Budget Statement — Budget DebateText is incorporated into the Bound VolumeBudget Statement — Budget Debate[Sitting date: 26 May 2016. Volume:714;Page:11325. Text is incorporated into the Bound Volume.]Budget StatementBudget DebateHon BILL ENGLISH (Minister of Finance): I move That the Appropriation (2016/17 Estimates) Bill be now read a second time.Mr SpeakerIt’s a privilege to present the eighth Budget of this National-led Government.I recall our first Budget delivered in difficult times with Treasury forecasting never-ending deficits and ever-rising debt.Today however I can present a healthy set of public accounts.The Crown’s books show rising surpluses and falling debt.This is on the back of an economy forecast to grow at around 3 per cent on average over the next few years supporting more jobs and higher incomes.Budgets are not just an accounting exercise.They are about achieving better results for New Zealanders and their families from almost $80 billion a year of existing spending.And they are about ensuring that any new spending is directed to where it will make a real difference.The Government has done that in areas ranging from schools to child health to reducing crime and to supporting new jobs.Budget 2016 builds on these achievements and identifies new opportunities.Mr SpeakerThis Government is ambitious for New Zealand.We can realise that ambition with a strong economy and continued prudent management of the public finances.Budget 2016 invests in a growing economy. In particular it supports four significant measures.The first is the Innovative New Zealand package – a $761 million investment that focuses on growing our science system producing the skills New Zealand needs and encouraging innovation and investment in regional New Zealand.The second is a $2.1 billion infrastructure programme that focuses on transport schools and the investment needed to deliver a modern flexible tax system.The third is a Social Investment package providing $652 million more to support vulnerable New Zealanders and help them live better lives.And the fourth measure I want to highlight is a significant investment in the health sector. This will receive an additional $2.2 billion over four years to ensure New Zealanders continue to have access to high-quality healthcare.The Budget delivers these measures and more because we have retained tight fiscal discipline and demanded better results from public services.We owe that to New Zealanders who go out to work every day and pay their taxes.Budget 2016 is possible because of the constructive working relationships National has with the ACT United Future and Māori parties.I want to acknowledge their continuing support and contribution to stable government.Economic outlookMr SpeakerNew Zealand’s economic outlook is positive.Treasury is forecasting real GDP growth of around 2.9 per cent over the coming year and 2.8 per cent on average over the five years to June 2020.Over 200000 more people are in work now than three years ago and another 170000 new jobs are expected by 2020.Over that period the unemployment rate is expected to drop to 4.6 per cent and the average wage is forecast to rise to $63000 a year.Only a handful of developed economies enjoy such a positive outlook.Strong population growth is both an indicator of New Zealand’s economic performance and a contributor to it.For the first time in a generation we have a net annual movement of people into New Zealand from Australia – rather than an exodus of Kiwis across the Tasman.Consumer spending and services exports are two other key factors driving economic growth.Further impetus is apparent in a large pipeline of construction projects and low interest rates should continue to stimulate investment.Certainly times are challenging for our dairy farmers who are finishing another season facing depressed prices.But elsewhere New Zealand is reaping the benefits of an increasingly diversified economy.Total exports increased by almost $2 billion last year.Tourism the beef sector ICT wine and much of the manufacturing sector are all performing well.Overall nominal GDP is expected to be $17 billion higher over the five years to June 2020 compared to the Half-Year Update and this flows into higher-than-expected tax revenue.Responsibly managing the Government’s financesMr SpeakerResponsible fiscal management has been the hallmark of this Government’s previous seven Budgets.It is also a feature of Budget 2016.The surplus target helped us turn the Government’s books around. Now our focus is shifting more to debt repayment.Reducing debt to more prudent levels will give the Government more room to support New Zealanders and the economy should we face another economic shock or natural disaster.The Government’s fiscal priorities over the next few years are:Maintaining rising operating surpluses.Reducing net debt to around 20 per cent of GDP in 2020.If economic and fiscal conditions allow beginning to reduce income taxes.And using any further fiscal headroom to reduce debt faster.Budget 2016 forecasts confirm the Government is on track and its books are in good shape.We’re continuing to manage our spending carefully. This means government expenditure falls to 29.7 per cent of GDP this year and stays under 30 per cent thereafter.Modest OBEGAL surpluses are forecast for this year and the next before rising strongly from 2017/18.Cash surpluses are forecast from 2018/19 which means the Government will start paying down debt in dollar terms.Net debt is expected to peak at 25.6 per cent of GDP next year and to fall to 19.3 per cent of GDP in 2020/21.As a result New Zealand Superannuation Fund contributions are expected to resume in 2020/21 two years earlier than forecast in the Half-Year Update.Mr SpeakerSpending pressures have changed since the last Budget – in part because higher-than-expected population growth has increased demand for public services.As a result $600 million a year of new spending previously earmarked for Budget 2017 has been brought forward.This takes new operating spending in Budget 2016 to $1.6 billion a year on average.This allowance remains much smaller than those of the previous government whose eighth and ninth Budgets for example contained an average of $4.3 billion a year of new operating initiatives.As I have mentioned reducing debt is one of the Government’s key priorities.Therefore a further $400 million a year previously earmarked for Budget 2017 has been used to reduce debt.Extra capital spending to fund investment in infrastructure and other public assets is set at $1.4 billion in Budget 2016 slightly lower than previously anticipated.However in addition significant capital spending will be funded from reprioritising within the Crown’s balance sheet taking the total new capital spend in Budget 2016 to $2.6 billion.In total these changes reduce Budget allowances for new spending by around $1.2 billion over the next five years helping to further reduce debt while still investing in public services.Building a productive and competitive economyMr SpeakerA priority for this Government is to build a more productive and competitive economy that supports jobs and higher incomes.New Zealand has a proud history of innovation.Our national prosperity hinges on businesses large and small investing in new products and markets.We are already seeing that happening.Business investment has increased from $31 billion in 2010 to $40 billion last year and is expected to grow to $50 billion by 2020.Our export sectors are taking advantage of free trade agreements and selling more New Zealand products to growing markets around the world.The economy is diversifying with the ICT sector for example more than doubling its exports over the past eight years.This Budget looks to the future and includes measures to further support business and regional innovation.The largest is the $761 million Innovative New Zealand package to encourage entrepreneurship skills and economic growth.This package will support more jobs higher wages and a stronger more diversified economy.The package has three parts.First investment in science and innovation will increase by $411 million over the next four years.A number of different science and research funding streams have been boosted including those that have a strong potential impact on New Zealand’s economy environment and society.The Marsden Fund – which supports excellence in research – will be expanded as will funding for the Health Research Council.In total increased funding will take cross-government investment in science and innovation to $1.6 billion a year by 2019/20.Second to support skills and employment we are investing $257 million in more tertiary education and apprenticeship programmes particularly in the areas of science engineering and agriculture.Tuition subsidies will be increased in a number of subject areas and the Government will fund 5500 more apprentices by 2020.Funding will be provided to help second-chance learners gain basic skills and to strengthen workplace literacy and numeracy programmes.Finally to support regional economic development we are introducing a series of initiatives worth $94 million that will unlock business opportunities and benefit regional communities.Additional funding will be provided for the Government’s Regional Growth Programme and to develop more regional research institutes across New Zealand.As a package Innovative New Zealand provides significant and targeted support to help New Zealanders and businesses across the country meet the demands of a changing modern economy.Mr SpeakerFurther support for businesses – particularly small enterprises – comes through a $187 million SME-friendly tax package which the Prime Minister announced last month.This provides a better balance of incentives to encourage taxpayers to pay the right amount of tax.Provisional tax will be reformed with a new pay-as-you-go option allowing small businesses to pay tax as they earn income.Use-of-money interest will be eliminated or reduced for the vast majority of taxpayers.Contractors will be able to choose a withholding tax rate that suits their own circumstances.And the ongoing 1 per cent monthly late-payment penalty will be scrapped from 1 April 2017 for new debt – although immediate penalties and interest charges will continue.Mr SpeakerThe Government remains committed to ensuring that everyone pays their share of tax according to the rules.We have a strong tax system in New Zealand and we are making further changes targeted at multi-national companies.New Zealand recently signed an international agreement that will make it harder for multi-nationals to artificially lower their tax liabilities.We will soon introduce legislation to increase the amount of tax compliance information shared between our treaty partners.We have commissioned an independent review of the disclosure requirements for foreign trusts which is due by 30 June.And we will continue to work with the OECD to address tax avoidance.These changes will help ensure that our tax base and disclosure rules remain robust into the future.Mr SpeakerThe tax changes previously announced are part of a wider business transformation programme that embraces new technology to make it easier and less complicated to pay tax.The Budget includes $857 million for Inland Revenue’s new tax administration system replacing one that is a quarter of a century old.This funding is just one part of a significant Budget infrastructure investment package totalling $2.1 billion.The package provides $115 million for roading projects in Gisborne Marlborough and Taranaki under the Government’s previously announced Accelerated Regional Roading Programme.KiwiRail will receive $190 million for the operation of the national rail network. The Government has a strong expectation that KiwiRail will continue to improve its performance to reduce the level of Crown support required in the future.Nine new schools and 480 new classrooms are included in a package of schooling investments that total $883 million.The package provides for growth in student numbers as well as for the Christchurch schools rebuild programme.Tourism infrastructure is also being upgraded.Mr SpeakerAs well as investing in infrastructure the Budget also includes funding to free up more land and increase housing supply in Auckland.Housing development on surplus Crown land in Auckland receives a $100 million boost in capital funding.This follows the $52 million set aside in Budget 2015 that has so far resulted in agreements for 20 parcels of land.The Government’s longstanding view is that obstacles to the supply of land and housing are the main issues facing the housing market.It is essential these obstacles are removed.As well as our work on reforming the Resource Management Act the Government will soon issue a National Policy Statement on Urban Development.This will direct councils to allow more housing development where necessary and to measure the impact of their decisions on house prices.Mr SpeakerThe Budget includes significant extra funding to ensure more people in need have access to social housing.$200 million is provided over four years for at least 750 more places for those with the most pressing housing needs and to meet the rising cost of social housing rents.Another $41 million will support around 3000 emergency housing places a year and establish a new emergency housing Special Needs Grant.This is part of the Government’s wide-ranging reforms focused on ensuring that New Zealanders in need have access to appropriate housing.Mr SpeakerThe tourism sector is experiencing rapid growth and Budget 2016 provides a $45 million package of support over four years.This includes a new $12 million fund to help communities with smaller-scale infrastructure projects like restrooms and carparks to deal with growing numbers of tourists.Tourism New Zealand will receive $8 million to target key growth markets and increase the record number of tourists arriving here.