Debate on Budget Policy Statement 
Debate on Budget Policy Statement 
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Debate on Budget Policy Statement 
CRAIG FOSS (Chairperson of the Finance and Expenditure Committee): 
 I move  
That the House take note of the report of the Finance and Expenditure Committee on the Budget Policy Statement 2010 and Half Year Economic and Fiscal Update 2009 
. First of all I would like thank the members of the Finance and Expenditure Committee for their hard work and for their contributions to putting this report together and also for their contribution to the high workload that the committee gets through. I would also like to mention and acknowledge the officials who assist us and sometimes make us look a bit better than perhaps we are.  
The Budget Policy Statement confirms that the Government’s focus for 2010 will be about getting the economy growing again and ensuring that this growth is higher and more sustainable than we have seen in recent years particularly in the period 2005 to 2008 which I will come back to. As noted in the report from the Finance and Expenditure Committee the Prime Minister’s statement to Parliament outlined and set the framework for some significant changes and developments in economic and social policies that will be seen in Budget 2010. But let us just stand back for a minute and note what we need to achieve. It is not only what this Government wants to achieve but what New Zealand must achieve what it has to achieve if we are to deliver on some of the expectations we should all have of a modern economy. Our focus is on lifting the long-term growth potential of the New Zealand economy without compromising short-term objectives and those desirables that we as a modern society choose to have to look after those who cannot look after themselves. We will put responsibility accountability and transparency back into our economy and into our structure. 
We face a very challenging fiscal position. Yes it is true that 10 years of deficits are no longer in front of us but we still now have 6 to 7 years of deficits right in front of us with a very tenuous international environment indeed. This drives and demands that we show discipline in our accounts and we will have to do some realignment and perhaps make some of the hard decisions that were sorely lacking by the previous administration in the last few years. 
We do have choices though even some in this House may say to do nothing or even go backwards. But if we go backwards if we do nothing we will keep getting what we have. Thousands upon thousands of our future taxpayers our families our friends our whanau are leaving this country for a brighter economic future. We have to address that and we have to change. Let us get more ambitious for New Zealand. Let us set our sights higher and create a country that we can be even more proud of where the hard-working Kiwis so often referred to by speakers in this House can get ahead and get rewarded for their hard work and perhaps we can attract our children back home. 
How do we do that? How can we do that? We must create jobs we must raise incomes we must improve living standards and we must provide better public services to our most vulnerable. I do not think many members in the House would disagree with that but perhaps some will disagree with how we will get there. We have to change our economy. Most members in this House acknowledge that we have a consumption-led economy—borrow and hope borrow against the increase in the value of the house borrow and consume—but that is not the way to develop a country and that is not the way to move up the OECD ladder. That is not the way to keep our children in New Zealand after completing their tertiary education. 
We have to build up our financial assets in this country. We have to at least make a level playing field in those investment decisions between bricks and mortar and equities or financial decisions which have been lacking over recent years. I note that many of the imbalances in this economy began in 1999 when the previous administration massively incentivised people to build up trust structures and company structures effectively encouraging a rorting of the tax base which is totally unacceptable to me and totally unacceptable to our future taxpayers and our children. 
What will be in the Budget? We will be concentrating on six key drivers: first investing in productive infrastructure; second removing red tape and improving regulation; third supporting business innovation and trade; fourth improving education and skills; fifth lifting productivity and improving services in the public sector; and sixth strengthening the tax system. We will also put disciplines on the Crown account which is something that has not been seen for many many years. We intend to stay within a $1.1 billion operating allowance year upon year. That is quite a change but it is forced upon us by the state of the financial accounts because it was $2.8 billion in the previous administration. It had $2.8 billion of extra spending. That is now translating to an extra $3 billion - odd a year that currently has to be borrowed to fulfil some of the programmes the previous administration put in place. 
In the Finance and Expenditure Committee’s report to the House when the committee talks about those six key drivers I am fascinated and amazed to note that Opposition and Green Party members do not believe in those six key drivers to a good economy and that they strongly feel that evidence to link the Government’s six policy pillars and its growth targets is unclear and tentative at best. That means that members opposite do not believe that productive infrastructure the removal of red tape supporting business innovation improving education lifting productivity and strengthening our tax system and making it fair contribute to a better economy. I look forward to speakers from the Opposition trying to justify that statement in that report. 
We combined the Finance and Expenditure Committee’s report with a review of the Half Year Economic and Fiscal Update. I think that most members acknowledge that the risks to our economy and the global economy remain but yes things are quite a bit better than they were in the deep dark times of the global financial crisis earlier on. However they are tentative at the least. One thing I noted yesterday and I will repeat today is the fact that although the forecast accounts are looking a bit better it does not mean they are fixed; they are just looking a bit better. That demands that we keep the discipline on our spending caps have a focus on raising productivity and bring fairness and equity back into the tax system. If we do not all those forecast curves will start to go the wrong way again New Zealand’s credit rating will be downgraded our currency will fall through the floor and our expectations of a modern economy will not be delivered full stop. 
I note in the accounts that unemployment has hit a 10-year high of 7.3 percent. That is terrible. Many families have suffered for that. The only bright side is that that high is a lot lower than what was forecast earlier on as recently as the middle of last year. We must note that to get to this point and to even keep the lights on to pay for superannuation education health law and order and the insulation package we as a country are still borrowing $240 million a week—$240 million. That is entirely why we need to concentrate on those six pillars and bring some fairness and ongoing growth back to our economy. 
I would like to quickly touch on what the Opposition has offered up as solutions as its alternative Budget. Over Christmas the Leader of the Opposition announced that he would cap 16 public servants’ salaries. The Government’s Budget is something like $65 billion and the Leader of the Opposition had about 8 weeks to come up with an answer to our issues. The Opposition’s other solution is to borrow about $7 billion because of what its spending promises that it announces day after day now amount to. We are borrowing $240 million a week right now and that is another $7 billion per annum. If we listen to what Opposition members are saying in some of their blog alerts we hear that they want to increase taxes. I guess old habits die hard. I remember the first thing the then new Labour Government did in 1999 in regard to tax was to increase it from 33c to 39c in the dollar and that has created so many of the problems we now have. 
Labour’s other solution is a bus tour around the country telling everybody that GST should not be increased from 12.5 percent to 15 percent. Well that is half the story if GST is to be increased. Labour constantly does not address this—and I would love those speakers to comment on this. When the Labour Government increased GST from 10 percent to 12.5 percent what compensation did it provide to hard-working New Zealand taxpayers? What compensation did it provide to superannuitants or those on some kind of assistance at that time? The answer is absolutely none. Solutions will be coming in this Budget. It is about fairness equity ongoing growth and sustainability for our country. I look forward to the Budget on 20 May 2010. 
Hon PHIL GOFF (Leader of the Opposition) 
: 
 Mr Foss strayed into areas he should not have—the Government’s amazingly expensive promises. We passed the emissions trading scheme bill last year with its $110 billion to subsidise polluters to continue to pollute. In Labour’s wildest dreams it has not promised anywhere near the amount of money misspent by this National Government in that ill-conceived scheme. Mr Foss talks about the records of Governments. I stand here proudly supporting the record of a Labour Government that saw unemployment at its lowest level in 27 years. I ask Mr Foss what is it that he does not understand about 350000 extra jobs created by the previous Labour Government. What is it that he does not understand about the fact that the previous Labour Government saw upgrading to the highest level in two decades by the credit rating agencies? What is it that he does not understand about the previous Labour Government reducing our public debt in net terms to zero? The National Government should be very grateful for the economic management and fiscal responsibility of the previous Labour Government. 
I want to talk today about Mr Steven Joyce and his mishandling of and embarrassing flip-flop on the SuperGold Card last week because that was the clearest and most recent example yet of a Government without a plan without any guiding principles and prepared to move away from the agenda that it put before the electorate in 2008. Members will remember that when National was in Opposition it promised that the SuperGold Card was sacrosanct and it would not be touched. Then last week we heard a remarkable statement by Steven Joyce who said that the officials would consider how off-peak travel should be defined. That meant they were going to cut the hours in which pensioners who used the SuperGold Card could travel. He said that they would look at the eligibility of certain services like the Waiheke Island ferry and the train service between Wellington and the Wairarapa. By saying “some changes will need to be made because it is currently on track to exceed the available budget” Steven Joyce stated in the clearest possible terms that he was proposing to cut the SuperGold Card. Yet 24 hours and a phone call from behind a bush later what do we find from the Minister? He said: “We have made it clear all along that the Government is totally committed to the SuperGold Card including the transport concession as it stands”. That quote was the absolute contradiction of what Steven Joyce told the country 24 hours earlier. It reminds me of a saying by Groucho Marx who said: “Those are my principles. If you don’t like them I have others.” It was remarkable. 
The Government promised not to touch the SuperGold Card Mr Joyce put his neck on the block and said that he was going to do it then 24 hours later he was running with his tail between his legs in exactly the opposite direction. The remarkable thing about Steven Joyce is that he said it was a misunderstanding caused by his political opponents who were scaremongering. Has the man no shame? Has he no pride? He was following the actions of his leader John Key who just a day or two ago likewise accused the media of hysteria. Mr Key said that the media were being hysterical because they floated a proposal that 7000 hectares of pristine environmental land on the Coromandel Peninsula on Great Barrier Island and on Paparoa National Park were going to be opened up for mining. The media were being hysterical. Well there was one way he could have dealt with that hysteria: he could have told the truth. Was that a proposal by the Government or not? Mr Key declined to answer that particular question. 
The truth of the matter is that the process of Government by this administration has been an absolute shambles. It has been dishonest and it has been decision making without proper consideration before it made proposals and without transparency. We have also seen that also in the super-city reforms where this National Government hides behind Rodney Hide to do its dirty work and will not take responsibility for policies condemned by the Chamber of Commerce in Auckland condemned by the National Party candidate for the Auckland mayoralty John Banks condemned by the  
New Zealand Herald 
 the  
Herald on Sunday 
 and suburban newspapers and condemned by almost every community group and individual that has commented on them. I ask National to stop hiding behind Mr Hide bring him to order and give democracy transparency and accountability back to Auckland. 
