Budget Debate 
Budget Debate 
[Volume:647;Page:16229] 
Budget Debate 
Debate resumed on the Appropriation (2008/09 Estimates) Bill. 
JOHN KEY (Leader of the Opposition) 
: 
 I move  
That all the words after “That” be omitted and the following words inserted: “this House has no confidence in the Government led by Helen Clark because New Zealanders have had to wait far too long to see any changes to personal tax thresholds or any lowering of personal tax rates and over nine Budgets this Government has presided over a decline in New Zealand’s standard of living compared to the rest of the world.” 
So there we have it: Michael Cullen’s ninth and final Budget. It may have been his election-year Budget but it was also his valedictory. You see he read the Budget speech but he did not believe one word of it. He did not believe one word of it. And did it not just smell of desperation? After 9 years of putting off tax cuts it hurt him to read out the words. He did not believe them. But it was a giant acknowledgment of the failure of his Government’s leadership when it comes to the economy. 
When it came to the tax cuts it was far too little and it was far too late. It is pretty interesting that this is the finance Minister who has been telling New Zealanders for 9 years that they cannot have a tax cut. For 9 years he has been saying that they cannot have a tax cut. But guess what? In 4 or 5 months’ time there will be an election and 2 weeks beforehand Michael Cullen after 9 years will give a tax cut that he does not believe in. It will be the only chance of a tax cut. 
The sad bit about the whole speech—because it was pretty sad—is when people start to reflect not just on the tax cut but on the price that New Zealanders are paying for the economic leadership shown by the Labour Government—or lack of leadership as the case may be. You see they were led to believe by Michael Cullen that he would keep interest rates under control and he has not. Interest rates have doubled under a Labour Government. There was no apology in the Budget this afternoon to the hard-working couple who borrowed $200000 and now find themselves paying $150 a week more in interest—no apology to that family. There was no apology to the families and other New Zealanders to whom he said: “Don’t worry your wages will go up.” 
But he did not tell them that the cost of living under his leadership would rise faster than their wages. The same people reading his Budget tonight are the people who picked up the  
New Zealand Herald  
today and saw that cheese had gone up 112 percent who had just gone to fill up their car and paid over $2 a litre for petrol and who cannot afford to buy butter in the supermarkets of New Zealand because Michael Cullen has not managed to produce wages that can keep pace with those price rises. 
There was no apology to the 1700 people who have lost their jobs in the last 2 months and to whom Ruth Dyson said: “Don’t worry about it because we’re all doing OK.” There was no apology to those people and no apology to the thousands of New Zealanders who every day go to a hospital and ask why after 9 years in which spending on health has doubled they still cannot get their operations why they still have to go to Australia to get cancer drugs and why if they take Herceptin they are funded for 9 weeks and not for 52 weeks. There were no apologies for all of that. 
You see the interesting thing about this Budget is that it is ideologically opposed to everything that Michael Cullen believes in. He believes in taking people’s money off them and spending it at a faster rate than they can. That has been the strategy. But let us be honest: we have heard over the last 9 years a lot of talk from Labour but we do not hear so much of it these days. 
Gone is the talk about New Zealand getting into the top half of the OECD. That was where Labour started 9 years ago: “We will be in the top half of the OECD.” Michael Cullen does not tell New Zealanders that we are not 20th any more which was the placing out of 30 that we had when Labour came to office; we are 22nd. The only OECD rating where we have literally gone up is for being more heavily taxed—we have moved from 20th to 12th. So gone is that talk. 
And gone is the talk of closing the gaps. Do members remember that? That was in 2000 when the average Maori family earned an income equivalent to 82 percent of a Pakeha family’s income. Has that gap closed? No! It has widened; a Maori family earns only 73 percent of the income of a Pakeha family. So gone is the talk of closing the gaps. 
Then there was talk of the knowledge wave. There was no talk about the knowledge wave in this year’s Budget and no talk about the hundred information technology companies that would have a turnover of $100 million. That has gone—no talk of that. 
Does anyone remember the talk of economic transformation? I remember listening through speeches where we heard it about 30 times—economic transformation. We are still waiting—New Zealand is still waiting—for economic transformation. What about growth and innovation? That was the talk. 
And last but not least was carbon neutrality. Did we hear that mentioned in the speech? No. You see Helen Clark has finally worked out what carbon neutrality means and that is that if we lead the world in it we lead the world in costs we lose jobs we lose people and we lose opportunities and most of all all that we do is export carbon dioxide emissions around the world. 
So let us turn to the centrepiece of Michael Cullen’s Budget—tax cuts. Well it has finally happened. It has been a long long wait but it has finally happened. I can only say that I hope they last longer than the ones he announced in 2005. They may not be supported by Michael Cullen but that is OK—we will come back to the legislation that will lock them in in a minute. But do they not just reek of cynicism? They come in on 1 October. We can put a ring round the date for the election: 18 October. But do not worry Labour thinks it will have a revival before going to the polls having given the average worker of New Zealand a family-size block of cheese. That is what the tax cut is worth. After 9 years of waiting New Zealanders get a family-size block of cheese. They will get two blocks before the election and they are meant to be grateful. That is the message—they are meant to be grateful. 
While they are being grateful they should think about this: the next time they get a tax cut—theoretically under this Budget—will not be for 2 years. It is a long time between toasted sandwiches. It is a long time between servings of macaroni cheese. People will wait 2 years. They will not get tax cuts in 2009. Do any members know why? It is not an election year! Actually it is not within cooee of an election year so in 2009 people are not allowed tax cuts. 
There we go; that was Michael Cullen’s tax cuts Budget. It was motivated by one reason alone: not the belief of Michael Cullen in tax cuts but his belief in electoral survival. That is the reason those tax cuts are there. The reason they have taken so long to get there is that Dr Cullen never wants to deliver them. He does not want to deliver them. 
What will be interesting to New Zealanders as they go home tonight and reflect on Michael Cullen’s Budget is the thought that they have waited for over 3000 days under a Labour Government to get a tax cut—3000 days. If they are paying the top personal tax rate which kicks in at $60000 and will eventually move up under today’s Budget they have to wait for only 125 days from go to whoa for their tax rate to go up. You see under Labour one waits 125 days and one’s taxes go up and one waits for over 3000 days for one’s taxes to go down. 
Earlier this week Michael Cullen told us that tax cuts that delivered a reasonable amount to New Zealanders were reckless and unaffordable. Maybe Dr Cullen should have looked over the road over the Tasman to the Australians. 
Hon Dr Michael Cullen 
: These are bigger than the Australian tax cuts—miles bigger. 
JOHN KEY 
: Then the design is terrible I say to Dr Cullen. We will come back to that in a minute. Let us look at it. During the same period of time that Labour has been in office in New Zealand people in Australia earning $47000 a year have got a tax cut of $100 per week whereas under Labour people in New Zealand have got zero and 2 weeks before the election they will get their block of cheese. In Australia they get $100 a week and in New Zealand they get zero until they are within 150 paces of a polling booth when they will get $16. That is the difference. If anyone is wondering why 44000 people left New Zealand last year and went to Australia I can tell that person that it is because they were looking for economic leadership. It is coming but not under a Labour Government. 