$25 million is being provided to upgrade and extend the New Zealand Cycle Trail and ensure it continues to offer a world-class visitor experience.And we are also starting a two-year trial to streamline border processing for low-risk travellers to make it easier for them to visit New Zealand.Mr SpeakerThe Government is committed to protecting our natural environment and to playing our part in addressing global climate change.The Government will phase out a subsidy in the Emissions Trading Scheme that was introduced as a temporary measure during the global financial crisis.This has allowed some businesses to pay one emissions unit for every two tonnes of pollution they emit.We believe it is time businesses move towards paying the market price for their emissions.Removing the subsidy will positively impact the operating balance by $356 million over the next four years based on a New Zealand Unit price of $12.The Budget also establishes a $100 million fund to help clean up New Zealand’s rivers lakes and aquifers over the next decade.The Freshwater Improvement Fund will contribute to projects that help communities improve water quality. Priority will be given to projects involving the private sector or philanthropic funds.An additional $16 million is being provided to control wilding pines in the highest priority areas.And the Battle for Our Birds programme – New Zealand’s largest pest control operation – will receive $21 million this year. This will help fight an expected pest population boom caused by a heavy forest seeding.$70 million over four years is being provided to tackle bovine tuberculosis.This new funding will help achieve our goals of eradicating TB from cattle and deer by 2026 and from infected wildlife by 2055.Delivering better public servicesMr SpeakerThe Government is committed to delivering better public services.Four years ago the Prime Minister gave the public service a set of challenging targets covering welfare education crime and health.Since then significant progress has been made.For example:More than 40000 fewer children now live in a benefit-dependent household.The proportion of 18-year olds achieving an NCEA Level 2 qualification has increased from 74 per cent to over 84 per cent.Total crime has dropped by 16 per cent with youth crime down by almost 40 per cent.And rheumatic fever rates have fallen by 45 per cent.Child abuse in New Zealand however remains too high.Mr SpeakerThe Government is investing in new ways of supporting more New Zealanders off benefits and into work so they can lead better lives.As a result the number of people on a benefit is the lowest for eight years and the lifetime cost of the welfare system has fallen by $12 billion since 2011.This is an example of our Social Investment approach which uses data-driven investment techniques to determine when and how to intervene to change lives for the better.Budget 2016 includes a comprehensive and wide-ranging Social Investment package with extra funding of $652 million over four years.There are a number of parts to this package.The Government recently announced major state care reforms and a complete overhaul of Child Youth and Family to improve the long-term life outcomes for New Zealand’s most vulnerable population. A new system will be in place by the end of March 2017.The Budget provides funding of $200 million for these reforms over the next four years.This includes developing an independent youth advocacy service raising the age of care and protection caregiver recruitment and training workforce training and development and better access to support for caregivers.This is the Social Investment part of new Budget funding for the care and protection of children. In addition a further $145 million will meet increased demand from more children and young people in care.Mr SpeakerAnother part of the Social Investment package provides $61 million to extend the Youth Service to 19-year old parents and to 18 and 19-year old job seekers at risk of long-term welfare dependency.If we do not take action the average 19-year old sole parent will spend 18 years on a benefit.It is our responsibility both to families and to taxpayers to do more to help these sole parents gain independence.The Social Investment package also includes $50 million to reduce barriers to employment including for people with complex health conditions who would otherwise spend significant time on a benefit.The package includes an extra $43 million for schools to increase support for around 150000 students most at risk of educational failure.The Whānau Ora programme which focuses on self-determination receives another $40 million to support around 2500 more whānau and families in areas such as managing health and disability issues improving financial literacy and reducing household debt.I acknowledge the advocacy and support of the Māori Party for this new approach.Another $20 million from the Social Investment package is to support offenders at a particularly vulnerable time when they leave the controlled routine of prison and return to the community.The package also provides $36 million to ensure more New Zealand families live in warmer drier and healthier homes.Half of this funding is targeted at insulating around 20000 rental homes occupied by low-income families through the Warm Up New Zealand programme. This will take the total number of newly-insulated homes since 2009 to well over 300000.The other $18 million – delivered through the health system – focuses on reducing preventable illnesses among young children who are living in cold damp and unhealthy homes.By addressing the drivers of demand for public services and helping people become more independent Social Investment also reduces the long-term costs of providing public services.As I’ve said many times what works for communities also works for the Government’s books.Mr SpeakerBudget 2016 contains a significant increase in funding for core public services that New Zealanders rely on every day.This extra investment comes with a clear expectation that public agencies must strengthen their focus on delivering better results.The health sector is a particular priority and the Government will invest over $16 billion in health in the coming year.Over the next four years $2.2 billion of additional funding will be provided for new health initiatives and to meet demand.Pharmac for example will receive an additional $124 million over four years to provide more New Zealanders with access to new medicines.As Pharmac has announced it proposes using this funding to provide new treatments in a range of areas including for melanoma and hepatitis C.The Budget also provides $39 million for a national bowel screening programme which when fully implemented is expected to screen over 700000 people every two years.As well as that a further $96 million over four years will increase the number of elective operations.This is part of a continued effort to increase elective operations. Around 50000 more surgeries are now performed each year than in 2008.Budget 2016 provides $169 million more for disability support services and a further $73 million for primary healthcare. This includes extra support for the free doctors’ visits and prescriptions for under 13s that we announced in Budget 2014.District Health Boards will receive $1.6 billion over four years to invest in services meet population growth and deliver better results.Mr SpeakerIncreasing the price of tobacco is the single most powerful tool to reduce smoking.The Budget confirms that tobacco excise duty will rise by 10 per cent on 1 January each year for the next four years.I want to thank the Māori Party for continuing its advocacy for this effective approach to reducing smoking.Mr SpeakerThis Government measures success by the results achieved for New Zealanders rather than the amount of money spent.Since 2008 the proportion of children in early childhood education has increased to almost 97 per cent.As I’ve mentioned the proportion of 18-year olds with NCEA Level 2 qualifications has also grown considerably.Children are starting school better prepared to learn and leaving school better equipped to succeed.The Budget continues this focus on results.The Government will invest a total of $11 billion in early childhood primary and secondary education in 2016/17. Together these sectors will receive an extra $1.4 billion over this year and the next four years.$397 million of this will meet growing demand for early childhood education and provide places for a further 14000 children.Additional funding is directed at students most in need of assistance.Instead of an across-the-board increase in operations grants schools will receive $43 million over four years to target students most at risk of under-achieving.In addition $42 million will be provided for students with high and special educational needs.As I mentioned previously the Budget provides $883 million for new school property.It also includes funding for around seven new Partnership Schools in 2018 and 2019.I want to acknowledge David Seymour for his advocacy for this initiative.Mr SpeakerThis Government is providing considerable support for initiatives to improve the education and skills of Māori and Pasifika New Zealanders.We have provided almost $10 million more over four years for Māori and Pasifika Trades Training. This will increase the number of training places to 3400 next year – up from just 1200 in 2014.In addition the Budget allocates $6 million over four years for other Pacific peoples initiatives such as helping Pacific youth in Auckland find work education or training opportunities.Mr SpeakerThe Justice sector faces a number of challenges including the rising prison population preventing crime and prisoner rehabilitation.Overall this sector receives $837 million over the next four years plus $56 million in 2015/16.Police receives $299 million including $49 million from Budget 2015 which will primarily be used to meet wage increases.Funding of $208 million supports a number of justice sector initiatives including addressing family violence increasing access to legal aid and ensuring the justice system better caters for victims of crime.Corrections receives $356 million to protect the safety of the public reduce reoffending and accommodate higher numbers of prisoners.This includes funding to manage offenders returning from overseas and to continue 24-hour GPS electronic monitoring for the highest risk offenders.Mr Speaker$303 million is provided over four years to combine urban and rural fire services into one organisation from the middle of next year.As announced previously this will come from a proposed increase in the fire levy from 2017/18 as well as government funding.I want to thank Peter Dunne for overseeing these changes.In addition the Ministry of Civil Defence and Emergency Management will receive an extra $6 million over four years to ensure New Zealand is well prepared for future natural disasters.Mr SpeakerA fundamental responsibility of the Government is to protect the safety of New Zealanders.The Budget provides $301 million of new funding over four years for the New Zealand Defence Force to concurrently undertake domestic regional and international security tasks.The New Zealand intelligence community will receive new funding of $179 million over four years.This will ensure it can provide essential intelligence and security services and remain effective in a rapidly-evolving environment.As announced previously the Government is investing $20 million over four years on a new Computer Emergency Response Team to combat cyber-attacks and cyber-crime.Mr SpeakerRecognising the importance of the arts the Budget provides an additional $12 million over four years for the New Zealand Symphony Orchestra Royal New Zealand Ballet and Te Matatini Kapa Haka Aotearoa.Budget 2016 also provides $16 million over four years for High Performance Sport to support athletes and enhance our medal prospects at the Tokyo Olympics in 2020.A further $4 million over four years will go to Drug Free Sport New Zealand.Mr SpeakerThe Government supports the SuperGold card scheme and is providing $41 million of additional funding to provide certainty for more than 670000 cardholders across New Zealand.Christchurch regenerationMr SpeakerSince the first Christchurch earthquake in September 2010 the Government has backed Cantabrians in the initial response and now in the recovery and regeneration of the region.I want to acknowledge the leadership of my colleague Gerry Brownlee.Taxpayers’ financial commitment to the Christchurch regeneration now stands at more than $17 billion – around $700 million more than signalled in the last Budget.Nearly six years after the first earthquake the Canterbury community can take real pride in what has been achieved.Almost 100000 cash settlements have been made by EQC which has also resolved more than 60000 land claims. Around 68000 homes have been repaired in the Canterbury Home Repair Programme.In Christchurch’s central business district 97 per cent of the horizontal infrastructure repairs have been completed.Overall $3.9 billion of public sector projects are completed or are under construction with almost $800 million more forecast to begin in the next six months.Three anchor projects have been completed in Christchurch – the Hagley Park cricket oval the bus interchange and the Margaret Mahy family playground.Work is progressing on the Metro Sports Facility and the Convention Centre.The recovery phase in Christchurch formally came to an end last month with the expiry of the Canterbury Earthquake Recovery Act.The Government will now progressively step back from its leadership role in Christchurch.Local organisations have been set up to deliver on the Government’s ongoing commitment to the city and the wider region.This new regeneration phase is not just about rebuilding Christchurch but also fulfilling the long-held potential of New Zealand’s second largest city.ConclusionMr SpeakerNew Zealanders rightly place a premium on stable government.Under John Key’s strong leadership the National-led Government is providing that stability.New Zealand has made significant progress over the past eight years.As a country we are more confident and our economy is growing.Businesses are creating thousands of new jobs and incomes are rising.We are getting to grips with our toughest social problems.And the books are back in the black.This all means so much more is possible over the next eight years and beyond.The Government takes a long-term view of its stewardship.We are shaping policy around a 20 to 30-year view of how we can improve the lives of New Zealanders.Budget 2016 does that by making positive long-term choices that will further strengthen our economy and our communities into the future.Mr SpeakerI commend this Budget to the House.ANDREW LITTLE (Leader of the Opposition): I hesitated for a moment. I was waiting for Paula Bennett to deliver her budget but we are not going to have that today. I move That all the words after “That” be omitted and the following substituted: “this House has no confidence in a government that has lost touch after eight years in office is too often focused on the few at the very top and which is forgetting about middle New Zealanders who are trying to get ahead.”They said you know make sure you start your Budget speech with a joke but I have had the wind taken out of my sails by Bill English. He started by saying: “I am presenting the