Turei Metiria: Questions for Oral Answer — Questions to Ministers 
Turei Metiria: Questions for Oral Answer — Questions to Ministers 
[Volume:669;Page:15910] 
3. 
METIRIA TUREI (Co-Leader—Green) 
 to the  
Minister of Finance 
: Does he stand by his statement that “Our tax cuts have been good for economic growth and fair for New Zealanders.”? 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Yes the tax cuts were part of a fiscally neutral package which was designed to tilt the incentives in this economy away from excessive housing speculation and excessive consumption which were both funded by excessive debt and to create more incentives for savings investment exports and new jobs. We are satisfied that the package we put together when we take into account the increases in GST and the decreases in income taxes is fair for New Zealanders and in the long run will be good for economic growth. 
Metiria Turei 
: Will the Minister consider extending Working for Families tax credits to families who are reliant on benefits as a way of both stimulating the economy and promoting fairness; if not why not? 
Hon BILL ENGLISH 
: As the member will know the previous Government extended Working for Families considerably and introduced a mechanism that ensured that people with children who went from benefits into work were better off for being in work. By and large the Government has left that mechanism in place and has not seen a strong case for making significant changes to it. 
Metiria Turei 
: Is the Minister aware of the evidence from the US Congressional Budget Office that putting more money in the back pockets of beneficiaries has the biggest stimulus effect on the economy because low-income households spend all the money they get on essentials? 
Hon BILL ENGLISH 
: Yes I am aware of that evidence. The Government has worked to strike a balance between the need to protect New Zealanders as much as possible from the sharp edges of recession—and in the case of beneficiaries we have made sure there have been adjustments to benefits regardless of the economic situation including compensation for GST increases—and on the other hand the need to make sure we do not end up in the situation of a country like Ireland where we lose control of our economic destiny because we have not lived within our means. So the Government has stimulated the economy in the recession but now has a path back to surplus. 
Metiria Turei 
: Does the Minister agree that extending Working for Families tax credits as proposed in the Green Party’s Mind the Gap plan would inject $300 million into the economy and give 130000 low-income families a much-needed income boost? 
Hon BILL ENGLISH 
: I would not dispute the facts with the member; I am sure she has done her research. As I have said though we have tried to strike a balance between supporting people through the recession and on the other hand showing a path back to surplus. There is any amount of spending we could do right now but we would simply have to pay it back later and on any significant scale it would pose a risk to New Zealand’s economic future. 
Nikki Kaye 
: Has he seen any reports on economic support for middle-income New Zealanders? 
Hon BILL ENGLISH 
: Well I have seen some reports. One was a speech entitled “The Squeezed Middle”. Another was a statement that says: “My aim is to show our party is on the side of the squeezed middle …”. The first one was the title of a speech by Phil Goff; the second one was a statement made about 9 weeks before by Ed Miliband in the UK and I do not think it was an accident that they used the same language. 
Hon David Cunliffe 
: Does he stand by his statement made in public session to the Finance and Expenditure Committee on 27 October 2010 when he said in relation to a question about fiscally irresponsible tax cuts: “Despite the recession we implemented the first tranche of that because we said we would” and can he confirm that he admitted to the Finance and Expenditure Committee that “this has had a $1.5 billion impact on tax revenue”? 
Hon BILL ENGLISH 
: It is a matter of fact that National promised a series of tax cuts in the 2008 election. We implemented the first tranche of those and we cancelled the next two because between announcing the package and the implementation date Lehman Brothers crashed and the world went into a global financial crisis. So we chopped off the last two tranches of that tax cut. 
Hon David Cunliffe 
: I raise a point of order Mr Speaker. Respectfully I do not believe that the Minister has addressed the essence of that question. The question was not whether he passed $1.5 billion in tax cuts but whether he did so knowing that that would be irresponsible because of the recession. I do not believe he has answered that point. 
Mr SPEAKER 
: I do not think though that the member can expect the Minister to give exactly the answer the member might want. The member asked him about the issue of those tax cuts specifically and the Minister replied with why the Government had implemented the first tranche and why it had not implemented the rest. The member has further supplementary questions if he wishes to pursue the matter. 
Metiria Turei 
: Does the Minister not agree that every child should have the essentials this Christmas regardless of whether their parent relies on the benefit? 
Hon BILL ENGLISH 
: Yes that would be desirable. One of the reasons we set up the Welfare Working Group is that there is a strong correlation between child poverty and people who are long term on benefits. That is why I hope the Green Party will give full consideration to the recommendations of that working-group when they come forward early in the new year. We all have an interest in ensuring that the large proportion of New Zealand children who are raised in child poverty can have more hope than a lifetime of dependency. 
Metiria Turei 
: I seek leave to table two documents. The first is a paper from the US Congressional Budget Office on policies for increasing economic growth dated January 2010 showing that increasing aid to the unemployed has an impact on GDP. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House. 
Metiria Turei 
: The second document I am seeking leave to table is a White House paper on the  
Framework Agreement on Middle Class Tax Cuts and Unemployment Insurance 
 showing that low-income families are most likely to spend additional money that they receive in creating jobs and helping growth dated 7 December 2010. 
Mr SPEAKER 
: Leave is sought to table that document. Is there any objection? There is no objection. 
Document by leave laid on the Table of the House.