Cullen Michael: Debate on Crown Entities Public Organisations and State Enterprises — In Committee Speaker Recalled In Committee 
Cullen Michael: Debate on Crown Entities Public Organisations and State Enterprises — In Committee Speaker Recalled In Committee 
[Volume:617;Page:13237] 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I was rather hoping one member of the Opposition would want to debate this extraordinarily large element of the New Zealand Government’s expenditure and programme. As I outlined this afternoon in the House the two largest long-term fiscal pressures facing any Western Government are provision for superannuation and provision for health care partly because of the ageing of the population. But the Opposition is far more interested in debating the New Zealand Teachers Council than it is the New Zealand Superannuation Fund. 
During 2002-03 the New Zealand Superannuation Fund had not gone to market. It was still being managed within the Debt Management Office in Treasury. Subsequently arising out of that year the fund has gone to market. Despite the claims made—for example in the  
Listener 
 
in what I regard as National’s weekly column on politics—that the New Zealand Superannuation Fund has lost lots of money on the market it has done absolutely no such thing. Since it went to market in October last year it has outperformed its own targets. It has outperformed targets such as the rate of return on New Zealand Government bonds. That can be compared for example with the Government Superannuation Fund which when the equity markets were bad was losing money. Even so since it went to market it has averaged a post-tax return of 4.7 percent which is above the bond rate return in terms of a post-tax rate of return. So it has done better than it would have done had it not gone to market in that period. 
We have heard a great deal about the supposed losses that were made all of which were unrealised losses on paper but suddenly now that the funds are doing well we hear a total silence from members opposite—except on the question that we want answered. We know about the National Party’s “by lunchtime” promise. It will reform the Resource Management Act within 3 months—so it says—and of course it promises that it will have nuclear ships back by lunchtime given the opportunity. We want to know whether National if it became the Government would have the New Zealand Superannuation Fund gone by lunchtime. If the New Zealand Superannuation Fund is to go by lunchtime what will replace it in terms of security for pensions for the baby-boom generation? There are tens of hundreds of thousands of people in that generation born between 1946 and 1961 or so who want to know where their pension is to come from. There is only one answer: a Labour-led Government. There is very little hope it will come from a National-led Government because National says that the New Zealand Superannuation Fund is not important to the future of New Zealand's superannuation. Well the latest figures show that at peak 36 percent of the funding of New Zealand superannuation will come from the Superannuation Fund. That is equivalent to $138 a week of the current married rate for superannuation. We should go out there now and ask superannuitants—those who are married couples—whether they would notice a cut in their superannuation of $138 a week. No doubt to people like Mr Key that is peanuts but to the great majority of superannuitants it is a great deal of money indeed. 
I raise the point further because what the Budget documentation will show is that the only real room available for tax cuts to the rich—so beloved of the National Party and the ACT party—will come about only if the Superannuation Fund is abolished. The only real big headroom for major fiscal initiatives over the next few years will occur only if the New Zealand Superannuation Fund is abolished by any future National Government. So the National Party will face some very hard choices and some very hard questions come Thursday afternoon in the House and subsequently. It will face them particularly from people who are part of the baby-boom generation. Lynda Scott is one of those people although she does not look as if she is booming very much at the present time because she is well looked after in other respects. Mr Carter claims to be a baby-boomer although I think he may be flattering himself slightly in that regard. He is more a sort of pre-boomer like I am. 
We want to know whether superannuation like all the other State-owned enterprises and State assets will be gone by lunchtime if the people make a mistake and vote for a National Government. Or will the New Zealand Superannuation Fund remain in the long term as an important part of how to fund New Zealand superannuation so that ordinary New Zealanders can enjoy a decent pension in retirement? That is the question we need an answer to today. It is one of the many questions the Opposition National Party will have to face over the next 15 or 16 months as we run into the election and it will get a surprise when it understands it has no answers.