Budget today.” That was not a Budget. That was not a Budget for New Zealand in 2016. That was scratched-out patchwork hotchpotch half measures designed to look like an economic strategy and it is not. It does not go anywhere near it. You know you would think 8 years on—8 years those members have been in charge of the nation’s purse strings 8 years to make their mark on history 8 years to add to the legacy bequeathed to them by the many Governments that have gone before them 8 years to make their contribution to building this great nation—and what we have had served up to us today is no answer to the real problems being faced by all New Zealanders all across the land. Eight years they have had to help Kiwis get ahead 8 years to help middle New Zealand and once again in this Budget—Bill English’s eighth—they have failed.This is a Budget that demonstrates yet again that they have lost touch they do not know what is going on and they have no answers to the problems that New Zealanders are most concerned about—the people who as the Minister of Finance says go out each day to work to pay their taxes. They are not helped by this Budget. There are new burdens placed upon them. You just look at how out of touch this Government has become. John Key who says there is no housing crisis—just go and ask Work and Income. Paula Bennett says that there is a housing crisis but she has decided that there is a housing crisis for 150 families who are already tenants of Housing New Zealand and that they need the help. Never mind the homeless living in garages and cars—they get no help. Oh hold on no—there was a second announcement was there not? They might get some help. Those members’ response to one of the biggest social crises facing New Zealand is just an absolute shambles and this Budget does nothing for it.Then there is the Minister of Health Dr Coleman or as they call him in the health sector “Dr No” and it is not helped by this Budget. It is not helped by this Budget. Then we have the Minister of Finance himself who when he talks about the young unemployed 18 to 24-year-olds—whose number has grown by 26000 under that Government—says: “They’re pretty damned hopeless.” And there is nothing in this Budget for them either. We deserve better.Let us have a look at what those members have done on housing. Nothing in the Budget today will make hardly a difference to the real problems in our housing sector. This Government is still in denial about the real problems faced by thousands and thousands of New Zealanders. There is $100 million for new land. Let us put that in perspective. Last year’s Budget provided $52 million for new land and one of the three housing Ministers—they need so many because you know they are really on top of this problem. So last year’s Budget got 13 hectares—13 hectares—and a few hundred houses in 2 years’ time. This Budget allocation will get 25 hectares and then who knows how many houses? So after 2 years we will have 37 hectares and just a few hundred houses to fix a problem that is tens of thousands of houses behind schedule. That is the real magnitude of the problem and this Budget does nothing. On social housing the Government says there is $200 million for social housing. This is a Government that has sold 2700 State houses and has not replaced a single one and those members wonder why we now have people living in garages and cars in Auckland and around the countryside. They have failed and they cannot see their failure and they will not face up to it. That is a disgrace.None of the measures in this Budget will lift homeownership rates in New Zealand. Those struggling people in Auckland who no matter how hard they work and how hard they save cannot get that deposit and will not get that first home—this Budget does not help. It will not solve the crisis. Then in health the reality is that even with the extra money it still does not keep up. And it gets worse because in the subsequent years after the financial year that this Budget covers the money goes down. It is as if the New Zealand population is going to shrink. All the elderly who are going to be retiring—suddenly there is somehow going to be fewer of them. This is not a plan for the future. This is not a plan for a good health system in New Zealand in the future. More New Zealanders will wind up in greater pain for a lot longer because of this Budget and this Government’s failure and this Minister of Health’s failure.Let us face up to the stark reality of education in this Budget. Operational funding is frozen. There is not extra money for every school. There is no money to keep up with the rising costs of running a school and we know what that means. Parents whose costs of contributing to education are already rising 10 times faster than the rate of inflation will pay more. Their costs will go up because this Government does not see that it has to support a high-quality public education system. It is happy to put the money into charter schools but every child in the country attending every other public school—they get nothing extra. This is not a Budget for success for our children.And then the police when so many New Zealanders are concerned about safety and security in their communities in their towns and cities—what do we get in the Police budget? Nothing extra. The Government is going to pay the police to negotiate a pay increase—no extra police and all those police stations that have been closed or understaffed by Judith Collins will remain closed and understaffed.You see here is the thing: the Government is not just out of touch; it just does not care. It does not care about middle New Zealand. It has given up. If you look at the Budget projections if you look at unemployment the Government says it is concerned about people out of work. By 2020 the unemployment rate for New Zealand under the Government’s economic stewardship will still be higher than what it was in 2008. This is not a Budget for the future—this is not a Budget for the future. We need a Government that is going to stop running our economy like it is a school gala day with candyfloss here and a few trinkets there. We cannot have Budget day turned into the quick-fire raffle where there is a lot of spin a few little prizes handed out here and there but you get home and you find that it has passed its use-by date. That is the way the Government is running it—that is the way it is running it and it is time to get past the spin.You see what we have had under this Government is 8 years of the economic gains that have been made—a much much greater share going to those at the very top and those who work for a wage or salary are getting much much less. Middle New Zealand has been missing out for 8 years and now with the eighth Budget under the Government’s belt there is more of the same. We have had 8 years of skyrocketing house prices and there is nothing in this Budget for that. We have had a struggling health system and there is nothing in this Budget for it. Our schools are going backwards. Here is the real injustice: more and more of the cost of our public education system is going on parents and families but our school performance is declining.New Zealanders will be asking after today: what on earth is in this for us? What they will be asking is: where on earth did we go wrong? But they should not blame themselves. Even though the Minister of Finance has announced a new constitutional principle—which is that as the Minister of Finance he is not responsible for every last dollar—actually New Zealanders will see it a different way. I have got news for the Minister of Finance: he is responsible. He is responsible for every last dollar and he is going to be held to account for it.Let us have a look at what is happening in the New Zealand economy. Unemployment is rising—144000 today. That is 40000 more than when that Government took office. Forty-three percent of wage and salary earners in the last 12 months did not or could not get a pay rise and yet the Government talks about economic growth. We have had 2 to 3 percent economic growth and people are working hard and people are trying to get ahead but nearly half the workforce cannot even get a pay rise. That is not fair. More and more of the share of the economy is going to those who are doing very well and less and less to those doing the hard work. That is not right. And we know that that slice of the economy which only a few years ago workers shared in—the effect of that Government’s economic management means that now on average the average New Zealand household this year is $50 a week worse off. That is the Government’s economic management. That is the difference. And we still have poverty with 300000 kids living below the poverty line.I have talked about young people—the 18 and 19-year-olds not in education employment or training. There are 26000 more than when that Government took office. That is not a path to the future. That is not a path to success. And in housing—where do you start? Here is the stunning thing. In March this year as the country was basking in summertime temperatures in what should otherwise have been autumn contemplating their futures houses in Auckland which were sitting there doing nothing were rising in price by $2200 a day—not a week not a month; a day—$2200. That is not a property market; it is a bubble that is dangerous and unstable and is no good in a properly managed economy. That explains why we have the lowest level of homeownership in 65 years and it is why we have people in Auckland and in other parts of the country who can no longer afford to even rent something reasonable. That is why they are living in shocking conditions and this Government has got nothing to say to them about it.I want to say this: the gap between the increase in the value of wages and the increase in property prices in New Zealand is now getting out of control. We are the second in the world for the worst ratio between personal incomes and property prices. We are beaten by one country: Qatar. I am saying to our Qatari brothers and sisters: “Don’t get too cocky. Don’t underestimate how focused Nick Smith and that Government are on making it even worse for New Zealand.” The housing policy is a shambles. Nick Smith cannot do anything. He promised thousands and thousands of houses on 500 hectares. Two years on we will have 37 hectares and a few houses. Paula Bennett is running around trying to rescue the 150 who have a roof over their heads already. There are 4500 families around the country waiting to get a State house and she thinks that the crisis lies with those already in one. It is just ridiculous—it is just ridiculous. The Government is simply not serious; it has given up.Then on education we know how important education is but housing is very important because you have got to get people in a stable house so that when the kids go to school they get to go to that school month after month year after year. This is not what is happening in a lot of schools around the country where schools are reporting a turnover of 25 percent of children because their parents cannot hold on to the same house. They have been tossed out of house after house kids are moved from pillar to post cannot get a stable education and that is damaging them too. The Government does not care about that. You see it does not see it in those terms. It just does not care. The Government fudges and mudges it fiddles and faddles and it faffs about because it does not have an answer. That is the way the Government approaches it.Education is just as important. Education is the great leveller. It is the way you lift yourself up. You get skills you find out what is going on and you get to the end of your education and you are equipped and prepared for the world. That is what we used to boast in New Zealand. We used to boast a world-class education system. We do not any more. We are slipping down the ranks internationally. We used to be fifth in reading in the world and now we are 13th. We used to be seventhin science under the last Labour Government; now we are 18th. We were 11th in maths in the world under the last Labour Government; today we are 23rd. Standards are falling and the Government has got no answer in its Budget today. It freezes funding for primary and secondary schools. It is out of touch and does not care. That is who the Government is. Its priorities are all wrong and the parents are paying more for it.In health we know what the impact is of 6 years of routine underfunding of health which is now $1.7 billion behind. The Government has added another $600-odd million. It will not be enough to keep up and worse its projection is that it will start winding back the funding in subsequent years. It is just plain crazy and it is out of touch. The impact on real people’s lives is that they cannot get the treatment they need. There are 160000 people in the last 5 years who cannot get to see a specialist or when they do get to see one they get specialists saying: “I’d like to treat you but there is no money. We cannot treat you.” So people are now living in debilitating pain spending their days on the sofa or on the bed because they cannot move desperate to get their surgery. They are so desperate in many cases that they now have to raid their retirement savings—that little nest egg that keeps them secure for the rest of their lives. They have to raid that to get surgery that 5 years ago under a Labour Government they would have got. National will not face up to these problems—National will not face up to these problems. National will not stand up for middle New Zealand.But the Labour Party will—the Labour Party will. Everything that the Labour Party will do in Government will be about getting all New Zealanders a chance to get ahead. We will diversify the economy—we will diversify the economy. It will be helped of course by the Our Work Our Future Bill which symbolically was drawn today. If ever there was some sort of you know fatalistic symbol that New Zealanders do really want things to be going in the right direction it is that piece of legislation which harnesses the power of procurement of the Government and actually focuses on adding jobs in New Zealand not overseas. Do they have an answer to that? No they do not care about it. They do not care about it.We will introduce research and development tax credits. We will not have the kind of Steven Joyce sit-on-high system and toss out a little bit of funding here and a little bit there. That is not the way you get economic development going. Research and development tax credits Government procurement that is going to create jobs in New Zealand—we will invest in long-overdue infrastructure spending not the repeated