Williamson Maurice: Budget DebateText is incorporated into the Bound VolumeWilliamson Maurice: Budget Debate[Sitting date: 28 May 2015. Volume:705;Page:4151. Text is incorporated into the Bound Volume.]Hon MAURICE WILLIAMSON (National—Pakuranga): Can I first say a big thank you to the whips for giving me a speaking slot during Auckland drive time. My adoring drive time audience hangs on all my words. It is 25 past 5; however Auckland drive time started about 2.15 this afternoon and will continue till about 9 o’clock tonight. For those of you who are not Auckland commuters this is known as Auckland drive time. First of all I say thank you to my party whips. To my adorable drive time audience I want to make a few key points about the Budget.The second point I want to make is that I am not going to get into the individual elements of the Budget tonight in my speech because so many of the members on this side have covered all of the fantastic bits. What I want to try to do as this is the 28th Budget I have sat through in this Parliament—Tim Macindoe: How many?Hon MAURICE WILLIAMSON: It is 28—28. I know I know. Yes I can walk into a forest and be the oldest living thing there; that is right.What I want to do is say that the general public view of a Budget that a Government puts out is very similar to how they view their own circumstances. They view it in terms of their family—like how much money is coming into the house and how much they are spending—or if they are running a business how many customers are buying their products compared with how much it is costing. It is exactly the same for a Government with a couple of slight qualifications.First of all Governments do not earn their income. It is other people who earn the income and Governments take a slice of it. That is a very big difference to a family that could go and take a second job or go and do some more work or get their kids out doing some extra work. Governments do not actually earn that money and so we have to be very very careful with what we take in by way of taxation—that we take in a correct amount; a balanced sensible amount.There is an element of spending that the Government must do. I think that everybody accepts that the Government must spend money on health education and law and order—like the police and corrections and so on—but I know that a lot of New Zealanders want to be sure that what is being taken out of their PAYE packet each week is spent sensibly. When a guy is coming in out of a dirty old mechanics’ bay and is covered in grease and it is cold and dirty and he gets his payslip he does not want to look at 400 and something dollars in PAYE being taken off him and think: “Well I know what those guys have done; they’ve squandered it.” So we have got an obligation at that revenue end to get a good balance.Secondly we have got an obligation to make sure that what we spend our money on has good outcomes. This is Bill English’s seventh Budget. I think he is rapidly becoming without doubt in my view the best Minister of Finance this country has had in terms of keeping a very steady stable direction at a time when we were into a headwind.I have given this analogy before but I want to give it again to my adoring drive time audience. It is to do with teachers who keep saying: “We don’t want to have a performance-based assessment put on us. It’s not fair because we may have a very low-end decile hard kids to teach and another person has a decile 10 with stunningly capable top students and therefore they’ll get the merit.” I agree with them. What you do want to do is have a measure of what difference they make—what difference do they make to those children? If you get someone who picks up the very bottom end of the kids and actually lifts them quite a way they have done way better than someone who had people in the very top echelons and did almost nothing with them. That is why I want to make an analogy between that and this finance Minister: he did not come in with a phenomenal tailwind a phenomenal surplus forecast and a phenomenal: “Hey I’m decile 10 and I’ve got the best kids in the country.” He came in at probably the worst time you could possibly come in in a financial cycle for this country. The world was at the beginning of the complete meltdown of the global financial crisis. In 2008 it sort of started during the course of that year and by the time we got elected it was sort of a situation of hands covering your face and saying: “Oh my God—what does this mean for the future?” Not to be done with just that we then got smacked around by some of the worst ever mutilating earthquakes that this country has ever seen with damage running into the billions—no into the tens of billions—to our infrastructure and so on.I pay great credit to a Minister of Finance who then says: “Right we’ve got a problem here and the problem lies around this: we have to be very careful not to take more money off people because it is actually their money that they have earned but we do have to make sure we maintain spending so that we do not end up with an education system and a health system that completely collapses.” So we went into a borrowing mode and do you know what? I am not a big fan of debt—I prefer that Governments do not