What else did we learn when we heard what was in the Budget? There will be an urgency motion tonight. The House will go into urgency. Why? To legislate for the tax cuts that will come in on 1 October. Actually the real reason is that Michael Cullen—and he admitted it earlier in the week—does not trust himself to deliver his own tax cuts if he does not legislate for them. He is like a chocoholic who loves Caramello and has to hide it in a box on top of the wardrobe so that he cannot find it. He is legislating for his own tax cuts because he does not trust himself. What is actually worse than that is that his own colleagues do not trust him. They want the House to go into urgency. What do Governments do? They change legislation. That is what Governments do. Beyond 2009 if New Zealanders trust Labour to give them a tax cut Michael Cullen will be whipping it away. 
Well enough of Michael Cullen. [ 
Interruption 
] Well we will get to some policy actually. I want to talk about National’s plan. I tell the members opposite to listen up because they may well be beneficiaries of it. This is the message to New Zealanders: under National tax cuts are a priority; under National personal tax cuts are a priority. It is a pretty simple message: under National New Zealanders will do better. The plan will be better the structure will be better and the delivery will be better. Most of all New Zealanders will be able to believe our tax cuts they will be able to trust our tax cuts and they will not wait 3000 days to get them. They will not be doing that. Most of all our tax cuts will not be just about putting dollars into the pockets of hard-working New Zealanders; they will actually be about delivering the right incentives in the economy. [ 
Interruption 
] We know that Labour members do not believe in tax cuts and they are admitting that. They may not like to hear it but tax cuts deliver the right incentives. Tax cuts let New Zealanders get ahead in their lives. They encourage New Zealanders to work hard to get extra responsibilities to save and to get further education. You see we believe in tax cuts we believe in the power of tax cuts and we will deliver them. 
What is more we can afford to do it. I will tell New Zealanders how we can afford to do it. This year the Government will spend $60 billion and not one of those dollars is being reviewed—not one. The Labour Government has for 9 years wasted money hand-over-fist and it does not care. One needs only to look at what is happening in Australia to know that tax cuts are possible. The Labor Government in Australia came in after 9 years of tax cuts and it still found savings and it still found the ability to do things. 
I want to make one last point about Michael Cullen. He has laboured on about interest rates but this is the simple point: if Labour and Michael Cullen care so much about interest rates why has he let them double under his watch? Let me say this very clearly: we have a plan for New Zealand. It involves tax it involves infrastructure it involves curbing the bureaucracy it involves having proper planning legislation and it involves having the right future. 
But most of all let us answer the real question. This is the difference between Labour and National: Labour is stuck in the past; it is the past. Helen Clark and Michael Cullen care more about the Viet Nam War and the Springbok Tour than they do about the big issues facing New Zealand today. They do not want to front up on a decent emissions trading scheme they do not want to front up on the big issues of globalisation they do not want to front up on the issue of why so many New Zealanders leave and they do not want to front up on how to lift economic growth in New Zealand. What they want to do is meander around in the past. 
National will not do that. National will take New Zealand forward on a high-growth environment where our young people know they have a future where they know that we as a Government will back them to succeed and where we will deliver them the tools they need. We will deliver fast broadband so that they can be connected to the world; a future-looking Government that knows where it is going; and a country that is not afraid of itself where winning is part of the national conversation where it is not just about participation but also about succeeding and where there is aspiration hope opportunity and ambition—most of all ambition. 
New Zealand deserves a lot better than what it has had in the last 9 years. New Zealanders deserve a National Government and in 5 months’ time and two blocks of cheese that is exactly what they will get. 
GERRY BROWNLEE (National—Ilam) 
: 
 I raise a point of order Madam Speaker. It was very noticeable on this side of the House that throughout the speech delivered by Michael Cullen there was orderly behaviour within the House and respect was shown to the Minister of Finance who was reading a prepared speech. Some of us were moved to think that the Labour backbench was so unenthusiastic that those members looked more like people on death row than cheerleaders for the Government. But during the Leader of the Opposition’s reply there was a considerable barrage and there was a considerable change for the worse in the standard of behaviour. We hope that the same courtesy if it is extended to the Prime Minister will not bring your wrath. 
Madam SPEAKER 
: I would point out to the member—who has been in the House for some considerable time and will actually know—that it is recognised in the Standing Orders and Speakers’ rulings that when there is a prepared speech the convention is that there is no interruption because there is no opportunity for the person giving the prepared speech to respond. After that the debate commences. I did listen and from all sides of the House from time to time there was robust and vigorous participation within the debate. That is what will continue. From my point of view the most important thing is that people can be heard and I thought that Mr Key could be heard. 
Rt Hon HELEN CLARK (Prime Minister) 
: 
 Madam Speaker—[ 
Interruption 
] 
Madam SPEAKER 
: I explained to members what the rule is. I understand the positioning here to get permission to be able to make sure that other speakers cannot be heard. But there is the right in this House for all members to be heard. There is also the recognition that there will be a robust and vigorous debate particularly on matters of this order. There is not permission to be given for not being heard otherwise members will be asked to leave the Chamber because they will be creating disorder. Of course there can be interjections and of course people can express their views but every member in this House has the right to be heard. 
Rt Hon HELEN CLARK 
: I think the problem was that the Leader of the Opposition’s notes ran out at least 15 minutes before the end of his 20-minute speech. I for one am not prepared to believe a single word he said—not a single word. I read on Monday morning in the  
Dominion Post  
that he was promising every worker $50 a week or north of $50 a week. By Wednesday morning when  
Breakfast 
 on Television One interrogated him for 10 minutes and asked time after time: “Mr Key will you confirm the $50?” he replied: “No I can’t confirm the $50.” That man’s promises cannot even last 48 hours. 
The only thing John Key confirmed today was that any tax cut he gives will be funded by cuts in public spending. A vote for John Key is a vote for fewer teachers not more; fewer nurses not more; and more problems not fewer. That is the man who in every speech complains about people leaving New Zealand. He was very happy to leave New Zealand himself under a National Government—very happy to leave his country. 
Can I say to the Leader of the Opposition that I did care about the Springbok Tour—and I remember where I stood on it as well—just as I cared about the war in Iraq and I remember where I stood on that as well. I care about climate change. I have never said it was a hoax. I have never denied it. I have never then tried to say “Well I never said that.” and then gone back full circle to saying again that it was a hoax. Over here we believe in having a bit of consistency in policy. 
The Minister of Finance today delivered his ninth successive Budget. The last time a National Minister of Finance got close to doing that it was Robert Muldoon. I sat here through his eight Budgets in the period of that National Government. He got in such a funk in 1984 that he could not write the Budget. He called an early election and ran away because he could not make the figures add up. That has been the story of the National Party year after year. 