announcements from previous Budgets that we have seen in this Budget. Taranaki is still waiting for that upgrade of State Highway 3—still waiting for their upgrade of State Highway 3.We will invest in more skills and training. Labour’s ideas will kick-start the economy and it will be fair for everyone. We will deliver our fair share for middle New Zealand. And in housing we operate by one principle: we will build more houses. And we will do whatever it takes to build them. There will be new houses and they will be sold to those people struggling to save their deposit to get them. They will be affordable. For those who need a State house or a social house there will be more housing for them too. We will embark on that programme it will be realistic and practical and it will solve the problem. Those who are suffering at the sharp end of the crisis right now—they will have their problems fixed. Nothing less will do.In education we will make sure that more and more of the cost that has been foisted on families and parents right now will not continue and we will have a world-class education system with teachers who are focused on teaching and spending time with the children and on getting the best out of them and helping them to succeed. That is what we need. Because we at least understand that the future of work and the need for skills is changing and is getting more elaborate and sophisticated. We will fund 3 years’ post-school education and training. People will get that for free because that is what a modern economy will demand and it will be way better than what this Government is doing which right now is precisely nothing. We will have a health system again that will be the envy of the world where people who need treatment need elective surgery and need operations can get them. It will be done over a sensible period of time but it will restore the routing that this Government has inflicted on our health system and people will be better off for it. We will have a Pharmac that can provide new lifesaving medications even if it is initially on a short-term basis so New Zealanders can live with a sense of security once again.This Budget has failed to deliver for middle New Zealand. Today will be a day of deep disappointment for most New Zealanders. They will not get their fair share. This Budget will not reduce child poverty it will not lift employment it will not fix Auckland’s housing crisis it will not help our kids to learn better and it will not undo the savage health cuts that this National Government has inflicted on our health system. Here is my message: this Government is not delivering for you but Labour will. We are the party for all New Zealanders to get ahead to have a chance to build opportunity and to have a sense of hope and security for their future. That is what this Budget called for today. It has totally and utterly failed. Labour is ready to serve.Rt Hon JOHN KEY (Prime Minister): That was poor old Andrew Little was it not who has achieved only one thing in 2016 and that is to make David Cunliffe look popular and confident. That is it for 2016. They do not call him “Angry Andrew” for nothing—but not without good reason because half of his caucus wants to leave and the other half of the caucus wants him to leave.You cannot say that he does not have a vision like all of the great left-wing leaders around the world. I mean just take a look at it: Bernie Sanders wants to rid the world of poverty. Jeremy Corbyn: he wants to rid the world of conflict. And Andrew Little: he wants to rid the phonebook of Chinese-sounding surnames. He has got a vision for all of those Chinese and Indian chefs. He wants them to be called Bruce or Trevor—that is his idea of a Chinese chef.Yet again it was another great Budget from Bill English. The man is a maestro. Budget 2016 paints a picture of positivity and success for New Zealand and our economy. Let us take just a bit of a look at some of those numbers because they are sparkling: 3 percent growth for the next 5 years stronger than almost any of our counterpart countries. A hundred and seventy thousand new jobs over the next 3 to 4 years on top of the 200000 we created in the last 3 years. Under this Government average wages have gone up $11000—$11000 a year; that is $211 per week for the average New Zealander. They are going to go up another $5000 over this Budget period which will mean that the average New Zealander is earning $307 per week in their pocket under a National-led Government.We do know that Labour knows how to tax and it knows how to spend. A National-led Government knows how to get expenses under control. They were 34 percent of GDP; they are now under 30 percent of GDP and debt is on track to be 20 percent of GDP by 2020. Go and have a look around the world. Japan: Government debt is at 220 percent of GDP; the United States: the better part of 90 percent; the United Kingdom: 80 or 90 percent; and there is Australia with deficits as far as the eye can see. Bill English has got this country on the right track and under control and debt under control as well.Let us look at the facts. This is an economy that is attracting more people attracting more investment attracting more international students and attracting more visitors. This is a place where interest rates are low and where inflation is low. When it comes to older New Zealanders this is a Government that cares and delivers. How do I know that?Rt Hon Winston Peters: Oh really?Rt Hon JOHN KEY: How do I know that Mr Peters? Well under the National Government the New Zealand Superannuation Fund has gone up by 34 percent in the time we have been here—34 percent. The average married couple are $250 a fortnight better off under a National-led Government.I sometimes listen to Mr Little and I accept that I made a comment to Gerry Brownlee before about Andrew Little’s speech. He said: “You mate are the only one who’s listening.” But I listened to it and I hear this doe-eyed kind of history lesson that is so out of touch with reality. Here is what happened when National came into Government: deficits as far as the eye could see. It was not a health system that was delivering for New Zealand; it was a disgrace. Cancer sufferers in this country did not get help; they got a boarding pass to Australia. That is what happened under a Labour Government.Before we came into office 35000 New Zealanders a year said: “I’ve got a good idea: it’s called living in Australia.” The education system under those people did not even bother to tell parents whether their kids could read or write. It was a country where core interest rates were four times faster. Wages were going up all right—so was inflation. Real wages were going backwards and in the last 5 years Labour increased Government spending by 15 percent. Our economy was hopelessly ill-equipped to cope.Let us have a look at the position today. Eight years on—what is the situation across our economy? Well it is prosperous and productive. This is where expansion is taking place: horticulture viticulture ICT export education tourism beef lamb honey manufacturing and high-tech industries. Here is a clue about how the New Zealand economy is going: there are now more Australians coming to live in New Zealand than New Zealanders going to Australia and the No. 1 selling white wine in Australia is a Kiwi sauvignon blanc. It is a takeover—it is a takeover.I want to take a moment to reflect on the strong and stable Government we have provided for the last 8 years with our partners. Can I thank the ACT Party United Future and the Māori Party for their strong and sensible support of the Government their input their ideas and for ensuring that the New Zealand public knows each day that this country is going to run well and efficiently.Let us go and have a look at some of the specifics in this Budget because there are some real gems here. There is a whopping $2.2 billion for health. Let us just take a step down memory lane. This Government this National-led Government—one of the very first things we did was say we were standing behind the women of New Zealand. We have funded Herceptin and as a result of that 1704 women have been granted Herceptin. It is no surprise that in Budget 2016 there is $124 million more for Pharmac. There is funding for drugs for melanoma like Opdivo. There is a hepatitis C drug that will help 50000 sufferers of hepatitis C with a 90 to 100 percent success rate. But most of all there is a $39 million investment in a national bowel-screening programme where 700000 New Zealanders will every 2 years get early detection. That is what a strong economy delivers. It saves lives for New Zealanders on issues that really matter.This is a Government that has delivered more elective surgery each and every year. We know it is not just about spending more money. It is about doing things better and more wisely. In this Budget there is another $96 million for more hip and knee operations. I remember when I came into Parliament in 2002. Half of the people who came to my electorate office could not even get on a waiting list for a hip or knee operation. Now they get that treatment. And for those who are disabled in our society there is $169 million.Let us talk about the plight of the less well-off New Zealand children what is happening to them and the support they are getting. I heard all that nonsense about Housing New Zealand before from Andrew Little. Here are the facts: when we took over the Housing New Zealand stock was dilapidated and it was run down. This Government has spent $2.2 billion on fixing it up and building more homes. Before those members get a bit too doe-eyed about what they did in respect of Housing New Zealand in the single-biggest year under the last Labour Government Labour spent $550 million on building or fixing State houses. Budget 2016 will see a billion dollars spent in Housing New Zealand.Andrew Little has woken up—maybe people need to live in dry insulated homes. Well hello and welcome to the 21st century. Under this National-led Government already 290000 homes have been insulated and 30000 Housing New Zealand homes. Budget 2016 sees that a further 20000 rental properties for the lowest-income New Zealanders will be insulated. Our Residential Tenancies Amendment Bill will see a further 180000 homes insulated. If you add all of that up—520000 homes insulated under this National-led Government. And what did the doe-eyed boys over there deliver? It was 50000—actually fewer than 50000. There is 10 times more insulation under a National-led Government.It is right that the Government should support the most vulnerable in our community but it is this National-led Government in the worst of times when people were standing up and saying to cut benefits and cut entitlements that said no. We stood behind the most vulnerable New Zealanders. We maintained Working for Families. We maintained entitlements. We maintained benefits. And guess what? This year for the first time in 43 years a National-led Government raised benefits for New Zealanders. There is $652 million worth of social investment—$200 million for Child Youth and Family for the most at-risk youngsters tens of millions of dollars to support young parents and young families drug and alcohol programmes for young pregnant mums and $41 million for emergency housing. More money is being spent in these areas than ever before.Let us turn to housing just for a moment. Once again what we heard from Andrew Little was some sort of dream-world. OK under a Labour Government this is how many houses a day were built in Auckland: 10—10. Apparently Labour is going to house everyone but its track record is 10 houses. Well we deliver 40 houses a day and two every hour in Auckland if the builders work 24 hours around the clock.The metropolitan urban limit choked off demand so 154 special housing areas were announced allowing 56000 extra houses to be developed. What happened when National announced that? Phil Twyford got out there. He thought he was in an election campaign and put up a whole lot of billboards saying “What a terrible thing” and then 2 weeks ago it was: “Oh I’m sorry about that. I’ve changed my mind. I got that one wrong.” It was the same thing when it comes to surplus Crown land. It stayed surplus under Labour but under National there is more money in this Budget.Very soon the Government will release the national policy statement on urban development. As New Zealand grows faster one thing that maybe we can agree on is that there is an emerging consensus that land supply issues have not kept up with all of the demand and must be addressed. So let me make this crystal clear because this is what the national policy statement will do when it is released over the next few years. It will ensure that councils must make available sufficient land to accommodate growth in the communities. It is no longer a matter of choice or debate for those councils. Land will be zoned residential and developed in quantities sufficient to meet demand—period. That is the same when it comes to industrial land. Let us see who stands up and votes for that if it requires legislation ultimately in the House.In order to live like a First World economy one needs to earn like a First World economy. That is why under Bill English and Steven Joyce you are now seeing this massive investment in a smarter more high-tech economy. There is $761 million to allow us to compete and be more productive. This is a Government that has put science at the heart of its thinking and has put science at the heart of the economy. We want to make sure that we move away from those commodity markets. But if we want to address the big issues—climate change the environment the protection of our native species—all of these things require more money. In science and innovation Budget 2016 has hundreds of millions of dollars dedicated to this area and in tertiary education in more apprenticeships and in a range of different research projects. This will make New Zealand a smarter better-equipped economy to compete in the First World.This Budget will also make it easier for our smaller businesses our small to medium sized enterprises which at the moment have to pay their provisional tax off a basically very antiquated system which is one of guesswork which they can never hope to get right. As a result of the $187 million investment tens of thousands of small businesses will no longer have to worry about that aspect. They will just have to get out there and make their businesses successful.Tourism is going better than ever—better than ever I say. There was a time when the Labour Party used to mock the cycleways—mock them. Mind you there was a time when they used to mock The Hobbit