borrow and get into debt—but there are times when it is justified. There are times when you can say that it is no longer right to pull back on the revenue lever and it is time to no longer try to cut to the bone on spending. It has been done before. I was a member of a Government in the early 1990s that had an alternative solution.I want to send a message out to some of the more left-wing members of this House mainly the Greens and some Labour members who keep saying as regularly as clockwork that the rich should pay more. In fact I have heard them say many times that the rich should pay their fair share. So what I want them to do now is get an Excel spreadsheet—I have got it for them if they want to get it from me—that shows what percentage of income tax the rich in this countryactually pay. It is done in the segments of nought to $10000 of income and then $10000 to $20000 and $20000 to $30000 and so on. Here is the percentage that really matters because I have added in two extra columns to it. It is not just the gross amount of tax that each of those income groups pay but it is how much gets paid back to each of those groups by way of Working for Families and subsidies and all sorts of payments that are transfers back. Then there is a final column of what the net income tax paid is and here is the number: 17 percent of taxpayers in New Zealand pay 97 percent of the income tax.Tim Macindoe: Say that again?Hon MAURICE WILLIAMSON: I am going to say that again because it is worthwhile saying. The top 17 percent of taxpayers of New Zealand pay 97 percent of the net income tax. That is after you have corrected it back. So I am not prepared to listen to lunatics saying that the rich should pay their share or the rich should pay more because they already do pay more. And they actually do not pay their share; they pay way more than their share.Your obligation when you are doing your family budgets is to say: “This is how much money we have got coming in.” Bill English has had to do that exact same transfer at the level of a Government: “This is how much money we can bring in without distorting the markets too heavily by ramping up the taxes. Here’s how much we have got to spend in core in terms of keeping all of the general stuff afloat and we’ve got a margin for some new initiatives that we can spend some money on each year.” It is not a lot—about $1.5 billion I think Bill English has concluded should be the new spending in each year. Compared with previous Labour Budgets which were in the order of $7.5 billion of new money in one year—well that happened to be an election year. But I mean it was just actually crippling to the economy.On the question of Budgets believe me I used to be a kid listening to the Budget at night because it used to be at night and I used to listen to it on the radio. Everything about New Zealand society was determined in that Budget on that night: the price of cigarettes the price of alcohol and whether you raced up to the petrol station to fill up your tank. Budgets today are no longer like that. What they are is just a general statement of principle: where is the country going is it being well managed and of that money that is coming in by way of revenue from the hard-working people out there—because I repeat again Governments do not earn a cent and there is not a single cent of money in this country that the Government actually earns; it is earned by hard-working New Zealanders whom we tax to get it in—is there scope for spending a bit more in certain areas?I have never ceased to be amazed by the New Zealand public. Certainly I have done a tally at National Party conferences and over a 5-year-period I think there were 138 remits for the Government to spend more money and 25 remits calling for the Government to cut taxes. And that is the problem. California actually did it. It had about the same number of propositions for spending more money and a whole lot of propositions for cutting taxes. You cannot do it. So it is that finely tuned balance of trying to keep the ship afloat trying to make sure that the necessary and standard services are there with a few new initiatives and there were a few new initiatives in this Budget.I am actually pleased that we have moved to some user-pays charges. I like them; I think we should have more of them. When I was the Minister of Customs I actually advocated for a border charge. I did not get it through but congratulations to the new Minister on getting that through and getting a border charge because I think that people who are using a service should pay for it. I am really happy that there is a telecommunications levy still there and that is going to be expanded because it is going to allow the roll-out of the most important infrastructure for our society.But in the end what you have got to do is forget the minutiae. It is like the family budget. You do not care whether the ice cream costs 20c more this week or not; what you care about is whether your overall spending is in tune with your overall income and that you have got a chance of progressing forward. This Budget did this for this country. I am really proud to be a member of this party and to serve under somebody as good as the Minister of Finance Bill English.