Joyce Steven: Taxation (Budget Tax Measures) Bill — First Reading Second Reading In Committee 
Joyce Steven: Taxation (Budget Tax Measures) Bill — First Reading Second Reading In Committee 
[Volume:654;Page:3963] 
Hon STEVEN JOYCE (Minister of Transport) 
: 
 One certainly knows it is a tough day in Opposition when one is down to quoting Brian Rudman in the first speech. Brian Rudman is that noted economist and right-wing Roger Douglas supporter. This Budget—I just need to comb my hair before I start—is a responsible Budget for difficult times. It has been titled a “Road to Recovery” which I think is an excellent name for it. I would probably prefer a “Multifunctional Multi-modal Low Benefit-cost Ratio Transport Corridor to Recovery” but I will settle for a “Road to Recovery”. 
This Budget makes some tough decisions and one of those decisions is on tax reductions. The National Party is the party that understands that paying too much tax stifles initiative and removes incentives to work hard and get ahead. We understand that one of the big reasons we have had record migration out of New Zealand over the last 9 years has been high marginal tax rates. That is why we campaigned on reducing taxes and we have done that. First we shamed Michael Cullen into doing it and then we did it ourselves at an average of $30 a week per full-time worker in an 8-month period. 
However we are a party of realists. That is not something we could accuse the Labour Party of being. So as the world economy continues to accelerate in the wrong direction we have made the tough call of postponing future tax cuts. Mr Cosgrove stood up before and said we knew the situation before the election. I need to acquaint him with some facts. The Budget 2008 forecast a surplus of GDP for 2009-10 as 0.5 percent of GDP. Prior to the election it was a deficit of 0.9 percent. The December forecast was a deficit of 2.2 percent. The Budget 2009 forecasts a deficit of 4.4 percent. The world economy fell off a cliff and Clayton Cosgrove—surprisingly enough—did not predict that. 
Postponing future tax cuts was not an easy decision to make. We work hard to keep our promises; we have kept nearly all of them. Tax reduction is important to grow the economy but we also cannot have New Zealanders burdened by higher than necessary interest rates because the Government cannot balance its books. I am pleased to report that this afternoon Moody’s upgraded New Zealand’s credit watch from negative to stable after the Budget was released today. The Labour Party thinks that is not important but I tell members that everybody who pays interest in this country thinks it is important. We made the right call. We fronted up and said we could not have tax cuts. But members should rest assured; reducing taxes will remain top of mind. 
There is only one party in this House that can keep tax rates under control and control spending and it is certainly not the party of the member for Waimakariri. It is certainly not that lot over there: the “Never-Never Land Party” which believes in the financial fairies at the bottom of the garden. It is a party that is now doing a very passable impression of the old Social Credit Political League. All that those Labour members need is the old Skodas and the crimplene suits. They say we should not cancel any spending. They do not want to control any costs. They do not want to run the ruler over expenditure. They do not want to suspend payments to the Superannuation Fund despite their own architect of the Superannuation Fund saying it is exactly what he would do if there were no surpluses. 
Back in 2000 Michael Cullen said any contributions had to be paid for out of a cash surplus into the fund. He also said back in 2000 that “The government will make contributions to the Fund from available surpluses. Where these are insufficient for making the required contribution a reduced contribution would be made.” That is what Labour’s architect of the Superannuation Fund said back in 2000. Not only do Labour members not want to stop spending but also they want spending increases. If they were allowed to be in Government today they would be proceeding with something called the deep tunnels for the Waterview Connection. They would have no changes to the Government policy statement on roading. They would have either $2.8 billion or $3.2 billion being spent depending on whether there would be two or three-lane tunnels. That would take the deficit this year from $7.7 billion up to $10.5 billion or $10.9 billion which is getting up towards 7 percent of GDP—just like that. They are not responsible. They are basically saying they do not believe in taking any responsibility for governance in this country. 
We need a responsible Government; a Government that preserves people’s entitlements gives people confidence and encourages jobs. What we do not need is a Government that guts the economy. I am sorry but I cannot agree with Sir Roger. The best accolade that could and has come out for the Budget today is that it is pretty boring and predictable. In New Zealand right now we do not need wild-eyed spending ideas from the current Labour Party. We also do not need the radical cuts to social expenditure that others propose. We need a steady conservative hand on the tiller and we have that with John Key and Bill English. New Zealand will be thankful for that tonight.