English Bill: Budget Debate 
English Bill: Budget Debate 
[Volume:639;Page:9515] 
Hon BILL ENGLISH (Deputy Leader—National) 
: 
 The one thing we learned from this Budget is that Labour is preparing for retirement. If Trevor Mallard is the next Minister of Finance many other New Zealanders will be deciding to retire from New Zealand and go elsewhere. Today in question time we saw Dr Cullen’s real credibility problem. He has been arguing for months that any tax cut means a cut in doctors and teachers. In fact his office said it again just last night to the  
Dominion Post  
or the  
New Zealand Herald 
. It said: “Ask National which teachers and doctors it will sack if it reduces taxes.” I asked Dr Cullen that today—a simple question. He has just given a $1 billion tax cut so I asked him which teachers and doctors would be sacked to pay for that tax cut. 
Hon Members 
: What did he say? 
Hon BILL ENGLISH 
: He did not say anything actually. I think he was flummoxed. He did not know what to say because he suddenly realised how stupid his argument was. 
Chris Auchinvole 
: He fell through the trapdoor. 
Hon BILL ENGLISH 
: That is dead right. We can only infer—to use a word that he would understand but that Trevor Mallard would not—what he means. What he means is that if Labour cuts taxes under severe pressure from the electorate and one of its coalition partners then that does not mean there will be any changes to public spending—because it is a Labour tax cut. But if National cuts taxes because it is good for the economy and will lift productivity then that can happen only if doctors and teachers are sacked. 
So I challenge Dr Cullen again. I want him to tell the country why he can have a tax cut with no impact on public services—no sacked doctors and teachers—but if National says there is one then that means doctors and teachers will get sacked. Clayton Cosgrove does not understand the fundamental error that Dr Cullen made today. That is that Labour cannot argue that any more. It cannot spend the next 18 months saying that National will ruin the public services if it gives tax reductions. [ 
Interruption 
] Well he will try. Do members know what will happen to that member? He will lose his seat. That is what will happen. He is the one man who took a safe Labour seat and turned it into what will be a safe National seat after the next election. And he is the one with real potential! At least Judy Keall got her majority to go up. 
You see the reality in any Budget is that a Government gets to make choices about its priorities. In this Budget Labour came up with not just $1 billion of tax cuts but another $1 billion of KiwiSaver sweeteners. So that is $2 billion where Dr Cullen had the choice of what to do about it. He had $2 billion worth of choices. That of course gives the lie to all the arguments he has raised. He has always said there can be no tax cuts because there is not enough cash it is too inflationary and it will affect Government spending. Yet in this Budget he came up with $2 billion worth of tax cuts and savings sweeteners. 
So the argument now is about the priorities. Does a Government spend all its time giving out cash that it earns from this economy—[ 
Interruption 
] 
 I raise a point of order Madam Speaker. I have generally good hearing but I am getting somewhat of a pain in my ear from the consistent interjections by the person back there. 
The ASSISTANT SPEAKER (Ann Hartley) 
: That member interrupted during a point of order but so did a member here. I will give a warning. There was a fair bit of barracking during the previous speech too Mr English but I take the point that consistent barracking is not acceptable. 
Hon BILL ENGLISH 
: That is why National is arguing for a more balanced approach to economic management. With every Budget every Government gets a choice. Labour has consistently chosen to treat the economy like a cash machine—take the public’s cash card along get the cash out and then spread it around. That has become more and more about Labour using the public’s cash to maintain Labour in office. We are saying that there should be a more balanced approach to economic management. 
Darren Hughes 
: What does that mean Bill? Give us some figures. 
Hon BILL ENGLISH 
: It is a bit like the Australian Budget. Even with smaller surpluses than we have it is quite clear that over time Australia has delivered lower taxes higher public spending and more investment in infrastructure. Those are the choices that Dr Cullen could have made but because he is so deeply opposed to New Zealanders using their own money he would not do it. 
I tell the House today that National will do it. When there are surpluses in the economy we will put forward a credible programme of tax reductions. There will be more investment in infrastructure. There will be enhancements in public services. We will be focusing on the productivity and growth of the economy not just on savings. Of course savings are a good idea and the country needs some but they do not mean much if there is nothing to invest them in. The people who are running KiwiSaver will face the problem of the lack of productive profitable investment opportunities. The mums and dads who do take up KiwiSaver in the end will need good returns on those investments. They will want to invest in New Zealand and they will need good returns for it to come to much. [ 
Interruption 
] I point out that a lot of people who voted for Mr Hughes will not be able to use KiwiSaver and that is the other big question that Labour needs to answer. What is it that it has done for those low and middle income people who have been loyal supporters and who are among the many people who do not have children aged 0 to 18 years? 
Darren Hughes 
: Working for Families minimum wage. How many of those? 
Hon BILL ENGLISH 
: I will tell the nearly former member for Otaki how many there are. Only about 400000 people in New Zealand qualify for Working for Families out of a workforce of over 2 million. In fact most people do not receive Working for Families and most of the low-income ones will not get KiwiSaver. In fact it is even worse. That member—and Dr Cullen—promised those people a tax cut in two Budgets in a row and in this Budget Dr Cullen took it away. Today I asked Dr Cullen why he decided to take away the “chewing gum” tax cuts worth $400 million but he would not say. The reason is that he could not even bring himself to give a tax cut that he had already promised. 
John Carter 
: Twice he promised it. 
Hon BILL ENGLISH 
: Twice he promised it but could not bring himself to do it. So the wrong people are paying for KiwiSaver. Those who are paying for it will be worst off in three ways. 
Jill Pettis 
: You lot haven’t done that since 1966. 
Hon BILL ENGLISH 
: That member’s voters in Wanganui are worse off. They cannot take up the KiwiSaver sweeteners because they cannot afford to save. Labour has forgotten that it used to represent people who could not afford to save. Those people will not get the KiwiSaver sweeteners and they lost their “chewing gum” tax cuts. When they go to the boss to ask for a pay rise he will say: “Labour has already put it in your savings account for the next 4 years. Go away!”. They will be much worse off under Labour. 
Darren Hughes 
: Voted for corporate tax cuts. 
Hon BILL ENGLISH 
: The member will regret this. Labour is preparing for retirement. It has written a whole Budget about it. This is all about retirement. I say to that member that New Zealand is not retiring. New Zealanders want growth opportunity and dynamism. We are not winding down. National is going to wind this economy up not wind it down. It is just a shame that Labour has taken an economic strategy that reflects its place in the election cycle. 
Darren Hughes 
: Voted for corporate tax cuts. 
Hon BILL ENGLISH 
: Labour members are headed for retirement. All they are worried about is their post-retirement income; and they should be. What prospects does the member opposite have? 
Hon Members 
: Not many. 
Hon BILL ENGLISH 
: Not many! The economy is not heading for retirement.