Brash Don: Questions for Oral Answer — Questions to Ministers 
Brash Don: Questions for Oral Answer — Questions to Ministers 
[Volume:624;Page:19105] 
1. Dr DON BRASH (Leader of the Opposition) 
 to the  
Prime Minister 
: Can she confirm her statement to the House yesterday that she had not in fact been advised that the impact of the Working for Families package on a 5 percent pay increase for a worker with two children earning $50000 and receiving an accommodation supplement would only be $5.20 per week; if so does she have any plans to review the package in order to ensure that more of the benefits of any wage increases flow to the worker rather than to her Government? 
Hon TREVOR MALLARD (Minister of Education) 
  
on behalf of the 
 Prime Minister 
: I can confirm in respect of the statement in the member’s question yesterday that the Prime Minister was not advised of that particular scenario because it was not relevant. The Working for Families package will dramatically improve the lives and opportunities of hundreds of thousands of New Zealanders and this Government stands proudly behind it. 
Dr Don Brash 
: Can the Prime Minister confirm that the Government’s Working for Families package will result in a worker with two children earning $45000 a year and in receipt of an accommodation supplement receiving a mere $4.67 per week of a 5 percent wage increase—a pay increase that delivers a gross increase of $43.27 per week; almost 10 times the net increase that the worker will effectively receive—and can she tell the House what sort of incentive that provides for New Zealanders to get ahead? 
Hon TREVOR MALLARD 
: I can confirm with regard to the example in the primary question that a family paying a high rent in Auckland and with two children will get $156 a week out of this package. The members opposite are opposed to it but we support it. 
Sue Bradford 
: Will the Prime Minister support the call for a 5 percent wage rise across the board for workers in light of research that showed that the chief executive officers of 25 leading New Zealand companies had an average pay increase of 25 percent in the past year compared with a 2.4 percent increase in average ordinary-time weekly earnings? 
Hon TREVOR MALLARD 
: Matters of those sorts of negotiations are between workers their unions and employers. 
Hon Peter Dunne 
: Does the Prime Minister have any information about the net impact on household incomes of the Working for Families package and other measures that have been adopted since she became Prime Minister; if so could she share that information with the House? 
Hon TREVOR MALLARD 
: I do not have the full list with me. I know that this package is worth about $1.1 billion. The changes in health are worth about $1000 a year for each family; similarly in education. For this sort of package to be done out of taxes would cost $5.5 billion and result in cuts right through the public services. 
Dr Don Brash 
: If the Government were so concerned about effective marginal tax rates that it specifically designed the Working for Families package to reduce the very high marginal tax rates facing beneficiaries why did it then simply introduce a system that moved those very high effective marginal tax rates on to the average Kiwi working family? 
Hon TREVOR MALLARD 
: The average Kiwi working family or the average family referred to by the Amalgamated Engineering Printing and Manufacturing Union with a couple of kids and paying a high rental will get over $150 a week out of this package. People like the cash and getting the cash is much more important than the marginal amount they pay on the last dollar of tax. I ask that member whether he is saying they should not get the money or is he saying their mates should not have a 5 percent wage increase because they do not have children? He has to make up his mind. Previously he clearly wanted a low-wage low-cost economy. That is not what this Government wants. 
Dr Don Brash 
: Does the Prime Minister agree with the Cabinet paper on the Working for Families package that estimates that only 2 percent of sole parents will move off benefits as a result of the package and that no couples at all will move off benefits as a result of the package? 
Hon TREVOR MALLARD 
: People have been moving off benefits because of the very good work done by Work and Income and because of the economy which is booming. 
Dr Don Brash 
: I raise a point of order Madam Speaker. I asked whether the Prime Minister agreed with the Cabinet paper that said that only 2 percent of sole parents would move off benefits as a result of the package and that no couples would move off a benefit because of the package. The Minister on behalf of the Prime Minister did not answer that question. 
Hon TREVOR MALLARD 
: The Cabinet paper is not relevant to people moving off benefits because people are moving off benefits because of the good work of this Government and the booming economy. What a contrast that is to the time when we had a Reserve Bank governor who saw it as his aim to drive people out of jobs in New Zealand! That was Don Brash. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. I note you have yet to rule on the requests that were repeatedly made of you yesterday to give the House an indication of how you would treat replies from Ministers under Standing Order 370 and its various subparts. I would now like to know whether the answer Mr Mallard gave and the style of it is going to be the style of question time so that perhaps from the point of view of supplementary questions members on this side of the House can make allegations of a sort similar to those that Government members clearly will continue to make in their answers. 
Madam SPEAKER 
: The Minister addressed that question. 
Gerry Brownlee 
: I raise a point of order Madam Speaker. I did not ask you any question about the Minister’s answer to the question. I asked a question about Standing Order 370 and its subparts and your view of how it is to be applied then a question specifically about whether your view was evident in the reply that Mr Mallard gave. 
Madam SPEAKER 
: The reply that the Minister gave was relevant to the question asked. That is what is required. 
Hon Richard Prebble 
: Does the Prime Minister accept that the poor design of the Working for Families package and the statement made by the president of the Labour Party endorsing an inflationary wage round are part of the reason why the Reserve Bank has increased interest rates today and everyone who has a mortgage will have to pay more for it; if she does not what responsibility does she take for the rise in interest rates? 
Hon TREVOR MALLARD 
: On behalf of the Prime Minister I was not advised that either of those factors was part of the reason for the rates going up when I was briefed by Dr Bollard. The reason for the rates going up is that he is concerned at the overheated economy in New Zealand. 
Dr Don Brash 
: Does the Prime Minister agree with this statement from the Cabinet paper on the Working for Families package: “The package is likely to have relatively modest employment impacts. This effect is due to the fact that some groups such as those on middle incomes will now face higher marginal tax rates from family assistance thereby reducing incentives to increase employment.” and is this the reason why the Cabinet paper has now been removed from the Ministry of Social Development’s website? 
Hon TREVOR MALLARD 
: The particular objective of this package was to lift the standard of living of working and low-income New Zealanders. This package does that. It is actually very hard to have a big effect on unemployment when unemployment is at record lows—no thanks to members opposite and especially Don Brash who spent his time at the Reserve Bank trying to drive low-income Kiwis out of their jobs. 
Dr Don Brash 
: I raise a point of order Madam Speaker. That in no way answered or addressed my question. I asked whether the Prime Minister agreed with the Cabinet paper. The Minister made another gratuitous remark about my record as Governor of the Reserve Bank. 
Madam SPEAKER 
: Would the Minister like to clarify his answer for the member. 
Hon TREVOR MALLARD 
: The Cabinet paper referred to the matter in the way that the member suggested but it was not the objective of this package to drive people into jobs; the objective was to drive up the standards of living of lower-income New Zealanders. We know that Tories would take that money off middle-income families; that is their policy. Their policy is to take $150 off the low-income families living in Auckland and we look forward to campaigning on that. 
Rt Hon Winston Peters 
: Can I ask the Prime Minister whether the claim that the economy is going so well and is booming is not cause for us to agree that a 5 percent pay rise would be reasonable if we have any intention of keeping people in this country rather than having them move to Australia where they would be paid about 35 percent more? 
Hon TREVOR MALLARD 
: I repeat the comments I made earlier on behalf of the Prime Minister. Wages are negotiated between employees their unions and employers. In some cases 5 percent will be justified; in other cases it will not be.