and then they went off to the premiere and they liked the movie. But there was a time when they used to mock the cycleways. In 2015—here is a number that is worth remembering—a million people went on the cycleways so there is $25 million more there.Education is at the heart of a decent society. That is why we have got national standards that is why we have wired up every school for ultra-fast broadband and that is why we have the higher expectations for kids getting National Certificate of Educational Standards level 2 or above and for having every child in early childhood education. There is $883 million in this Budget for nine new schools 480 classrooms and more help for the most vulnerable. You see when we get up and say “Those poor kids actually deserve a bit more support.” Labour does not like it. So its members get up the whole time and say “Give money to poor families” and the National-led Government delivers just that—more money for poor families—and they do not like it. Where are their priorities?We are going to continue to invest in keeping our communities safe because it is the expectation of every New Zealander that they will be safe and it is the responsibility of the Government to do that. There is more money for our intelligence services better tools for cyber-security more money for those brave men and women in the New Zealand police force and better programmes for drugs and alcohol and all the different things that we are doing. We are investing in the latest GPS for high-risk investors—I mean offenders not investors but we are willing to invest in those as well.The number eight is lucky in Chinese is it not? The number eight is lucky. Bill English’s eighth Budget will be successful for our country but not because of the number eight and not because of luck but because of good management and good choices. While the Opposition is lost in a fog of negativity Bill English shines a light on prosperity and opportunity. While the Opposition seeks to close off new markets and to ban those who were not born here from investing or immigrating to our country Bill English seeks to make it easier for New Zealand companies large and small to compete and win on the world stage. While the Opposition demonstrates a complete lack of faith in New Zealanders and their abilities and drive to want to succeed and to get ahead without the support of the Government it is Bill English who empowers them to make the most of their lives to back themselves and their families and to understand the most basic principle in life: that there is no substitute for hard work and determination. This country New Zealand has a brighter future and in very large part we have the maestro Bill English to thank for that.JAMES SHAW (Co-Leader—Green):E Te Māngai o Te Whare tēnā koe ki a koutou huri noa i Te Whare ngā mihi o te wā ki a koutou katoa.[Greetings to you Mr Speaker and to you collectively throughout the House acknowledgments of the moment to you all.]I do not often agree with the Minister of Finance but when he said that this Budget was going to be boring—well Bill I am right there with you. We have all been waiting for the big idea the deep raid into Opposition territory and the headline-grabbing idea that was going to grab the headlines for the next few days. Well where is it?When New Zealanders needed homes this Government has given us toilets. The extent of this Government’s vision for New Zealand is $40 million worth of toilets for tourists and presumably for those New Zealanders who are sleeping in cars. Budget 2016 has shown yet again that in response to the great challenges facing our nation all this Government is willing to do is plaster over the cracks when it could have been building houses. For 8 years now we have had a Government that has put together its Budgets on the basis of what polls well rather than on what will fix the problems that we face. This eighth and with any luck second-to-last Budget shows just how much this Government’s first and only true commitment is to stay in power; its only vision for New Zealand is that it continues to be governed by the National Party.Today the Government could have used its considerable powers to solve the great challenges facing New Zealand—to leave a legacy not just a length of tenure. But it has chosen not to. This Government has done as little as possible rather than everything it can. Budget 2016 as with every other Budget for the last 8 years tries to make it look as if the Government is changing things for the better when all it is doing is preserving the status quo. This Government is the political equivalent of Milli Vanilli: lip-syncing when it should have been leading. This Budget does not solve the housing crisis but it does pretend to. It does not create the sustainable clean jobs that New Zealand needs—the ones that will pay enough for families to thrive—but it pretends to. It does not protect our rivers or our wildlife but it pretends to.So what will be John Key’s legacy? What will be remembered about this National Government and how it used the enormous powers that New Zealand gave it to create lasting and meaningful change? Well what have previous Prime Ministers left us? Michael Joseph Savage was the architect of the welfare State. Peter Fraser created a world-class education system. Keith Holyoake abolished capital punishment not because it was the popular thing to do at the time—and it was not—but because it was the right thing to do. David Lange—nuclear-free New Zealand. Helen Clark gave us KiwiSaver Working for Families and the Superannuation Fund. And John Key’s Government? It will be remembered for this: for record numbers of homeless people for children suffering from Third World diseases because of the condition of their homes for the biggest decline in homeownership ever for two-thirds of our rivers being so polluted that they are not safe to swim in for the highest ever rate of greenhouse gas emissions for native wildlife inching closer to extinction and for the conservation estate crumbling.After 8 years and eight Budgets the National Government has squandered the opportunities to create a meaningful legacy one that leaves New Zealand in better shape than it inherited. National has chosen to do as little as possible rather than all it can.The Green Party had three big hopes for Budget 2016. First that it would fix New Zealand’s housing crisis give first-home buyers a look-in and get homeless families out of cars and into houses. Second that it would herald the start of a transition to a low-carbon economy with jobs that pay enough for families to thrive. Finally that it would save our endangered wildlife clean up our rivers and cut our greenhouse gas emissions. Let me take a look at how Budget 2016 stacks up against these three concerns—these three transformational shifts that the country and the economy need to take.On our first measure that this Budget would fix the housing crisis in New Zealand this Budget is a fail. I cannot see a single new State house in this Budget or any meaningful steps to enable young families to move into their first home. There is not one new initiative to make homes more affordable for those who do not already own one or two or 11. When more homes need insulating to keep kids healthy and safe Budget 2016 has the smallest allocation for home insulation in years.The other day the Minister for Social Housing Paula Bennett said that there was a housing crisis “for some people”. Well she is right. It is a crisis for people who do not already own their first home it is a crisis for people who are not millionaires it is a crisis for people who are not the children of millionaires it is a crisis for the governors of the Reserve Bank who point to our present housing bubble as the single greatest threat that our economy currently faces and it is a crisis for families who are living in cars and garages. Over the last few weeks we have all been affected by the daily stories of families many living with parents and working minimum-wage jobs who are locked out not just of the housing market—they are locked out of a house. These are families like that of mother-of-three Rhiannon who joined us last week at the launch of the Green Party’s policy to free up Housing New Zealand to respond to the emergency that is facing us.Ms Bennett says that the homeless have always been with us. Well that may be true but only once before in our history have so many New Zealand families been forced on to the street. It was during the Great Depression and guess what happened next? New Zealand elected the first Labour Government and a Prime Minister Michael Joseph Savage who built thousands and thousands of State houses. It was a heroic effort to make sure that every New Zealander had at the very least a roof over their heads. They made no excuses about how the homeless have always been with us. They were not interested in plastering over the cracks to make it look like they were addressing the problems whilst at the same time doing everything that they could to appease the property investors’ lobbyists. They actually wanted to solve the problem—that was their vision. That was their commitment. It was not a commitment just to staying in power for its own sake but to using Government to transform the country for the better.But this Government will not do that and that means that while one set of Kiwis is growing wealthier at a staggering pace the homeless families who are victims of this crisis are now in debt to the very Government agency that is supposed to be helping them out. More than any others Māori suffer disproportionately from the failure to fix the housing crisis. Their challenges will not be solved by Treaty settlements alone; good social policy is also needed.National pretends that there is nothing we can do other than to build more houses on farmland on the edges of Auckland but there are much more effective decisions that it could make. National could have taken the simple step of restricting foreign buyers from speculating in our small housing market and pushing up housing prices. National could have started addressing the supply side of our housing crisis simply by building more houses—affordable energy-efficient houses.If we want to fix the broken housing market it is time to change the Government. It is time to put families first to ensure that every New Zealander has a warm safe house to call their own. As Mickey Savage knew the Government has the power and money to ensure that every New Zealander lives in a warm dry safe home. National just lacks the will.On the second measure that Budget 2016 would hail the start of a transformation to a low-carbon economy this Budget contains one baby step forward and several very large steps backwards. Budget 2016 mentions climate change just once which to be fair is once more than all seven of the previous Budget speeches put together. A long-awaited investment in research and development is a win for those who like the Greens have been pointing to New Zealand’s under-investment in innovation as a real barrier to our ability to make the transition. The end of the one-for-two emissions trading scheme subsidy is long overdue because it has contributed enormously to the 19 percent growth in New Zealand’s net greenhouse gas emissions since this Government came to power 8 years ago.On the downside the Government is actually reducing the amount that it is spending on climate research at the exact time that it is most needed. After 8 years it is pretty obvious that this National Government just does not get climate change. It is the single greatest threat to our long-term prosperity and collective security and National does not want to even talk about it let alone fight it. In December it signed the climate agreement in Paris and then immediately—the next day—started undermining the pledges that it made on our behalf. What has it done since signing up to the Paris Agreement? It has committed to keeping the Huntly coal-burning power plant open spewing millions of tonnes of greenhouse gas emissions into the air. It has invited more oil companies to prospect in our seas reopening and extending the bloc offer. There are a total of 1200 electric vehicles on our roads and nothing that Simon Bridges has announced will make the transition any faster than it was already going to be. Eight years on and not a single Crown car is electric even though the fleet has been replaced twice in that time.David Bennett: What’s your car?JAMES SHAW: I walk. And it has repeatedly refused to include our most polluting sectors in the emissions trading scheme. It is no wonder that New Zealand’s greenhouse gas emissions last year were the highest ever on record.Looking across the House today I cannot see a single person on the right who is strong enough to break the mind-set of a Cabinet that is dead set on protecting vested interests over the national interest. If New Zealand wants a clean economy it is time to change the Government.The third hope that we had for Budget 2016 was that it would protect New Zealand’s natural heritage. The Green Party has been campaigning for years and years and years to pay attention to the polluted state that our rivers have been falling into. National will crow about the $100 million clean rivers fund its Battle for our Birds and its wilding pine funds but it will pay for it with swingeing cuts to the Department of Conservation (DOC) estate and other areas. As the DOC estate crumbles and our wildlife inches closer to extinction funding DOC’s natural heritage protection has gone down in this Budget by 14 percent. It is robbing the Pīwakawaka to pay for the penguin. National’s spending on conservation has been on average $56 million less per year than the last Labour Government’s. That is $336 million that DOC has missed out on since John Key moved into the Beehive. We have the know-how and we have the resources to clean up our rivers to reduce climate pollution and to protect the wildlife that we love so much in this country. We say: let us make it happen.This Budget shows that John Key and his Ministers honestly have no interest in leaving a transformational legacy for New Zealand and that denies all of us the opportunity of a better country. Today we can rightly ask: where is the equivalent of a Kiwibank in Budget 2016? Oh that is right the Government is selling it off to itself for half price so that it can sell it back to itself for full price later. Where is the vision and the compassion that drove Mickey Savage when he kicked off the great State-house build? Where is the bravery that was shown by David Lange when he stood up to the superpowers and banned nuclear ships from our waters? Where is the moral