If we talk about dishonesty surely the biggest dishonesty has been over GST. I remember the words from John Key before the election very well. They were something like this: “The National Party will not be increasing GST.” After the election suddenly we find that National is increasing GST. The National Government has broken its word and it has broken its promise. Throughout the major cities of this country and around the major provincial towns and the small rural communities I and my colleagues got very consistent feedback from every electorate represented by National members on the other side of the House. What did they tell us? They told us that they did not vote for an increase in GST. John Key promised that he would not increase GST. My advice to John Key is to take a leaf out of Steven Joyce’s book: he should forget the pride forget the shame admit that he is wrong admit that he is breaking his word admit that he is going back on the sincere promise made to the electorate and dump the GST increase. In every community in this country the people of New Zealand told us that they were against it. They said it was just a tax switch and the Government was going to give on one hand and take back with the other. Then they reflected on it and asked whether Bill English had not said that this process would be tax neutral. If it is going to be tax neutral then I ask National to explain this: $1.5 billion is being proposed to go to the top 7 percent of income earners in New Zealand. If people do not earn over $70000 they can forget about their situation being improved by these tax changes proposed in the Budget—that is the truth of it. 
The only people who will benefit from these tax changes are the wealthiest—all of the members of this House included. Ministers like Mr Williamson will get another $140 a week clear. Regarding John Key—I am not talking about his wider personal wealth but about his prime ministerial salary—the tax changes are worth $310 a week. Paul Reynolds the chief executive of Telecom will get on his basic salary—not his bonus because I do not think that he will get a bonus this year—another $1300 a week. But for the ordinary citizens in my electorate the middle-income folk and the low-income folk the best that the National Government can promise them is that they will be no worse off. Well the truth is that they do not even believe that miserable promise. They do not believe that. 
The issue I will finish on 1 year out from the Job Summit is employment. You know there were three big ideas in that Job Summit. It was the Job Summit that John Key told us would not be a talkfest but was. The big ideas included a $2 billion bank loan which fell over before it got off the ground. There was the 9-day working fortnight. It was going to be worth 6000 jobs. What have we got? A couple of hundred. There were 25000 jobs overall but 6000 jobs were saved. 
AMY ADAMS (National—Selwyn) 
: 
 I am rising to take a call on the Budget Policy Statement. I mention its title because I think that the Leader of the Opposition who spoke before me missed the whole point. I think that everyone forgot to tell Mr Goff that there is no general debate today. This is not a general debate and anyway I ask where the Opposition’s spokesman on finance is. Where is Mr Cunliffe? Why is the Opposition’s finance spokesman not taking the call? It is interesting that Mr Cunliffe is not here to take the call on the Budget Policy Statement when he leads the Labour position on that. No instead we have Mr Goff. 
The reason we had Mr Goff is because when he travels around the country on his “happy bus” nobody comes to listen to him. So he saved that speech up he comes here and he has the cheek to talk about the chamber of commerce. When he rocked up to the chamber of commerce in Napier five people turned up and three of those five were from the Labour caucus. Of the five people who bothered to listen to the Labour leader three of them were from his own caucus. So what does he do? He trousers the speech that he could not use on the bus he comes to Parliament and he tells the whips to put the call around and get him a full house because someone has to listen to his speech. Do members know why he gets so passionate when he gives these speeches? It is because every single time he stands up it is a leadership bid. Every single time that Mr Goff gets to his feet he has to convince his troops that he is still fit to lead them. No one is listening on the streets and no one is listening in here but at least in here he can get the whips to make sure that he has a full house. Because of his insecurities we have had 10 minutes of what should have been a debate on the Budget Policy Statement wasted on pandering to Mr Goff’s insecurities and his sense of failure over his bus trip which no one noticed or cared about and certainly did not help him in the polls. 
I will take it back to the Budget Policy Statement because I think it is shameful that the Labour leader completely failed to deal with it. The economy is the single biggest issue this country is dealing with. It was the single biggest issue facing us when we came into power and it is one of the key reasons why New Zealanders chose a National-led Government to get them through the worst global recession that any of us will see. When we took office New Zealand wanted one thing from us above anything else: a significant lift in economic performance. That is why people put their faith in John Key that is why they put their faith in Bill English and that is why the National-led Government is taking this country through the current issues. Economic growth is the only thing that can deliver New Zealanders the sort of permanent increase in their living standards that everyone is calling for. If we want to talk about going around and talking to people every single member of this party knows that the one thing that New Zealanders want is a lift in their standard of living. The difference is we know that the way to deliver that to them is through a lift in economic performance. We have to get this country growing. 
The Budget Policy Statement does two things. It looks back over where we have been and it looks ahead to what this Government will do to continue the path of recovery. We are through the worst of the economic recession but that should not be mistaken by anyone for thinking that from here on in it is smooth sailing. Everybody knows that there will still be bumps in the road. My colleague Mr Foss made the point that certainly for every New Zealander who loses his or her job it is one New Zealander too many. But we have to reflect on the fact that when we look at what all the numbers were predicting when this Government came into office the turn-round has been remarkable. The Labour Opposition was trumpeting from the streets that there would be 10 percent or more unemployment—10 percent or more. In fact unemployment has been limited to just a little over 7 percent and it is gratifying for us all to see those numbers coming off significantly. 
Chris Tremain 
: And thanks to the employers. 
AMY ADAMS 
: Mr Tremain is absolutely right; we have to thank employers for coming on board and doing their part. 
I thank the Minister for Social Development and Employment Paula Bennett for her excellent work through schemes like Community Max and Job Ops and for extending the Limited Service Volunteers scheme. Those are all real steps that will create jobs. I thank the Prime Minister for the 9-day working fortnight initiative which has been so valuable in saving New Zealanders’ jobs. 
The best thing we can do to create sustainable jobs is to get our economy back in balance. We heard the Minister of Finance mention today during question time that if New Zealand had kept pace with world growth during the period when Labour was in Government right now New Zealand families would on average be $5000 a year better off after tax. That is the legacy of the previous Labour Government. It took an average of $5000 a year after tax from every New Zealand family by squandering the opportunities that it had while it was in office. Those were some of the best economic times this country has seen but did we see our real economy growing? No we saw our productive economy—the part of our economy that is real and creates real wealth and real jobs not Government spending; it is the export economy and the engine room of New Zealand—in recession for 5 years under Labour while the world was growing. 
In the time that we have been in Government we have taken significant steps to change that. We are focused on things that will create a higher standard of living real jobs and higher incomes so that we do not see our young people heading off to Australia. Just this week I was called up by a constituent who said: “Amy I am sorry to tell you but we cannot keep doing this any more. I think your Government is on the right track but it will take so long to recover from Labour’s mess that I think the only future for us is not in New Zealand.” 
Moana Mackey 
: He did not say that. 
AMY ADAMS 
: That is exactly what he said I tell Ms Mackey. If the member were to listen to constituents she would know that that is exactly what the people of New Zealand are saying. 
We in this Government are prepared to take the necessary steps to get the economy growing. We have signalled that we want to have a world-class tax system that encourages production entrepreneurialism innovation and enterprise not one that encourages consumption and the debt-fuelled boom that we have seen for too long. We have to focus on reducing the regulatory burden on businesses and getting away from some of the nonsense red tape. I think that all of the Ministers in this Government have done an excellent job of getting that under way. Minister Williamson who is sitting in front of me now has made some significant steps towards reducing red tape in the building industry and I know that that is the sort of thing that will allow our construction sector and housing sector to get under way without those sorts of regulatory burdens. We are supporting business and innovation. We have seen an excellent paper released from Minister Mapp recently around the changes we need to make to our Crown research industry. It will make a significant difference and it has been warmly welcomed. 
We are focused on lifting productivity in the public sector. One thing that this Government has talked about consistently and is doing consistently is getting more money out of bureaucracy and out of the back room and into the front lines. We are seeing jobs in the Ministry of Health and the Ministry of Education refocused so that the actual outputs for consumers—for the real people of New Zealand—increase. That is why we now have more elective surgery than we have ever had before and that is why we will lift educational outputs across this country as we focus on what really matters. 
I want to focus on the fact that even since the 2009 Fiscal Strategy Report the indicators have improved markedly due to the actions of this Government. In the 2009 Fiscal Strategy Report gross sovereign debt was forecast to be at 45 percent of GDP in 2012-13; now the forecast is for 38.8 percent of GDP. The operating deficit was forecast to be 3.3 percent of GDP over this year; it is now forecast to drop to 2.6 percent. With regard to total Crown expenses one of the things that we have consistently been strong on is the need to rein in Government spending so that the real economy grows. I am very pleased to say that in the 2009 Fiscal Strategy Report total Crown expenses were forecast to be 48 percent of GDP in 2012-13; that forecast has now dropped to 44.5 percent in 2013-14. 
Those are real measurable outcomes of the solid economic performance of this National Government. That is why New Zealand elected us. That is how we will get the sort of change in economic growth that this country needs to lead to a much stronger much more sustainable and much more balanced New Zealand for us all to enjoy. Thank you. 
Hon ANNETTE KING (Deputy Leader—Labour) 
: 
 “The Government has a technique for brushing aside issues that it would rather not confront”. That was the editorial in today’s  
New Zealand Herald 
. It also said that this Government is jumping on the bandwagon to be popular and to get votes with a haphazard approach and little analysis to back up its decision. The 
 New Zealand Herald 
 was talking about the Government’s decision to give $300000 to the All Whites soccer campaign even though New Zealand Football will receive $10 million from its governing body FIFA. The editorial was headed “$300000 to ride the bandwagon” and it concluded that the Government’s contribution was essentially meaningless but that it gives Mr Key the chance to hand over the cheque. That editorial shows that even the  
New Zealand Herald 
 is starting to see through this Government. 
Paul Quinn 
: What about Trevor’s stadium? No one wanted it. 
