Joyce Steven: Debate on Budget Policy Statement 
Joyce Steven: Debate on Budget Policy Statement 
[Volume:653;Page:2075] 
Hon STEVEN JOYCE (Associate Minister of Finance) 
: 
 The Budget Policy Statement tells us today that New Zealand is a country with twin chronic deficits—twin chronic deficits that National inherited when it came into Government last November. The balance of payments has long been a problem for this country and the balance of payments deficit for 2008 is 9 percent of GDP. The outlook has worsened from the pre-election update but National is doing all it can to bring under control the loose and reckless spending of the previous Labour Government which has led to the projected decade of fiscal deficits. The issue is not just a balance of payments deficit and it is not just a decade of fiscal deficits; it is twin chronic deficits and this Government will act to get that under control. There are a number of ways to do that and all of them have been turned down by the Labour Opposition members because they are in fairyland. They were in fairyland before the election and they are surely in fairyland now. 
What does one do if one is faced with these problems? Well one has to solve the big bogey that has been the problem for this country over the last 9 years which is falling productivity per person. Productivity has not been growing. The reality is that in any organisation one cannot expect to improve people’s incomes unless one improves productivity. So how does one grow productivity? How does one get productivity to improve? Well the first thing one has to do is to look around one’s organisation and ask which programmes or things it is doing do not make any sense because they are not actually saving any money or making any money. Which are the programmes that one might do something about? Which low-quality programmes in the organisation might one try to sort out? 
Well according to those in fairyland there are none. Every programme is sacred; every programme is absolutely essential! Members on the other side of the House spent the last 9 years adding programmes and refusing to reduce any of those programmes. Over 9 long years all they did was announce new programmes and they never checked what was going on with the programmes that were already in place. 
Hon Darren Hughes 
: That’s rubbish. 
Hon STEVEN JOYCE 
: Well I think they had an expenditure control committee which met probably two or three times and then gave up. We need to improve productivity and that is why low-quality programmes in Government have to be curtailed. 
Then we have to improve productivity in the public sector generally. How do we do that? We have to move people to front-line services. Apparently—according to the Labour Opposition and particularly Mr Robertson—that is impossible and cannot be done. Not only is that the case but it is an insult to try to do it! But we have to think of the people who are paying the bills and we have to think of the people whose incomes are not growing. The only way to achieve a growth in income is to improve productivity. That means providing more front-line services and that means really testing whether the people who are working here in Wellington in the back offices are all needed or whether we need to move people to the front-line services. 
Hon Darren Hughes 
: Like press secretaries for Ministers! 
Hon STEVEN JOYCE 
: Then we get on to the matter of Government infrastructure investments and that is where—particularly—Mr Hughes is in absolute fairyland. This is the Hon Darren Hughes who when he worked out that the Waterview Connection was going to cost $3 billion or thereabouts—$3.16 billion—said: “Oh just get on and do it. It doesn’t matter what it costs. Just get on and do it. It’s not my money; I don’t care. We need to do it and you are just a silly person for even considering for a moment that we should not get on and do it.” 
Then there was the small matter of Transmission Gully which again he thought should be done at any price whatsoever. It did not matter whether it was going to get any return; it had to happen immediately. Darren has no understanding of the value of a dollar. He would be— 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. The member is a relatively new member but I think even he should know now from the briefings that he has had how to address members in the House. 
The ASSISTANT SPEAKER (Hon Rick Barker) 
: The point is made that members should be addressed correctly. I call upon the Hon Steven Joyce to continue. 
Hon STEVEN JOYCE 
: The Hon Darren Hughes would not have been out of place in the late lamented social credit party because he has no understanding of the value of a dollar whatsoever. He thinks that the solution is just to throw dollars like confetti in the general direction of a problem and that there is no point worrying about annoying things like cost-benefit ratios or value for money; they are just pesky things that get in the way and we should just go away and spend—[ 
Interruption 
] That is right. Of course it is always unfortunate if a party makes those promises and then does not win at an election—that is unfortunate as well. 
The other thing a Government has to do is to think very carefully about the costs it is imposing on people around the country. For example it would be high arrogance at this point in time to suggest that a 14c a litre tax on one-third of the country for petrol was a good idea at a time of recession. That would be a real arrogant imposition on the economy. The Labour members said “But it’s only money. If we just hit them with it it doesn’t really matter. We’ll just dive in take the money and pretend that it doesn’t hurt anybody. It’s simply free money for the Government and its friends to spend as they see fit.” The issue here is that the Opposition is in absolute fairyland when it comes to dealing with a very big world economic crisis. On this side of the House we understand what needs to be done. We will not be slashing and burning despite Labour’s worst rumours. We will not pretend that problems do not exist either. We will be responsible we will take measures that will have an impact on the economy and that will help to grow productivity. 
What are those measures? For a start reducing taxes is helpful. That gives people incentives to work hard and get ahead. That encourages people to go out and work harder because that is what we need. It will not make any difference whatsoever what we here in Wellington do in the Government sector; it is the private sector the people working in businesses up and down the country over the next 2 years that will determine how fast this country grows out of recession. That is why the tax reductions from 1 April this year are so crucially important. 
Then there are the plans for small to medium sized enterprises which are really important. The small to medium sized enterprise business package is crucially important because small and medium sized businesses in this country over the last 9 years have struggled under the yoke of a Government that did not understand them. It professed that it understood and it had a small business advisory forum but then it did not actually do any of the things that it said it was going to do. Then it said it was too late. Labour had had only 9 years and it did not have time to put in place things that would help small businesses which was unfortunate! But anyway we now have a Government that understands that it is the small and medium enterprise sector that is so crucial to the economy. 
There are other things such as the ReStart package the Job Support Scheme the 9-day fortnight and investment in infrastructure across the country that make sense—not the things that the Hon Darren Hughes thinks should happen so he can get a quick headline in the newspaper. Those are the things that will make the difference. Those are the things that are improving productivity in this country and are actually growing the country and growing individual incomes to help us to grow faster out of the recession and into the future. The reality is that we have two very big deficits and we have to grow much faster than we have been doing if we are to deal with those over the next 9 years. Thank you Mr Assistant Speaker.