Prasad Rajen: Debate on Prime Minister’s Statement 
Prasad Rajen: Debate on Prime Minister’s Statement 
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Dr RAJEN PRASAD (Labour) 
: 
 I am pleased to take a call in the debate on the Prime Minister’s statement. It is the first time I have responded to a plan from the Prime Minister. 
A few speeches ago we heard from the Minister for Social Development and Employment. I would have expected the Hon Paula Bennett to take the opportunity available to her to take the social development content of the Prime Minister’s statement further. It certainly was a glorious opportunity—a set piece if you like. We expected Paula Bennett to explain her social policy and social development direction a little further. That would have given us a sense of what the Government is trying to achieve in its social development programme as reflected in the statement. 
She could have at least taken the opportunity to explain her own philosophy about where she wants social development to go. A great opportunity was made available to the Minister. Perhaps she could have shared with us some of her own doubts and ambivalences about what her Government is trying to do and the problems it is trying to address in this country in terms of social development. I would have respected such a speech. I would have listened to it very carefully probably very quietly and even respectfully. That opportunity was there but it was missed. In its absence my women friends from this side of the House were railed against for no good reason at all. I would have thought that the opportunity might be taken but it was an opportunity lost. 
One looks for certain things in the Prime Minister’s statement. I would have thought the Hon Paula Bennett would have told us about the markers she was looking for. For me I looked for some kind of balance in the statement some kind of measure of fairness and also for solutions to the pressing social and economic needs of our society. I especially looked for comments on solutions to the needs of the most vulnerable in our community. This Parliament stands as their champions—and everybody else’s. For me there are two primary components that one looks for. They are the two components of national development and the core business of this House: the economy and the people without whom the economy would not exist. Those are the two components. Put another way one would have looked for the statement to address national development which is a result of the combination of economic development and social development. That is what I was looking for in the statement. 
I was also looking for solutions that benefit the many not the few. Let me take two examples. One is the policy framework for GST. The plan is to raise GST to 15 percent and colleague after colleague from this side has got up to demonstrate what the effects of that will be on a particular section of our society. The idea is to increase GST to provide some tax relief and at the same time to use a significant amount of that money to decrease tax at the upper end. In that statement and subsequent statements we are also promised that no one will be worse off. Well I think we should interrogate that proposition in some detail. Others have done it but I am trying to gauge for myself whether there is balance in that particular statement and I will use that proposition as an example. 
For those on low incomes the increase in GST even with some compensating tax relief means their situation gets no better. I do not understand how the Prime Minister can say that their situation will get somewhat better. It is not possible to see that occurring. However [ 
Interruption 
]—I will explain to the member how that is so and I invite him to do this exercise in his own electorate with people who fall into this particular category—for the other end of the spectrum for those earning above $70000 the benefits will be enormous compared with the benefits for those who are on a limited income. For an individual or a family on a low income for low-income people who work hard for their wages any increase in GST in the cost of food clothing petrol rates etc. raises enormous burdens. 
After paying for the basics those families end up— 
Hon Dr Wayne Mapp 
: Haven’t you heard about the compensation provisions? Don’t you listen? 
Dr RAJEN PRASAD 
: The member may not want to listen to the analysis. There are not many people of that nature in his electorate but there are in an electorate not far from his. For them the benefits will be nil but for many in his electorate there will be significant benefits and perhaps that is where his interest lies. My interest is in seeing a balance between the two. After paying for the basics families on low incomes will end up with no spare cash at all. Even with tax breaks there will be no benefit to them at all. They spend 100 percent of their income—the member knows that—on just living day by day. Is that the step change we have been promised in the statement? It is not a step change. It actually is a continuation of the kinds of policies that National Governments have pursued for generations—privilege the rich and punish the poor in one form or another despite the rhetoric. For those on high incomes a smaller percentage of their income goes on the basics and the tax cuts will give them quite good relief. So GST increases will be a huge burden for low-income households. 
If we deconstruct the proposals on GST in the Prime Minister’s statement we cannot be satisfied with them. If members opposite were intellectually honest and applied their minds to the exercise they could not be satisfied that that policy is fair to the human input into national development. Therefore it is a policy that is not balanced. Therefore it is not fair. It is to the contrary; families at the lower-income level will still struggle. It is really a shift of resources from the poor to the rich. 
There is another matter that I want to raise. A lot is said in the statement about social services. It purports to address the emerging underclass. The Prime Minister plans to improve social services. We do not know where Whanau Ora will lie. I hope it will lie in a place where it does improve social services beyond where they are today. I will not bag the social services of today because the people who do that work day in and day out go out and do work that nobody else in our society wants to do. 
Te Hurihanga was a programme that was actually working and working successfully. 
Hon Member 
: Aw! 
Dr RAJEN PRASAD 
: If that member would like to identify himself and say that it was not I would question that. It was not social engineering I say to my good friend. That programme was working and working for the most difficult 20 cases or so. Last week Mr Power challenged us that we do not know what we are talking about. Well I challenge Simon Power to take a call and tell us the real background to tell us what it is that Judge Caroline Henwood does not understand. The newspapers report daily that that was a stupid decision. Somehow Paula Bennett turned it round in a perverse cynical kind of way. Her argument today was that by closing down that facility those resources can be used for the many not for the few. That is what she said three speeches ago. That is very cynical because that programme’s clients were the very people whom those on the other side say they are concerned about. They are the ones who create a lot of difficulty. 
By my two factors by which I judge the Prime Minister’s statement it is not balanced and it is not fair. It will not work in the long run.