Shearer David: Debate on Prime Minister’s Statement 
Shearer David: Debate on Prime Minister’s Statement 
[Volume:660;Page:8715] 
DAVID SHEARER (Labour—Mt Albert) 
: 
 It is very good to be able to take a call on this debate today. I came to Wellington this morning with a degree of expectation that this was going to be the day when we heard about where the Government was really heading. We were going to hear about its plan the cornerstone document the template the vision the strategy. The Prime Minister’s statement was going to be where the Government laid out its future. I got the Prime Minister’s statement at approximately 9.30 this morning. I spent a number of minutes reading through it and at the end of it I sat back and thought: “Is that it? Is that really what New Zealand wanted to hear? Is that the best this Government can do for New Zealand?”. 
Last year this Government was a new Government and in a way it was given the benefit of the doubt. Certainly media and other commentators gave it the benefit of the doubt. They let the Government get away with not announcing a proper plan although towards the end of last year a number of commentators were asking where it was. But there was a recession and that was the cover for much of the non-planning the lack of a strategic view. Those excuses now are gone. The Government is no longer new. The Government is no longer hitting a recession. We are now in positive growth and are trying to look at where we go from here on. Where then are the ideas? Where is the plan? Where is the sense that we know where this Government is going? 
There was a lot of speculation about the Prime Minister’s statement and 23 pages later there is still a lot of speculation. Colin Espiner wrote today that the speculation is out there but we really do not yet know any of the detail. Mr Brian Fallow writing in the  
New Zealand Herald 
 stated: “Business is unlikely to be blown away by the boldness of the vision outlined in today’s agenda-setting speech. Indeed the average thistledown would not be blown away.” It is a lightweight speech. There is nothing exceptional no big thinking and as my colleague said no step change. We are looking at more of the same that we saw last year. The goal is to try to make it through to the next election get re-elected and stay in power. That is the total sum of this Government’s aspirations. Indeed that is what Bernard Hickey said today in the  
New Zealand Herald 
. He said of Mr Key: “He is saying he wants to get re-elected. How uninspiring. How pedestrian. He is saying he is not a real leader. He is saying he will follow his followers.” That is what the Government is trying to do. 
The other big goal of course is to catch up to Australia. But we know that on  
Q+A 
 on Sunday Alan Bollard spiked that goal. He said it is not possible. He was courageously and—characteristically—unbureaucratically prodding the Government to make a difference and step up to the plate. He said this course of action will not be able to deliver the goods. The Minister of Finance Mr English already believes that. He says that currently that goal is aspirational not real. We have heard a lot about aspirations today but not too much in the way of how we will achieve those aspirations. I think the goal of catching up to Australia is frankly cringeworthy. Friends of mine in Australia said: “Do you mean your goal is simply to catch up to us? Is that all it’s about?”. We try to beat Australia on the rugby or cricket field but when it comes to economic growth we like to come close to tie with it. So when the Australian cricket team comes over here in the next few weeks we will hope to tie with them not necessarily beat them! 
Australia by the way is not looking behind. It is not waiting for us to catch up. Mr Bollard spoke of Australia being “blessed by God sprinkling minerals across the top of the surface”. Here is the big news: Australia is not just sitting there collecting royalties and expecting to collect royalties from its minerals; it is moving its economy into overdrive. To do that it lifted its research and development spending by 25 percent. Also it is looking at tax credits and tax rebates for its major companies that invest in research and development. Does that sound familiar? That sort of thing was abolished by this Government as soon as it got into power. Australia realises that to make its labour force more productive it needs to upskill its population invest in innovation and invest in science engineering and business. Its aspiration unlike ours is to be in the top five countries of the OECD. That is real aspiration unlike the aspiration that this Government is talking about. So why are we not following a similar path? This Government does not have the aspiration that is needed. We need our own vision not one of just catching up to Australia. 
I want members to look at the examples of Denmark and Sweden or more important to look at Finland which is a country of 5.2 million people. Its population is not dissimilar to ours and Finland is not blessed with endless natural resources. At the end of the Cold War it suddenly realised that trade with its biggest trading partner the USSR had dried up. Finland needed to make a step change and it did that. It is currently putting more than 3 percent of its GDP into research and development and science. Nokia is now a household name; when Finland began that step change it was not. That is a real step change. It came from understanding that science and innovation were the way forward. Finland is now one of the most successful European economies. We need that same boldness but it did not happen today with the Prime Minister’s speech. We will not succeed by simply changing the tax structure. That is not the silver bullet. Finland’s tax structure along with that of a lot of Scandinavian countries actually has much higher taxes than New Zealand’s but it is performing better than we are. 
We also need available capital to get in behind those ideas. Ninety percent of those ideas might fail but the 10 percent that will succeed will succeed overwhelmingly. We have a great education system and inspirational scientists but public sector levels of investment in science and technology are at 75 percent of the OECD average and business sector levels are at 33 percent of the OECD average. We heard a lot about science and innovation approaches in the Prime Minister’s statement but not much in the way of action. Mr Key announced in his statement that he was going to make changes to the Crown research institutes saying that they are “powerful engines for growth”. I agree with him. But then comes the crunch a couple of paragraphs down: “As I indicated earlier the fiscal situation means that future new spending allowances can only be very modest and most agencies will miss out on funding increases altogether.” What fantastic inspiration! We know what will work; we just will not give people the money to do it. What is the point of even putting that in a statement? So much for the step change! What did this Government do when it came into power? It abolished Fast Forward. The sum of $700 million was going to be put up to be balanced alongside the contribution of the business sector. Australia is now bringing in tax rebates. What did we do? We boldly went out and cut them! We saved ourselves $300 million. But that meant businesses are not able to make the investment that they need to do. 
My disappointment with today’s speech was matched only by my disappointment with the speech of National’s coalition partner Mr Rodney Hide. He spent most of his address today talking about the global conspiracy.