Everybody knows that this Budget has been drawn up against a background of a slowing international economy. I remember the last time that happened as well. It was in 1998 and Jenny Shipley was there with Bill English Maurice Williamson Nick Smith Murray McCully Tony Ryall and Lockwood Smith. What was their response to a slowing economy? They cut New Zealand superannuation. They sold one of New Zealand’s prime State assets. Contact Energy was sold and they penny-pinched and under-invested across the board—health education and the rest of it. 
Let us look at the contrast. Yes the international economy is slowing. What is the Labour Government doing? Superannuitants are getting more money in their pockets not less. We have not sold a State asset; we have bought one back—New Zealand Rail—and I am proud of it. We are investing properly in the future of our people—in education in health and in other things. There is a stark difference between these two approaches. 
We all know that Kiwis are paying record prices at the petrol pump. We all know that key items of food like dairy products are way up in price. Those prices are doing well for our dairy farmers but they hurt back home at the supermarket checkout. Then there is the global credit crunch and that has affected our households with mortgages and it has affected our small to medium sized businesses. Alongside the slowing global growth there has also been a prolonged drought. Our farmers have had a very very difficult few months and that has affected our whole economy. 
None of those things are the fault of the New Zealand Government—not a single one. But it is our responsibility to manage through them and to keep the New Zealand economy well positioned for upturn when it comes. That means not doing what Jenny Shipley Bill English Tony Ryall Nick Smith Lockwood Smith Murray McCully and Maurice Williamson did last time there was a slow-down and slashing and burning. It means carrying on investing and giving our people some genuine relief. I believe that Kiwis want relief from the cost pressures. But ask Kiwis: “Do you want that relief to come at the cost of less health care and less investment in education?” and they reply that no they do not. They want things kept in balance and that is what this Government does. 
In this Budget married superannuitants get a 5.2 percent increase in their income on 1 October. That is over $45 a fortnight. Our single superannuitants get an increase. They are benefiting from the tax relief and so they should. Society is judged on how its older people are treated and this Labour-led Government with support from our confidence and supply partners New Zealand First and United Future and with the support of the working and abstention agreement of the Greens has managed to deliver to vulnerable people. We have managed to deliver to superannuitants and I am proud of that. On 1 April next year we can add next year’s projected increase of close to $30 a fortnight to the 1 October increase of $45.88 a fortnight for our married superannuitants. That means that over the course of a year our married superannuitants will have an increase in their pay of 8.6 percent. That is phenomenal. 
Let us not forget the other things that matter to our older people. Let us not forget that this Labour-led Government with support from its confidence and supply partners is providing in this Budget for another 5000 elective surgery operations on top of already record numbers. Let us remember also that with the support of our confidence and supply partners—and this is a New Zealand First initiative—those who require a hearing aid will see the subsidy go up from $198 to $500. Another New Zealand First initiative is that those with a SuperGold card can look forward to free travel on public transport at off-peak times. Is that not good for our older citizens as well? 
The tax cut that is pushing up our superannuitants’ pay forms part of the $10.6 billion tax package—the $10.6 billion tax package—that the Government is delivering over the next 4 years. That starts on 1 October with a cut for every taxpayer. Those cuts are fair because those who are the lowest earners benefit the most—and that is the way it should be under any Government—because the lowest tax rate falls to 12.5 percent. By 1 April 2011 that 12.5 percent rate will apply to the first $20000 of earnings. 
Hon Dr Nick Smith 
: What a cynical bill—just cynical! 
Rt Hon HELEN CLARK 
: I am starting to think that this must be a very good Budget because I think Dr Nick Smith will have a heart attack if he gets much more upset. And although one cannot comment on the absence of members I do note that some are very happy to shout at others and then when they get their comeuppance they are not around to hear the reply. 
So what do the tax cuts mean for our Kiwi families? They mean a lot especially because the Government is also bringing forward the adjustments for inflation into the Working for Families payments. 
Let us take our Kiwi family on the average household income of $72000. Let us assume that the income is split with two-thirds from one partner and one-third from the other. Let us assume that they have two children at primary school. The $45 extra they get in the pay packet on 1 October is equivalent to a 3.6 percent increase in their take-home pay. That is not bad. By the full implementation of the tax package on 1 April 2011 that Kiwi family will be $82 dollars a week better off. That is equivalent to a 7.5 percent increase in take-home pay on today’s money. The one-earner family on $45000 a year—which is very close to our average wage—again with two primary school - age children will see the equivalent of a 3.7 percent increase in their take-home pay and it will be 7.6 percent by 1 April 2011. 
The tax relief in this Budget is important. So is the fact that this Labour-led Government is maintaining investment in the critical areas of health education housing and infrastructure. We know that although people want tax relief—and we are delivering it—they do not want it at the expense of the basics and we have to balance these things. 
For our families that 5 percent increase in school operations grants means a lot because if we do not look after that the schools come back to families for money they do not have to put into the school system. It might be the Tory way to keep putting that cost on to families but it is not our way. Our parents and our schools have high expectations—as they should have—and we need to meet those expectations. This Budget also funds the teacher-pupil ratio of 1:15 for our new entrants in schools. What can be more important in the school system than looking after small children turning up at the age of 5 and needing to learn the basics? 
For our families the money that goes into heath care is absolutely critical. If any Government eases up on that then Kiwi families pay the cost. They pay higher doctors’ fees they pay more for their drugs and they wait longer for treatment. That may be the National Party way—we all heard John Key talk about reviewing every area of public spending to try to squeeze out the money for the tax cuts. That is what he said. That is National’s way not our way. 
 In this Budget we are funding new initiatives in health like the new vaccine against cervical cancer. Over the years that vaccine will save the lives of thousands of New Zealanders. If we have a way of preventing a deadly cancer from developing then we should take that way and we have funded it in this Budget. 
The investment the Budget makes in housing is also critical for our families. We have invested in retrofits for warm and healthy housing saving people money on their power bill and improving their health. It was only a few weeks ago that along with the Hon Mark Burton I visited a lady in her home in Tokoroa. That home was being retrofitted. It had a heating system that was unhealthy and caused breathing respiratory problems. That lady with the support of a Labour Government and others who work with us is getting a clean healthy heating system and I am proud of that. 
I am proud too that this Budget for the first time is coming up with investment for shared-equity loans for our first-home owners. That is a way for families on modest incomes to get into their own home in the big cities. 
Hon Dr Nick Smith 
: It’s a joke! Twenty for Nelson? Don’t make us laugh! 
Rt Hon HELEN CLARK 
: The city of Nelson is one that benefits but Nick Smith opposes it. It is absolutely unbelievable that the local member for Nelson would try to stop people in his city getting a shared-equity loan. 
There is a lot in this Budget that adds to New Zealand’s economic capacity. The increase in operational spending on research science and technology is close to 6 percent. There is the huge investment in the Fast Forward fund so that our agriculture and food industries can earn more for their producers and for our country. There is the major investment in broadband. It is not a subsidy to a Telecom monopoly which is the National Party way but contestable funding that gets the maximum investment from the private sector. Under Maurice Williamson and a National Government the National Party protected Telecom for years. It caused us all to pay a lot for poor services. That is its legacy to New Zealand and it is not something we want to be known for. 
