Copeland Gordon: General Debate 
Copeland Gordon: General Debate 
[Volume:627;Page:21852] 
GORDON COPELAND (United Future) 
: 
 I believe United Future believes and according to Saturday’s Fairfax-ACNielsen poll 75 percent of New Zealand voters including nearly 70 percent of Labour voters believe that it is time for tax cuts. All the parties in this House with the single exception of the Labour Party also believe it is time to cut taxes. On this issue at least it would appear that the once-Teflon Helen Clark - led Labour Government has been reduced to a 25 percent party. There is no doubt in my mind that New Zealanders should have a tax cut that it should occur immediately and that it is affordable. 
It is clear that between now and the election date Labour will attempt to obscure those patent realities via a mixture of red herrings smokescreens and sophistry. That must not be allowed to happen. Let us today however in anticipation of Labour’s efforts get some fundamental facts clearly put on the table in this House. New Zealand voters deserve no less. 
Let me say unambiguously that the tax cuts proposed by United Future could be funded in their entirety from the surpluses contained in the Budget projections. Let us be crystal-clear about what a surplus is. A surplus is the amount left over after Government expenditure on health education police superannuation defence Working for Families etc. has already been taken into account. The media need to grab that reality and make sure it is conveyed to the people of New Zealand. I read for example a New Zealand Press Association article from 15 June that blandly stated that tax cuts worth $2 billion a year would require welfare benefits superannuation school classroom ratios or health services to be cut. That is just plain wrong. 
Here are the facts. The Government’s operating balance over the next 3-year period—2005 to 2007—will be around $17.9 billion before money is set aside for the superannuation fund. That will take $7.2 billion leaving $10.7 billion. The cost of the tax reductions that United Future proposes for that same 3-year period is $2.5 billion—still leaving $7.2 billion available for capital expenditure. It is a modest and entirely affordable proposal. 
Here is the way in which Dr Cullen tries to fudge this matter. He simply uses the word “expenditure” without defining what kind of expenditure it is. As I have mentioned spending on education health etc. is revenue expenditure and is deducted before the surplus is calculated. But Dr Cullen then says that in any event he spends the amount of the surplus as well and is left with no cash in the bank. Here he is clearly talking about capital expenditure. If he wants to debate with me about how capital expenditure can be funded then I simply say “Bring it on!”. 
There are in fact myriad ways in which capital expenditure can be funded—private-public partnerships and borrowing being just two of them. In fact funding capital expenditure exclusively and only from each year’s surplus which is the way Dr Cullen does it is highly unconventional. The only people who buy a new car or a new house and fund all of it from that year’s income are either super-rich or Lotto winners. 
That is the debate we should be having. I say in this debate to Dr Cullen that an error repeated over and over again ad nauseam until the end of time still does not constitute the truth. We should be on guard for significant errors that will be used to try to influence the way in which people vote in this year’s election. The people of New Zealand deserve to know the facts. They need to have the facts unambiguously explained to them. That is the whole point of my contribution to this debate today. I hope that as  
Hansard  
will show we have clearly put on the record that not only are tax cuts affordable but we do not have to cut expenditure on revenue costs like health education etc. or on the construction of new roads hospitals prisons etc. to have tax cuts. It is simply a matter of some innovative and in fact rather conventional funding and financing and of an ability to understand how to read a balance sheet and arrange a nation’s financial affairs.