Parker David: Budget Debate 
Text is incorporated into the Bound Volume 
Parker David: Budget Debate 
[Sitting date: 29 May 2012. Volume:680;Page:2582. Text is incorporated into the Bound Volume.] 
Hon DAVID PARKER (Labour) 
: 
 John Key and the National Party always blame Christchurch or Greece for New Zealand’s problems. Greece and Europe have had problems. Outside of Greece and Europe average growth in the world has been 1.5 percent per annum for the period since National has been in Government. Over that same period New Zealand has grown under 1 percent—not 1 percent per annum but 1 percent in 3 years. The 53000 people who last year went to Australia did not go to Australia because of Greece’s problems; they went to Australia because of New Zealand’s problems. It is time that the Government fronted up and addressed some of the difficult issues and some of the hard choices that have to be made. All Governments have choices. This Government has choices. This Government will not make the choices that we need in New Zealand and that workers in New Zealand and businesses in New Zealand need for the Government to grow the economy to grow our exports and to grow our wages.  
Indeed Fran O’Sullivan said after this Budget that the “problem is that there is no clear economic growth agenda.” About 10 other commentators said the same thing. I am sure they have been speaking to each other but I am also sure that they had independently come to that same conclusion because this Budget does not have any economic growth agenda. That is why we continue to fall behind the rest of the world outside of Europe and that is why this Government ought not to be able to use Greece as an excuse any longer. 
National members say this Budget is not their fault but I think this Budget has exposed them. It has exposed them for their own negligence. Can anyone believe that this Government got it so wrong in respect of intermediates? Is that just not incompetence? Is that not just negligence? Did no one around that Cabinet table ask a question? Did the Minister of Finance who previously said that dropping class sizes made educational outcomes worse not ask a question? Did the Prime Minister not ask a question? The star of National’s front bench the up and rising Hekia Parata—future leader of the National Party until last week—obviously did not ask the question. The negligence of the National Party its incompetence is further exposed by that debacle that it is now backtracking on.  
The Budget exposed them as having a lack of vision—a lack of vision. Is there anything in that that would give New Zealanders hope as to why they would want to put their forces behind the New Zealand economy rather than leave for Australia?  
Hon Phil Goff 
: No. 
Hon DAVID PARKER 
: No. A complete lack of vision—a drab Budget is how some people have described it and they are right. I return to the point that has been made by so many. They are exposed as having an inadequate plan to grow our economy.  
Even their handling of the public relations around this has been a debacle. They started skiting about the fact that it was a zero Budget. Just weeks ago they were saying that a zero Budget is a good thing. Then when everyone in New Zealand turned round and said that a zero Budget is a sign of failure in the week before the Budget they changed their own rhetoric and they denied it was a zero Budget. They said: “We are spending more money. It is not a zero Budget.” They had been saying until then that it was a zero Budget. They changed their mind last week and it is not a zero Budget. The problem is that it is a zero Budget when it comes to ideas to grow our economy.  
In the face of 53000 people leaving for Australia in the last year you would expect that they would be doing something showing some vision and tackling some of the problems that needed to be tackled. But do you know what? National members put off limits virtually any big step they could take. We have proposed quite a few and I am going to address them later. But they have put them all off the agenda. Their canvas is so flat and devoid of colour; it is a white-out over there. They cannot see anything for the clouds and John Key keeps hopping from cloud to cloud. Our very glib Prime Minister performed like a circus master in the House last week— 
Hon Members 
: More like a clown. 
Hon DAVID PARKER 
: More like a clown my colleagues say. He was entertaining his trained seals around the back and he chucked them another sardine and they clapped their flaps together and had a round of applause. The very glib contributions of the Prime Minister had no substance. He even had the audacity to say that New Zealand’s exports are growing. He had said it a few days earlier. His problem was that on the very day of his Budget speech Statistics New Zealand said that export goods had dropped by $800 million an incredible 17 percent drop year on year. It was not as he said in question time today a monthly figure. That was the annual figure for the year to April. Export goods were down by $800 million compared with the year before. He pretends our export sector is recovering when his own Budget shows in the forecast that from here to the end of the projection period exports increase at only half the rate of imports. We have already got a current account deficit. We already do not cover the cost of our imports and interest by our exports and his own Budget shows that for every year under his projection period out to 2016 it gets worse and the rate of growth of imports is twice as high as it is of exports.  
He then pretends that it is all Christchurch. The Labour Party checked with Treasury officials when we were in the lock-up. There was another glib statement in the Budget document saying that a significant part of the current account deficit relates to Christchurch. So we checked. At no year is Christchurch more than about 1 percent per annum of the current account deficit. You go out those 3 years and you get a current account deficit of up to 6.8 percent per annum of GDP. It is less than 1 percent so if it was not for Christchurch we would still have a current account deficit growing to 5.8 percent. Our current account deficit is becoming out of control again. We are returning to old patterns. We have got residential-led growth rather than export-led growth. The Government has no plan to address that problem. 
Let us reflect on what is the central plan of this Government’s agenda for these 3 years in Government. It is to sell our assets. It is to sell our power companies. Not only does that make the Government deficit worse to the tune of about $100 million per annum but it does not change the economy; it does not grow our economy. Changing who owns what already exists does not grow our economy. We do not get extra exports. Over time it will actually increase our current account deficits with those profits flowing to overseas people. It does not grow the output of our economy.  
Why is this? Why is National wedded to following this same course which is not cutting the mustard? It is because it is a conservative party. Conservative parties around the world trim expenditure they fiddle with the fiscals but they never address the fundamental changes that are needed. It is always progressive parties that change things. That is the fundamental difference in New Zealand and overseas between conservative parties and progressive parties. Conservative parties are basically happy with the status quo. They actually want to protect the status quo because the people who support them have assets that are held up in value by the status quo at least in the short term. They are not willing to make the progressive changes that progressive parties are willing to make. History shows this time and again in New Zealand. It is the Labour Party that makes the substantial economic changes. The National Party is conservative and it just fiddles. I say to National that if you change nothing nothing changes. It is a truism—if you change nothing nothing changes. That is why National has not rebalanced the economy. 
New Zealand needs pro-growth tax reform. We need a capital gains tax for a neutral investment signal. We also need it to address some of the inequities in New Zealand and the widening gap between the rich and the poor. We need a research and development tax credit. We need pro-growth savings reform expanding KiwiSaver to a universal scheme. All of those are off the agenda from National. Not only that National pretends that superannuation is not a problem. Today the Minister of Finance did not even know that by the end of his projection period superannuation every month will cost more than total education will cost. This is another example of negligence on the Government’s part. All Governments have choices. This Government has them too. The reason that we do not have export growth and wage growth coming at us down the track is that this Government will not make the right choices and if it changes nothing nothing will change. Just let us not let the Government blame Greece.