Brownlee Gerry: Budget Debate 
Brownlee Gerry: Budget Debate 
[Volume:639;Page:9604] 
GERRY BROWNLEE (National—Ilam) 
: 
 Two things can be concluded from the speech just given by Steve Maharey. The first thing in looking at the content of the speech and recognising that he is the third-ranked Labour Minister in the Government is that it is no wonder that Labour is in a ditch. He cannot talk about the Budget and he has to come in here with all sorts of other silly attacks. The second thing is that it is no wonder that Labour is panicking about its future because he is it. He is the next leader of the Labour Party and that is as good as it gets. I do not blame poor old Mr Maharey though for clearly having no idea of what was in the Budget because nor does the Prime Minister Helen Clark. 
This afternoon I want to read to the House a small snippet from an interview that Helen Clark gave on a radio station this morning. But let us put a bit of context around it. The Prime Minister has said for some days now that this was actually a tax-cutting Budget. Michael Cullen had told her so and she believed him. He said that the business tax cuts out there were enormous and that anybody in business would get a tax cut. But unfortunately over the weekend she must have been brought up to speed a little bit because now she is advising people by saying in this particular interview—and I do not want to try to mimic her— 
Hon Members 
: Go on! 
GERRY BROWNLEE 
: No it would devalue the effect. She said: “Self-employed can certainly come into the scheme”—we assume that is the KiwiSaver scheme—“but of course you know by definition they are paying their own wages.”Well that is interesting. That is a reasonable admission. Self-employed people pay their own wages—that is good the Prime Minister understands that much. She goes on: “But it is uh well ah will be that the changes to company tax encourage a lot more self-employed to actually incorporate Jamie.”—Jamie being the interviewer of course. So Helen Clark is saying that these people who employ 80 percent of the workforce in sole trader activities will get a tax cut by incorporating—having just said that these people actually pay themselves wages. 
It gets better. She goes on and says: “See a lot of our smaller businesses don’t actually bother setting up as a company. They are just sort of operators and individuals and they pay their personal tax. Now with the corporate tax rate cut there is quite a lot of advantage in incorporating.” 
Well I ask members to tell me what the advantage in incorporating is if one is a sole trader and every time one takes a drawing out of one’s business one pays one’s personal tax rate at a much higher level than the corporate rate. I say to the Prime Minister that there is no way around it. It is good for big business; it is not good for small business and it is just another level of cost being put on it. 
Showing us further how much she understands all of this stuff the Prime Minister goes on to say: “And as well of course if you are a company and then you’re paying a wage well you are going to get the personal tax credit for your KiwiSaver. You’re going to get the tax credit for the employer putting the contribution in.” Well I say to the Prime Minister: “Guess what? The wage payer the employer and the subsidy payer are all the same person!” I do not know why we should expect someone like poor old Mr Maharey to understand the Budget when clearly the Prime Minister does not. 
One of the worrying things that came through in the Budget is that Labour members have now seriously convinced themselves that they know how to spend better than any individual inside this economy. They believe they are the people who should be making the choices not individual New Zealanders. The only snippet we got from Mr Maharey’s speech was that there is now more money going into core services. He asked for example whether I was aware that there has been a 99 percent increase in money going into health spending. Well actually I am—so are all of my colleagues. But those of us who sit in our electorate offices still see the long queues of people coming in and wondering why they will not get services. We still read the statistics every week that tell us that last year there was less elective surgery in this country than ever before; that tell us that if one wants specialist attention then one will wait for months and months if not years; that tell us that if one wants some form of a relatively simple test then fewer of them were performed in New Zealand last year than the year before. 
So we are asking ourselves: “If all of this money is going in and if that is the answer why are the services not there?”. I am confident that New Zealanders are asking that same question as well. No doubt the answer to that question is found in some of the polling that is out there at the present time. 
The Prime Minister has also hung her hat on the KiwiSaver scheme. I do not think anyone in our party would argue about the wisdom of one saving if one can—no one will argue against that. But what we are absolutely staggered about is the way in which this scheme will be structured. It will mean that workers who cannot afford to take $40 out of their pay packet will get nothing. But they will still pay tax which means that the person standing next to them on the assembly line—or wherever else it may be—who can afford to take $40 per week out of his or her pay packet will be subsidised by the worker who cannot afford it. So the poorest New Zealanders are subsidising the wealthiest New Zealanders. That has got to be a brilliant scheme! It is certainly one that could only be put together by Labour. 
I think that one of the interesting things we will see will be how many of the many New Zealanders who are prepared to say that they think the KiwiSaver scheme is a good idea will actually get around to saying they want to do it. What Mrs Pettis and so many of the members on the other side of the House do not understand is that we are a very low-wage economy—Labour has made it that way. Labour does not like the workers to get too far above themselves because then it may not be needed. Labour has created a low-wage economy over the last 8 years and there are far too many people in this country who simply cannot afford to take out the $2000 from their pay packet on an annual basis in order to save. I think they will be very angry when they find out about that because it has been sold to them as a tax credit. Workers have been told to join up to the KiwiSaver scheme and that there is a tax credit there for them. Not so; it is only for the workers who can afford to take it. 
I call the House’s attention to this letter this piece of Labour Party propaganda that was sent to a large number of households throughout the country. The Auditor-General has had a lot to say about this sort of thing has come down with some rules and no doubt will be looking at how Labour progresses with its State-funded propaganda from this point. I want to make a prediction. There is such a mess around this KiwiSaver scheme. So much of it is unclear. So many people do not understand how it will directly affect their pay packets. We will see millions and millions of dollars spent by the taxpayer trying to explain what Helen Clark should simply have asked Michael Cullen in the first place and trying to explain to people like Mr Maharey why Kiwisaver is such a wonderful idea when in fact it will see so many New Zealanders at the bottom end of our society continuing to subsidise those who have a few more quid because Labour basically hates the workers.