Hon ANNETTE KING 
: The Government is all sizzle—and we are listening to some of it over there now—and absolutely no sausage. 
Wherever we go now people are saying that John Key is the Prime Minister who just smiles and waves. It does not matter what the issue is he just smiles waves and has another photograph taken. While New Zealanders are having to cough up $300000 for a pretty picture of John Key handing over a cheque to an organisation that does not need it old frail and disabled New Zealanders are having their small amount of home support cut. It is not house cleaning as Tony Ryall is telling New Zealanders. Those support workers might be cleaning old people’s toilets because they cannot see to clean it themselves but they are also buying food for those old people to be able to eat. That little bit of assistance is being cut by this Government even though it can give $300000 to an organisation that did not ask for it and does not need it. That is the Government’s priority. 
Tony Ryall is now the “Minister of Silly Talk” because he says “No no no it is not a cut in service. It is a change of service.” Obviously he has been educated in the school of doublespeak because in anyone’s language if one day we have a service and the next day we do not have a service then that is a cut. I ask Mr Ryall to say the word “cut” because that is exactly what he is doing to the most vulnerable people in New Zealand. Old frail and disabled New Zealanders are having their home support cut. 
Prior to the election National not only made all the promises that the Leader of the Opposition outlined today but also made a promise not to cut health services. National candidates made a big stand on that platform before the last election. They said that nothing would be changing and that there would be no cuts. Where did the National Government start those cuts? It started with the people who it thinks will complain the least. It is no wonder that Grey Power and all the organisations that support older New Zealanders are increasingly alarmed at the attacks on their members. They are asking why this Government hates old people. It is no wonder they are putting out statements like the one that states that this National Government is shaping up more and more like the days of Jenny Shipley. I particularly enjoyed this quote from Grey Power: “If this is the way the National Party treats those low income people then they are looking very much like a one term Government.” 
This is a Government that is making decisions for the few and not the many. Why else would it announce an increase in GST? 
Paul Quinn 
: Even Hutt South is going to go in the next election. 
Hon ANNETTE KING 
: There is not one member in this House who does not know that an increase in GST will mean higher prices. Even Paul Quinn knows that an increase in GST will mean higher prices not just on his second flat-screen television but also on ordinary New Zealanders’ bread butter and milk as well as their power rates accident compensation and doctors’ visits. The many will be paying the most because they already spend most of their incomes on daily living. Seventy per cent of New Zealanders earn $40000 or below. I tell the Government to remember that figure. A 20 percent increase on the tax those people—our old people single people who are on low incomes beneficiaries and middle income earners—pay for the basics will hit them very hard. 
No one believes John Key when he says that most people will not be worse off but why should they believe him? Before the election he told New Zealanders that there would be no increase in GST. He also said after the election that there would be no increase in GST. He duped New Zealanders. The nice Mr Key said there would not be an increase in taxes. He said he would decrease them. Well consider this: what do we call increasing GST from 12.5 percent— 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I am really sorry to do this to my colleague but if no one in the Government will defend Mr Key when he is being called a liar I just want to ask whether the rules have changed in the House and people are now allowed to be called liars. I note that no Government member is disputing the fact but I think it might be an abuse of the parliamentary process for my colleague to call him a liar so often. 
Chris Tremain 
: The issue we have on this side of the House is that like the New Zealand public no one on this side is listening to the deputy Leader of the Opposition’s speech so that is probably the problem. 
The ASSISTANT SPEAKER (Eric Roy) 
: If the member specifically made that accusation I did not hear it. I thought the member was skirting quite close to what was acceptable. It is probably better that she moves a bit away from that. 
Hon ANNETTE KING 
: I used the word “duped” and I do not think that has been ruled out in this House. As for Mr Tremain saying that no one is listening I say he should go on believing that because the people in his electorate who earn $40000 and less will be looking very closely at whether they should waste another vote on that member who does not think an increase in GST will hurt them at all and that they will be all right after the tax cut. What do we call an increase? I ask Mr Tremain to answer this: what do we call an increase in GST from 12.5 percent to 15 percent? Is that an increase in tax? Mr Tremain’s leader said: “No increases in taxes.” but that is an increase. 
I think we should call the Prime Minister the “Minister of Broken Promises.” Nobody believes the Prime Minister as was shown in a very recent Westpac consumer confidence survey. That survey showed that almost 60 percent of New Zealanders feel they will be either worse off or no better off after the tax cuts and the increase in GST. That is what New Zealanders think about what this Government is promising. If middle-income New Zealanders think the tax cut will make them better off they will be very very disillusioned after the Budget this year. 
A colleague of mine was talking to a dairy worker in provincial New Zealand— 
Paul Quinn 
: I raise a point of order Mr Speaker. The speaker referred to a survey by Westpac. I have the Labour Party press release in front of me and it says— 
The ASSISTANT SPEAKER (Eric Roy) 
: That is a debatable point. It is not a point of order. 
Hon ANNETTE KING 
: I raise a point of order Mr Speaker. It was also not a point of order because it was aimed at breaking up my speech and I think you ought to rule on that. 
The ASSISTANT SPEAKER (Eric Roy) 
: Let us just talk about points of order that break up speeches. I think members on both sides of the House are guilty of that and I would not like to try to decide at this point as to where the most blame for that should go. I think we should leave that alone. It is also out of order to comment on a point of order on which I have ruled. 
Hon ANNETTE KING 
: It is a shame that Paul Quinn does not take a call in this debate instead of shifting from his seat in the back of the House and being big and brave. He should have the cameras on him. 
A dairy worker living in provincial New Zealand and working in Hawera shared with a colleague of mine last week his costs and his outgoings. After 16 months of a National Government he is going backwards. His gross income is $69549. The basic outgoings for him and his family are greater than his income. That will not help him to stay in New Zealand; in fact it will drive him offshore. But wait a minute: was the National Party not going to close the gap with Australia? It was not an aspiration; it was a promise. It is so easy to do it when one is in Opposition—“We’ll just close the gap with Australia. We’ll just say it in Opposition and hey presto there will be milk and honey the sun will shine longer and that wage gap with Australia and New Zealand will close.” Let me tell this House that the wage gap is growing. It will be bigger in 2010 than it was in 2009 but more than that the Grant Thornton International survey which National used as its Bible when it was in Opposition said that the big difference between the New Zealand economy and the Australian economy is that Australians are hiring people and New Zealanders will be part of a brain drain to Australia. So much for the promise that National would close the gap. 
I have to say that although National members are praising themselves and patting themselves on the back about how great the reforms have been not one of those reforms had anything to do with anything the Government did; it was due to the fact that a Labour Government left them with a very good set of books and that is why this country has done better than a lot of other countries around the world. 
Dr RUSSEL NORMAN (Co-Leader—Green) 
: 
 I start today by acknowledging the passing of Bevan Tipene-Matua who was a leader within the Green movement and within Maoridom. He will be sadly missed but well remembered. 
Today we are talking about the Budget Policy Statement. The Green Party would like to address the six pillars that the Government has put forward within the Budget Policy Statement but before we do that it is important to understand the context within which we approach the Government’s Budget. For us the objective of economic policy is to achieve prosperity for New Zealanders while at the same time cutting our use of natural resources and cutting our pollution. We need prosperity while restoring and protecting the integrity of ecosystems and that is the definition of sustainability. 
The Government has put forward six pillars the first of which is investment in infrastructure which actually means roads. The Government is saying that it wants to spend about $20 billion on motorways over the next 10 years and that it wants to borrow the money in order to do it. This is Steven Joyce’s think big project. It is a project that takes no account of the two giant issues that are currently facing the world. Those two giant issues are climate change and the end of cheap oil. This project is in total denial about the two greatest realities facing the global economy. Roads mean more greenhouse gas pollution more oil dependency more obesity and more air pollution. The Auckland state of the environment 
report was released yesterday. It showed that there was a 9 percent increase in kilometres travelled by car in the years 2004 to 2008. That is an extra billion kilometres. Health costs have been $547 million a year as a result of that road usage. 
The problem we have is that the oil import costs on New Zealand are dramatic. The last time the oil price peaked in 2008 it had a massive impact on New Zealand’s balance of payments figures because it had a big impact on our trade balance. If we do not reduce our dependency on oil then we will face exactly the same problem as oil prices go up again. We will find ourselves having to work harder and harder in order to pay for the oil that we import. Last time virtually the entire exports of the tourism industry were required to pay for our oil imports so a strategy that makes us more dependent on oil imports by investing in motorways is a pretty stupid strategy. 
Last year the executive director of the International Energy Agency the international body we all pay to predict future oil prices stated: “I can’t rule out the possibility of an oil supply constraint in 2013 and 2014.” In December 2009 the International Energy Agency which employs the international experts whom this Parliament pays in order to predict the future prices of oil stated in its oil market report that there are two demand scenarios in front of us. One is an oil demand growth of 1.4 percent for 2009-2014 which would give us an oil crunch in 2014. The agency also stated that semi-recessionary growth which would be growth of only 0.5 percent globally per annum would postpone the oil crunch to some time after 2015. The International Energy Agency is very clear that we are facing an oil price shock. 
The chief executive of the Total oil company recently stated that the oil price would rise to more than $145 per barrel on the concern that supplies may fall short as early as 2014. The spokesperson for the chief executive officer of Total stated: “We are running the risk of another oil crisis when demand outstrips supply around 2014 or 2015. There won’t be enough oil and gas by the middle of the next decade.” 
Although oil is getting more expensive and all the experts we pay to give us advice on it are telling us that the price of oil will increase dramatically over the course of the next decade we are borrowing money to invest in infrastructure that will make us more dependent on oil. Although the price of emitting greenhouse gasses will only increase as price is factored into the international market in greenhouse emissions we are building infrastructure that increases our greenhouse gas emissions. In fact we are borrowing money to build the infrastructure that will result in increased greenhouse gas emissions. Although congestion is a major cost for our urban centres we are building the infrastructure that induces greater road use and moves the congestion to another point in the road system. Only an investment in buses trains ferries cycling and walking can solve the transport problem as everyone who has ever done any study in transport knows but instead we are borrowing $20 billion over the next decade in order to invest in the one thing that we know does not work which is brand new motorway projects. National has a think big motorway building project as had Labour before it and it will end in tears like the last Think Big project did. 