Hon Maurice Williamson 
: If it was all so bad why did you wait 8 years? 
Rt Hon HELEN CLARK 
: I really am beginning to think this is a very good Budget because I am getting such hysterical resistance from some members opposite. I can only feel encouraged in my efforts. 
I come back to saying that we have all seen Governments take different approaches to managing their way through economic difficulties. Some Governments cut the pension. Some Governments sell State assets to try to manage the books. Some Governments penny-pinch on health and education. But this Labour Government is putting up superannuitants’ income. It is looking after our families. It is investing in health education and housing and never never never is it selling our State assets. It is buying them back because we believe in that for the future of our country. 
I believe that this is a fair Budget that gives timely relief to our taxpayers. I believe that it invests in our future and it is able to manage through this current international downturn because over the years when the international economy was in better shape we addressed the critical deficits—the years of underspending in health and education and on the police the prisons and the transport system. We are now in a position to give relief where it is needed to maintain investment and to position ourselves for the upturn that Treasury forecasts in these Budget papers. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
: 
 Budget 2008 contains some good elements and a few bad omissions but most important New Zealand First is promising something better. The moving of tax thresholds in October of this year will provide relief for New Zealand workers and New Zealand First will support these initiatives. But we make this point: much of the good in this Budget is found in the fine print and a lot of it flows on from New Zealand First’s confidence and supply agreement with the Government. New Zealand First’s gains include assistance to superannuitants such as free off-peak travel on public transport during the day—not at night as Television New Zealand said—for SuperGold card holders; subsidies for hearing aids of $500 or more; advantageous tax effects for those who receive New Zealand superannuation; increased funding for Maori wardens; an ongoing funding boost for the elder-care sector; and—more could have happened here—a significant injection into the shipping industry which has at last been rediscovered as being important for New Zealand. We have been saying it for years. Here comes climate change and all of a sudden we have this. There is nothing so true as the saying “We told you so.” but we damn well did and for a long long time. 
Hon Annette King 
: Yes well at least we listened. 
Rt Hon WINSTON PETERS 
: Well better late than never. Our gains also include a lift for premier racing stakes and if we add in the substantial Budget boost for foreign affairs that will ensure that this country for the first time for a long time has the resources to confront the great challenges for the 21st century of diplomacy and trade we can see that New Zealand First has delivered again. 
 I want to give this warning: I was just told by a National Party member that the Ministry of Foreign Affairs and Trade does not expect to get it. 
Hon Members 
: What? 
Rt Hon WINSTON PETERS 
: The Ministry of Foreign Affairs and Trade does not expect to get it. They can only be the only people who have talked to him and are foolish enough to think that National is going to win the next election because the ministry is going to get it and it is getting it now. 
But there are other critical elements missing. For example we are disappointed that the Budget does not include tax policies to promote export growth. Yes subsidies incentives the kinds of which one will see in Ireland in Singapore in Japan in Thailand throughout the Nordic countries and even in countries that used to be behind the Iron Curtain do work. We do not have to reinvent the wheel here. We need to learn what an export-dependent economy needs by way of critical policy. We are an export-dependent economy and our policies should reflect that. Nor has the Government or its predecessor addressed the elephant in the room—the Reserve Bank of New Zealand Act which is so loved by so many people in this Parliament. This is a failed economic experiment. It is inflation targeting. There is some belief in this Parliament that somehow we can deal to massive import inflation by damaging our domestic markets and our domestic consumers. Targeting import inflation using the blunt instrument of domestic interest rates can only create domestic pain and it is. We heard nothing from Mr Key today about that. We have been saying this for 20 years and only if we get back on track as an exporting nation can we grow our economy so that we can afford decent wages and social services. 
We think there is a programme in respect of affordability and the rapidly rising prices of household basics but it is still insufficient. Let us face it times are tough and a lot of people are finding it hard to make ends meet. But we have some questions for the National Party. Will it cut New Zealand superannuation? 
Hon Members 
: Yes! 
Rt Hon WINSTON PETERS 
: And the $45 windfall for married couples from this October? 
Hon Members 
: Yes! 
Rt Hon WINSTON PETERS 
: Give us an answer! 
Hon Dr Nick Smith 
: Of course not. 
Rt Hon WINSTON PETERS 
: I am not taking it from Nick Smith. Excuse me! Will it torpedo KiwiSaver? 
Hon Members 
: Yes! 
Rt Hon WINSTON PETERS 
: Will it cut the 1000 extra police that we are putting on the streets? 
Hon Members 
: Yes! 
Rt Hon WINSTON PETERS 
: Will it slash extra funding for the elder-care sector? 
Hon Members 
: Yes! 
Rt Hon WINSTON PETERS 
: Will it take hearing aids off the elderly? 
Hon Members 
: Yes! 
Rt Hon WINSTON PETERS 
: Will it take away their free transport? 
Hon Members 
: Yes! 
Rt Hon WINSTON PETERS 
: Will it make them pay more to go to the doctor? 
Hon Members 
: Yes! 
Rt Hon WINSTON PETERS 
: We could go on but unlike National New Zealand First has a solution. We are actually able to offer a real alternative with real policies that have been tried and tested in nearly every other growing economy. We want to see a tax-free threshold of $5200 introduced: a tax cut that everybody—everybody—benefits from. We also want GST reduced to 10 percent across the board. 
What was most noticeable about the theatre of Parliament today was that there in Parliament were Roger Douglas and Richard Prebble alongside National indicating their support. Remember them? They said that GST at 10 percent was written in stone—that it could not be changed. Then they changed it to 12.5 percent and they have never explained why. 
Those two steps I have outlined are not enough on their own. We want 68 percent of the net average wage for superannuitants—and we could afford it. So although we support this Budget we are looking forward to the real alternative of tax relief and greater affordability in Budget 2009. And we mean to be here. And those who are following the polls will know we will be here—just in case some people have some silly ideas. 
We know that with a package of tax incentives for exporters a rewrite of the Reserve Bank of New Zealand Act and a more equitable tax policy we could put New Zealand’s economy and its people back on the front foot. We are not going to go on with a Governor of the Reserve Bank unelected doing what he likes to the major part of the economy while those of us who are elected can do nothing because of our own legislative frustration. We offer an alternative; National does not. An old National Party would have Holyoake would have and people like Holland would have but not this crowd. Growth can come only through productive and non-consumptive wealth. Never has this been more urgent. 
There were no solutions from the National Party today. I was amazed that Mr Key got to his last 5 minutes and said: “Now to National’s plan.” I have just two questions: how much and when? Come on I say to Mr Smith tell us now. 
Hon Dr Nick Smith 
: We’ll tell you in the election campaign. 
Rt Hon WINSTON PETERS 
: Oh he will tell us in the election campaign!  
Hon Member 
: He doesn’t know. 
