Willis Nicola; Robertson GrantNICOLA WILLIS (Deputy Leader—National): I was particularly struck by the comment from the Minister of Finance in which he held up the COVID-19 Response and Recovery Fund as an example of the transparency in the way the Government spends. The Minister of Finance will acknowledge that he raided that fund for the purpose of consultants to work on three waters reform. The gap between spending money to help people through a health crisis and paying people from consultancy firms to tell the Government how to reform the governance of three waters assets could not be wider. So if that's the Minister of Finance's example of transparent reporting I suggest he find a better one because the facts are stark. Government spending in the year we are reviewing was the highest as a proportion of GDP as it has been in at least 17 years; more in the last year than during the other COVID19 lockdown years. The question that we have asked on this side of the House is: where is the value for that spending? Because let's think back to 2017 when Crown spending was 27.7 percent of GDP. It's now 35 percent. In that year the State house waiting list was at least a quarter of what it is today. There were not thousands of children sleeping in motel rooms. In fact the health waiting lists were shorter. Here in Wellington today if you want to go to the emergency department well good luck because around two out of five times you'll be waiting more than six hours for care. So my question to the Minister of Finance is this: what good is the wellbeing framework and the pages and pages of faff about how nice the intentions are and how hard everyone's trying and how we've all wrung our hands and said we cared about it if the result is that you're spending so much money that we have a higher inflation rate than Australia the US other countries around the world that we like to compare ourselves to; that our cost of living is completely out of control; interest rates have spiked higher faster than at any point in the history of the official cash rate; and we're not seeing the social results for it. The Minister has poured billions into Kāinga Ora yet the State house waiting list is the longest it's ever been in New Zealand's history. We have literally thousands of kids in motel rooms. The hospital system is in the words of the man who used to be in charge of it until very recently in crisis". Our educational achievement has declined in real terms. Yet the Minister of Finance says "Trust me. Look how transparent the COVID fund was. Look how well we did with all of those billions. And I've got a wellbeing report. So look it's all going to be fine."Well my question to the Minister of Finance is pretty simple: why should New Zealanders trust you to spend more of their hard-earned money with the tax you take from them when you have failed to date to provide the results they have a right to expect for it?Hon GRANT ROBERTSON (Minister of Finance): Madam Chair thank you. Perhaps a history lesson might be helpful at this moment—in response to the member's question—covering the period which we are assessing through these statements and trying to answer the member's question around the influence of Government spending on inflation. On 6 October 2021—in the period in which we are covering here—the Reserve Bank raised the official cash rate (OCR). On 21 October that year the National Party called for a multibillion-dollar stimulus package of tax cuts and more spending including increasing the wage subsidy which would have cost $70-80 million a week; continuing the wage subsidy further which would have cost another $70-80 million a week; implementing rental support for small businesses which would have cost $100-180 million a week; and extending the loss carry back by $100 million per year.Nicola Willis: What's this got to do with your financial accounts?Hon GRANT ROBERTSON: What this has got to do with it is that the question that the member asked me was about the role of one of them—her question was about the role of Government spending in increasing inflation. The point I'm making to the member is that had we followed her prescription in the period that was being covered—Nicola Willis: It wasn't my prescription.Hon GRANT ROBERTSON: The member says it wasn't her prescription. Well it was certainly the National Party's prescription. In the period that the member is concerned about they were looking for a multibillion-dollar stimulus package of tax cuts and spending.So if the member thinks that it's Government spending that increases inflation imagine what would have happened if we had followed on from the member. I might say that the National Party carried that on—after the November OCR increase Christopher Luxon called for more stimulus. After the February 2022 OCR increase—also covered in this period that we're looking at here—the Reserve Bank raised the OCR for the third time. And National's response? An $11 billion tax cut policy that would have exacerbated inflation even more.Nicola Willis: Point of order Madam Chair. Look the Minister of Finance has used his floor in the House to misrepresent National's position in tax policy. The number he has used to characterise our tax policy is I think false. I don't want to accuse him of misleading the committee wilfully but I do want to give him the opportunity to withdraw that characterisation. Hon GRANT ROBERTSON: Madam Chair am I back on? No it was an $11 billion tax cut policy announced on 6 March 2022. It included increasing tax thresholds by 11.5 percent; removing the 39 percent tax rate—the top tax rate; restoring the property investor interest deductions; repealing loss ring-fencing and returning the brightline test to two years: $11 billion estimated at the time.Nicola Willis: Ring-fencing is not even in our policy.Hon GRANT ROBERTSON: But it was; it was in the policy that you announced on 6 March 2022. Anyway regardless of whether we want to debate whether it was $11 billion or $10 billion or $9 billion the point is that the kinds of things the member has been proposing would have exacerbated inflation even more than the necessary spending that we had to do when it came to COVID.I am proud of the Government's record in this regard. I think that the Government has done as good a job as almost any other Government around the world in the face of COVID. The member might like to join Mr Seymour in the pursuit of a PhD in "Hindsight Economics". That is not actually what it means when you have to govern. When you have to govern you have to govern in the here and now. Sometimes we don't get every decision right. But overall what the Government did during that period I believe was invest to support New Zealanders to stay in jobs to support New Zealanders to say well and healthy. When I look at that and compare that to the rest of the world I believe that we have a record that we can be proud of."