Shearer David: Taxation (Annual Rates and Budget Measures) Bill — In Committee Third Reading 
Shearer David: Taxation (Annual Rates and Budget Measures) Bill — In Committee Third Reading 
[Volume:672;Page:18946] 
DAVID SHEARER (Labour—Mt Albert) 
: 
 It is a bit rich for Peter Dunne to stand up and say what he said. The Taxation (Annual Rates and Budget Measures) Bill is not what he talked about. It is simply about ideology. It is about the ideology of bringing down tax rates and rewarding those people at the top of the tax pile. 
The reason we are here today talking about this bill is that we will be stripping out provisions on Working for Families and KiwiSaver and making changes that will affect the middle-income people we do not have enough of according to the Minister. We are doing that because we have a $16.7 billion deficit. This Government came in on a $5 billion surplus and we now have a $16.7 billion deficit—in 3 years. That is extraordinary. How can a Government fail so comprehensively in 3 years? The only comparable thing I can think of is when the man who is now the Minister of Finance took over the National Party when it was polling at 30 percent and drove it down to 21 percent in 3 years between 1999 and 2002. That is the only thing I can think of that is comparable to such a failure as taking a $5 billion surplus and turning it into a $16.7 billion deficit. 
Because the Government has restructured the tax rates so inequitably we are now sitting here debating how we will strip out the KiwiSaver provisions undermine people’s confidence in KiwiSaver and hit those people whom Mr Key calls “richer people” on Working for Families. My God those people are not rich. They are the people who come into my electorate office. 
The CHAIRPERSON (Lindsay Tisch) 
: Changes to KiwiSaver and Working for Families are in Part 2. Although you can mention them now we are actually on Part 1. If you tie your comments back to Part 1 that is fine but do not spend the rest of your time on KiwiSaver otherwise I will have to stand up and pull you up. 
DAVID SHEARER 
: The point is that a tax bill like this one is really looking to try to pull money back to fund a deficit that has blown out to $16.7 billion which is seven times higher than the projected deficit in 2008. 
Stuart Nash mentioned the projections. When we look at the projections from Treasury we see they have been consistently above the reality. The Inland Revenue Department probably has it much much closer to the truth. Here is what Standard and Poor’s said: “The budget foresees an operating deficit … of NZ$16.7 billion (8.4% of GDP) in fiscal 2010/11 compared to the $11.1 billion deficit (5.5% of GDP) foreshadowed in the Half Year Economic and Fiscal Update announced in December 2010.” Literally 5 months ago we were looking at an $11.1 billion deficit and now we have a $16.7 billion deficit. I do not understand how on earth Treasury can get it so wrong so consistently for so many years unless this Government is pushing Treasury to raise the forecast to make it more optimistic. 
People are starting to realise that. They are starting to realise that not only is this Budget gutting the many provisions that middle-class New Zealanders need but also it is based on a whole bunch of false promises and false projections—false promises and false projections. It means that as we struggle to curb this deficit that seems to be out of control—because those projections will not come true any more in the next 2 or 3 years than they have in the last 2 or 3—we are not funding the very things that are growing this economy. If one thing is absent from this Budget it is a plan to grow the economy. There is absolutely no plan to grow this economy. 
I looked at some of the provisions in research and development and in tertiary education. There is nothing that would give me any confidence that this Budget will try to grow our economy any more.