The second pillar that National has talked about is regulatory reform which means leaky houses. The last time the ACT Party types did a job on cutting red tape in New Zealand they came up with a thing called the Building Act 1991 which was laissez-faire legislation saying that one could build whatever load of rubbish one liked. The cost for fixing up the leaky houses that resulted from the last attempt to cut red tape in New Zealand which we are currently facing is somewhere between $11 billion and $22 billion depending on whom we read. In terms of GDP that is a cost comparable to the devastating earthquake in Chile. 
Somewhere over 10 percent of our GDP will have to be spent on fixing up what happened the last time we let ACT Party types decide what regulations should govern the Building Act in New Zealand. It was tremendously expensive. The ACT Party types got rid of the rules that stated that a builder needed to know how to build a house that would keep out the rain. They said that was the nanny State and that they would get rid of that rule. That was in 1991 under the previous National Government and the policy was developed under the Labour Government that came before it. The ACT Party types got rid of the rules stating that the external cladding had to keep the rain out because they said that a rule like that was clearly an example of the nanny State—it is a nanny State rule that says our houses have to keep the rain out! 
The ACT Party types got rid of the rule stating that the framing needed to have a bit of boron treatment because they said that was a nanny State rule. Some of those in the National Party who promote the idea that it was the greenies who promoted that move need to know that it was decided by the New Zealand Standards Council where the timber industry had a majority vote over the researchers who opposed the change. In fact it was a result of the deregulation coming through the New Zealand Standards Council on which the timber industry had a majority. They got rid of the rules stating that buildings have to keep the rain out because they thought that it was nanny State. 
Tens of thousands of New Zealand households are today having to wear the pain as a result of the last time a National Government deregulated the building industry. So when the ACT Party types put up their ideology around regulatory reform I ask members to remember that it could again cost us $22 billion with thousands of families living with the heartache pain debt and illness that results. That is all due to the Rogernomes in National and in Labour before that. 
Let us look at another pillar that is being proposed here: tax reform. In tax reform the Government is proposing to cut the taxes paid by the top earners and to pay for that tax cut by having an increase in GST which will fall on those who have the least money. The fiscal difficulties that were created by Labour’s round of tax cuts just before it left office and by Labour’s failure to deal with the housing bubble are real; there is no question about that. But what the Government is proposing to do about them will not fix them. 
We actually need thoroughgoing tax reforms—such as a capital gains tax that excludes the family home which would make a difference because it would be highly progressive it would fall more on the wealthy than on the poor it would broaden the tax base and it would drive investment away from the housing boom. That would be an important and significant tax reform we could make not to mention putting serious prices on carbon and on water which would drive the economy to be more efficient in its production of carbon and in its use of water. 
We need to move our economy in a sustainable direction. We need to reduce our use of resources and production of pollution and unfortunately this Budget Policy Statement fails to do that. The only good thing about it is that it is not Don Brash’s policy statement so dog-eat-dog is not its central thesis but it does not have a lot of vision. 
The world is changing and that is the reality we face. It is constrained in resources and it needs to cut its pollution. That creates fantastic opportunities for new businesses in New Zealand to make a prosperous living out of New Zealand living up to its reputation for being green and for being smart. Once again I encourage the Government to start to steal our ideas rather than to steal the inheritance of future generations. 
Hon Sir ROGER DOUGLAS (ACT) 
: 
 Unfortunately I believe that the Budget Policy Statement once again demonstrates the Government’s major deficit and that is the deficit of imagination. The Government clearly lacks the guts to do what is right to turn round the New Zealand economy from where it is today. The Government has decided in terms of this policy statement to once again take the soft option—to hell with New Zealand so long as the Government survives. Once again it has decided to borrow and hope. 
The Budget Policy Statement summary states: “The key issues and themes are summarised below. The Government told us its primary focus for Budget 2010 will be on lifting and sustaining economic growth.” But I want to predict that the Government will in fact fail. It will do substantially better than did Labour and the Greens but essentially it is not doing enough to ensure that real growth occurs in this economy. 
If we ever wanted a wake-up call then I suggest that we got it yesterday with the announcement of the latest productivity figures. They showed us that we are going backwards. Improving our living standards and catching up with Australia is a promise but not a reality. The fact is that productivity is critical. A decrease in productivity as we have had over the last 12 months means that we are now getting less output for the same amount of input. In other words we are getting less for what we are putting in. Between 2006 and 2009 under the Government of Labour and the Greens New Zealand experienced negative labour productivity and that is the first time that that has happened in 20 years. Overall GDP decreased by 2.2 percent without— 
Hon Trevor Mallard 
: Why Roger? 
Hon Sir ROGER DOUGLAS 
: It was because of the member’s party’s mad policies actually—that is why. Without higher productivity per week there can be no higher wages. And that is the point: the only way we will have real increases in wages is by way of real increases in productivity. The fact is very simple. The fact is very simple I say to members and I want New Zealanders to ponder it: if New Zealand between 2000 and 2009 had had the same labour productivity that we had between 1984 and 2000 then wages in this country would be more than $100 over and above what they are now. The average weekly wage today is $538. If we had had the same productivity in the last 9 years as in the 15 or 16 years before that wages today would be $107 higher and New Zealanders would be earning $645 a week and not $538. That is what a Labour and Green Government did to the people of New Zealand; they increased Government spending by more than 50 percent and the result of that was a rapid decline in labour productivity. I might add that capital productivity and multifactor productivity also declined. But if members put that aside they will see that Labour’s legacy is wages lowered by 107 bucks a week because of the madness that the member for Hutt South and his colleagues introduced. 
Before I come back to the main proposition—that is lifting and sustaining economic growth—I will touch on one or two other points that have been raised in the Budget Policy Statement. There is a lot of talk in the statement about fiscal policy and tax and the fact that we might adjust the tax system to our advantage. I want to make the point that the impact on the New Zealand economy is not so much from the design of the tax system. Sure we can design the system better but if the Government and local government are spending 45 percent of GDP then we have a problem. It does not matter how we design the tax system we have a problem. When we think about the burden of tax the quantity of Government expenditure that determines its cost—that is about 85 percent—we can see that we might be able to improve the system by designing it a little better but that accounts for and improves things only at the margins. What we need to do I believe is to look at Government expenditure and accept that until we reduce that expenditure and get it back to where it was 6 years ago at 29 percent of GDP we are going to have a lot of trouble. 
I do not personally support the increase in GST; I think it is unnecessary. I believe that if we take the compensation— 
Hon Trevor Mallard 
: Will you vote against it? 
Hon Sir ROGER DOUGLAS 
: I ask the honourable member to listen. GST brings in about $2.2 billion but with paying compensation to superannuitants and to those on benefits etc. as the Government intends to do the net increase in revenue will be about $1 billion to $1.2 billion. That represents less than 2 percent of Government expenditure. We can have the tax cuts if we are prepared to reduce Government expenditure by less than 2 percent and I suggest that— 
Hon Trevor Mallard 
: Will the member vote against it? 
Hon Sir ROGER DOUGLAS 
: I certainly will not be supporting the GST increase. On the other hand it may well be that I will be voting for it I say to Mr Mallard because that is part of the supply agreement that we have. 
Hon Trevor Mallard 
: Oh you used to be a man of principle. 
Hon Sir ROGER DOUGLAS 
: Well it is quite easy. I can justify that I tell Mr Mallard. I might not like the fact that National will increase GST by 2.5 percent but if the option is to go back to the mad policy that you introduced over the years from 2000 to 2009 it is a no-brainer as to what I am going to do. 
Hon Trevor Mallard 
: Retire. 
Hon Sir ROGER DOUGLAS 
: Oh—well you should have retired a long time ago. 
Dr Kennedy Graham 
: I raise a point of order Mr Speaker. In the last 30 seconds our colleague has suggested that you should retire and that you had maintained mad policies. 
Mr DEPUTY SPEAKER 
: Yes I heard that. I come back to the point that no member can bring the Speaker into the debate. Every time the member says “you” or “your” he is referring to the Speaker—and I do not intend to retire just yet. 
Hon Sir ROGER DOUGLAS 
: I come back to the main proposition which is about trying to lift and sustain economic growth. There are really seven principles to follow if we are to achieve that. I think really that the Government has only two of those under control and they are the issue of monetary policy and the policies relating to free trade. But if we really want to give a boost to this economy then private enterprise has to play a much bigger part than it is playing at the moment. We simply cannot have 40 percent of GDP being spent by the Government. 
I actually agreed with the leader of the Green Party in terms of what he said about infrastructure. If infrastructure improves New Zealand’s growth then that is well and good. But there is also the situation where the Government is making investment decisions for political and not economic reasons. I personally think that a perfect example of that is Transmission Gully the benefit-cost ratio of which is below one—that is Treasury has estimated that it will cost far more than it will deliver in benefits—yet the Government is going ahead with it. If we continue to make political decisions in this country rather than rational decisions we cannot expect the country to go forward. The fact is that we need to introduce more competition particularly into the State monopolies of health education and welfare. We will move forward only when we have low taxes and minimal regulation. 
TE URUROA FLAVELL (Maori Party—Waiariki) 
: 
 Tena koe Mr Deputy Speaker. Kia ora tatou katoa. The Maori Party welcomes the opportunity to focus on solutions that will lead to economic recovery and improved economic performance. This debate is pretty timely as we reflect on the residual effects of the worst of the recession and concentrate on six key areas that the Government proposes to promote in order to prompt growth in the economy. The No. 1 area that is being promoted is an investment in productive infrastructure which includes an ultra-fast broadband network new roads and transport initiatives school buildings and over $300 million to be spent on one prison—$300 million on one prison. I want to focus on that for just a short time. 