Rt Hon WINSTON PETERS 
: He does not know. You know there was a time when New Zealanders could expect to hear something uplifting and memorable from the National Party. I know; I used to belong to it. Frequently I was the cause of it; its members could expect that. We used to hear speeches about leadership vision ideas answers and solutions. Instead all we got today were the words “the National plan” and no detail whatsoever. And when we look across at the inglorious line of wannabes never-have-beens and political seat-warmers we realise the old saying is right: “You can’t make a silk purse out of a sow’s ear.” 
Look at that party’s line-up. Mr David Carter is here only because he has some preference on selection even though it has been to court three times. Mr Williamson believes in four private companies to run New Zealand roads. The next man? Need I mention Mr Smith? I do not think so. He is the top-up man—Harpic. The next guy—very inexperienced. The next one well frankly he was the deputy leader and he got demoted. He jumped before he was pushed. Then we come to Mr Key. You know I can recall the National Party leadership of recent times. One came out of a kindergarten and wanted to be the Prime Minister. It lasted 5 minutes and she delivered the worst result in National’s history. Then the next one turned up. He came out of Treasury. He delivered the worst result upon that. Then they got a guy who walked out of the Reserve Bank and thought “I am qualified by this background to run the whole of New Zealand.” And he lost the unloseable election. Then National got somebody from the stock markets of England—no memory of this country whatsoever. And National members are telling us with all their puffery that he can do the job. 
Bob Clarkson 
: You’ve still got me. 
Rt Hon WINSTON PETERS 
: Oh here comes “Bob the Quitter”. That really tells us a massive amount about the National Party. When his stadium much-vaunted was in trouble he socialised his losses. He got the people of Tauranga to buy it and they will be paying for it forever. Typical! And he even made himself sound magnanimous when he did it. But when anybody inquired into the due diligence the council would not release the information—his council. We know that is true do we not I say to Bob? We will hear more about this. This guy was going to stand against me and he was going to do this and he was going to do that. He was full of puffery and bovine scatology. He is all talk; he is the Blue Chip member. Tens of thousands of old people in Tauranga have lost all their money and he is off—going finished. He did not jump. He was pushed. I say to him “You were pushed sunshine weren’t you?”. One cannot make a silk purse out of a sow’s ear. 
By the way the National Party was talking about the cost of bureaucracy. National is going to pay for all the tax cuts by having a review of everything—of every department. National has been talking about cutting the cost of bureaucracy. That is fair enough: National likes slash-and-burn policies. National did it in the 1990s when it slashed benefits and pensions. National cut police numbers and social services. National calls it market forces. 
Most of the culprits are still there on the front bench. Their DNA and fingerprints are all over everything that went wrong. They even sent the economy into a recession in 1991. I was here. I saw them do it. And now we are being told that the soft face of capitalism from a State house in Christchurch is the answer. Like some of us do not know about poverty? Like some of us do not know what it smells tastes and feels like? Is there something special about that? But what we are not being shown is the cost of National putting its best bland face forward. We are not being told about the gravy train that National is creating in the process. Do members know that John Key himself in his Wellington parliamentary office employs 36 people?  
Hon Members 
: How many? 
Rt Hon WINSTON PETERS 
: He employs 36 people just in his office and that does not count the staff for MPs. Look at the pages. It is all here. There they are; they are all here—36 people at great expense. Every year they cost the taxpayer over $7 million for their parliamentary operations. [ 
Interruption 
] Yes they do. That is what they do and I am not even counting his secretary in the 36. There is someone called a web manager. 
Hon Member 
: A what? 
Rt Hon WINSTON PETERS 
: A web manager. Maybe it is a duck—or Charlotte the spider. There is an IT manager and there is a graphic designer. What would a graphic designer do? Maybe he or she would try to dress up Nick Smith—I do not know. Members will like this one. There is a programme and stakeholder relations manager. What would that person do? And of course there are teams of public relations people spin doctors and policy advisers. And what for? There is no policy. They are all feverishly out there creating the image of leadership saying “You’ve got to walk this way. You’ve got to have your whole crowd around you.” Look John Key cannot get his advisers into one bus; he has to have an articulated bus to take his entourage with him! The John Key image that members see over there and on TV is one shaped by many hands and spun by many spin doctors. That is only the lot within Parliament. What about the blogsters the webmasters the David FarrahRumplestiltskinites the consultants the ad agencies and the even more public relations people outside of Parliament? Do members remember the so-called freedom fighting organisation called the Free Speech Coalition? It was going to give us all of the changes that we need to have for our electoral system but in that time—since 1993—it has not given us one idea at all. It just so happens though that its front man also works out of the National Party’s headquarters. Are members beginning to smell a rat? I am. 
The biggest increase in taxpayer spending in New Zealand today is going to the National Party. Why is the National Party not a separate item in the Budget? What about the people who are financed by big business on the outside? How can John Key go around the country and tell everyone that he is fiscally prudent when he needs a fleet of buses to carry his entourage? You know National has a bureaucracy that would boggle the minds of commissars in the old Kremlin. Even Joseph Stalin did not have 36 people in his own office. Even Joseph Stalin could not do that. 
I actually worked out that National is bigger than some Pacific Island economies. It is actually bigger than some Government departments and ministries. But that may be what it is all about—the creation of a new big-spending freeloading free-lunching perk-gathering “Ministry of National Affairs”. 
Hon Dr Nick Smith 
: If this is your best it’s time you retired. 
Rt Hon WINSTON PETERS 
: Oh really? That member should have never come here. He got in here only because I actually campaigned for him one night and it brought us an audience wall to wall. Philip Burdon asked me to and like a fool I went down and did it. Now despite the efforts of all these people assisted by a sympathetic overseas-owned media we still do not know what National stands for. So far all we have had is a succession of “Me too!”. The National Party has a duty to tell the public what it is that it intends to do. 
I remember it was Keith Holyoake a real National Party leader—one whom I was proud to work under—who said: “Tell the people. Trust the people.” That is National’s problem: its members do not trust the people so they will not tell them what National intends to do. There are all sorts of parties in this Parliament. We do not always agree with a lot of the things that they say but at least they tell the public what they intend to do and we respect that. But there is something about National that is not quite right. It seems to be a party with secrets kept under wraps like a boil covered over by a sticking plaster. 
What has National tried to do since the election in 2005? What initiatives and policies has it launched since that election? Where does it stand on all of the big burning issues of the day? What policies has it sought to support? National has spent 2½ years waiting for a snap election that was never going to happen. I say “bad luck!”. But that is no excuse for doing nothing. 
There is only one real alternative to this year’s Budget and it is being put forward by a party that is not afraid to tell the public its policies on the economy socialism social welfare or capitalism in this country. New Zealand First is the party that has answers to questions that have been around for a long time. The answers are not something experimental or chosen by the paper-shufflers of Queen Street or of Main Street Wellington; they are something to do with this country’s long-running economic structure. There is still hope that we can get to the promised land but we have to change our direction and head down the right path. That means creating a tax-free threshold reducing GST to 10 percent creating a tax regime for exporters rewriting the Reserve Bank of New Zealand Act to relieve interest rates and creating a better deal for senior citizens. 
