English Bill: Budget Debate 
English Bill: Budget Debate 
[Volume:625;Page:20787] 
Hon BILL ENGLISH (National—Clutha-Southland) 
:  
Madam Speaker—[ 
Interruption 
] For the member’s benefit I think it is a poor Budget and I do not support it. I think that is the view that most New Zealanders will take. Labour is making the mistake of thinking that New Zealanders see a lolly-scramble as a replacement for an economic strategy. Of course they do not. 
The people of New Zealand who are taking much notice of what was said today are the same people who are concerned that when their fixed-term mortgage comes up and the rate changes they will be paying a 2 percent higher interest rate. They are the same people who are concerned about the values expressed by this Government that undermine the things they hold dear. When they heard Dr Cullen saying: “I will index the thresholds in 3 years’ time.” they started laughing because they thought: “How stupid does he think we are?”. Somehow this man who has misjudged the fiscal situation quite badly is telling mainstream middle New Zealand that the one dividend they will get from this strong fiscal situation over 5 or 6 years is an increase in the tax thresholds in 3 years’ time. I have had the calls already to my office saying: “Why does he think I’ll be grateful for 27c a week in 3 years’ time?”. My response is: “Now you’ve found out how stupid he thinks you are—that somehow you’re going to be grateful for that.” That will be the symbol of this Budget. “Dr Cullen has promised to give you a $500 shift in a tax threshold which you won’t actually collect until 2009.” That will sum up this Budget. 
Dr Cullen also engaged in verbal gymnastics over the deficit. What is interesting is that that somehow encapsulates the slipperiness of the Labour Government. Having come into office as the Minister of Finance Dr Cullen said that he would change the definition of the deficit. Of course Labour’s back bench did not understand what he was doing but he did change it. He changed it to what is called the “operating balance excluding revaluations and account changes”. The operating balance excluding revaluations and accounting changes was useful; it was a more technically correct accounting measure. Economically speaking it was not much different from the measure that was there before but Dr Cullen ran with it in five of his six Budgets. 
But when he figured out that it was killing him politically—that it was showing to New Zealand that Labour was opposed to tax cuts in any circumstances—he suddenly decided to change the measure of the deficit. New Zealanders are still laughing about that. No one believes it because it is economically wrong. He is in fact trying to wind New Zealand’s budgeting system back to the mid-1980s when his own party—quite rightly—changed it because it was wrong. If cash accounting was the way to run a country that is what we would be doing but we have had bipartisan agreement for 15 years that it is the wrong way. Suddenly Dr Cullen decides to change the measure of the deficit because it does not suit him! That is utter nonsense. It is intellectually dishonest it is political chicanery and middle New Zealand will take no notice of it whatsoever. They know that Dr Cullen’s definition is as sensible as saying that Mr and Mrs Smith are running a cash deficit because they do not have the money in their pocket to buy a new house. That is what he is saying. That is the kind of deficit those MPs are signed up to; it is economic nonsense. It makes no sense at all—particularly when he keeps saying that this is all about the long-term framework. 
The reason one does not run cash deficits is that it takes no account of future assets and liabilities and ability to fund the assets and meet the liabilities. So it is a nonsense. It was a disgrace that the Minister of Finance should expect us to take it seriously. He expected us to take seriously his new definition of the Budget balance but it just will not work. The public will not say: “Oh! Dr Cullen has suddenly run out of money!” when he has been showering them with dollars from the sky through the rest of the Budget. That simply will not work and it is a result of Dr Cullen’s misjudgment. 
What he should have done was come to the House and say that he got it wrong that he was overtaxing us that he could give us quite a lot of it back and that here were the significant personal income tax cuts that he believed should be made. Instead he succumbed to media and public pressure that his surpluses were too big and tried to make it look like he was being clever when in fact he was simply wrong. 
I now pass on to education. Well what a joke in education! The last Minister of Education standing Trevor Mallard is now the biggest political liability this Government has—an even bigger liability than Michael Cullen will turn out to be. The great thing is that Trevor Mallard is the best operator in Labour’s caucus. Is that not wonderful? He is the man who managed to upset the whole of middle New Zealand by putting $20 million into Te Wananga o Aotearoa then upset all the Maori voters by attacking the wananga. He managed to upset everybody—that is political finesse if ever one saw it. But what has he done today? I shall tell members what he has done today. 
There is an increase of a total of $19.8 million in the operations grant for every school in New Zealand this year—not for 4 years but per year. Or if we calculate it a bit differently it is a bit over $20 million. That is the increase for 2700 schools. Let us call it $20 million. Can members guess what the increase is for the Ministry of Education? 
Lindsay Tisch 
: No what is it? 
Hon BILL ENGLISH 
: It is $24 million. So the Ministry of Education is getting a bigger increase than every school in New Zealand. 
If anything sums up the priorities of this Government this is it: more for bureaucrats less for kids. [ 
Interruption 
] I will repeat it: more for bureaucrats less for kids. That is Labour. There is a big fat Ministry of Education and schools are starving for money. Every Labour member knows that that is the case in his or her electorate. I invite those members to go back to their electorates and say that they have done exactly what parents want. They can say that they have put more into the Ministry of Education than into schools because they think kids do better by having more bureaucrats and that spending $2.6 million more on policy advice will teach children to read. That is better! Schools are laying off support staff to feed some fat bureaucrat at the Ministry of Education. It is a disgrace. It shows that Labour does not value our children. It has wrecked our qualifications system because it does not give a stuff about teenagers their aspirations and their need for a decent qualification. Now the Government is starving schools of cash so that it can feed its fat bureaucrat mates in Wellington Central so that they will vote for Labour. 
I look forward to campaigning on education. I am happy to go to any of those Government members’ electorates to have a public debate about why we should put money into schools instead of doing what Labour has done which is to put it into the fat Ministry of Education.