In order to convey a sense of the value that a new prison will add to our economy I tell members that it just so happened that last week I was up at Spring Hill Corrections Facility at Te Kauwhata at the prison itself. If we base our assumption on the fact that the average sentence cost per inmate is approximately $52000 rising to $71000 for a maximum-security prisoner and if we take into account current projections that by 2016 our inmate population is projected to hit 10700 we are certainly talking about a multimillion-dollar investment in what some may say is based on the industry of misery. A better description is probably “negative spending”. Why do we have to continue to pour money down the gurgler in such a negative way? The House has been saturated with pieces of legislation that add to the investment in the prison infrastructure including the use of container cells to meet the excessive volume of prisoner numbers that is planned for. 
Yet when I looked around me at Spring Hill I saw that it was not an investment that I for one feel very proud of in terms of leading our nation forward. This is an industry in which Maori are grossly overrepresented an industry in which the average length of sentence imposed has increased and an industry that is characterised by a high rate of re-imprisonment particularly for Maori. The Maori Party believes that we should change this paradigm. We surely have to question an economic framework in which we measure our wealth through the growth of criminal activity. The $71000 that it takes to keep an inmate in maximum security for a year exceeds the average teacher’s salary by $20000. If we were to add up the amount spent on courts probation officers police and the judiciary then one really has to question the economic value to the nation of the true costs of crime. 
That leads me logically to another of the six key areas that are proposed as a foundation for economic growth and that is the area of lifting skills. During the adjournment recently I also chose to visit two schools: Lytton High School in Gisborne and Wairoa College in the Ikaroa-Rawhiti electorate at Wairoa obviously. During my visit to these schools I got a firsthand view of the Kotahitanga programme in action and I was really really impressed. I found all the teachers involved in the programme to be absolutely committed to the change process we so urgently require in our schools. 
I go back to the issue of criminal activity and criminal justice I remember what we were told when Judge Becroft reported to the Education and Science Committee back in 2007. He told us that almost all the young people seen in the Youth Court are not actively engaged in education. He spoke of them drifting having been excluded or exempted from school. They awaited placement in another school in alternative education in a training course or in employment—anything. He also advised us that since the early 1990s young Maori have made up almost half of both police apprehensions and youth justice cases. He concluded that getting young people back into education was the king-hit that we should be looking at in the youth justice area. 
I come back to the Kotahitanga programme. At one of the schools a teacher had been involved in the programme for just 4 weeks. One of the breakthrough comments that came out of a discussion with that teacher was that the Kotahitanga programme allowed a cohort of teachers to teach the same class together. It allowed them to sit together and talk about the students they taught. This is not rocket science but there was an amazing sense of similarity across the discussion about the students that those teachers taught. Together they shared strategies about how they could make schooling a more meaningful experience for those young students working through ideas that could lead to changing the way that they each responded to those individuals and in doing so they were working in a way that would support aspirations and ambitions rather than focus on discipline and control. The programme provided them with the opportunity to talk and change the paradigm. Another approach was as simple as the basic respect accorded in the way that teachers greeted their students. They said “Kia ora.”; it was as simple as that. That was all about changing the paradigm. 
Another part of the Budget Policy Statement focus on lifting skills was the national standards. As a former teacher myself I know that introducing national standards by themselves is the type of life-scale change we need in order to improve the education experience of what is commonly known as the 20 percent who underperform or underachieve. It will be a gauge for us to be able to address the longstanding issues that have impacted on poor rates of numeracy and literacy or have led to consistent patterns in the truancy suspension and exclusion statistics. We have to do more here. Maybe Te Kotahitanga could be rolled out nationwide. 
Another key area in the Budget Policy Statement is the commitment to improve services in the public sector. This is certainly an interesting time to respond to this objective when today’s breaking news is that nearly 1500 jobs have been cut from the Public Service in the past year. The Maori Party’s policy position has been that we want to see more community services and less Government bureaucracy for the outcome of whanau restoration. 
I raise a point of order Mr Speaker. I do not mind a few comments being interjected about the speech but a lot of the discussion is not about the speech itself; it is actually coming from across the House. I would appreciate it if that could be dealt with. Thank you very much. 
Mr DEPUTY SPEAKER 
: That is a fair comment. Interjections should be rare and reasonable and should not be interchanges that have nothing to do with what is being said. 
TE URUROA FLAVELL 
: As I said the Maori Party policy position has been that we want to see more community services and less Government bureaucracy for the outcome of whanau restoration so we welcome another of the six key areas of economic growth which is to remove red tape and improve regulation. 
Many of the Maori providers whom we have spoken to or who have spoken to us about our Whanau Ora approach have raised their concerns about the practices of the Government by which the compliance and transaction costs that emerge from multiple contracts with multiple funders have serious disadvantages for providers and often restrict their capability to be more responsive to whanau. I have heard reports from some providers that they are reporting to or completing auditing and monitoring accounts for the Government every third day. There are other stories of providers being hamstrung by the compliance costs of different reporting schedules and the administrative overload of meeting contract outputs. 
We in the Maori Party want to see far greater investment in what counts—that is in outcomes. We do not want to know how many posters were pinned on the wall or how many phone calls were made and pamphlets distributed. We want to be able to measure the true wealth that can be achieved through improvements in whanau capacity to undertake the functions necessary for healthy living and to contribute to the collective well-being of the whanau. 
Whanau Ora we would suggest will also fall into the framework of another one of the Budget policy pillars—that is the supporting of business innovation and trade. My colleague Tariana Turia has spoken frequently of Whanau Ora as being the most transformative concept that we could ever invest in. It is about investing in aspirations in innovation and in initiatives of whanau to become more self-managing and to take responsibility for their own social economic and cultural development. Although developing whanau capacity will be the primary outcome I believe that we should also expect to see considerable improvements in the business of the Government as part of the success of this policy. Instead of being trapped by output-based tick-box contracts we would hope to see better smarter services that will focus on real results for whanau. 
Finally we come to the last pillar of the six policy planks in Budget 2010—that is the concept of strengthening tax. This too is a key area that I took on the road in the last couple of weeks in order to gauge the view of people on the proposed changes. While I was hearing first-hand the fears of people about the projected rise in GST several reports that have come out recently from the Christian Council of Social Services suggest that our most vulnerable citizens are feeling the impact of the recession despite what the Budget Policy Statement tells us when it says the worst of the recession has passed. There is more to be done. 
DAVID BENNETT (National—Hamilton East) 
: 
 We are talking about the Budget Policy Statement in the debate today but I feel that this debate has been sad because it has been hijacked by the two Opposition parties. They have used it as an attempt to blatantly attack the Government rather than as an opportunity to debate the real issues and the substance that the Government a very constructive Government has been trying to provide over the last year or so. You know it is really sad when we look at the operating environment of the Labour Party and see what it has devolved into. 
Labour is using fear tactics to prey on the most vulnerable in our society and talk about what those people will potentially lose in this world rather than being constructive delivering solutions and working in this Parliament for the common good of New Zealanders. I feel very sad when we see today that the Labour and Green members have taken this debate to a stage where they have taken it away from the people of New Zealand and used it for petty politics when in fact we are debating something that is very much more important—the Budget Policy Statement. 
The Budget Policy Statement gives the Government’s focus for getting a sustainable economy that will grow and go forward. One thing we need to look at is the policy behind that debate. It has not been enunciated much in this Parliament but I think it will be talked about more and more as we go through the next year and look at the Budget and what comes out of it. What I am talking about is the fact that I think there needs to be an attitude shift on the part of New Zealanders. There needs to be a change in approach so that New Zealanders understand that we do have a role to play in the world economy and that we can deliver that successful future. 
A perception change is needed out there. New Zealanders need to know—and they need to have the vision from their Government—that there is a way in which we can earn our way in this world achieve our goals and therefore deliver the services and the society we all seek. That is what I think this Budget will show. The Budget Policy Statement is a setting out of some of the parameters but over the next year we will see a change in the attitude of New Zealanders when they see that there is a way forward and that the way forward is being promoted positively by the Government of the day. 
New Zealanders need to see that they need to value education. They need to see that there is a future in working hard. New Zealanders need to see that there is a future in investing in industry in taking risks and in getting success out of our research science and development. Those are the things that National has indicated that it wants to see come through in its Budget. It wants to see a country that is delivering a new vision of economic growth—economic growth that is based around achievement and success higher wages and a society that provides opportunities for all. 
That contrasts with the Budgets we have seen from the previous Labour Government over the last 9 years. They were all about buying votes and looking at the day—at “this point in time”—and not actually about delivering a constructive future. But I think that delivering a constructive future is what National will be seen as being successful in doing along with its political partners in the coalition and the public will understand that. They are ready for that change in direction and they are supporting it. That is why we see such great support for the Government and Prime Minister whereas the members of the Opposition lack any traction. 
Members of the Opposition do not have any understanding of what the public want and they do not seem to be able to hit any issues. They are looking at an old way of dealing with what the public want. They are looking at an old direction of just spending the money that comes in rather than seeing a new direction where people want to build a future. New Zealanders want to see some aspirations and some goals. They want to see that there is a brighter future ahead of them. That is what National and its coalition partners are delivering and I am very proud to be a part of that. National is setting up a new direction and a change in attitude that have been long overdue. Really that is the only answer in order for New Zealand to get where it needs to get to in this world. 
We cannot live in the situation we have lived in in the past where we have just taken money and redirected it. We need to set up a desire and a passion for New Zealanders to get education to work hard and to achieve success. Those are the vital ingredients for keeping New Zealanders in this country and delivering the standard of living we need. It comes back to a lot of policy over many areas. Now there is the infrastructure to set up that environment so that New Zealanders can take advantage of a world economy where we are very well placed in this region to be very successful. There is a need for national standards so that we have that education base and so that people do not fall between the cracks and then have to be picked up by the Government at a later date. We do not want to see people get to that situation; we want to give them the hunger and the desire to make the most of themselves so that they want to get an education and learn. 
