Tisch Lindsay: Budget Debate 
Tisch Lindsay: Budget Debate 
[Volume:608;Page:6018] 
LINDSAY TISCH (NZ National—Piako) 
: 
 What a sad day it is today! New Zealand has been excluded from a free-trade agreement with the United States. 
David Benson-Pope 
: You’re making it up. 
LINDSAY TISCH 
: The senior whip says I am making it up yet all the media reports even from the embassy today are saying that New Zealand has been isolated. We stand alone; out on the side. We are not a team player and we have been excluded from a trade deal that the United States is prepared to sign with Chile and Singapore. Where is New Zealand? We are not even considered. We are on the scrap heap. We are missing out on a billion dollars of trade because this Government has come out said: “We are not going to support our traditional allies—the United States Britain and Australia. We know better. We are going to stand apart.” 
Six months ago in December Robert Zoellick the US Trade Representative said that there was possibly an opportunity for New Zealand to be included in a free-trade agreement along with Australia. What has happened since that time? We have seen the New Zealand Prime Minster standing out to one side saying: “We don’t want to be a part of it. We don’t to support our traditional allies.” So what has the United States done? We have said time and time again that trade is linked to our traditional relationships with our trading partners and friends. In testimony before the US House of Representatives agriculture committee on 21 May Zoellick said that negotiations for a free-trade agreement with Australia which President Bush aimed to complete in 2003 would not extend to New Zealand. 
The senior whip said I was making it up. This is straight from the embassy which says that the free-trade agreement will not extend to New Zealand. “That is my present expectation” Zoellick said. “Citing one challenge he indicated that US farm groups would be likely to oppose increasing imports of New Zealand lamb and dairy products diminishing support for such an agreement in the Congress.” He also said: “New Zealand has taken some actions recently that would pose problems for congressional passage of a New Zealand free-trade agreement.” 
That spells it out—this Government is responsible. This Government does not have the foresight to see where we need to position ourselves. No wonder Treasury said that there would be only 2 percent growth next year. We now know why. It is because we have been excluded from that very important free-trade agreement. Zoellick said he expected to be signing a free-trade agreement with Chile very soon as well as Singapore. But where is New Zealand? We are left out. 
I represent a rural constituency—the Piako electorate. We are a nation of farmers. That is where the growth in New Zealand comes from. What does this actually mean to the farmers the people I represent in my area? Well we are not going to forget this day. We will not forget the cruel blow that this Government has dealt to the prosperity of all New Zealanders in the cities and the towns. That free-trade agreement with the United States was something we could have hung our hats on. We are an exporting country and most of our wealth comes from the rural sector. It is the rural sector that has given us growth and buoyancy over the last couple of years. Export prices commodity prices low interest rates high prices overseas and the weather have all contributed to buoyancy in rural New Zealand and that prosperity has flowed through to the cities. This country has had the ability to capitalise on that; it not due to anything that the Government has done. But today the Government has put a nail in the coffin of any future growth because this Budget is a no-growth Budget. 
Certainly the announcement today that New Zealand has been excluded from a free-trade agreement is something that this Government will have to bear. At the next election Labour Party members will be hanging their heads in shame that they did not support our traditional allies when the time came and they asked New Zealand to stand beside them. But our Government said: “No way. We’re going to isolate ourselves and put our support behind those non-aligned countries.” We could not go out there and say to our friends—the Americans the UK and our Australian colleagues—that we were prepared to stand beside them. 
This Government oversees “New Zealand Incorporated”. The mission of a Government should be to provide a very prosperous economy and an environment in which businesses can grow. Every year about 44000 new businesses are created in New Zealand and about 45500 of them fall over. The rate of births and deaths of small businesses is amazing but it is a natural progression. Small businesses in New Zealand are going to be hard hit by the Government policies of the last few years. Nothing in the Budget actually said to small businesses that the Government thinks they are important and will help them out. This Government will form a committee to advise the committee on another committee. This Government is all about forming committees; it is all talk no action. If we want growth in the economy—and most of the growth in the economy comes from small to medium-sized businesses—it follows that we have to remove those compliance costs and regulatory barriers. Since this Government has been in power that regulatory creep is causing a real problem in terms of the way New Zealanders do business. 
I shall quote some statistics to show the importance of small business to New Zealand: 92 percent of Kiwi businesses employ fewer than 10 people and specifically 80 percent employ fewer than five people. We are a nation of small businesses. Of course an owner-operator or owner of a business is obliged by law to comply with complex regulations and laws and pay tax. Some very interesting statistics have come out in recent times. The extra compliance costs for a business employing 20 people in February 2002 was estimated at $26000 but in December 2002 that figure was $43877. That is a huge increase in compliance costs and New Zealand businesses are carrying the can. We are not operating under a cost-plus mentality now. Prices are driven by the market: they are whatever people are prepared to pay. The National Party is saying that we have to get those regulatory barriers and compliance costs out of the way so that business can get on with the job it does best—growing the business employing the people making the investment. That is where growth comes from. Businesses create growth not Governments but this Government would not know that. It wants to empower the bureaucrats. That is where this Government thinks growth comes from. It says: “Tax the people tax businesses.” That is the way it thinks it can fund its operations but it does not work. 
