Foss Craig: KiwiSaver Bill — First Reading 
Foss Craig: KiwiSaver Bill — First Reading 
[Volume:629;Page:1684] 
CRAIG FOSS (National—Tukituki) 
: 
 I am opposed to the introduction of this bill. Quite frankly I think it is typical of an administration that has lost touch with reality that is trying to grab back an agenda and that is trying to get on the front pages of the paper for perhaps what it believes is some good news rather than for the reasons that it may be in the paper or on the TV news currently. Perhaps the resources the time and the energy spent in preparing this bill would have been better spent with an examination of what was not working in the New Zealand economy. To put it more simply why on earth are 600 New Zealanders per week leaving New Zealand for Australia permanently? No one seems to be addressing that question. This type of policy will actually increase the numbers of those moving to Australia. 
This KiwiSaver Bill was part of a suite of pledges that appeared on the Labour Party election pledge card which incidentally is also the subject of an investigation by the police; to that I simply say: “Pay it back.” 
The proposal in this bill in my eyes is typical of socialist thinking. I am sure that Mr Cullen like all socialists has the best of intentions in mind. He is looking to achieve the best for his country—I am sure he is. But also like all socialist policy once those ideals are confronted by reality and meshed with the real world they fail. We have a shambles of compliance band-aid papers emergency policies all sorts of changes to legislation and of course a further decrease in our country’s productivity. 
I believe that it is ironic that this current Labour Government has committed over $2 billion in asset write-offs and maintenance of a student loan scheme—an interest-free student loan scheme—that is targeted at school leavers and encourages them to take on debt yet at the same time it is spending $700 million over 5 years on a scheme that supposedly encourages those same people to save. The total cost of those two schemes is over $3 billion yet they cancel each other out—one encourages to borrow more and one to save more—and they are targeting the same people. It is absolutely nuts. Members opposite still believe that there is no room for tax cuts or more efficiencies in the Government books. 
I believe that like many of the other pledges on the Labour Party pledge card this bill is not named correctly. The Working for Families package as we know should be renamed “Welfare for Families” package. The interest-free student loans package should be renamed the “State Asset Free Give-away” package—$1.5 billion at last count. This KiwiSaver proposal I believe should be renamed the “Increase the Cost of Entry-level Housing by $5000” package. Because quite simply those who try to enter the first-home market will find that the price of the house funnily enough will start to nudge up by the amount that they have on deposit regardless of the fact that the credit card has probably been racked up three or five grand. 
The explanatory note of the bill states that essentially New Zealanders are not saving enough. My colleagues and members opposite have addressed this and are not particularly arguing to that but my point is that this is not just a savings problem. New Zealand does not have just a savings problem. We have a productivity problem and at its worst in the public sector. We have a social welfare problem that is destructive and poisonous to those in our next generation. We have an over-taxation problem we do not have just a savings problem. We have a drain to Australia of our brightest and best—problem! We have a Resource Management Act and infrastructure problem. This KiwiSaver Bill will not address or fix any one of those issues. 
The underlying reason for the lower savings ratio that Mr Cullen thinks is not right in New Zealand is quite simply as my colleague Lockwood Smith just said that New Zealanders do not have enough spare cash. There is no money left after the bills are paid and after the mortgage is paid on the higher floating and fixed rates that are now coming through the system. New Zealanders’ after-tax incomes are an absolute disgrace. It is no wonder that workers are going on strike. It is no wonder that workers are striking for higher after-tax incomes. One cannot tell me that this is good for workers and their well-being because this was an election proposal which is now about 5 or 6 months old. 
Workers are striking or proposing to strike to try to catch up and at least get some decent living wage so they can scrimp maybe save pay off their own debt pay off their mortgage buy some decent food and pay for their petrol or electricity. Perhaps they have just heard what their Aussie mates are getting across the ditch for the same work. 
Just keep an eye on those same unions keep an eye on those strike dates and proposed dates if Mr Cullen’s pay-roll tax comes in and totally devastates New Zealand’s labour-intensive industries. Again it is socialist dogma hurting those that it is supposed to protect the best in the first place. 
My colleague Lockwood Smith earlier pointed out that the Labour Government over this past financial year has taken in $16 billion more in the way of tax than in the year 2000. That is why New Zealanders are not saving. That money has been whipped—“pick a pocket or two”—by Mr Cullen for his taxes surcharges levies local government charges and whatever it might be. 
Darren Hughes 
: We have the lowest unemployment. 
CRAIG FOSS 
: That is quite right because there are so many in Australia. Bondi actually has quite high unemployment. That same $16 billion is thrown at various schemes and various pet proposals where there is no accountability where even Treasury the guardian of our Government’s books is not receiving adequate timely and quality information. So how on earth can those who are starting to argue for the KiwiSaver Bill justify the diversion of expenditure? 
I did find one good point in this bill and the Minister mentioned it earlier— 
Hon Member 
: Who? 
CRAIG FOSS 
: But she was a bit confused. The Government will not guarantee any of the deposits. Well OK therefore the risk is not on the Government. That is a very good thing. But then what on earth is the point other than just being a conduit to various private entities who will take fees and pay under-market interest rates to those who will not be able to afford a house in the end anyway? I guess the test is does this bill give the taxpayer value for money? Does it cross that threshold? Is it worth it? Well the evidence from the UK and Ireland says no. The indication from the Wellington public service says no; even with a dollar for dollar subsidy—an incentive—it is not working. 
 One of the most disturbing aspects of this bill is that it opens the door to pork-barrel politics and election bribes. I can see the next Labour Party election pledge card hopefully paid for legitimately which states: “Vote for us and we will double your contribution to your KiwiSaver.” It is absolutely outrageous and an abuse of taxpayers’ funds. The explanatory note also says that there will be minor compliance issues for small business. The Minister said earlier that that was great. Surely the point is that it is yet another compliance cost on businesses which are already de facto payroll agents and administration payment agencies for the Inland Revenue Department that are not compensated each and every time they have to adjust something for their employees. 
There are four or five default agencies to be appointed under this bill. My money is that Kiwibank will be No. 1 in line again at the expense of our regional building societies and our credit unions. 
In conclusion I recommend that members have another look at this bill step back from the trees and the twigs of little detail look at the forest of the big issues that are facing New Zealand and ask and deal to the hard questions.