authority that led Keith Holyoake to abolish the death penalty in New Zealand? The sad truth—the sad truth—is that National has no vision for a legacy other than another term in Government.We need more than a few toilet blocks and more than the plaster through which the cracks are becoming so painfully obvious. National’s legacy will be poisoned rivers more extinct wildlife and a nation divided between those who seek to own their home and those who own several. National has chosen to do as little as possible rather than all we can. The Green Party has a vision for a cleaner a fairer and a stronger economy; this National Government does not. It is time to change the Government and change is coming. Nō reira tēnā koutou tēnā koutou tēnā tātou katoa.Rt Hon WINSTON PETERS (Leader—NZ First): There is only one phrase to describe this document from National: this is a “Get stuffed” Budget. To those wanting a home that they can both buy and afford; to those in pain desperately seeking an operation this Budget says: “Get stuffed.” To those wanting a job with First World wages and security; to those wanting First World affordable education that is paid for by the State this Budget says: “Get stuffed.” To those wanting law and order in this country and burglars apprehended with the police numbers to catch them; to those wanting serious infrastructure spending to go to the regions and not just to Auckland this Budget says: “Get stuffed.” To those retired and living on stretched incomes even though today’s boast from the Prime Minister is the result of our 66 percent law; to those young families who are worried about their family’s future the answer is: “Get stuffed.”National thinks these people are invisible. This Government is simply not listening. I spend more time in the provinces and at public meetings than any Government member. I have more public meetings free to the public—and not a jack-up tired audience—than any Government politician. We know what they are saying out there. That is why on a workday down in Gore I heard all about Mr Barclay the boy MP. The place was packed out. We know how they feel about the jobs and the lives that they want.Hon Gerry Brownlee: There aren’t that many phone boxes in New Zealand.Rt Hon WINSTON PETERS: Tonight around this country young parents will lie awake—no Gerry you have never had a public meeting that anybody remembers. Just incompetent. Cannot campaign cannot speak—all bluff and bumf. Tonight around this country young parents will lie awake wondering about the future that they can provide their kids. Grandparents will worry about the future that they once had not being their grandchildren’s legacy. Students will lie awake wondering whether they can ever pay off their student loan and get a good job when they finish. Farmers will lie awake worrying about the bank manager’s call and whether they will ever be able to hang on and pass on their farm to the next generation. Many elderly will go to bed cold without enough to eat and sit there worrying about the power bill on the table confused because the retirement that they have worked all their lives for has gone sour. The Prime Minister might sleep like a baby but hundreds of thousands of New Zealanders do not and they cannot. Out in the regions in the provinces they all wonder why they the economic powerhouse of this country have been sacrificed on a cross of Auckland gold in this Budget.This is not the New Zealand that we once knew. Our opponents like to talk and laugh about old people. They do not remember a time in this country when if you worked hard and played by the rules you could make a good life for you and your country. You could find a decent job buy a decent house put food on the table and every once in a while take the family for a holiday on a favourite beach lake or river. That was not a New Zealand dream; that was once a New Zealand vision which great leadership made a New Zealand reality. We all know about the growing gap between the rich and the poor and the problem is not that some have grown so rich; it is how so many have grown so rich. It is a bit like that man from Merrill Lynch boasting that he is a self-made man. He has never been a businessman; he has been a money trader speculating against whom—his country’s currency.We have seen three decades of economic experiment. We have seen the majority of people promised that their lives were to be improved and it did not happen. We were sold deregulation and globalism. We had to make sacrifices to become more competitive and we had to accept the much lower living standards of other nations. We were told that if we took this globalismaboard then a rising tide of economic prosperity would lift all boats—it would improve the lives of all New Zealanders. But accompanying this globalism there have been tax cuts for the rich and growing inequality for the rest. This is a chart by income decile of 10 decile numbers of New Zealand homeownership.Hon Members: It’s upside down. It’s round the wrong way.Rt Hon WINSTON PETERS: I am not showing it the wrong way. You are precisely right: what should be up is down and what is down should be up. It is upside down and Mr Bennett when we take power we are going to turn it the right way up and get rid of you first. You are so right—thanks for helping out. That is the chart. Nine deciles all down; the top 10 percent way up. Thank you Mr Bennett. I knew that even in a Freudian way one day you might make some sense in this House. This is a “Get stuffed” Budget. Every commentator should look at this Budget and say “It contains spending details adjustments but are they adjusted upwards for the population growth?” because if they are not the numbers are bogus and propaganda. It is a “Get stuffed” Budget.Perhaps the best backdrop to this Budget was the announcement yesterday by Paula Bennett. This was a sign of utter desperation—proof that the emperor from Merrill Lynch has no clothes. It was a policy written on the back of an envelope thought up in the back of a ministerial car on the way to the airport. She announced that if people would leave Auckland she would give them $5000 to go. Just last week Mr Key said: “Go to the WINZ office.” Yesterday Paula Bennett said: “Here’s $5000; now get lost”—“Here’s $5000; get lost.” In short no matter how many generations you have been living in Auckland she wants you to get out of there so she can make way for an immigrant and that is what the Māori Party supports.Hon Members: Oh!Rt Hon WINSTON PETERS: Yes that is what it supports. Oh yes it does. Look Mr Ganesh Nana is an immigrant. Mr Ganesh Nana was on Radio New Zealand this morning and he said this—this is what he said because he is an honest man: “Underlining everything is the rapid population growth.” Not my words—he said it. He said that immigration plays out in all areas right across the board and Madam if you have not got the guts to say it I have. I am standing up for New Zealanders who know whom this country used to belong to. They spend decades—dare I say it a hundred years—to build this country and we will not have some soft-in-the-heart and soft-in-the-head person waving out to me from the gallery like that. On immigration this man who is an immigrant said this: “Underlining everything is the rapid population growth.” His words—not mine. To say that it is a matter of racism shows just how unpatriotic and un - New Zealand some people are.You know every year now the population of New Plymouth—or 68000 net—is coming to New Zealand. Every year now the population of Wanganui—or 34000—is going straight to Auckland and pray tell me who is housing them? Where is the transport? Where are the railway lines? Where are the jobs? Where are the schools and where are the hospitals? Answer that and then you can wave your hand. Every other party has welcomed that development; but one party has not. It has said for years that this is a looming disaster and here we have a Budget that is totally focusing on trying to fix up what? Mass immigration problems. We have got the courage to say it and out there hundreds of thousands of New Zealanders are beginning to understand—you watch these polls go—and thank God they are.We are not going to have the sell-out merchants acting for foreign banks and foreign corporates running this country any more. There were all the gestures but the real message to all those with legitimate concerns in Invercargill and Kaitaia was “Get stuffed.” Where are the 10 bridges? Where is the super-fast broadband up north? Where is the first metre of the superhighway from Pūhoi to Warkworth let alone Wellsford? Where is the cell tower coverage? It is just absolute bulldust. This is typical of every Bill English Budget—it is just spin. It is a package of suggestions designed to create the illusion that some serious thinking went into the Budget but the real message from this Budget to all those areas—whether for Pharmac mental health or apprenticeships—is way short of demand. They could all be doubled and still be far short of what is needed. We built more houses in 1973 when our population was 3 million people than this Government is building with 4.6 million people and you tell me why we will bring in 68000 more people who need houses as well. That is lunatic stuff. No other country in the world voluntarily takes that level of immigration and nor should we. [Interruption]Mr SPEAKER: Order! [Interruption] Order! If Mr Bennett cannot control himself—I do not mind a reasonable amount of interjection; it is a heated debate. But when it gets to this level and it is continuous if the member does it again I will ask him to leave. Sorry to interrupt the member.Rt Hon WINSTON PETERS: This Budget has no integrity. There is an elephant in the room that is so big no one else can get in. Adding 68000 people per year is inflicting enormous cost on New Zealand. Massive immigration is impacting on every Government service: health education welfare transport infrastructure. Record immigration is adding all these things into this Budget and the rest of New Zealand is missing out. It is nearly all going to Auckland. Government Ministers and their cronies may not be suffering the erosion of the quality of life but New Zealanders know what is happening to them from what they see and feel every day and one party in this Parliament intends to respond to their concerns.We have to build new hospitals now because of it. We have to build schools houses and public transport—and hire people to keep running them—just to maintain current standards and some people think it is good. My challenge to the Government is this: why do we not double it and make it twice as good because lunatic logic works like that. That is what it works like and that is what we are seeing right now. The consequence of doing what we are doing is seeing a decline in services across this country for most people.Rural health is capped—no funding at all. Lousy figures like $10 million over 4 years—calling that progress. Lengthening hospital lists—you know today there are waiting lists to get on the real waiting list. You have got waiting lists in our health system to get on the real waiting list. As for the police they are grossly underfunded grossly undermanned and underwomanned. Here is the point: only one out of 10 burglaries gets investigated. Nine out of 10 do not get any attention. Crime pays under National. If you are a victim National’s message to you is “Get stuffed.”Conservation—there is the Prime Minister gloating about the numbers. The Department of Conservation is stretched out like a shanghai and cannot do the job. How many will come here if this country is flattened with tyre tracks and has rubbish strewn everywhere? And so much of this country’s tourism is done by people wishing to visit New Zealand on $20 a day. How dumb can you be? So much of this country’s tourism has been brought here by foreign airlines with people staying at foreign-owned hotels and it is creating far fewer jobs and less wealth than the Government boasts. Look at provincial and regional New Zealand where they go and tell me it ain’t so. Our natural estate is at risk the department is massively underfunded and as for the cutting of carbon emissions well this has been done by a Minister for Climate Change Issues whose credibility on this issue—self-confessed—is zero.As for public finances this is not prudent fiscal management. Engineering a surplus when you cut core services—this is not a surplus. The manipulation of the public finances is now so gross and shameless as to render any claims to balancing the books or reaching a surplus as hollow. The real truth is that the quality and quantity of New Zealand life and Government services is in decline. The Budget is silent on what really matters to New Zealanders yet the Prime Minister is already touting tax cuts of $3 billion in next year’s Budget. We need to be on guard. The Prime Minister will not come clean. What he will not spell out is what his tax cuts actually mean in terms of reduced quality of life for New Zealanders.This is a Government that ignores foreign corporates sucking this country dry earning over $600 million a year in this country and paying 0.38 percent—like Tegel chicken. Is that a fair policy—0.38 percent? Facebook right? What does it pay?Hon Gerry Brownlee: Come on Pita wake up.Rt Hon WINSTON PETERS: It paid less than Gerry—it paid $42000 last year. This massive multinational corporation in New Zealand paid $42000 of tax and the National Party backbench laugh. The laugh is on the other foot sunshine. They are going to come for you and very soon. The New Zealand voters will not put up with this any more. They will not take this shilly-shally. They will not take this “fast on the lip slow on the hip” type of behaviour from you any more. They want you to get up in Parliament and say something and do something and actually put your people first and put your province first. Be a voice for the regions. Do not come here as a bunch of Tea Party clones being told what to do aping what the Prime Minister says and getting your head patted like an ACT Party member and thinking that that is worthy account for your pay.As for the Auckland regional policy in this country today we have got two economies: one is Auckland and the other is the rest of us.Hon Gerry Brownlee: Someone ring the bell.Rt Hon WINSTON PETERS: A total failure—[Bell rung] Yes will someone ring a bell so that Gerry can have an idea. Thank you Mr Speaker for ringing that bell. Gerry needs an idea; he cannot get there by himself. The total failure to apply common sense in policy—let me say what we are going to do. We are going to provide the infrastructure investment for roading rail and strategic