Key John: Questions for Oral Answer — Questions to Ministers 
Key John: Questions for Oral Answer — Questions to Ministers 
[Volume:627;Page:22123] 
6.  
JOHN KEY (National—Helensville) 
 to the  
Minister of Finance 
: Does he agree with the statement of the Minister of Education that there is “room for $1.9 billion additional spending” in the Budget; if not why not? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 Yes. 
John Key 
: Can the Minister confirm that the cost of the student loan policy announced on Monday will come out of the $1.9 billion of new Budget spending earmarked for the out-years; if not where will the cost be funded from? 
Hon Dr MICHAEL CULLEN 
: Yes but the member must be careful—the $1.9 billion is $1.9 billion plus $1.9 billion plus $1.9 billion. Three hundred is roughly flat line. 
John Key 
: Will all new pledge card initiatives that have a fiscal impact be funded from the $1.9 billion of new Budget spend; if not where will they be funded from? 
Hon Dr MICHAEL CULLEN 
: That is the intention as opposed to promising tax cuts of a total of $1 billion—having already promised more than $1 billion—with the main course yet to come. 
Peter Brown 
: Noting the Minister’s positive answer to John Key’s initial question why does the Minister not spend some of this $1.9 billion on roading where he knows there is a shortfall where he knows there would be huge economic gains and which he would get back plus bonus in very short order; why does he not do that? 
Hon Dr MICHAEL CULLEN 
: In the Budget we announced $8.4 billion additional spending on roading. Since then we have added a further $500 million. Since then we have added further spending on Wellington. The Minister will announce spending in the Bay of Plenty next week. There is a Waikato package to come next. There is $23 billion to be spent on land transport for the next 10 years. There is in Auckland at the moment by value 10 times as much roading under way as there was in 1999. 
Gordon Copeland 
: Does he agree with the Minister of Education that a significant proportion of the $1.9 billion per annum is already spoken for in terms of salary increases for teachers nurses and other State servants; if so what is the difference between the figure that is spoken for and the amount that is in the slush fund that has now been used to announce this policy of no interest on student loans? 
Hon Dr MICHAEL CULLEN 
: The $1.9 billion allocation—which I draw to Mr Key’s attention was in the Budget documentation on page 71—is not a slush fund. I think it was actually the Rt Hon Bill Birch who first put a Budget allocation for out-years into the Budget after some encouragement from me as Opposition spokesperson on finance. It is quite true that a significant growth in expenditure is required merely to keep services constant. Thus if a party promises merely to increase health spending by say $1 which is more spending than in the previous year services will go backwards. That of course is precisely what the National Party is saying about the track of health and education spending. 
John Key 
: Did the Minister’s office provide the costings for the student loan policy announced on Monday or was it Mr Mallard’s office; and if there are cost overruns over and above the $300 million per year will those be funded out of the $1.9 billion of out-year spending? 
Hon Dr MICHAEL CULLEN 
: I think it was a joint effort between our offices on that matter. In terms of those cost overruns for the future I thank the member for his confidence in the re-election of a Labour-led Government. 
Rodney Hide 
: On what date were the costings done on the student loan policy that was just announced; can the Minister confirm that when Mr Birch set aside new initiatives for spending the amount was $600 million compounding each year not the Labour Party’s $1900 million compounding each year; and if one adds that up it is $5.7 billion as set out in the Budget in 2009 which combined with the surplus of $5.3 billion actually leaves $11 billion above current forecast spending? 
Hon Dr MICHAEL CULLEN 
: I think that explains why that party is at 1 percent in the polls on that particular matter— 
Hon Dr Nick Smith 
: Just answer the question. 
Hon Dr MICHAEL CULLEN 
: I ask that member to keep apologising to Basil Morrison for his behaviour on Monday night at the local government conference. Work started on those matters earlier this year. Final costings were done in the last few weeks.