Gosche Mark: Taxation (Personal Tax Cuts Annual Rates and Remedial Matters) Bill — First Reading Second Reading In Committee 
Gosche Mark: Taxation (Personal Tax Cuts Annual Rates and Remedial Matters) Bill — First Reading Second Reading In Committee 
[Volume:647;Page:16291] 
Hon MARK GOSCHE (Labour—Maungakiekie) 
: 
 I watched the Budget debate and the debate on the first reading of this Taxation (Personal Tax Cuts Annual Rates and Remedial Matters) Bill and it was interesting to see the look of horror upon National members’ faces. They had to sit with Roger Douglas and Richard Prebble who were like a couple of old crows beside them. Their presence reminded New Zealanders of the bad times. Rodney Hide can rewrite history all he likes but the ACT party if it had had its way on policy would have seen no railway system in New Zealand. It would have allowed the system to collapse. So I tell Mr Hide not to rewrite history. Rail was under threat of utter collapse—so was Air New Zealand—but this Government stepped in. We had the prudent financial management of Dr Michael Cullen who was able to rescue New Zealand from a fate that ACT would have supported—no international airline and no railway. Can members tell me of any modern economy in the world that could sustain that particularly one at the bottom of the South Pacific? We are completely dependent on having an airline owned by this country. 
Coming to this bill and looking at the personal tax package I can relate a very interesting example I was given about what this means to real people. Let us call this couple Lisa and Paul. They are in their late 30s and have one child who is 4 years of age. This is a pretty typical sort of family in my electorate of Maungakiekie. Let us say that Lisa works as a hospital cleaner. What will she get out of this Budget and this bill in terms of changes to her tax? First of all let us look at what she might earn—$29640 a year. For a start how is she earning that? It just so happens that this year the Government put a significant amount of money into the public health system which allowed Lisa the hospital cleaner to earn $29000. Under the 9 long years of the previous National Government her wages had gone backwards. First of all she is now earning $29000 up from the pitiful amount she would have earned under a National Government. In those days she would have earned a minimum wage if she were lucky. She will be better off by $620 per year from 1 October. As well she will receive $588 from Working for Families. 
Her husband—let us call him Paul—is a labourer on the minimum wage. Let us remember that the minimum wage was $7 an hour when Labour came into power just over 8½ years ago because National had not moved the minimum wage for such a long time. It moved about 60-odd cents in 9 years so nobody noticed. Let us say that Paul is on the minimum wage which is now $12 an hour not $7. He will get a tax cut as well so the family will be $1800 a year better off on 1 October because of this bill and the changes to Working for Families. In fact by the time this process is completed in 2011 that family just from this tax package and the Working for Families package will be $3500 a year or 68 bucks a week better off. 
National members scoff at that. Some people out there say that that amount is nothing. Well I tell them that when people are earning $12 an hour—or $14.25 as these people would be—that is a lot of money. National members scoff at that and say that it will not make any real difference. Well I tell them that people in my electorate on that sort of money—often people in the normal family situation—will thank us very much and say that it is of great use to them and they appreciate it. National members and members of other parties like ACT denigrate this package but to real people who earn real wages and do real work it is significant. It will make a significant difference to them when they go to the supermarket pay the rent or mortgage fill up the petrol tank and do all the other things they have to cope with in an economy that is changing because the world is changing. Oil prices are going up through the roof in a way we have not seen in our lifetime. When the products we sell overseas like cheese butter milk and those sorts of things are suddenly in huge demand in growing economies like China we have to pay those prices in the supermarkets. It is getting tough for people but this Government listens to them. 
I also think about the 4-year-old child in my sample family. The child will go off next year to a school in my electorate. When Labour came into Government and did away with bulk funding Maungakiekie schools received an extra $2 million in their operations grants in 1 year. We took money that National had sat on and refused to give out because it could not get its way on bulk funding and we put it into schools in my electorate. We put in an extra $2 million. In this Budget as well as Paul and Lisa getting an individual tax cut and extra money through Working for Families their kid will go to a school next year that has an extra 5 percent in its operations grant. Extra money has been given to primary and secondary schools and it will pay for teacher aides people who work in schools computers and all of the things that local schools now take for granted but that were not there in the 1990s. Those things were cut. In my electorate the schools did not have the money to do the sorts of things they do in their schools now. 
Of course expectations have gone up. I chaired a board of trustees. We were always looking to improve the school—looking for more computers better property and more people to work with the teachers to cover the extra duties that are now expected in schools. They will also be able to take that child to the doctor for free. They will be able to pay for the prescription and not wait till pay day before they can fill it as so many families had to do under National—when they had to get a mortgage to fill the prescription even if they could actually get to the doctor in the first place. Our memories are not short and our working-class people understand that this is real money that it sits alongside an improvement in the public health system and an improvement in the education system and in their local schools. My local schools do not have a big pile of international students coming in to prop up the budget; they rely on the Government and the operations grant and some money from the community. This tax cut will actually give the people in our community a chance to be able to buy things that have gone up in price to be able to make sure their local schools get donations when they ask for them and to be able to send their kids to school with lunch and all those sorts of things. 
I shall look at a few other examples—that is of real money going to real people who are in our electorates and who earn this sort of money. I will just grab another couple of examples. First a one-earner couple with two children under the age of 13 are earning 45 grand which is a pretty normal wage for a lot of people in the ordinary sorts of jobs where they work hard and struggle along. What will they be better off by come 1 October as a result of this bill? They will be better off by $30.83 as a result of the personal tax cut and the Working for Families package. They will not turn their noses up at that and say that it is meaningless. They know how much milk costs. They know how much bread costs. They go and do the shopping every week as I do in Countdown at Mount Wellington. I have seen the prices go up. I can afford them on my wage; I am an MP. People on 45 grand need this sort of money. That is why they will get a real tax cut and the wealthiest people will get one too but they will not get the sort of tax cut that National would give them. National would give them big fat tax cuts but leave the people in my electorate scrabbling about on a few cents. That is what National has done in the past when it has tried to redistribute through the taxation system. 
I will finish off by talking about a part of the speech from the Prime Minister. We are in tough times economically in the world but this is not a Government that has said: “Aw! We have to cut back so who do we hit first?”. If it were National it would be the pensioners. That is what National did last time and that is what it would do again. Look at what the pensioners in our electorates are getting; the people who actually live on the pension. 
Hon Steve Chadwick 
: Hearing aids. 
Hon MARK GOSCHE 
: Yes they will be able to get hearing aids. Yes they will be able to get that money—the rates rebate and all of those things—in this Budget. They will be helped by the fact that we have sensible affordable sustainable tax cuts in this bill plus spending on things like hearing aids and increases in the pension. 
We did not do the National Party trick of saying: “Oh well we’ve got to save money somewhere. Whack those old people over. Damn them—we couldn’t care less.” We actually put the pension up. We look back at National and see that it sold the family silver to pay for its tax cuts. National hocked off rail to their mates who completely wrecked it. Talk about the private sector doing things better! They were selling off the rails the sleepers the trains and anything they could lay their hands on. And then they shifted off to Switzerland. 
Hon David Cunliffe 
: Who sold it to them? 
Hon MARK GOSCHE 
: The National Government sold it to them. That is how it paid for tax cuts. We do not do that. We have had sound economic management. That is why we can have this bill and we can spend more on health education and the elderly. 
Mr DEPUTY SPEAKER 
: This is the last call. There will be a bell at 4 minutes.