We were once God’s own country controlling our own destiny built by generations of hard-working and innovative people. We have seen what this country and its people can achieve. We in New Zealand First still believe in them and we believe that we have the policies the priorities and the persistence to rebuild this country along lines that will work; not along lines of economic experimentation of the type that sadly we have seen over the last 23 years. In short my message to New Zealanders in the next 4 months if they have any idea that they want change is that they should vote for change that they can believe in. In that respect my message to them is to hang on because as before help is on its way. 
JEANETTE FITZSIMONS (Co-Leader—Green) 
: 
 We are living in a moment in history and in a generation where the people who have the power have a clear choice: either they face inconvenient truths that are very obviously around us or they leave it to their grandchildren to face those truths when it may be too late. But the one thing that gets this Parliament excited is tax cuts. 
We are bumping up against the limits of growth. The atmosphere will absorb only so much carbon. There is a finite number of fish in the sea. The planet has only so much fresh water and only so much oil. Unless we recognise all of this we will only create problems from Budget to Budget for our grandchildren and for the world. Those environmental limits are already feeding inflation in a way that just playing with the official cash rate is not able to control. We have to recognise that the environment is the economy and that resource limits are driving our spiral of high inflation high interest costs and high exchange rates which again raise the cost of imported resources. Oil water and climate limits are driving food prices up—up 28 percent in a year for a basket of staples the  
New Zealand Herald  
tells us—which in turn are driving poverty. 
Addressing the problem at its cause will enable us to get monetary policy under control but Parliament can see only tax cuts. Some days—and this is one of them—I feel like I am surrounded in this Chamber by people who have their heads in the sand. There is the opportunity here to propose an answer to the defining challenges of our time—and I say to Winston it is not trade and diplomacy—to unite us collectively as a people sharing the costs of our carbon footprint equitably and sharing both the effort and the resources. There is an opportunity to future-proof the quality of our lives in an uncertain world. But our Parliament is talking about tax cuts. 
This is not a Budget in total that will be remembered and celebrated by my grandchildren’s generation or even in a couple of years from now. What this week will be remembered for is not this Budget but a turning point in the economic history of the world. The financial markets have finally recognised that we live in a time of diminishing resources bumping up against the limits of the planet. Yesterday for the first time in history the futures markets for oil put their money on continuous price increases from here on out. It is the first time in history that that has happened. I do not want to frighten members but the bubble of limitless mindless and unfair economic expansion has burst. As I said yesterday for the first time in history the futures market for oil put its money on continuous price increases from here on out. To ordinary common-sense people that might seem a no-brainer. Is that not what oil prices have been doing for years now? Well the futures market does not think like that. Until now the market has been in a state known in the trade as backwardation. It means one looks in the rear-vision mirror to predict the future. I have shown the House the results of that before. Repeated oil price forecasts by Treasury the Ministry of Economic Development and the Reserve Bank of New Zealand start each time from a higher real price and predict it will fall; it never happens and they never learn. But Parliament argues about tax cuts. 
Now that the futures market on which Treasury says it bases its predictions has moved out of backwardation can we expect Treasury and the Government to stop backwardising too? Is it not about time they used a windscreen instead of a rear-vision mirror got out of their backwardisation and contangoed with the Greens? Contango is the other state where the futures markets put their money on oil prices rising continuously. That is where we Greens would put our money if we were speculators. It is where we have been for years now ever since I pointed out in my 2004 Budget speech that as Dr Cullen was delivering his speech the price of oil was just over double Treasury’s predictions on which that Budget was based. 
So at this defining moment in history what forecasts has Treasury used today to underpin this Budget? Well it has forecast a drop to US$100 a barrel which is higher than it has ever said before; it has forecast US$100 right out to 2012 but today it is US$133. It has forecast US$100 a barrel in defiance of the futures market. I am sorry but this fiction has gone on long enough. It borders on negligence. True leadership requires that we admit that the economy is still and always has been subject to the laws of physics. True leadership requires that we acknowledge the challenges ahead and that we take steps to safeguard our families and the planet that supports them. True leadership requires that we face facts and make hard decisions even when the information at hand is incomplete and even when there is an election pending. It requires courage and I do not see a lot of it here. 
So we can agree as a starting point then that this Budget is not based on reality. We cannot trust its numbers. It is planning for the past not for the future. That is the same lack of urgency that we see in climate change policy: “Lord make me carbon neutral but not just yet; in fact not for a very long time please and don’t make me take serious steps towards it for ages.” Last week I quoted in the House Dr RajendraPachauri head of the Intergovernmental Panel on Climate Change who said of the world’s climate change efforts: “If there is no action before 2012 that’s too late. What we do in the next 2 to 3 years will determine our future. This is the defining moment.” Half our greenhouse emissions are not planned to face any price on carbon even at the margin till the year after Dr Pachauri says it is too late. But the New Zealand Parliament is arguing about tax cuts. 
We have a small window of opportunity perhaps 3 to 5 years to make New Zealand a more resilient nation that is able to withstand the shocks that lie ahead in oil food and climate. We have a small window to invest in the economic transition to reduce our dependence on oil with much more efficient transport options—but we see again six times as much funding for motorways as for public transport—with more energy-efficient self-reliant homes; with businesses that make their money from resource-conserving activities; and with food supplies grown sustainably and locally. I have been calling for years for sector-based peak oil task forces of industry and Government leaders to analyse our vulnerability and develop strategies for each sector to overcome it. Since I first called for that other countries have been doing it but New Zealand has not moved yet. Queensland’s task force has just reported after a couple of years’ work. It was set up in alarm when oil prices were predicted to reach—wait for it—US$115 by 2050. That was enough to trigger emergency action by the Queensland government. Today it is US$133. But the New Zealand Parliament is arguing about tax cuts. 
The Greens welcome the fairness with which the tax cuts have been delivered through the economy—provided that one is in work. For those on benefits who are some of the most vulnerable in our communities this Budget offers nothing except maybe an incentive to have more children in order to qualify for Working for Families. It is a national shame that beneficiaries are worse off economically today than they were after the 1991 “mother of all Budgets”—and that is reported in the Government’s own reports. This Budget does not help them. 
The Government seems to have totally ignored the 61 percent of people who said just last month they would rather not have tax cuts if it meant cuts to spending on health education and benefits. Failing to fund those services to keep up with needs is a cut even if the amount of money does not go down. Michael Cullen acknowledged that when he said that Budget 2009 will have lower spending and require “significant reprioritisation efforts”. “Significant reprioritisation efforts” means things that should be funded will not be funded. 
On the limited evidence available this Budget is probably better than the alternative. It does not deny that climate change exists and it does not drastically cut and privatise health and education services so as to provide more money for the wealthy. It does make some effort to ensure that tax cuts reach lower wage earners. We welcome the recognition of the need for investment in rail. We have been banging on about this for years with campaigns to buy back the tracks and to save the Overlander and we note that Dr Cullen now recognises its importance in the future. But we are concerned that there are no numbers in the Budget speech. The Budget speech is full of numbers but we do not know what this investment in rail is going to amount to. We are glad to see $13 million to restore the Department of Conservation’s capacity after the huge expenses it had with firefighting. We are glad to see an increase in research and development and in funding for tertiary education providers although students are likely to be rather less than overwhelmed by getting another $5 a week. I guess it equals a can of beer a week if one is a student—if one gets it at all. The increase in the accessibility of the living allowance is not very great either. We are glad to see the investment in broadband. We are glad to see shared-equity housing. It is very good small-picture stuff but it misses the big picture. 