I want to mention a couple of measures because they are huge hindrances for business. The first is the Holidays (Four Weeks Annual Leave) Amendment Bill which is being proposed by the Hon Matt Robson. He might stand and say something about it but I say that the increase from 3 weeks’ annual leave to 4 weeks’ annual leave will also create relativity claims because those getting 4 weeks’ leave will want 5 weeks. Small businesses cannot afford that sort of compliance cost. Then there is the matter of payment for statutory holidays and holiday pay. If staff work on a statutory holiday the employer will have to pay time and a half—penal rates. A lot of businesses do that anyway but at the same time they have to give a day off in lieu. 
A real challenge is the 3-day bereavement leave provision. What does that mean? It is not 3 days per year; it is 3 days if a close relative dies. We will see a multiplication here. A businessperson whose company employs 53 people came to see me. If this bill is passed in its present form that company will pack its bags and go to Australia because of the huge compliance costs this Government is going to impose on business. There is no incentive to be in business today—none at all. Those huge compliance costs are causing employers to say: “Why should I bother? I might as well put my money in the bank.” 
As well as that there are sick leave provisions that say that employees do not have to produce a doctor’s certificate for 4 days’ illness. That is open-ended and I know what will happen—there will be an abuse of the system and small business will carry the can. There is also the extension of paid parental leave from 12 weeks out to 14 weeks. We have union negotiations; we have this thing called “stress in the workplace” Heavens above! I wonder what that means. Employers cannot insure against it. Then there is “mental fatigue”. I wonder what that is. Members opposite probably suffer from mental fatigue all the time. 
Hon MATT ROBSON (Deputy Leader—Progressive) 
: 
 I now know that to be a member of the National Party—and it probably goes for the other right-wing parties; ACT and New Zealand First—is very easy. They can be lazy. They do not have to do any thinking. They do not have to develop their own international policy. All they need to do is go into www.republicanparty.org.usa and take a photocopy and spread it around—then they have their foreign policy. Nothing has changed from when I became conscious of international politics and the war in Vietnam was waging. The National Party of the time did not have its own foreign policy. It supported an immoral illegal war which killed millions of people and said: “We’re doing it because it’s free trade and we’re doing it because of our traditional allies.” In other words “Easy—don’t think.” [ 
Interruption 
] On 4 weeks’ leave one can shift to Australia. I tell Mr Tisch that in Australia 4 weeks’ leave is normal for workers and most of them have 5 or 6 weeks. 
This is the fourth progressive Budget from the centre-left coalition first elected in 1999. The Budget shows a net cash surplus of $4.2 billion from core Government operations as at 30 June 2003 which lets us invest $1.2 billion net investment in physical assets like schools for the benefit of the nation and $1.2 billion is to be invested to partially fund known future pension liabilities. That is responsible centre-left rule for the benefit of current and future generations. That is progress. It is the rebuilding of New Zealand. Budget 2003 permits us to build further on the framework put in place in the past 3½ years to facilitate economic development jobs and safer communities. It builds after the wreckage of the policies of Roger Douglas through the 1990s of the National minority Governments. 
The need to have a framework in place to facilitate the creation of high-paying jobs for all of our people is all the more necessary because the international environment is so uncertain. Yesterday we had a frank insight into why the United States does not want to enter into a fair trade deal with New Zealand—a deal that would facilitate job opportunities certainly in New Zealand export industries. The reason it will not lower its punitive barriers on our exports has nothing to do with our independent foreign policy which puts New Zealand’s interests first. US trade representative Robert Zoellick yesterday told it as it is. He dashed hopes of a fair trade deal between our two countries by citing too many objections from Washington-subsidised United States corporate agricultural interests in dairying and sheep meat. The anti-fair trade policies of the rich economies of the United States Europe and Japan are against New Zealand’s national interests which seek a fair multilateral rules-based system. Their practices also cost lives and living standards in the developing world. But that is the world we live in and Dr Cullen has to manage the coalition finances with a view to having the most positive impact on the New Zealand economy within the context of the hard cold facts of the international environment. 
Despite the uncertain international scene Budget 2003 builds on the steps taken since 1999 to foster intelligent partnership with industry sectors and regions and between business and Government agencies to leverage more out of the business expansion opportunities in New Zealand and overseas as they arise. In particular the Progressives are pleased that this Budget provides for policies that are dear to our hearts. There is another $85 million for industry training schemes. We will have 100000 in training by 2005 because of that. There is another $56 million towards getting all youth under 20 into jobs education or training by 2007. That is the way in which National should attack the dole problem. Also in this Budget is $37 million over 4 years for a long-term trade development strategy and $400 million over 4 years is being added to the existing $112 million for industry and regional development funding. This is investment in the future. It is a vote of confidence. 
There will be more for children getting cheaper or free doctors’ visits the elderly can look forward to cheaper health-care and there is more for early-prevention programmes. Next year when an even more progressive Budget is introduced low-paid workers will have a minimum of 4 weeks’ annual leave as an extra bonus. The coalition has acted on drug abuse. The Labour and Progressive parties will not agree on everything. The Progressives for example will continue to advocate for no fee increases for any tertiary students and we hope that that policy will come to fruition. We also recognise that that will mean a reduced Government surplus or that cuts to other programmes of lesser priority than education need to be put in place. The challenge for those voting against Budget 2003—National New Zealand First ACT and the Greens—is to put up a coherent alternative upon which they can all agree. But they cannot agree on anything except to promote negativity and promise the earth. They stay silent on how they will develop the economy or what tax regimes they will put in place.