon David Parker 
: Given the Minister’s reference to the difference on the basis of average weekly earnings in one of his earlier answers to questions is he aware that when comparing average weekly earnings on a purchasing power parity basis with Australia—not the median—the gap has grown from $121 per week to $179.94 in the period since he took office? 
Hon BILL ENGLISH 
: No I am not aware of that. But even if I was it is not the relevant measure for take-home pay for New Zealanders. Real after-tax wages—that is pay adjusted for inflation and for tax—have grown 12 percent in New Zealand since 2009 and they grew 9 percent in Australia. So real after-tax wages which is what people pay their bills with have closed the gap between New Zealand and Australia.