Goff Phil: Questions for Oral Answer — Questions to Ministers Questions to Members 
Goff Phil: Questions for Oral Answer — Questions to Ministers Questions to Members 
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1. 
Hon PHIL GOFF (Leader of the Opposition) 
 to the  
Prime Minister 
: Does he stand by his statement that “the vast majority” of people will be “better off” as a result of his tax switch on 1 October 2010? 
Rt Hon JOHN KEY (Prime Minister) 
: 
 Yes because that is what the facts clearly show. Raising GST will increase prices by a touch over 2 percent but will be more than compensated for by income tax cuts and an increase in benefits Working for Families and superannuation. Therefore it is plain for everyone to see that people will be better off. 
Hon Phil Goff 
: Does he really think that the more than 400000 Kiwis who earn $15 a week or less and who will at best get a net $5.70 a week will be better off when in addition to GST they are paying rents that are going up by $20 a week in Auckland paying rates that are up paying accident compensation charges that are up and for some people paying $20 to $25 a week extra in early childhood care? I ask whether he is really saying that those people will be better off because they do not believe it. 
Rt Hon JOHN KEY 
: Yes they will be better off. What is so often the case is that when the Leader of the Opposition comes into the House he says things that are factually incorrect. In fact his story last week about rents is wrong— 
Hon Darren Hughes 
: I raise a point of order Mr Speaker. All members of the House are honourable members who give their word as they see it as being correct when they are asking questions. For Mr Key to say that another member is factually incorrect and imply that an honourable member is not being truthful— 
Hon Rodney Hide 
: I raise a point of order Mr Speaker. [ 
Interruption 
] 
Mr SPEAKER 
: Before I hear the honourable Rodney Hide members may not agree with a point of order but it must still be heard in silence. I will rule on the matter in a moment. 
Hon Rodney Hide 
: It is certainly true that members cannot question another member’s integrity in this House. But a member can certainly say that a member is factually incorrect; that has to be allowed in this House. 
Mr SPEAKER 
: I thank members. There will be silence. The dilemma that the member asking the question faces is when one builds supposed facts into a question—and that question contained a number of statements of alleged fact—Ministers are at liberty to dispute those facts. It does not mean that they are impugning the integrity of the questioner at all. They just have a different view of the facts. That is why the Standing Orders strictly do not allow members to load additional supposedly factual material into questions. I do not stop it because I think we would constrain question time too much. But the risk is that the Minister answering the question—in this case the right honourable Prime Minister—may dispute the supposed facts and that is what has happened on this occasion. I do not believe he was saying that the Leader of the Opposition was misleading the House. He was just disagreeing with the supposed statement of fact. 
Hon Phil Goff 
: When he says that the vast majority will be better off does he not really mean that the top 10 percent of taxpayers who get 41 percent of the tax cuts will be a whole lot better off but the bottom 20 percent of taxpayers who get 2 percent of the tax cuts will be a lot worse off? 
Rt Hon JOHN KEY 
: No I mean what I say which is that the vast majority of New Zealanders will be better off. I point out that two-thirds of the entire tax cut package was applied to the lowest two rates. But I say to the Leader of the Opposition that if he is so convinced that he is on to a winner he should go to the election campaign in 2011 agreeing to reverse the personal tax cuts that National has introduced. 
Jo Goodhew 
: Has he seen any reports of people being confused about the tax switch? 
Rt Hon JOHN KEY 
: Actually I have. I have seen pamphlets from the Labour Party implying that GST is going from zero to 15 percent on 1 October. Not only is this completely false and an attempt to mislead the public but one would think that Phil Goff of all people would know that GST is 12.5 percent because a Labour Government introduced it and raised it with no compensation. 
Hon Phil Goff 
: If people are to be a whole lot better off why are debt collection agencies like Baycorp predicting that over the next 6 months there will be “a massive spike in the number of people who just won’t be able to pay their bills.”? 
Rt Hon JOHN KEY 
: Because the country is coming out of a recession which was caused by 9 years of economic mismanagement by Labour. 
Hon Phil Goff 
: In the press statement put out today the Government has claimed a high level of extra income from after-tax incomes and why did he neglect to say in that press statement that just under half of those tax cuts were introduced under Labour; and of the tax cuts the other half that he introduced overwhelmingly benefit the very rich and not the average New Zealander? 
Rt Hon JOHN KEY 
: Because they form the first tranche of National’s tax cuts. Let us be honest: the only reason Labour ever introduced tax cuts after 9 years in office is that it was desperate and heading for the exit door. 
Jo Goodhew 
: Has he seen any reports of alternative tax switch policies? 
Rt Hon JOHN KEY 
: Yes I have. I have seen reports of policies to take GST off fresh fruit and vegetables. Such a policy would needlessly complicate the tax system and create all sorts of perverse anomalies. New Zealanders would rightfully wonder for example why GST was being taken off out-of-season asparagus and imported figs but not for a packet of Wattie’s frozen peas. In addition this policy would cost somewhere near $450 million in revenue and would be paid for by more borrowing. 
Hon Phil Goff 
: Can the Prime Minister name just one other country in the world with GST at 15 percent or higher that does not exempt fresh fruit and vegetables? 
Rt Hon JOHN KEY 
: I do not have that information to hand but for once I will take my guidance from Michael Cullen who said: “I am aware of many countries that have appallingly inefficient GST systems where they exempt various articles … Thank goodness we have not followed those very bad policies.” But when one is desperate one will do anything.