The 2008 Budget might not make a huge impact overall but it will make a difference in some specific important areas that the Green Party has targeted and negotiated hard for. If this Budget is to be remembered for anything it is for how much the Green Party—six MPs and not part of the governing coalition—has managed to achieve. We have added some $95 million of value to an otherwise lacklustre Budget. One would never know of course because there was not a single acknowledgment in Dr Cullen’s speech of the things we have worked hard to achieve in this Budget. That shows the lack of value that he puts on the initiatives we have put forward. 
The Budget targets the much-neglected community sector—that vital third sector of the economy where civil society organises in not-for-profit organisations to work for the common good. It promotes better health not by waiting until people are sick and then treating them but by keeping them healthy by preventing illness from cold damp houses antibiotic-resistant infections and contaminated food. It promotes democracy by opening up the decision-making process to ordinary people outside of politics and Parliament. And it links key Green concerns about climate change and biodiversity conservation. 
Let us look a little more closely at some of what we have achieved. For a total of $53 million we will ensure that in 5 years’ time no State house tenant lives in a cold damp home. I acknowledge the support of two Ministers on this issue particularly. It will mean that 21000 homes have a package of renovations including insulation draft-proofing of windows and doors wraps for hot-water cylinders efficient showerheads lagging of pipes low-energy lights and in some cases energy-efficient home heating. This of course helps with our climate change efforts in a small way because insulated homes use about one-fifth less energy. But for the people who live in State houses who are among our most needy it is a huge move. Children who live in insulated houses have half the number of days off school from asthma and respiratory disease. Their education is improved and their families save money on their power bills. This was the only Green initiative mentioned by Dr Cullen in his speech and there was not a single word to acknowledge that it would not have happened unless the Green Party had fought very hard for it. 
We have gained more than $4 million for a citizens’ jury to consider funding of elections and political parties. This important achievement lays to rest uninformed criticism of the Greens for supporting a less than perfect Electoral Finance Bill. We are passionate about everyone having a say in election campaigns not just those with deep pockets who can back up their lobbying with big donations. We are equally passionate about allowing ordinary people not just National and Labour to have a say on how the whole election campaign system should be funded. 
I want to look also at the more than $10 million extra that my colleague Sue Bradford has secured over 4 years for the Community Organisations Grants Scheme. This will help provide essential support for non-profit voluntary and community organisations to help meet real needs. The Community Organisations Grants Scheme is the most devolved and accountable of all Government funding schemes and it has been chronically underfunded since its inception. In my home area of Coromandel for example amounts of money went to groups like the Waihi and Paeroa resource centres the Restorative Justice Services Hauraki Trust the Thames Budget Service the Mercury Bay St John Ambulance and the Coastguard Northern Region. 
Earlier I said that the Budget does nowhere near enough to address our Kyoto obligations. But Green MP Metiria Turei has at least convinced the Government to do more on climate change research. Funding of $8 million over 4 years will go to five major research projects on climate change on conservation land. Study will also be made of how increasing carbon storage can maximise biodiversity values and of the impact of extreme weather events such as floods slippage wind storms tidal surges avalanches and rockfalls on the management of huts tracks and campsites on Department of Conservation land. Meanwhile in the conservation area $4 million over 2 years will go to the new National Community Biodiversity Fund to support restoration projects on public and Maori land that protect indigenous biodiversity. 
Through the efforts of Sue Kedgley the Green Party has secured $4 million of funding over 4 years to establish a new and comprehensive antibiotic-resistant surveillance system to be administered by the Ministry of Health in conjunction with the Food Safety Authority. The aim is to monitor not only prescriptions of antibiotics but also the levels of antibiotic resistance in our hospitals our communities our environment and food-producing animals. Sue has also initiated $2.4 million to look much more closely at the safety of the food we import which totals 2.5 million tonnes a year. At a time when this Government has decided on a preferential trade deal with China and when there are numerous media stories about occasional pollutants in Chinese exports we need to be much more vigilant at our borders. 
Nandor Tanczos has secured $800000 over 4 years for environment centres. These centres provide environmental information and education for communities and promote recycling alternative power sources and energy efficiency. I have visited a number of these centres over the years and they do a host of things such as running seminars and training courses on environmental issues helping people to understand how to use the Resource Management Act and taking part in practical projects such as cleaning up waterways and restoring the biodiversity of bush reserves and wetlands. 
 Last but not least of the things I have time to talk about today we have funding for people in our country who are among the most marginalised and the most needy—refugees. The Green Party does not attack refugees as some parties do because they are unlucky enough to find themselves without a safe home. Keith Locke has instead secured $1 million of funding over 4 years to help them set up homes and jobs here. New Zealand has a proud record of doing its bit by accepting refugees but in our view it does not do enough to help them settle once they are here. We will help them put the horrors that they have experienced behind them live a quality lifestyle and contribute in positive ways to our country. In looking at one of the causes of refugee suffering we again promote the cause of preventing rather than fighting wars. Keith has secured $200000 for a peacemaking feasibility study to look at the possibility of New Zealand furthering our work in resolving conflicts around the world beyond what we are already doing in places like Bougainville. 
I said earlier that this Budget is not based in reality. It is backwardising in that it expects the future to be like the past. It is ignoring the urgent need to respond to climate change peak oil and resource depletion. It is a long long way behind and the tragedy is that National is even further behind. I would like to devote the last little bit of my time to silence in order to recognise the dead hopes and perishing people who will be—and in some countries already are—the victims of Governments around the world that refuse to get serious about climate change the end of cheap oil and abundant food and the need to plan a different kind of future. 
Dr PITA SHARPLES (Co-Leader—Maori Party) 
: 
Tena koe Mr Deputy Speaker. Budget day is the day when the members of one side of the House rise to their feet and applaud while the other side throws brickbats and dissects the dollars. The meaning of life does not feature much in that classic piece of political theatre. But for over 4 million New Zealanders the meaning of life is the quintessential conversation point of every significant discussion. It is the motivation that separates out those who live by their dreams from those who live in regret. It is the question not about whether we will die but about how we will live. So how will the great New Zealand public assess the difference this Budget will make to their lives? A $4 billion tax cut package is all well and good but there is so much more to do to address inequalities and need. The tax cuts will relieve pressures on many families but we really wanted to see a much greater emphasis on eliminating poverty. This Budget does not do that. 
