Hide Rodney: Questions for Oral Answer — Questions to Ministers 
Hide Rodney: Questions for Oral Answer — Questions to Ministers 
[Volume:626;Page:20796] 
5.  
RODNEY HIDE (Leader—ACT) 
 to the  
Minister of Finance 
: What is the total annual fiscal cost in 2009 of the tax changes announced in Budget 2005 and what is this as a percentage of total Government spending? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 The fiscal cost of the business tax package and personal threshold changes is $456.4 million—some 0.8 percent of Government spending—which is offset by $319.2 million of revenue from carbon charges making a net cost of $137.2 million or approximately 0.2 percent of total core Crown spending. 
Rodney Hide 
: Is this 0.2 percent reduction in Government spending to be returned to hard-working Kiwis the extent of the “deep dark secret” that the Labour Party President Mike Williams hyped up to the  
New Zealand Herald 
 or was the “deep dark secret” just another example of this Minister of Finance getting his facts wrong as he did this morning when he had to issue a correction and an apology to avoid being sued? 
Hon Dr MICHAEL CULLEN 
: I repeat again that Prime Television was engaged in underhand tactics in cahoots with that particular member; we are well used to his tactics in those respects. No in fact the deep dark secret—which is out there in the public arena if members care to look—is that on 1 April next year many working families will get another $50 or more a week from the in-work payment plus changes to family support. 
Kenneth Wang 
: Does he realise that his failure to cut tax rates has led to the lowest level of business confidence in 70 years; if he does not accept that which Government policy has caused such a huge drop in confidence? 
Hon Dr MICHAEL CULLEN 
: As I am sure Dr Brash could inform the member the purpose of monetary policy in situations such as the present is to slow down the economy. If the Government then chooses to re-inflate the economy by borrowing for tax cuts the Reserve Bank will simply put interest rates up higher. That is how a modern Western economy works. 
Gordon Copeland 
: Does the Minister not agree that a second-round effect of using proceeds from the partial sale of State-owned enterprises to retire debt is that the Crown accounts are left with a great deal more cash which could be used for tax cuts? 
Hon Dr MICHAEL CULLEN 
: No. What happens of course is that if assets are sold the future dividend income stream is lost from those assets and that further has to be taken into account. The notion that one would sell off assets in order not to retire debt but to fund tax cuts does not make fiscal sense at all. The Government’s accounts would significantly deteriorate as a consequence of that. 
John Key 
: Is not the real truth around the Budget that the Prime Minister recognised that this Labour Government was miles behind in the polling on taxation; that she had to force the Minister of Finance begrudgingly to give some pathetic tax cuts in 3 years’ time; that the Prime Minister then dispatched the president of the Labour Party to go on his Amway sales course to pump up the Budget; and that now that it is an absolute disaster everybody in the Labour Party is blaming everybody else and the truth is that this will be the longest resignation letter of the Minister of Finance? 
Hon Dr MICHAEL CULLEN 
: No no no no no and no if I can quote the French. But also I think that member could do with a public relations person to sell National’s tax policy. It has been a disaster over the last week. 
Deborah Coddington 
: Will his proposed tax changes mean that families can double their net worth in the next 6 years as the Government is proposing to do—going from $35 billion to $63 billion? If not what does he say to families who are now complaining about “rich Government poor people”? 
Hon Dr MICHAEL CULLEN 
: Many families have doubled their net worth over the last few years but what they have learnt of course—and the member should take note of this—is that in terms of a household budget just as with a Government Budget net worth does not pay the weekly bills. 
Hon Ken Shirley 
: Does he concede that his Government’s carbon tax will be inflationary to the extent that it increases the consumer price of both electricity and petrol; if he does not concede that it is inflationary could he explain to the House why not? 
Hon Dr MICHAEL CULLEN 
: Yes indeed. Clearly the carbon tax will increase the consumer price index on a one-off basis presumably by somewhere around or just under 0.2 percent. 
Heather Roy 
: Why has he denied hard-working Kiwi families this $40 basket of groceries every week instead giving some only this measly packet of chewing gum in 3 years’ time? 
Hon Dr MICHAEL CULLEN 
: Firstly I hope the member will return the plastic basket to the supermarket that it came from and secondly could I point out that the scale of the tax cuts that that member’s party was talking about would lead to both a massive increase in interest rates— 
Hon Member 
: Oh no. 
Hon Dr MICHAEL CULLEN 
: —$5.7 billion—and a massive decline in funding for services that the very same family relies upon unlike the people who fund ACT who do not worry about health-care and education costs. 
Rodney Hide 
: Why should New Zealanders believe anything the Minister of Finance says when he went up to Hong Kong in April 2000 and promised that the Government wanted to reduce the 33 percent company tax rate when it could afford to; when he continues to make up stories about my friend Dave Henderson when under attack; when he attacks TV3 journalists by making things up and accusing them of operating by false pretences; and when he continues to make things up by accusing me of working in with some Prime Television journalist whom I have never heard of and as far as I know have never spoken to; why does he not actually tell the truth? 
Hon Dr MICHAEL CULLEN 
: Like why does the member not apologise for his false accusations against Mr Tamihere which he has never actually had the gumption to face up to and apologise for? I certainly made a mistake about TV3; it was Prime Television and I make no apology to it for its behaviour in that respect. That member of course is well known for trying to dig up dirt on everybody around the place. The trouble with digging up dirt is sometimes it comes back to rest in one’s own boots.