assets to support regional growth. We will bring royalties into the regions where what you earn there from your extraction—no less than 25 percent will stay where it came from. In Southland on the East Coast and up north we are going to have new initiatives to disperse Government agencies not just to Wellington and Auckland but right around New Zealand. Why should they not be? We have got computerisation. Why are Auckland and Wellington getting them all? And we are going to change the Reserve Bank Act so that the currency reflects that we are an export-dependent nation. To all those students graduating prepare to go to the critical shortages in our regions. We are going to say: “You go there for 5 years and we will get rid of your student loan.” Make no bones about it; we have got a policy. Our policy is about economic growth.Today’s Budget had nothing about economic growth and no plans at all; just steady as you don’t go nowhere. Bill English said the economy had had 3 percent growth. Where is that in the Budget? It is 2.8 percent and that is wrong. Nowhere in that Budget document is the term “3 percent” used. Worse still this is a country where the economy is financed on foreign money and the outcome for that is always this: ask Ireland—ask Ireland. It had three decades of magnificent growth and then utter collapse. Mr Bennett can laugh because that is probably the smartest thing he ever does. As for housing in Auckland what a gaping hole. Housing in Auckland? No answer whatsoever. Here is a message to the Prime Minister: Mr Key people do not choose to live in cars or garages or tents. They do not choose to live under bridges or to live out in the cold. Foreign speculation has come in here and bought one person sometimes 50 or 60 houses. Housing affordability has collapsed as that chart shows.I want to close by saying this. The global outlook is not good for this country. It is very uncertain and this country needs just one or two things to go wrong and we are going to be in serious shock. Even now Australian forecasters are saying that we are not going to make 2 percent growth—more likely 1.7 percent. What is Mr Bennett going to say about that then? I want to close by saying this: there is one party that for a long time has forecast what would happen to New Zealand if we went down that path. It is still here. It is growing faster than any other political party. We have a Facebook page right now that gets 60000 strikes and rising. Yesterday’s debate when the Prime Minister made a fool of himself has got 171000 strikes in less than 24 hours. You can laugh chaps but I know it is a nervous laugh because very soon the message that New Zealanders will want to hear is “Are you back New Zealand First?” and the answer is most certainly—David Bennett: “Get stuffed.”Rt Hon WINSTON PETERS: —we will tell you—we will not tell you to get stuffed; we will tell you to get enrolled get out and vote and when you do the possibilities for this country are magnificent.Hon TE URUROA FLAVELL (Co-Leader—Māori Party): Kia ora tātou katoa. One year ago when I stood to respond to the Minister of Finance’s Budget speech I stood in absolute humility. I was humble. I did not want to talk the Māori Party up but I just kept it very low key. I did not want to sort of show off in any way shape or form. I did not want to show any sort of arrogance in any way. Well that is over—that is over. It is time to break out because the Māori Party unlike others is here to deliver—not to just talk about it but to deliver it. Budget 2016 has delivered because I heard in that Budget speech “the Māori Party” more than the names of most other political parties in this House and that is why we are here—to get some gain.Budget 2016 for the Māori Party absolutely builds on the gains that we have made by way of whānau whare whenua and whakapapa. All of those themes over the last 8 years have been what we have brought to the Budget and indeed we are sitting next to the National Government as a support party. This year in particular I am really pleased about and we are really proud of the gains that we have been able to make. Whānau Ora is getting an extra $50 million—Marama Fox: $50 million?Hon TE URUROA FLAVELL: —only $50 million—over 4 years. It is now getting up to $72 million every year. Why? Because we make a difference. That is what happens—we make a difference. In terms of building cultural wealth Te Reo Māori investment—$34.6 million to Te Reo Māori. There is additional support to emergency housing and for goodness’ sake we definitely want support in that area—$41.1 million in that area. That is what the Māori Party brings to this Budget.But wait there is more. There is more. The great thing about some of the gains that we have made in this Budget is that they come on the back of the legislation that we have put in front of this House and it is sad that some of the parties in this House do not support Te Ture Whenua Māori Bill. Why? Because we have actually got the money to make it happen. We have also got some more money going into Te Reo Māori. That is where the change will happen.Ever since we have been around what the Māori Party has brought has actually been about bringing innovation and innovative solutions to the table like Whānau Ora. Unlike National and unlike Labour our focus is not middle New Zealand. Our focus unashamedly in Government is to break down the intergenerational disparities between Māori and non-Māori. No other political party on its own has had the courage to face that or to focus on it. The Māori Party has. That mind shift benefits this Government and it benefits the country as a whole. Just consider if the Māori Party had not pushed the whole issue of smoking cessation by way of lifting our taxes by increments by plain packaging getting rid of the advertising of cigarettes in garages and so on. That is the innovation that the Māori Party brings to this Government and indeed to this country.We have worked in good faith with the National Government to introduce initiatives like insulating low-income houses since 2009. In 2010 Whānau Ora came to town and now just this year the once-in-a-generation reform of Māori land law. That is again what we bring to this table. We bring the courage we bring the fortitude and we bring the innovative solutions to the table.The wonderful thing I think about the Māori Party presentation to this Budget is that we have shown faith in our whānau and communities to find the right solutions and we have worked really hard—really hard—to secure the initial resources they need to make a difference. One of the key themes in the Māori Party policies is one called mana motuhake—self-determination—helping Māori and other communities to determine their own destiny with a hand up from the State not a handout. That is our approach in Māori development it is our approach in Whānau Ora and it is our approach in economic development.We a party of two have secured more gains—more gains—for Māori than any other political party in the 8 years we have been a support party. Is that right?Marama Fox: That’s right.Hon TE URUROA FLAVELL: That is right. Just imagine what the Government Budget would have been like without the Māori Party needling it on issues around social development and poverty. Let us put another fact out there: since joining the Government benches the budget for Māori affairs cum Māori development has actually increased by 50 percent. That is right—only 50 percent! It is a shocking total but it is pretty good. I like it—it is pretty good. I like it.Since becoming a support party in Government we have secured and influenced more than $2 billion worth of Budget gains. If some media person had asked me that question before we came in we could have put it out there but I am helping the media today to understand that the Māori Party is bringing something special unique and Māori to this House not just by our presence but in real substantive gains for our people. Whānau Ora since 2010—it had a budget of $45 million but this year it is up to $72 million. I know—$72 million. It is up there. Base benefit increase—$790 million in 2015. It is the first time in 40 years that either side of the House has moved. Why? Because of the Māori Party presence. Free GP visits from age 6 to under 13—why? Because of the Māori Party presence. Warm Up New Zealand rheumatic fever—$20 million in 2014. These are the gains that we bring. We do not talk about it like some; we make it happen—two people make it happen for the best interests of New Zealand.In fact we would have liked a hell of a lot more. We would have liked for example benefit levels to be indexed against the median wage but that might have cost a little bit extra like—Marama Fox: $7.9 billion.Hon TE URUROA FLAVELL: Yes $7.9 billion—a little bit big. A little bit big but that is all right—we will get there.Meka Whaitiri: What about the 12.8 percent Māori unemployment rate?Hon TE URUROA FLAVELL: Oh this is what I was waiting for. I was waiting for the bait. I threw it out there and I knew I would get the hook. Tell me—somebody here please tell me what the Labour Party has delivered for Māori over the last 8 years. Just give me a number. [Interruption] Give me a number. Oh it is a big zero. A big kore kāre kau zero nothing zilch zip—all of the above. Nothing—that is what those members bring. We do not change the whole wide world but I tell you what we do better than that side over there—absolutely.So let us just go back to those four things I talked about leading off: whānau whenua whakapapa and whare. Those are the four pou that we bring to this House. In Budget 2016 I say again we have delivered more than any Labour Party initiative in 8 years. Why? Because Labour is not at the table. It is not in power. Actually I was frightened by the word Mr Peters gave. He said “When we’re in power …”—it is all about power. Actually it is not about the people; it is all about power. That is the problem.This is what we do—we think about the people. That is important for us and that is why we focus on Whānau Ora because Whānau Ora is making a difference for our people. It gets into Māori communities it is delivering the goodies and the wonderful work done up and down the country by Whānau Ora navigators is something we have got to support. We have got to support the Whānau Ora commissioning agencies that are doing the great work.Housing—the Māori housing network is linked to achieving the best outcomes for health and homeownership. Again there is $12.6 million earmarked for the Māori housing network over the next 4 years. That is more than—actually $1 would be more than the Labour Party has delivered in the last 8 years. Just $1 but it cannot even get to that.Te Reo Māori revitalisation—no one will talk to this one because we have delivered the goodies: $12 million over 4 years for Te Mātāwai. Somebody said that there was not going to be any money for Te Mātāwai. Well I am sorry we delivered—I am sorry we delivered. Twelve million dollars over 4 years—$12 million for Māori Television $12 million to support Māori language strategies—all of it all adding up.Just before I close for the Māori Land Service on the back of Te Ture Whenua Māori Bill there is $14.6 million over the next 4 years to design that service. It is all backed up. We set the plan and now we are going to make it happen. That is what the Māori Party brings to this Parliament brings to the National Government and most importantly brings to this country. Tihei mauri ora! Kia ora tātou.DAVID SEYMOUR (Leader—ACT): I proudly rise on behalf of the ACT Party in support of this Budget because I want to keep Bill English as the Minister of Finance. Why? It is because Bill English is pretty good but also because the alternative is terrible and the people I represent are terrified of the idea that Grant Robertson would become the Minister of Finance and introduce $2.7 billion of new expenditure and a 45 percent tax rate from $70000 and up. That means that on your marginal dollar you are spending 45 percent on income tax. If you spend any of that then on anything that is left you pay GST. If you work for a company or buy from a company there is a company tax component to that. Under a Labour-led Government people would be spending more than half of their marginal income on taxes. Well that is a very good reason to keep Bill English and the National-led Government on this side of the House and those guys on that side of the House.It gets worse because New Zealand has a “Donald Trump movement”. It consists of the Labour Party of New Zealand First and of the Green Party because have you noticed that whenever any issue involving foreigners—particularly wealthy and successful ones—enters the public arena for a debate they all do their bananas. Their positions on anything to do with any foreigner are absolutely interchangeable whether it is the Green Party which used to stand up for the environment; whether it is Labour which used to have a proud liberal free-trading tradition; or whether it is New Zealand First for which there has never really been any hope with international matters to start with. So it is important to keep the Opposition members out of Government because they would raise taxes and because they are congenitally xenophobic.But it is also important because they are out of touch. I have listened to the speeches from the Opposition members tonight and their speeches appear to be about another country not about one of the top five fastest-growing economies in the OECD not about a country where more people think the country is going in the right direction than in any of our Anglosphere peers and not about a country that has record-breaking employment and record-breaking industrial records in just about every sector of the economy. The Opposition members would love it if New Zealand was as bad as they say it is but the problem for them is that it is not. They are like many Oppositions: when they hear some bad news about the country they say: “Christ it was even worse than we hoped for.” The problem for them is that it very seldom is that bad in New Zealand. They are out of touch.There is more good news in this Budget. Partnership schools kura hourua—there is funding for another seven of these schools which are transforming kids’ lives for the better. The Opposition would like to tell you there is no demand for these schools. Well just this year we had 26 organisations apply through a rigorous process to run more partnership schools kura hourua. While I am at it I would like to thank our coalition partner the Māori Party for its staunch support of this policy because of what it is doing for Māori. I would like to thank my colleagues in the