Let us compare those aims with the aims of members of the Opposition. They want to dumb down the population. Opposition members want to keep people down so that they can use their fear tactics about what people could potentially be and aspire to. That is the Labour mantra and the Green Party is supporting it. It is very disappointing when we see what Labour has done to our country and its people in the past when it could have achieved so much more for our country. That is the heart of what this debate is all about—it is about providing that directional and aspirational point of difference. We look forward to seeing that aspiration come forward and we look forward to New Zealanders being constructively successful in the future and building a stronger country. 
New Zealand has done pretty well in the last year when we consider the economic environment we encountered. Our country was in recession. The world was in recession. Under Labour there was falling economic growth rising unemployment high inflation and a rising current account deficit. There were deteriorating fiscal deficits and there was rising Crown debt. All those things happened under the previous Labour Government. It set us up with a situation that was very difficult. 
When we talk to people on street they tell us that we came in at the hardest time but we still delivered for our people. They tell us that Labour left us a basket case. That is what the people out there say—that is what they say. National has delivered when Labour gave us nothing. That is the history of National Governments picking up the can after Labour Governments. The public understand that and they support us because they know we have gone through the tough times and delivered a brighter future for New Zealanders. 
Over on that side of the House we see the Labour Party. We see Shane Jones trying to take over the leadership along with David Cunliffe and David Parker—all three of them. Which one will be the leader of the Labour Party in a year’s time? That is the question. The three bright hopes of the Labour Party are sitting there together. Trevor is not in it now. Those are the three faces—that should be the picture on the news. Which one will be the next leader of the Labour Party? They are all smiling. Each in his heart of hearts wants the job. They are all the right age they are all looking for it but none of them will get there. None of them will ever become the leader of the Labour Party and be successful. They will never do it—because we have leadership in New Zealand right now. 
We now have the leadership and the direction that have been missing for nearly a decade. During that time New Zealanders felt that they were missing something and now they have found it. They have found that direction they have found that leadership and they have found a Government that looks after them and provides a future. That future will be announced in the coming Budget. It is an important Budget because it delivers the essential elements of that future. 
I am looking at those three members. They are smiling again are they not? They do not know which one of them will be the leader do they? We could have bet on them if we really wanted to to see who will be the leader out of those three. They are just waiting. They are waiting and waiting until after the next election because they know that they have got no chance. 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 We can always tell when a Government is in trouble by the way its members handle themselves in the House. A clear giveaway is when the member speaking cannot face the Opposition and turns and looks at his or her own backbenchers. Mr Bennett spent the whole 10 minutes staring at Mr Quinn. I do not know whether he is particularly fond of him whether he does not like Mr Henare or what it is. But I tell members that Mr Bennett should spend more time facing the camera and less time ogling Mr Quinn and then he would be in better shape. 
But that member has good reason to worry because when we go around the country we are hearing two very clear messages. From the business sector we are hearing this message: why can this Government not make a decision just one decision and stick to it? There is “Handbrake Joyce” back in the Chamber the member who made a handbrake turn on the SuperGold card. “Auntie” they call him in the blogosphere—“Auntie Joyce.” I have an Auntie Joyce and she is offended by that nickname. She was far more decisive than that Minister—far more decisive. The business community is asking why the Government cannot make a decision. 
What ordinary New Zealanders are saying around New Zealand—and Madam Speaker you certainly have improved in looks in the last couple of minutes—is: “My God! Why don’t they stop making the decisions that they’ve been making? If GST is the answer what was the question? We don’t want this GST rise; we didn’t vote for it. They didn’t tell us they were going to do it; they told us the exact opposite.” The Prime Minister said that no Government with half a brain would raise GST. No Government with half a brain—I do not know what that says about the current Government. 
The problem with this Government is serious. It is very very serious. There is no plan for growth. Sir Roger Douglas is back in the Chamber. Sir Roger Douglas had a plan that many of us did not agree with but at least he had a plan. That is the difference between this Government and other Governments. 
Hard-working Kiwis have struggled through the recession. On our recent bus tour of the country we met with many families who are having trouble; the member Sam Lotu-Iiga may smirk but there are real people out there with real challenges. They have real trouble feeding their children from week to week. People who earn below the average wage and who are facing a rise in GST are saying they cannot cope; they are genuinely afraid. It is all very well for Government members like Mr Bennett to smirk away when there are real Kiwis suffering. Whatever this Government does when Labour comes back people can be assured that we will have a tax package that is fair to all New Zealanders. Under National the people at the bottom know they will get it in the neck. The people in the middle will be lucky to break even. The people at the top the very few will get a big wad of cash that they do not need. I repeat: they will get cash that they do not need and that they did not even vote for. 
So why is this Government doing it? If GST is the answer what is the question? It is not a plan for growth. It does not address the structural imbalances in the economy the runaway property— 
Hon Steven Joyce 
: Yes it does. 
Hon DAVID CUNLIFFE 
: “Oh yes it does.” says the “Handbrake”. Minister Joyce thinks GST is a structural policy. He thinks he can stop a property bubble with GST. Well we have news for Mr Joyce: it is the wrong tool for the wrong job and it will have the wrong effect for his party on the polls. 
There is no plan for growth. This Government was elected with a mandate for change. Mr Key said it would be a step change. He said that we were going to take a bold step forward into a brighter future that we were going to catch up with Australia—but what happened? The 2025 Taskforce was dead before the ink was dry on the paper. Sir Roger has not forgiven the Government for that. The Government has abandoned even the term step change because it cannot do even bit-by-bit change. The Government cannot change anything because it cannot take a decision. 
Why is that? Handbrakes are around every time there is a focus group. Let us take mining for example. I personally think that mining national parks is a very stupid idea because we will lose more from our brand image and our tourism revenue than we will get in digging up a bit more coal in the Coromandel. But if Government members were to make that stupid decision we would expect them at least to have the courage of their convictions and make it. But oh no another week’s focus groups told them what we already knew: this was political suicide. So we can imagine the Cabinet meeting: “Handbrake” came to the fore “Handbrake” said: “You can’t do that; I’ve seen the focus group numbers.” and Mr Key withered. He withered in the headlight of public opinion. Once again this Government looks like a possum on the road waiting to be road kill. It will not be long until the next election when we can examine the entrails of the failed experiment of the great National Government. The Government that was never— 
Paul Quinn 
: Lift yourself above the clichés; give us something new. 
Hon DAVID CUNLIFFE 
: Mr Quinn wants a doctoral thesis in the House. I will be happy to match Mr Quinn thesis for thesis but I will give him first try. But I will not hold my breath because I am sure that Mr Bennett was not looking lovingly at him for theoretical policy advice. 
There is no plan for growth. National’s tax package is unfair and nobody voted for a rise in GST. 
Paul Quinn 
: The members that you talk about of society—that is how they want it. 
Hon DAVID CUNLIFFE 
: Interjections are supposed to be rare reasonable and witty and that was none of the three—neither rare nor reasonable and certainly not funny. 
Why are Government members trying to distract New Zealanders from the truth from the real story? It is because there is no game plan and there is no policy. It is like buying a used car and getting home and lifting the bonnet to find there is no engine in it. That is what New Zealanders are increasingly saying about this National Government. There is no plan there is no there there. 
National has a leader who would rather preserve his own personal popularity than do what is right for New Zealand. He smiles and waves watches the focus groups but does not make a decision. That was great for National in 2009 in a long honeymoon. It might work for a few months in 2010 but it will not work in 2011 because when a party is in Government for 3 years it is supposed to govern not spend the whole time complaining about the world economy and the previous Government. The New Zealand public expects leadership. They have not had leadership from John Key. They have not had leadership from this National Government. They have had sound bites they have had focus groups they have had a 9-day fortnight—which was cancelled—and they have had a cycle track to nowhere which was the best idea of a job summit. 
There is no plan there is no future and that is why New Zealanders are talking about leaving this country. That is why young New Zealanders are looking at their parents and saying “I don’t know if I can get a job in New Zealand that will fulfil me.” 
Hon Steven Joyce 
: That’s absolutely outrageous. 
Hon DAVID CUNLIFFE 
: “Handbrake” says that that is absolutely outrageous. He says that it is outrageous that New Zealanders are losing hope. One of the reasons why they are losing hope is that they cannot get broadband I say to the Minister for Communications and Information Technology. Nearly 2 years ago the Broadband Investment Fund was ready to run and Maurice Williamson promised roll-out within a year. Fifteen months in that Minister has yet to make a decision. There is not yet a bankable project in the hopper and not 1 millimetre of broadband fibre has been laid under his $1.5 billion hole—not 1 millimetre. The information and communications technology sector is asking why John Key is loading up that Minister with portfolios when he cannot do even the basics in the one portfolio he started with. He cannot do the basics in the one portfolio he started with. Where is our faster cheaper broadband? It is not here. That is one of the reasons why young New Zealanders are going overseas. They are going overseas because they have lost hope in the so-called brighter future that they were promised in the step change they were promised. They have lost hope. That is what we have heard as we have been going around the country. 
If the Government thinks that the answer to its problems is to raise GST where has that Government been? Ordinary New Zealanders do not like that idea and they can tell the difference between a tax rise and a plan for growth. There is no plan for growth. There is no step change. There is no brighter future. 
PESETA SAM LOTU-IIGA (National—Maungakiekie) 
: 
 I rise to talk on the Budget Policy Statement. Unlike the last speaker who accused my colleague of staring at his other colleague I say it is surely better than staring at oneself for most of the time as that member did. The “Prince of Ponsonby” claims he travels up and down the country listening to the people. The “Prince of Ponsonby” is used to sipping a latte in a Ponsonby cafe on a Saturday morning. But I digress. 
I come back to the Budget Policy Statement before us which the last speaker did not refer to once. The first page of the executive summary in the Budget Policy Statement says that New Zealand is on the road to recovery—and it is under this Government. The previous Government put through a number of policies that have almost destroyed our economy. The Budget Policy Statement confirms that the Government’s focus in this year 2010 is on getting the economy growing again. Its focus is on getting the economy growing again and ensuring that growth is higher and more sustainable in the years to come. It supports the statement made by the Prime Minister in this very Chamber on 9 February. He set out the framework for a significant programme of economic and social policies that this Government will roll out in the coming years. 
