Woodhouse Michael: Spending Cap (People’s Veto) Bill — First Reading 
Woodhouse Michael: Spending Cap (People’s Veto) Bill — First Reading 
[Volume:675;Page:21323] 
MICHAEL WOODHOUSE (National) 
: 
 I am very pleased to take a call on the Spending Cap (People’s Veto) Bill a bill that has come to this House because of the confidence and supply agreement between National and the ACT Party. National is a Government that delivers on its confidence and supply promises. Darien Fenton can wax lyrical all she likes about the fact that this bill took some time to get to the House—and I am sure there are many reasons for that—but it is here. I contrast that with the confidence and supply agreements that the previous Labour Government had with its minority partners and in particular with United Future. I know of at least one example where not only was a confidence and supply agreement not followed through in one Parliament but it was not followed through in at least two and maybe three. 
I draw the attention of the House to the particular agreement that Labour had with United Future on the issue of support for private health insurance which was in the confidence and supply agreement between Labour and United Future. It was so dismissed by the Labour Government that by the time Pete Hodgson became the Minister of Health he did not know it even existed—he had absolutely no knowledge of it whatsoever. So I refute any of those accusations that this Government has not met completely its undertakings under the confidence and supply agreement. 
There are many things said by Rodney Hide that I will agree with. One of them is that although I agree that this bill is one part of the “response to the need for greater fiscal prudence” I suggest that the best response to that need will be the future election of a National-led Government and the appointment of Bill English as the Minister of Finance. It was only when Bill English became the Minister of Finance that any attention was drawn to any notion of fiscal constraint. We can play the game of “my statistic is bigger than your statistic”. I think Ruth Dyson tried to indicate that there was no problem with Government spending under the Labour Government but there is no doubt that Government spending increased dramatically during the period of the Labour Government. Crown spending went up by 63 percent from 2001 to the last Michael Cullen Budget of 2008-09. Even adjusted for population growth that increase was 51.5 percent more than double the CPI growth during the same period. At the same time the tradable sector was being strangled. 
I also want to draw attention to the comments made by the Maori Party MP Rahui Katene who said that this was simply a means to stop the wealthy from paying their fair share in tax. Well I draw the attention of that member and the House to the data presented by the Minister of Finance which has received quite a bit of air time I have to say on who is really paying income tax in this country. Thanks to the fiscal policies put in place by this Government 44 percent of households are paying no effective income tax after wealth transfers such as Working for Families and housing supplements and 10 percent of households are actually paying 71 percent of net taxation. If we take it out to 17 percent of households they comprise 97 percent of all net income tax paid in this country. I think that is fair. I refute any claim by any member of this House that this bill is a means to stop the wealthy from paying their fair share in tax. They already are. 
I will come back to Government spending over the period of the Labour Government. Dr Russel Norman implored the House that somehow this was necessary to maintain health and education services. On the issue of health services he made a very interesting comment. He said that the private sector existed only because the public sector existed. Well I think there might be some merit in that argument but I would argue the counterfactual and that is that the public sector exists because of the private sector especially in the areas of surgery anaesthesia radiology and endoscopy. I relate the case of a surgeon who was considering working at Dunedin Hospital 3 or 4 years ago who when told what the salary was at Dunedin Hospital said: “Well that’s pretty good for a monthly salary.” He was then told that that was the annual salary at which point he ran back to New York from whence he came. It is increasingly the case that the surgical and anaesthetist fraternity see their core business as their private business and view their service to the public sector in the same way lawyers view legal aid. There was a need to increase that but the fact that productivity went up not one jot during that period is a blight on that Government. 
In summary I think this is a sound bill that is worthy of the Finance and Expenditure Committee’s consideration and if by the electorate’s good grace I am back here after 26 November and still a member of the Finance and Expenditure Committee I would be very happy to listen to the submissions on the bill. I strongly support it.