Cullen Michael: Financial Review Debate — Procedure In Committee Speaker Recalled In Committee 
Cullen Michael: Financial Review Debate — Procedure In Committee Speaker Recalled In Committee 
[Volume:616;Page:11850] 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I will deal briefly with some of the points that have been raised. In response to Mr Copeland no the Government will not be removing GST on rates. I am afraid that local authorities are strengthening the argument for GST being on rates by moving more and more towards specific charges rather than property-related rates as they used to have. I remind him that Mr Dunne probably made the crucial swing vote to impose GST on rates in 1984-85 in a Labour caucus decision that had a margin of one. I also point out to him that we would not be raising any capital for Air New Zealand by selling shares to mum and dad shareholders. It is only if new shares are issued that new capital will be raised. Mixing up the shareholders does not raise the capital for the company. 
In response to Mr Donald no we are not imposing a capital gains tax. As for his response about playing on the market I come back to the essential point: if the member really believes that over the next 30 or 40 years all international equities markets will collapse then we can forget all our plans about anything over that period of time. In relation to the New Zealand Superannuation Fund contrary to what Ms Clifton said in the  
Listener 
 some 2 or 3 weeks ago—I have no idea where she gets her information from on these kinds of matters—when she said that we lost lots of money on the superannuation fund in fact in the first quarter that the superannuation fund went to market last year it significantly outperformed any benchmark measure that can be put forward. We made money out of that deal. On the Government Superannuation Fundwe lost money on markets as everybody else did including the member—except of course for that famously subsidised property scheme that the Green Party runs as part of its so-called superannuation policy. 
Now I will turn to Mr Key. He tells us that we do not know how to grow the economy. That is funny because in the last year we outgrew Australia the United States Europe and Japan. I ask him to name me any other year when New Zealand has managed to do that in recent decades. 
 This country under this Government has been growing faster than the OECD average in almost every year it has been in office. The member can do the cute sums about reaching the top half within the next period of time but I invite him to do the same sums on his own leader’s promise to pass Australia by 2010 given the rate of economic growth in Australia which was a lot more than 4 percent per capita growth—and he nods his head in agreement. Australia has been outperforming the OECD almost every year for the last decade or more. 
We also learnt about the National Party’s fiscal policy. On the one hand the National Party said in response to Mr Copeland that one could not afford to take GST off local authority rates—$1 million amongst 253 authorities—but on the other hand on anything else one could spend what one liked. Mr Key’s policy is that even when the economy is growing fast one should still be borrowing to pay for tax cuts. At least it is no longer tax cuts for the rich. It is only a year or two since Dr Brash told us that the key to growth was to lower the top tax rate. 
Dr Wayne Mapp 
: Yes. 
Hon Dr MICHAEL CULLEN 
: “Yes.” says Dr Mapp. Dr Brash said that unless the top tax rate is lowered there would be no growth and last week he said: “Oh wait no cut in top tax rate; we’re going to cut the company tax rate and the lower tax rate even though we don’t believe that’s any good.”—indeed even though National believes that cutting the bottom tax rate will lower growth. That is the National Party’s view of economics but because of the politics Dr Brash said that National would not lower the top tax rate. So much for U-turns within Parliament! At least when some of us change any position we are in the Chamber to defend it. Dr Brash is a phantom figure around this place these days. He is never here to tell us what the National view is. 
Gerry Brownlee 
: He’s out there talking to the people. 
Hon Dr MICHAEL CULLEN 
: He is out there talking to both people at once we are told by the deputy leader of the National Party—a man who is disappointed in life because he sits there with a dagger in his hand but never has Dr Brash’s back next to him to stick it in. Probably why Dr Brash is never sitting there is that it would be far too unsafe for him to do so with Mr Brownlee next to him pondering his own potential future. 
This Government has got growth up to near-record levels in terms of comparison with other OECD countries unemployment is down to the lowest figure since 1987 we have strongly growing household income growth we have particularly large reductions in unemployment amongst Maori and Pacific peoples and we have still despite the problems of the dollar high levels of consumer confidence. We are seeing a growing New Zealand economy a growing future for this country and a strong prudent fiscal management. 
Reports noted.