There has been a lot of comment about what the Budget on 20 May will hold. I must admit that I myself do not know the contents of the Budget but certainly the debate that has occurred in this Chamber around tax and around productivity is healthy. It is about what this Government wants to achieve. What does it want to achieve? The Government’s focus is on the long-term growth potential of this country New Zealand. It is about increasing our savings rates. It is about increasing exports—and I will come to the question of exports. It is also about investment in productive resources. 
Along the way we will come into a few speed bumps. One of the things I have heard out in the electorate and in Maungakiekie where a number of small to medium sized businesses are located is that there are some very grave fears around unemployment. There are grave fears around the exchange rate for example. It is the high exchange rate that precludes our productive sector from getting ahead. One of the other things that is clear from this Budget Policy Statement is the debt levels. The debt levels and the fiscal position of our economy are quite grave and we face another 6 years of deficits—6 years of borrowing $240 million a week. That is something we have to bear in mind. I know that my colleague the Hon Sir Roger Douglas referred to those debt levels and referred to some of the measures that he would like to see taken to beat back some of the debt that we have incurred over time. 
But to put it into context some of the speakers opposite have referred to what they gave us as a Government in terms of the economy. Let me talk about a few of the things they gave us. They gave us falling economic growth of 0.2 percent in 2008-09. They gave us rising unemployment. They gave us high inflation of 3.4 percent of CPI growth in 2008-09. They gave us a rising current account deficit of 9 percent of GDP. The “member for Ponsonby” knows that. He knows that annual productivity growth— 
Grant Robertson 
: I raise a point of order Mr Speaker. I am reluctant to interrupt the member’s speech but there is a practice in the House of referring to members either by their name or by the electorate they represent. The member has twice now referred to a member of Parliament by an electorate that does not exist. 
Mr DEPUTY SPEAKER 
: All members must refer to a person by his or her full name or by Mr Mrs Ms and not use abbreviations. We do not use the practice here in our Parliament of referring to an electorate. Some Parliaments do but the New Zealand Parliament does not. I ask the member to continue. 
PESETA SAM LOTU-IIGA 
: Mr Robertson knows that the annual productivity growth in this country over the last 9 years has been 1.1 percent per annum. The Hon Sir Roger Douglas said that had the productivity levels been the same as under the previous Government we would have had over $100 more per week per worker. That is quite clear. The real tragedy here is— 
Hon Tau Henare 
: Labour. 
PESETA SAM LOTU-IIGA 
: I say to Mr Henare that the real tragedy here is that the tradable sector of our economy has been in recession for 5 years. Government spending has gone up by 50 percent over the last 5 years but the tradable sector—the sector that exports and the industries that import—has declined by 10 percent over the last 5 years. That is a tragedy. We can ask why it is a tragedy. It is a tragedy because while that sector declines and diminishes the standard of living we are able to have in this country will also decline. It is a tragedy because if we do not grow the pie that is “New Zealand Incorporated” the numbers— 
Hon David Cunliffe 
: What is the member doing for exporters? 
PESETA SAM LOTU-IIGA 
: The amount and quality of social services that that member would like to see roll out diminishes over time. It is a tragedy because while the tradable sector declines and diminishes jobs and opportunities for those out there looking for them also decline. 
As a country we have a clear choice here. We either carry on down the same path of the previous Government of increased Government spending and a lack of fiscal restraint or we can set our sights higher and create a country where hard-working Kiwis are able to get ahead raise their families and look forward to a comfortable retirement. Our end game is quite clear. It is about high long-term growth. The Prime Minister was quite clear about how we go about that. In his statement on 9 February he said that it is about six things. It is about investing in productive infrastructure removing red tape and improving regulation supporting business innovation and trade improving our education and skills lifting productivity and strengthening the tax system. 
Let us quickly look into those six things. Regarding productive infrastructure I am glad that the Minister of Transport is here because we now have a Minister who is about taking action. He and I visited the construction site on Mangere Bridge on Onehunga harbour 2 weeks ago. He announced that this project which is well overdue for our community in Maungakiekie is now 6 months ahead of schedule—6 months. That is the type of action that certainly my constituents demand of this Government. 
He is also rolling out broadband and we have had announcements on a number of roads of national significance across this country. When we look at supporting trade and business innovation we see Mr Groser who has negotiated a number of free-trade agreements that will benefit this country reduce the barriers to trade and increase the access to the markets of those firms that I discussed earlier—the exportable tradable sector. That is the sector we are trying to assist. 
Our Government is also about improving education and skills. Last week I was with the Hon Anne Tolley talking to our parents and our teachers about how national standards will lift the education of our children. The parents loved it. They welcomed the fact that the Minister was out there listening and talking to the electorate. It was a good exchange between the Minister and parents. May I say a final thing before I wind this up. It is about the tax system. 
Mr DEPUTY SPEAKER 
: The level of interjection is too high because there is this cross-play. They should be rare and reasonable. Interjections are fine but when I cannot hear the speaker that is unacceptable. 
PESETA SAM LOTU-IIGA 
: I am sorry; I will have to speak up. We heard the Leader of the Opposition slam the proposed tax changes that have not been finalised. Yet here we have a man who leads the Labour Party who was part of a Government that raised GST and did not compensate those same middle-class and lower-income families that he now supposedly defends. 
Hon DAVID PARKER (Labour) 
: 
 We are here today in March 2010 approximately halfway through the term of the National Government. In a month or two the Minister of Finance will be delivering the second of his three Budgets so it is time for us in this Parliament to look at how the National Government is performing. I think we should look at a couple of questions. At the time of this Budget fiscal update we should look at how the Government is doing whether it is achieving what National said to electors it would achieve whether it is keeping or breaking its promises and how the future is looking. 
I suppose the first point to be made when we are looking at the Budget Policy Statement is that we should have some focus on the performance of the Minister of Finance. One thing I would say at the start is that he is a very backward-looking Minister of Finance. He spends his whole time even now coming up to his second Budget looking back and inventing criticisms of the previous Government rather than advancing the interests of our country. We heard it again today. He was out there again with the Crosby/Textor speech saying that the previous Labour-led Government had 9 years of economic mismanagement. It falls upon me as it did with prior speakers to show just how ridiculous that assertion is. We reduced Government debt very significantly. Gross debt went down from 38 percent of GDP to under 20 percent of GDP. It was 17.7 percent at the time of the election. We reduced net debt down to virtually nothing. Unemployment was amongst the lowest in the world at 3.4 percent. Growth in New Zealand during that period was higher on average than it was in the United States the whole of Europe Japan or the United Kingdom. Indeed during the period of our Government it was virtually identical to growth in Australia during the same period. It was a very strong economic performance. 
Perhaps the Minister of Finance has been so backward looking because it is true—I think this is a matter of public record and I do not take pleasure in saying this—that he has been more than beset with his own irregularities and problems in terms of claims for household accommodation for his personal budget and he has taken his eye off his more important responsibilities as Minister of Finance. Clearly he has had a horror year. 
I ask members what the Government is doing in terms of achieving what National promised New Zealanders it would achieve. Its first promise was a step change in the New Zealand economy. The Government promised to close the income gap with Australia and to rebalance the economy towards the tradable sector. What meaningful steps or changes has it made towards those goals? Sadly the answer is none. I accept that infrastructure is important. Members on this side of the House clearly accept that. Indeed it was the Labour Government that markedly increased spending on infrastructure and started to improve our roading and our public transport infrastructure. 
Hon David Cunliffe 
: Broadband. 
Hon DAVID PARKER 
: It was Labour that made progress towards broadband which has stalled since this Government came in and made the necessary investments through State-owned enterprises and other private sector electricity companies in electricity generation and transmission. There has been no step change there since the election. 
Let us turn to the next big lever that can be pulled. The Government called for a review of the taxation system. That was a wise thing to do but it was unwise to get the review and then effectively trash its contents. It was a ruse because in the end the Minister of Finance has done what National Governments always do. In the end stripped to the basics it is increasing the tax burden of low and middle income groups and decreasing the tax paid more than proportionately by those who already earn the most. That is what National always does that is what National has done this year and that is what New Zealanders know it is doing. New Zealanders know that that is breaking the promise made during the election that National would not increase GST. Perhaps as important—I will not say “more important” because there is nothing worse than a broken promise—it does not go anywhere towards rebalancing the New Zealand economy. 
Members on this side agree with the Minister on Finance that New Zealand’s economy has been and remains imbalanced. We invest too much in property and we do not invest enough in the productive sector. The tax levers should have been pulled to help rebalance the economy but they have not been. The leadership shown by the Government in this area is wrong. It is bad for two reasons. One is that National’s economic ideology is so simplistic. Essentially it is unsophisticated. National says that we should tax high-income people less and low and middle income people more. That is National’s ideology. Its ideology relates to taxation rather than to management of the economy. So the Government is failing to achieve a step change in New Zealand. 
The gap with Australia rather than closing is widening in every area except one and that is unemployment. It should be of no pleasure to the Government that in the one area where New Zealand is narrowing with Australia it is going in the wrong direction even though it inherited a lower unemployment rate than was the case in Australia. New Zealand’s unemployment rate is growing while Australia’s has been dropping. 
Hon David Cunliffe 
: Did we catch up? 
Hon DAVID PARKER 
: We have caught up on unemployment by getting a worse unemployment record and in every other way we are doing worse. 
There is another area of important policy where the Government sits on its hands and that relates to monetary policy. Last year Labour said that it no longer agreed with the current monetary policy settings and that the consensus had broken down. At the time both the Prime Minister and the Minister of Finance said that Labour was wrong that it was all perfect and that New Zealand had the best monetary policy in the world. What has happened in the last month? The International Monetary Fund has produced a report stating that Labour was right and National was wrong on this issue. The report highlights the difficulties caused to the tradable sector to the real economy from the consequences of New Zealand’s existing monetary policy. It points out the damage that it has done through imbalance and the risks that it creates to the financial sector and also notes the difficulties that are faced by our tradable sector. Our exporters face a volatile exchange rate. Still the National Government sits on its hands and does nothing. 
