Brownlee GerryHon GERRY BROWNLEE (National): The previous speaker—Dr Deborah Russell—was right to say that this bill comes about because of the changes that the Government has made to benefits. While it is interesting to note the relationship between benefits and family support what's more alarming is that you might have expected that the Government would have put a greater focus on people earning more and therefore the gap between those who are earning and those who are on a benefit being taken up by the wages that they're able to earn out of this economy. But no there is just this simple redistributive mentality that does not look at the benefits of a growing economy. Now the Minister of Finance in delivering his Budget today did mention some projections for growth moving forward. But there was not one thing in this Budget that would support that growth—Hon David Parker: R & D tax credits. Hon GERRY BROWNLEE: —not one thing in this Budget that would support that growth. Now the Minister over there says Oh there's R & D tax credits." Well that requires them to spend money. It requires them to spend money and it requires them to be profitable in order to be able to do that. Don't—Hon David Parker: It's a tax cut. Hon GERRY BROWNLEE: While he's over there saying that it's a tax cut that's a tax cut you get if you spend your money—it's not at all. That kind of shows the convoluted mixed-up logic that goes on on that side of the House. So if we look at other aspects of this Budget—and I know sir we're not debating the Budget. This bill is a direct consequence of a serious improvement in people's beneficiary income but it doesn't deal with the fact that you need to get people back into the workforce and standing up and just saying that "Oh well unemployment is going to fall to a particular rate."—it only does that if people invest in the economy if people expand the economy and people choose to employ more people in the economy. We know that in the next short while the State can't be relied on to fill up that gap because the extraordinary thing in this Budget was the Minister of Finance managed to increase the incomes of those who are on a benefit while at the same time having previously announced a decrease in the incomes for those who are in work and in the employ of the State because we're looking at this over a four-year period. So while this is a Budget move that on the face of it might be well accepted by a lot of people it does put a huge burden on to the economy. We heard the Prime Minister saying that this can be afforded because we've got greater capacity now to borrow. But in the end a borrowing programme from a Government is a shifting and a shuffling of obligation from now until some time in the future—some time in the future—and it was interesting that the justification is that it's undoing something that was done in a Budget 30 years ago. Well in 30 years' time young New Zealanders now will still be paying for this. So where was the focus on closing that gap by increasing the earnings capacity of those who are currently relying on family support? It simply was not there. When it comes to these sorts of things the previous speaker described it as a purely technical bill and that is true. It is a technical bill. It's a very short bill—it's just four pages long—but the consequences of it are what this House should be aware of. It's what should be discussed here today. I'm sure that people are going to stand up from the other side in a minute and say "Lives are going to be improved. It's all going to be fantastic." Well I suggest they go and read an article that's published today by interest.co.nz talking about the hidden inflation inside our economy. It makes the case that if a certain collection of grocery items were put into a basket similar to a Consumers Price Index basket then the underlying inflation in New Zealand would be something like 7 percent. It makes the case that if there is a 1 percent move in mortgage rates in the next short while—just 1 percent; it doesn't sound like much—on the average mortgage at the moment that would be the equivalent of a 14 percent increase in payments required. That comes out of earnings. So what you've got here is a proposal that simply with its redistributive approach increases costs all around. It increases costs all around—no question about that. While people might say "Oh look lives are going to be so much better as a result of this."—I appreciate how hard it is for people on low incomes like that. I can't imagine what it's like on those incomes to wander through a supermarket wondering whether or not you can take something off the shelf and worse than that looking at that high level of inflation on those basic staple products must be very very demoralising. So there was a need for a different approach—a much different approach—to simply saying "We will solve everything by putting in place an additional payment that takes us back to the levels that we were at 30 years ago." I would ask the question: why has it taken a Labour Government so long to get to this given that half of that time they were sitting on the Treasury benches? It's only now—only now—because they've got the cover of COVID-19 and are able to commit the future generations of this country to enormous debt that they can sell their desire to have a freebie for people in difficult circumstances that it's actually happening. It's not based on "The country's doing really well." It's not based on "The income coming into the Government from the productive sector is now so big that we can afford these things." All it is is another layering on of cost to the productive part of the economy and that's sad because the people who suffer most when that happens are those who are on the bottom rung of society: the people who have the lowest of incomes. Far from being kind this is a cruel hoax and while people will be happy for 12 months or so with the increased payments it's going to catch up and it's going to catch up very very quickly. So this is a bill that I think is totally misnamed and at a later point in proceedings today we'll be able to discuss that aspect quite a bit further. I just want to conclude my remarks on this bill by stating that there will be a number of questions that we will be putting to the Minister in the committee stage of this bill so that we can get some sense—some sense—of how it's expected the economy might get to a position where this is a truly affordable thing. I don't mean "affordable" in so much as the Government being able to afford it because I've already explained that. The Government is just going out to borrow to pay for it—simple—and then they'll transfer the cost of that borrowing on to everyone who's working. The real question is: how long can we afford to keep people out of the workforce—keep people out of the economy effectively—shoving them to one side and not giving them a great deal of hope? There are programmes in here that they'll point to and I can see one of the speakers that's about to come from over the other side is getting very excited in preparation about how they're going to rebut everything I've said. Well answer these questions when the opportunity arises: what is to be done about that underlying inflation in the food price sector? What is to be done about the $100-a-week increase in rents over the last three years? And what's to be done about the massive gap now between the average income the need to save a deposit and the cost of a house? They are the real things that need to be dealt with. They are the real things that will make a difference in the lives of people who are on the bottom end of society. I don't begrudge them getting this—not one bit—but what I will say is they're getting it because of the Government's mismanagement. While they can take it and that's a good thing that they do it is unfortunate that the country is being lured into a kind of fool's paradise about where the economy sits about what is an affordable thing and about what is a reasonable way to treat people in this country. So far from being a wonderful beneficial generous kind thing it is everything that is opposite to that. Those end my comments at this stage of this bill."