National Government for their support of this policy. We are seeing 100 percent pass rates for university entrance for 100 percent Māori cohorts.This is a policy that is a success. You just have to ask yourself whether the Opposition is really so worried that a small number of students for now at a small number of schools for now are going to fail or is it terrified that this policy is going to grow and grow and eventually become the leading type of school in New Zealand and transform many more kids’ lives for the better. The Opposition is not scared of this policy failing; it is worried it is going to succeed because I think that partnership schools are going to go from strength to strength and transform more and more Kiwi kids’ lives for the better. I just want to salute the principals the sponsors the students and the parents who have bravely gone into this new model of education despite all of the criticism they cop from some of the most negative people in New Zealand to actually make a difference in the way that education is done in this country.Those are the good things in this Budget. The bad things are mostly things that were not in it. The most important thing that was not in this Budget is tax relief. Who would have thought that we voted out Helen Clark and Michael Cullen the spendthrift Labour Government of 9 years that had this country going into recession before the rest of the world—at least Labour helped New Zealand lead the world on something—only to elect a National-led Government that taxes you like a Labour Government? Eight Budgets in a row with no tax relief but for 1 year. We have had no tax relief since 2010 and the best the Government can say to us is āpōpō āpōpō āpōpō as they say in Māori—tomorrow tomorrow tomorrow. It shows the priorities of this Government that there is always extra money for Steven Joyce’s corporate welfare—$700 million to flutter around the country and get lots of new photo ops for the Government—but when it comes to the people who get up in the morning get to work work hard earn the money and actually pay the bills it is āpōpō āpōpō āpōpō. Tax cuts are always tomorrow.Well the ACT Party says that tax relief for the people who actually do the work and pay the bills should be the priority of a centre-right Government otherwise what is the point in voting out Labour just to get a National Government that taxes you just as hard? This Budget could have very easily raised the top tax bracket in which you pay the top income tax rate from $70000 to $100000 because the Prime Minister has admitted that very soon half of taxpayers will be in the top tax bracket. To borrow a phrase from Michael Cullen these are not “rich pricks”; these are middle New Zealanders who are working hard and getting pushed by inflation into the top tax bracket in greater and greater numbers every year. That is the biggest problem with this Budget: there is no tax relief even on the horizon for the people who earn the money and pay the bills. And it shows this Government’s priorities—that it is more interested in increasing spending on corporate welfare than it is in actually cutting taxes for the people who earn the money in the first place.One thing that is in the Budget that I think is very regrettable is the tobacco tax increase. If I thought that increasing tobacco taxes was going to improve the welfare of the poorest New Zealanders then I would be here wholeheartedly supporting it but the reality is the average smoker is very poor highly likely to be Māori smokes 10.6 cigarettes a day and pays $2600 in taxes on those cigarettes. Today’s Budget announcement is that that is going to rise to $3800 a year. Increasing taxes has not successfully reduced smoking rates. In the past 5 years we have doubled smoking taxes and we have reduced the rate of smoking from 16.3 percent to 15 percent. That is simply not good enough. What we could have done is legalise electronic cigarettes tax-free and what that would have achieved would mean that people who choose to smoke at the moment could have got a $2600—soon to be a $3800—tax cut in some of the poorest households in New Zealand. It is a great shame that we did not do that.The biggest thing that is not in the Budget is a sensible discussion about the sustainability of national superannuation. My generation knows there is no way we are going to get national superannuation at 65 as far off as that may be. However what really grates is that under the current Government—and the Opposition which frankly has been gutless on this issue—we are not even allowed to have a discussion about how that adjustment is going to happen as we go from five taxpayers per superannuitant down to only two taxpayers per superannuitant. All we ask for is a conversation about how that transition will occur so that younger generations can actually plan and see what their retirement will look like. At the moment the Government has its head in the sand.So it is a good Budget a competent Budget and a very good Budget when you compare it with the alternative. It is a fabulous announcement that we will have more revolutionary partnership schools kura hourua but it is sad that we will not have tax cuts that we are actually going to tax some of the poorest households in New Zealand harder through tobacco taxes and that we cannot have a grown-up conversation about the sustainability of national superannuation.With all of that I support this Budget and I commend it to the House. Thank you.Hon PETER DUNNE (Leader—United Future): At first glance this is a pretty boring Budget but only a fool would dismiss it as faddle and only a racist would dismiss it as being all caused by rising immigration. The reality of this Budget is not so much in the baubles it delivers in the short term but in the transformation it sets in place for the longer term. How often have we heard various Governments lament genuinely I think the plight of the vulnerable—the fact that we have this huge problem with family violence in New Zealand with at-risk children with families who are dysfunctional? We pour more money in year after year and the statistics get worse.What this Budget and the social investment strategy that it heralds are all about is saying that we want to target our interventions much more directly and clearly to those who are genuinely at risk. The work that is being done by the Minister for Social Development to bring together a replacement for Child Youth and Family which has clearly failed and to bring together a coordinated approach to family dysfunction which this Budget helps fund is I think one of the most laudable achievements of any Government of recent times.How often have we all said in this House that we want a better deal for the families and the children of New Zealand? I have heard members opposite talk about putting children at the centre of policy making. This Budget and these changes do that. I guess the sad thing is that the consequences will not be immediate—these are generational shifts we are ushering in—but it is important to be making the stand now. It is important to be ensuring that the statements we have uttered over the years about kids getting the best start in life do actually come to mean something and we can turn round the horrific statistics that some of us were protesting about in the weekend with regard to family violence for example.It is important that we can deal with dysfunction at its earliest stage with good parenting skills and with support for families who are vulnerable and need help and by ensuring our services are not tailored to suit the requirements of the bureaucracies but are to be wrapped around the families they are designed to be servicing. That is I think one of the most important constructs contained in this Budget. Although it might sound pretty boring on the face of it because it is long term it is actually fundamental. The way we get good economic growth a stable society and productive individuals for the future is to lay the foundations properly right at the beginning and I believe that is what this Budget is all about.Unfortunately I do not think it goes far enough in the area of housing. We are making a number of moves that are around the fringes—important individually peripheral certainly but not linked in to an overarching national strategy. I believe that the idea I floated earlier in the week of having a national housing summit is relevant because it would bring together the Government local government the construction industry the banking industry and the social service providers to not just nut out a strategy but more important agree on a plan for its consistent implementation.There is something wrong in my view with watching on television night after night various building companies advertising “We will build you the home of our dreams” or “of your dreams”—probably “our dreams” is more correct—while at the same time we have people who are homeless and who are struggling to get accommodation and while at the same time we have a generation of people rising who say: “Homeownership will never be for me because I will not be able to afford it.” We have the resources; we have the capability. What we need is the leadership to bring it together into a coordinated national strategy that will see a significant impact on the housing problem in New Zealand.While I am at it let us not get waylaid by the canard that this is all the fault of mass immigration. Immigration flows go up and go down. If one looks at the international literature and if one looks at New Zealand’s long-term trend line the old story of what goes up will come down will be borne out. So the short-term blame game of “It’s all the fault of immigrants.” will be pretty quickly exposed for the very vicious and nasty fallacy that it is and those who promote it will be similarly exposed as frauds as bigots and as unacceptable in the context of our society.One of the things I do want to talk about—because again I think it goes to the heart of where New Zealand stands—is good quality services. Good quality social services and community services were mentioned by the Minister of Finance in the Budget statement and I want to say a word or two about the changes for which I am responsible as the Minister of Internal Affairs relating to the reorganisation of the Fire Service. I will be bringing legislation to this House in the next couple of months to provide for what will be the biggest single change to our fire services in around 70 years—the establishment of a unified national Fire Service with appropriate regional representation and good support for our paid staff for our volunteers and for our rural fire fighters all brought together into a single agency for the first time.At the moment we have 60-something different rural brigades and we have hundreds of volunteer fire brigades around the country and we also have a national Fire Service two pieces of legislation and a very confused and archaic system. It is going to change and it needs to change because actually what the modern Fire Service does is very little about putting out fires. It is a lot about vehicle extractions medical assists and as we saw so valiantly in the case of the Christchurch earthquake profound work in the urban search and rescue area. But here is the rub: technically the Fire Service today has no mandate in law for all of the other activities that it covers. So we are going to make that change give our communities greater confidence about their security and ensure that that emergency service is resourced to meet the needs of the modern time.I want to say a word about one small area in the Budget that does give me some concern. There is an entry in the Budget of approximately $179 million for intelligence and security services. It is not explained and I want to draw the House’s attention to comments by the Inspector-General of Intelligence and Security just 2 days ago that are very relevant here. Inspector-General Gwyn observed that the security services in New Zealand are still less transparent in their operations than the security services in our “Five Eyes” partners. It strikes me as a little unusual that we are getting an increase in its funding that is substantial with very little explanation at the same time as the Inspector-General of Intelligence and Security is pointing out that it is still not as transparent as it could be and still not as transparent as those in the comparable nations with which we work. So I say that the funding comes with a price tag and the price tag has to be greater transparency the price tag has to be greater accountability and the price tag has to be greater cooperation and if you like revelation in terms of exactly what is going on.It has been a privilege over the last number of years to work with my colleagues in the ACT Party and the Māori Party alongside the National Government to achieve a series of policy changes. We have not always agreed nor should we but we have always worked constructively and respectfully with each other. I think the gains that various parties can claim from this Budget demonstrate that point very well. There was a statement contained late in the Minister of Finance’s speech about how New Zealanders value and deserve stable government. That is right. One needs only look at the situation in Europe at the moment to see the consequences of political uncertainty and political instability. Let us make sure they do not come to this country.This Budget will not set the world on fire but that is not important because that is not its mission. It lays a solid framework for future achievement when the surpluses start to build up when the Government then faces the more vexing problem of managing surpluses. If it thought managing deficits was difficult managing surpluses will be even more difficult because it will be much harder for Ministers of Finance to say no when there is more money. But that is the aim we need to be working towards to ensure that we get this country back on to a sustainable prosperous certain course and to give the assurance that within that structurally we can cope with the next natural disaster or the next major global economic crisis and we will not be plunged into the depths of depression as we have been in the past as a consequence of those activities. This is fundamentally a good Budget even if it lacks a little on the excitement front.Hon GERRY BROWNLEE (Leader of the House): I move That this debate be now adjourned.A party vote was called for on the question That this debate be now adjourned.Ayes 63New Zealand National 59; Māori Party 2; ACT New Zealand 1; United Future 1.Noes 58New Zealand Labour 32; Green Party 14; New Zealand First 12.Motion agreed to.