Newman Muriel: Budget Debate 
Text is incorporated into the Bound Volume 
Newman Muriel: Budget Debate 
[Sitting date: 16 June 2004. Volume:618;Page:13675. Text is incorporated into the Bound Volume.] 
Dr MURIEL NEWMAN (Deputy Leader—ACT) 
: 
 It is my privilege to speak on behalf of the ACT party in this 2004 Budget debate. But I have to say this Budget makes me really ashamed to be a New Zealander. I see in this Budget that the Labour Government is sacrificing the country’s progress and its future with a tax-and-spend Budget that is a blatant attempt to buy votes for the next election. That is a disgrace. This Budget exposes Labour’s aim to turn hundreds of thousands of working families with children into beneficiaries and that is absolutely contemptible. Colin James described this Budget as “a milestone in a Labour-led journey back towards the social democratic world that New Zealand left behind in 1984”. Labour is taking New Zealand back to the future with a massive tax and spend. It is the biggest redistribution of wealth that New Zealand has seen since 1972. 
All the commentators are saying that it simply marks the beginning of Labour’s election spend-up. It is using taxpayers’ money to bribe voters for the next election. If that is not the case I ask this question: why will the benefits for families on welfare not come in until next year—election year—and why will the benefits for families who are working not come in until the year after? Members can just see the electioneering pamphlets; they will be all about encouraging people to vote for Labour so that it can put $100 $50 or whatever into their pockets. 
The worse thing about this Budget is that the $21 million that Labour will be spending to promote this Budget will be weaved in with its own party propaganda and spin doctoring. That is an absolute disgrace. It is despicable and dishonest. Labour is putting its own party propaganda in with $21 million of taxpayers’ money. That $21 million is the biggest spend-up ever as I understand it by a Government on propaganda ahead of an election. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
Dr MURIEL NEWMAN 
: The people of New Zealand simply cannot trust a Labour Government when it uses $21 million of taxpayers’ money and weaves it in with its own spending to create a propaganda package. That is being very dishonest. The reason for it is that the driving force for Labour is winning power. It is not about the good of the country. If this Government actually cared about the good of the country this would not be a tax-and-spend Budget; it would be a growth Budget. The first thing the Government would do is lower taxes. A recent poll showed that 66 percent of New Zealanders wanted to see lower taxes rather than the Government giving handouts. Therefore we should have a 20c low tax rate giving back the surplus to the families who earned it. 
This should also be a Budget focused on welfare reform—a Budget that reforms welfare rather than growing welfare. Struggling families need a Government that is committed to lifting living standards; just like a rising tide lifts all boats so a rising standard of living lifts opportunities for all families rather than locking families into an endless struggle as this Government is doing. No Government no country has become wealthy through redistribution and that is what Labour is doing in this Budget. 
It is just outrageous that the Government is also damaging the very social fabric of New Zealand. It is putting in place a poverty trap for working families; not those families going from welfare to work but ordinary working families who are trying to better themselves. Labour is destroying the very incentive that allows families to get ahead. Normally the harder people work the more they make and the better off they are and that is the incentive to carry on trying to improve their situation. But under this Budget if a family with two children that is on the accommodation supplement and is earning $25000 a year doubles its income so that it earns $50000 it will get less than $100 a week in extra income. Under Labour that family will face a 90c abatement regime where for every extra dollar it earns it gets to keep 10c. That is despicable. Labour is destroying the very incentive to get ahead to go for promotion or to get another job. We are locking into this country a whole vision if one likes of mediocrity where the employment ladder has been destroyed by a Labour Government. 
What is really interesting is that Labour is turning its back on its very loyal support base. Working families traditionally have been Labour’s supporters. The Labour Government is corrupting that employment ladder. This is a bad moment for New Zealand because Labour is turning its back on working families and it is condemning this country to Third World status. 
Labour collected $6 billion more in taxes than it needs—that is it had a $6 billion surplus. Labour overtaxed struggling working families. It has spent $2.4 billion in this Budget. In creating 300000 families dependent on Government handouts—that is 150000 working families and 150000 beneficiary families—all that this Government is doing is holding back New Zealand. This Government is locking this country into a low-wage economy and we will end up with a mediocre future because of Labour. I ask the Government members sitting over there what they think a working family who is struggling to get by would rather see: would those family members rather see the money given back to them so that they can budget it and spend it on things to make their family do better or would they rather it were given to the politicians in Wellington so that they can spend it on the America’s Cup and can spend $21 million to try to promote this Budget? What do those members think those working families would rather see? It is very clear that working families would rather keep more of what they earn. 
If Labour was serious in saying it wants to help people move from welfare to work the other thing it should be doing is not giving out more handouts but bringing in a proper programme of welfare reform. Research from around the world shows one thing: when an economy is booming and the number of people who are on the welfare rolls is increasing that has nothing to do with society or the economy but has everything to do with poor welfare policies from the Government of the day. That is the situation we have now. We have employers around New Zealand calling out for workers. They cannot get people to fill skilled and unskilled jobs. We now have 350000 people on the welfare rolls and families and children locked into the poverty of welfare dependency and that is because this Government is so short-sighted it cannot see that a good programme of welfare reform could give those families the opportunity to become independent of the State to earn a good living and to have a decent life for themselves. That would then remove taxpayers from the trap that they are in where they are locked into paying high taxes for people on welfare who actually could be working and would rather be working. 
This Government is failing on all counts. It is failing because it should have given the Budget surplus back to those families who earned it. It is failing because this Budget lacks vision to help New Zealand to climb up to being a First World country. It is failing because it will not improve the standard of living because this Government believes in redistribution of wealth which locks economies into poor performance and families into poor performance. It has also failed because this should have been a welfare reform Budget not a welfare Budget locking more families into dependency. It is a very sad day for New Zealand when we sit here and see Labour taking out the traditional way of families to get ahead which is to work hard and gain benefits for themselves.