Rich Katherine: Taxation (KiwiSaver and Company Tax RateAmendments) Bill — Second Reading In Committee Third Reading 
Rich Katherine: Taxation (KiwiSaver and Company Tax RateAmendments) Bill — Second Reading In Committee Third Reading 
[Volume:639;Page:9464] 
KATHERINE RICH (National) 
: 
 I am always keen to hear from that Minister. He is a Minister who on this side of the Chamber we have a lot of respect for. But I think he overestimates the interest of 18 or 19-year-olds in this particular legislation. The Minister would have been a rare 18-year-old in taking out superannuation when he was at university although it is quite nice to think that while most 18-year-old men were thinking about beer girls and rock ‘n’ roll Peter Dunne was taking out his first superannuation policy planning for his future. I think he is a rare person who demonstrates common sense. 
One of the things that concern me about this legislation is that there is very little in it for people who vote Labour. We heard Russell Fairbrother talk about the person on $11.25 an hour and how he or she would benefit. I say to him that people on $11.25 will not opt into KiwiSaver because they cannot afford it. They cannot afford it because if they earn that amount of money they are struggling to put bread and butter on their tables and cover their costs. Those are the people who were shouting the loudest for tax cuts so they can increase their discretionary income and cover a few more of their bills. 
So low-income Kiwis on $11.25 an hour will now be in a position of subsidising the superannuation of higher-income people who have the ability to put some money away and save. And that is the thing. The $11.25 an hour wage earner will be hit in two ways. First those wage earners will not have the true option to opt into KiwiSaver. They will not put their money away. They will not be able to get credits through KiwiSaver and they will also be asked to subsidise high-income Kiwis who do have the option to save. But the last thing is that they will not get any pay increases. 
We have heard from the Minister of Finance and the unions that in order to appease some of the concerns of employers they are sending the message out right now that no pay increases should be expected. Basically this is the pay increase for those wage earners. So those people will get very little whatsoever and I think that will dawn on a lot of people as they suddenly work out the details of this package. I think of all those 18 and 19-year-olds in my home town right now. They are not going to get all excited about this. They will not see that they will be better off by getting a payment in 45 years’ time so I do not think they will be particularly excited about it. 
I think what we are seeing here is a debate forming about the difference between independence and dependence. Members heard my learned colleague Simon Power make the point that those Kiwis who are earning the average wage want to be able to survive and to be independent. They do not want to have a relationship with a Work and Income manager if they can help it. They do not want to spend their lives filling out forms because they believe that they are only getting back money they have earned in the first place. Therein lies the difference between National and Labour. We believe that people should be independent that they should not have to form a relationship with someone from Work and Income unless they really have to and that we should do more to allow people to stand on their own two feet and not continually have more money taken from their pocket only to have it handed back by the Government which believes that they should be grateful for getting their own money back. 
Even if we look at the Budget where has the chewing gum gone? In 2005 when Michael Cullen handed out this tax cut and thought that this would appease those calling for tax cuts he said: “You can have one but it will be in a couple of years.” Well that has gone as well and albeit that it was small I think it is something that many Kiwis will be disappointed about. We have heard lots of other announcements today that will bring benefits supposedly in a few years’ time but they are not forthcoming. 
One of the things that I think it is important to consider when we are looking at our savings problem is that it is not because people are lazy or short-sighted. The fundamental problem is that most New Zealanders are not earning enough to be able to put money aside. What we have here does not solve that; it just postpones the problem. The fundamental problem is that Kiwis do not earn enough. I am surprised that more Kiwis are not getting on a plane and going to Australia because in the last four or five Budgets we have seen Peter Costello deliver more money into the pockets of Australians.