If we look at how the Government is doing the answer is not well. How is the future looking? The future is looking increasingly dire for New Zealand. The latest Treasury and Reserve Bank forecasts show our current account deficit will increase in the next couple of years to more than double its present rate. That means that if as predicted it goes back to 7.2 percent of GDP every year New Zealand is losing its sovereignty. Every year more of our main enterprises are owned by overseas interests. Every year New Zealand as a country is getting poorer not by a small amount but by a predicted 7.2 percent of GDP per annum. Far from rebalancing the economy so as to encourage exports savings and investment the imbalances are on the rise. 
The National Government is leading New Zealand towards a repeat of the worst excesses in consumption and property-related investment. It has not done anything meaningful to change the policy settings. New Zealand will have a future of poor savings. The Government has undermined KiwiSaver; it has done nothing to fix it. We have inadequate savings and we have monetary policy settings that mean New Zealand enterprises are paying higher interest rates than their competitors overseas. They suffer the double detriment of a volatile exchange rate and interest rates that are higher than the rates paid by the businesses competing to buy those same assets in New Zealand. The competitiveness of New Zealand businesses decreases as we see the hollowing out of the New Zealand economy and the gap between New Zealand and Australia getting worse. Indeed we see more and more of New Zealand being owned by Australia and by other companies from other jurisdictions including China. New Zealanders are getting poorer and the gap between Australia and New Zealand is growing which is the exact opposite to what was promised. We are coming up to the second Budget and the Government is not achieving what it told the New Zealand electors it would achieve. 
AARON GILMORE (National) 
: 
 Today is St Patrick’s Day. No one has mentioned that so I would like to pass on a blessing that was passed down to my family: “May your blessings outnumber the shamrocks that grow and may trouble avoid you wherever you go.” That is probably a good adage for the Labour Party today. 
Phil Goff was the first Opposition speaker today but he did not talk about the economy or about the Budget Policy Statement and he would not let David Cunliffe speak first on the Budget Policy Statement. What does that tell members? Annette King was worried about tax cuts migration and wage gaps. Russel Norman talked about peak oil again. Sir Roger Douglas talked about the need for 29 percent Government spending to GDP and I will get to all of this in a minute. David Cunliffe was so frustrated with Steven Joyce all he could do was call him names. He fixated on Steven Joyce’s hand on the brake. David Parker spoke about how he believed this Government has done nothing and current account deficits have skyrocketed. All I can say is that dreams are free. 
This Government outlined through the Prime Minister’s statement and the Budget Policy Statement six key pillars for the future of our country. National will reduce red tape improve infrastructure change tax bring in some innovation and improve trade improve the skills in our country and achieve some public sector productivity. What are we even doing so far to get there? Let us talk about a few of these things. National set up a whole bunch of task forces but I must give some credit to Labour for the first one. Labour set up the Capital Market Development Taskforce during its time in Government. Good on Labour! It was a good piece of work to initiate but National finished it. The task force has pointed out a bunch of changes to our capital markets. 
Hon Trevor Mallard 
: You did nothing. 
AARON GILMORE 
: Well we will see. What else came out? National set up the Tax Working Group. The Tax Working Group came out with many changes to suggest our tax system is broken—76 percent of our tax is paid by 10 percent of New Zealanders and that cannot continue. What will happen? Good young people will jump on planes and go overseas. That is what happened under the previous Labour Government when it was in power. Thousands of young people left this country and did not come home. What has happened in the last 6 to 12 months? Twenty-two thousand more people have come home from overseas. They believe in a National-led Government and in John Key as Prime Minister. That is the signal that shows the changes that people believe in. 
We have seen reform and changes as announced as part of the Budget Policy Statement put into action in a large number of other areas. There are major changes to the management of the Crown balance sheet accident compensation KiwiRail and student loans which were all an absolute mess and needed some changes. We have outlined a series of areas for change to bring those things back under control. In relation to KiwiRail essentially we paid $1 billion for a trainset. The only one who was happy about that was a gentleman in Australia who made headlines about it. We are trying hard to fix those things and to fix accident compensation. We inherited billions of dollars worth of problems around that. 
Last week we had the pleasure of hearing some further announcements of changes to science and innovation particularly in the Crown research institute sector. We need to increase and lengthen the contracts that exist and give Crown research institutes a bit more flexibility in some arrangements. I think that is a wonderful thing. Last week the Prime Minister announced that the world-leading players in our science sector would receive over $1 million from the Government. I have spent a bit of time with those people and talked particularly about the development of superconductors. 
Hon Trevor Mallard 
: You taught them most of what they know! 
AARON GILMORE 
: Not exactly but in Mr Mallard’s electorate this has been a wonderful development for the good people of Industrial Research Ltd and I thank them for that. We have announced some major changes to the electricity sector to stop the 87 percent price rise that occurred in the last 9 years under a Labour Government. 
What is the problem with Labour? Its members are suffering from what I believe my good colleague Tony Ryall called “relevance deprivation syndrome”. They do not want to talk about the Budget. They do not want to talk about the future of New Zealand. They want to nitpick about little details and argue amongst themselves. The three triplets were sitting here but I notice they have all gone. The three triplets of Labour Party doom were all sitting there worrying about the leadership ambitions of the Labour Party and worrying about nitpicking issues of bus trips and naughty kids. Yesterday a leading Labour backbench member criticised the behaviour of children on planes. That is all those members can talk about—children on planes. They are not worrying about real family issues. They are not worrying about the important things that matter to New Zealanders. That is why when members go out and talk to the people—not go on a bus trip with five mates—they will hear members say they care about what matters in people’s homes and to individuals. They care about the economy they care about their future and they care about their families. 
We heard that Labour members are worried about jobs and things like that. I will give members an example of what occurred recently in Christchurch. Under Labour aquaculture was stuck in a rut. There was 9 years of doing nothing at all; nothing was going to get approved. In recent months approval has been given for an offshore mussel farm—the first ever in New Zealand’s history—in Pegasus Bay. That farm will create 200 jobs and $60 million a year worth of exports to New Zealand. Labour sat there for 9 years because it did not want to do anything. This development will create 200 more jobs that those members did not care about because they did not want to do anything. That is another example of what Labour did. 
National has announced some big changes in welfare reform as part of the Budget Policy Statement and I will touch on one in particular. We have this great policy called Community Max. Some wonderful things and projects have happened in my part of town but Labour members were running around and criticising Community Max as a waste of time and a wasted effort. Well I would love to see whether the member for Rimutaka Chris Hipkins actually thinks that. I quote from this article where he said that anything that gives people a second chance at education is a wonderful investment. He went to a camp last week on Community Max to learn about people’s achievements and he said what a wonderful thing that was. That was from a member of the party that has been running around criticising our policy openly in this House but at home in his community he thinks that Community Max is a wonderful thing because it works. It works and we have seen Mr Hipkins turn round and prove it. 
The Government is worried about jobs and unemployment but the key thing is getting the private sector to invest and create jobs. They are good companies like Holcim Cement based in Christchurch. It is looking at spending over $550 million on a new cement plant down in Oamaru in my colleague Jacqui Dean’s electorate. Under the previous Labour Government that company would not have done that. It was going to shut up shop and leave the country. Well I can tell members that I spent some days with people from Holcim Cement during the adjournment. I am pleased to say that they are very keen to invest in New Zealand under a National Government because they like our six pillars. They like the fact that we are happy to invest in infrastructure. They like the fact that we will reform the tax system and bring in some more innovation. They like the fact that we are happy to invest in public sector productivity. They love the fact that we will invest in national standards that will bring in a more skilled workforce for our country. Those are the things that really matter to mum and dad out there in the community. They are not worried about nitpicking about where kids sit on a plane or about who will be the next leader of the Labour Party. I will touch on another aspect that I think— 
Hon Trevor Mallard 
: It’s a great Facebook group. 
AARON GILMORE 
: I will leave my long-suffering colleagues over there in Labour alone. The Green member Russel Norman said that he was worried about oil. Well I am pleased to say that in the last few years oil has become one of the leading exports in New Zealand. I think that is a wonderful thing. Long may the oil price continue while we continue to pump out 50000 to 60000 barrels a day from the new oilfields. In our party we believe that one of the great things to get our economy growing is selling the stuff that comes from underground to our good friends in China and India who are very happy to buy it because over there— 
Grant Robertson 
: Things under the ground in the national parks? 
AARON GILMORE 
: We see the Opposition members run around and hear them talk about mining in national parks. Well it was that party in Government that approved one of the most successful operations in Pike River Coal on the West Coast of the South Island. There is a word to describe that but I will not talk about what it is. 
Our wealth of natural resources has the ability to create a massive number of jobs. I know particularly that in the oil sector alone we have the ability to triple our exports and create thousands of jobs up and down the country both in the South Island and in the North Island. Right now companies are drilling for oil up and down our coasts and it is a wonderful situation. 
I will sum up by talking about what we have heard about this Budget Policy Statement being another plank and a wonderful step in creating a brighter future for New Zealand led by our wonderful Prime Minister John Key. It is so good that the public of New Zealand has endorsed it through giving us our continued high poll ratings and by their lack of support for Labour. Those members over there cannot even get to see more people on their bus tour than the number of their own MPs whom they have wandering around the country. Long may that situation continue because I look forward to spending many years on this side of the House hearing members on the other side of the House whinge and moan. Thank you. 
A party vote was called for on the question  
That the House take note of the report of the Finance and Expenditure Committee on the Budget Policy Statement 2010 and Half Year Economic and Fiscal Update 2009. 
Ayes 68 
New Zealand National 58; ACT New Zealand 4; Maori Party 5; United Future 1. 
Noes 53 
New Zealand Labour 43; Green Party 9; Progressive 1. 
Motion agreed to.