Burns Brendon: Appropriation (2011/12 Estimates) Bill — Third Reading Imprest Supply Debate 
Burns Brendon: Appropriation (2011/12 Estimates) Bill — Third Reading Imprest Supply Debate 
[Volume:674;Page:20522] 
BRENDON BURNS (Labour—Christchurch Central) 
: 
 I am pleased to follow the member opposite Michael Woodhouse who had the temerity to talk about tax and fairness when he is a member of a party that introduced two rounds of tax cuts that favoured the top end of town the “Tea Party” of New Zealand. He had the temerity to also talk about opposing the inclusion of agriculture in the emissions trading scheme when agriculture makes up 48 percent of our emissions profile. The equivalent of our continuing to exclude agriculture is like Australia saying it will not tax the emissions that come from its coal industry. There has to be fairness across the globe. 
That member also wanted to talk against the capital gains tax yet we want to emulate Australia. It has had a capital gains tax for 20 years and it has done nothing to constrain its growth. If we do not adopt a capital gains tax we will be the only turkey of the Western World that does not have one other than the tax haven of Switzerland. There is the international comparison. 
We are considering the Appropriation (2011/12 Estimates) Bill and the Imprest Supply (Second for 2011/12) Bill at a very dark and worrying time and I speak both of the international horizon and for my city of Christchurch. At the moment riots are occurring in the city of London and in other parts of England. Why is that happening? It is happening because of inequality. The world financial markets are in turmoil and the fears are that we could be heading back to the dark days of 2007 and 2008. 
Where is the National Government’s plan to deal with these issues? In the House today Bill English said that we need to save as a nation. He is the very Minister who took away one of the pegs underneath the KiwiSaver scheme in 2008 so he could fund the first round of his tax cuts. Why is he saying today that we need to save when 3 years ago he cut one of the very schemes encouraging New Zealanders to save? Where is the consistency and coherence in policy when he does things like that? 
Bill English also said in the House today that we should not be talking about the need to keep assets here and away from the hands of foreigners when we are prepared to borrow from foreigners. The point is that when we keep assets in New Zealand hands we retain an income stream and we are able to repay our debts. Once those assets are sold they are gone and there is no income stream to repay our debts. Labour has a plan around asset sales. We say to keep assets in New Zealand hands and not sell them off. Labour has a plan around the capital gains tax which everyone knows in their heart of hearts is the right policy because it has been adopted by virtually every other nation in the Western World. We have a real commitment to training and skills not like this Government which has taken $130 million off training schemes over the last 2 years. 
Here is where we are as a nation at the moment—here is where we are. We are a tiny cork on an ocean of international debt. We cannot influence international markets but we can and must have a sound financial management policy and a plan for the future. When those members opposite stand and talk about financial management they always forget how sound the economy that they inherited was. I asked the Parliamentary Library today to tell me what the situation was with Crown debt under the last Labour Government. Here is what it was: when Labour came into office in 1999 following a National Government net Crown debt was nearly $26 billion—$26 billion—which is equivalent to 24.4 percent of GDP. What was it when we went out of office? It was down to $2.6 billion—$2.6 billion—which is equivalent to 1.5 percent of GDP. That was our proud record in office. We paid down the debt. We resisted the urges of National in 1999 in 2002 and in 2005 to cut taxes at the time of surplus at the time of boom which would have been absolutely the wrong thing to do by any orthodox economic measure—absolutely the wrong thing to do. Instead we paid down the debt and left this nation in a very sound state to go through the difficult times that we are going through today. 
There is one other figure from the Parliamentary Library about the payment of debt: the percentage change in general Government financial liabilities as a percentage of GDP between 1999 and 2008. One country did better than New Zealand and it was Norway. It had oil revenue. It paid down more debt than we did but we were the second-highest nation in the world in terms of paying down debt through that period of boom. That is the financial record of the Labour Government that is the record that National inherited and that is what has helped this country through its difficult times to date. 
But we still need a plan and we still need a sense of coherence and direction. We do not get this at all from this Budget. The Budget of course includes money for the Canterbury earthquake recovery and I acknowledge tonight that the Government—through the Budget and indeed through this Imprest Supply Bill—has put up funding towards the recovery of Christchurch. We need that funding. I acknowledge that the Government has done the right thing in that respect. Around $5.5 billion of funding has been provided. 
But let me also tell members about one of the other sources of funding that I believe is a prospect. I am pleased that the member for Rangitata a Canterbury MP is in the House tonight. I again issue my challenge as I do every time I speak on this issue to a Canterbury member to stand and take a call and tell me that I am wrong when I say that this Government if it is re-elected is very likely—is on course—to force the Christchurch City Council to sell its asset base to fund its share of the recovery. It is the same philosophy this Government adopts in terms of national debt. Why would it not do it locally in Christchurch? 
More than that here is the record of the Finance and Expenditure Committee report on the estimates for Vote Finance 2011. The commentary states: “As the Canterbury Earthquake Recovery Act 2011 allows the sale of Christchurch City Council assets to fund the rebuilding of the city we asked the Minister of Finance whether he would guarantee that this would not happen. The Minister said that this was a matter for the city council to decide. He added that the Government would discuss cost-sharing with the city council but that it was important that the council have a stake in the process … discussions are just beginning”. They are beginning all right. They are starting to begin. Again I invite a Government member from Canterbury to stand take a call and put it as a matter of record in this House that this is not being steered by this Government for delivery. After the election the assets of $2.2 billion held by the Christchurch City Council through its holding companies—including the Orion network the port the airport Enable Networks and Red Bus Ltd—will deliver an enormous stream of dividends to ratepayers. In the case of Orion alone $1 billion has been paid back over the last 20 years to the ratepayers of Christchurch which is $1 million a week. 
I again challenge members opposite especially from Canterbury to stand take a call and put it on the public record that under the fearful prospect of a re-elected National Government we will not see the assets of Christchurch sold down and we will not see an enormous increase in rates in Christchurch as a result. Those assets prop up our city and contribute to the repayments that we are able to make for the recovery. We are prepared to pay our share but we are not prepared to see our assets sold down the river by this Government with its economic philosophy that it is all right to sell assets: that we pay down the debt forget the dividends and get the money in the bank as quickly as possible—that we forget about tomorrow and make the balance sheet look good today. That is the basic premise of this Government: selling State assets. National will do the same I believe if it is re-elected. 
I again challenge members opposite to stand take a call and deny that this is a prospect because it is on the record of the Finance and Expenditure Committee that it is actually allowed by the Canterbury Earthquake Recovery Act. The Minister of Finance told the Finance and Expenditure Committee that it is there. Again I challenge members opposite to deny that that is a prospect under a re-elected National Government following on from this Budget appropriation for 2011.