How does this Budget affect the 1.8 million people on incomes under $25000 whose hope is being extinguished by a Government that seems to ignore them? There are 1.8 million people who are struggling to make ends meet. We need to recall that it is not just the unemployed who need help with feeding their families but those in part-time work and those on low pay scales. Of these 1.8 million people 10 percent are children who the Child Poverty Action Group has revealed are living in severe and significant hardship. The Public Health Association describes these children as an underclass with poverty and poor housing making them sick. And what is the meaning of life for the people who inhabit our dormitory suburbs—those communities like Titahi Bay Otara Mangere and Flaxmere—where people may sleep but their working life is elsewhere? The meaning of life must be about a qualitative difference that brings our aspirations within reach. 
The Minister referred to a vision for a sustainable nation. The trouble is that if we do what we have always done we will get what we have always got. We need to be bold and to make statements of faith to lift the quality of life for all. Some of that policy courage has been demonstrated in this Budget amongst the loads of lollies designed to reward lobby groups. We welcome the investment in rail and ferry infrastructure to deliver a better service to reduce the number of cars on the roads and to decrease our greenhouse gas emissions. We commend the initiative of the Greens in their work in achieving a State house insulation programme—a programme that will improve the health of tenants and achieve energy cost savings. Of course we are pleased at the investment of $450 million to improve partnerships with community-based social services $80 million for child and adolescent oral health and $30 million to create healthier environments. All are elements of progress but are they enough? 
We cannot be blind to the newsflash from Statistics New Zealand that the number of New Zealanders leaving for overseas in the past year—some 48000 of us—has never been larger. It is even more shattering to learn that quality of life has displaced pay as the biggest single influence on finance professionals weighing up whether to leave New Zealand. Ironically the factor that most attracts immigrants to our shores—our quality of life—is pushing us on to the first plane out of here. When we talk of quality of life we think of traffic congestion poor air quality the management of waste poor beach and stream quality and the need to protect our biodiversity. We think about crime violence child abuse white-collar corruption and poverty. We think about the 29000 workers who have lost their jobs and we think about the fact that the unemployment rate for Maori has shot up to 8.6 percent and for Pacific peoples to 8.2 percent compared with 3 percent for Europeans. It would seem that our pursuit of wealth as our saviour has sacrificed sustainability in Aotearoa as a place people want to live in. 
The Maori Party has constantly raised the need for a genuine progress index to ensure we measure progress on all levels. If we do not set a baseline standard for what is acceptable the nation will end up with a quality of life that is far below what we deserve. We need to pledge to end child poverty in terms of all poverty measures by 2020. One part of this is to designate an official poverty line at 60 percent of the median household disposable income after housing costs. How else will we know we have made the difference if we do not have a benchmark to begin with? The need to bring relief to the poor is urgent. Although the bringing forward of the Working for Families adjustments related to family tax credits is welcomed we still believe there is much more to do to respond to what the Minister described as the twin pressures of food and fuel price increases. We need to adjust income support levels to maintain and improve their relativity with what the New Zealand Council of Trade Unions has recommended to be required—a new minimum wage of $15 per hour. If we were to increase benefits by wage movements rather than by the CPI that would equate to an annual increase of little more than 1.1 percent on average. Based on the current forecast for benefits in 2007-08 at $16.4 billion the extra cost would be about $180 million—not a great deal in the scale of things. 
Although the business tax regime has been simplified we would have supported the introduction of business tax incentives for businesses to move to limited employment zone areas—those regions that are economically underdeveloped. We want to turn our dormitory suburbs back into communities of hope and promise where we know our neighbours we enjoy sport and recreation together and we rebuild our communities as sites of safety. 
We want to see our world being a clean green haven once more. We know that that means facing the costs of greenhouse gas emissions including carbon dioxide which someone has to pay—the polluter the taxpayer or future generations. We need a savings culture that is not just about living within our means but is about investing in our future. For tangata whenua our quality of life is associated with our cultural values and customs our responsibilities for our traditional lands water sites wahi tapu and other taonga and our capacity to live as Maori. Although the Government has announced that $750 million will go into developing our unique national identity it appears to be focused on developing that identity only in Asia the Pacific and Latin America—in fact anywhere but Aotearoa. No matter how important it is national identity is more than a wharewaka on the Wellington waterfront or the re-appropriation of funding to pay for waka umanga. When will we learn that our greatest opportunity for success is in upholding our indigenous values to ensure that our country maintains its natural beauty and is home for all New Zealanders? 
We want to see an investment in diversity. Diversity should not be redefined as a way in which we understand the persistent disparities of the social and economic disadvantages associated with low levels of educational participation and attainment and of those who are preyed upon by gambling lords and loan sharks. Diversity is about the strength of all our peoples in Aotearoa the added value our nation achieves through valuing the importance of working together and living together and our shared heritage—our home. And most important of all our quality of life is about happiness which is what we might call “wairua tau” “mauri tau”—that general sense of well-being. 
If there is one thing that New Zealanders want now it is to know that leadership is being provided by people with a purpose by people who have the knowledge about what one needs and by people with a burning desire to achieve that success. That leadership is being provided already in whanau hapu and iwi. It is being provided in families of the working poor families in hardship families in business and enterprise and families enjoying success. The Maori Party respects that leadership and our biggest job now is to ensure that the qualities displayed by that leadership are not hindered by structures and systems designed to undermine them. 
The Maori Party is committed to working together with those who are committed to staying in this country to make Aotearoa great once again. This Budget is but one reason that demands we do so. 
Hon PETER DUNNE (Leader—United Future) 
: 
 For many New Zealanders this Budget was all about tax cuts. That was partly brought on by media hype that that was going to be the central theme of the Budget and partly also brought on by the fact that New Zealanders have had to wait 12 years since they last had a cut in their personal taxes. In the event the calculation they will be making right now is whether those cuts have measured up to their expectations. I think that the moves announced this afternoon are a step in the right direction. They are a logical flow-on from the moves we made last year with the  
Business Tax Review 
. But with petrol having hit $2 a litre early this morning and with the dollar having gone up this afternoon in the wake of the Budget—thus suggesting that early relief from rising mortgage rates is unlikely—it is more than likely that those many New Zealanders who are hanging out for this afternoon’s tax cuts announcement will conclude that they are just a step in the right direction but that they have not over the 3-year period given them the type of relief they were expecting. And when they factor in on top of that that we still have the impact of the emissions trading scheme to come and the likely boost to household living costs that that will bring on without any clear indication in this Budget of compensation to households they will be even more concerned. 
It is interesting that when the emissions trading scheme was first postulated last year the talk was that households would be compensated for the increase in costs. Over ensuing months that has become refined to “vulnerable” households would be compensated for “some” of the ensuing costs. And in this afternoon’s Budget we heard that the SuperGold card provisions for the elderly in respect of electricity charges will take effect at the time that electricity enters the emissions trading scheme. I have no problem with that aspect but I have a huge problem with the fact that those New Zealanders who have got a tax cut this afternoon may now be forced to view that not as the dividend for the economic good years but as the down payment on the cost of the emissions trading scheme to come. I do not think that New Zealanders will tolerate that for one moment. 
We take this Budget; United Future welcomes the positive steps in it towards addressing tax issues. They are a start but there is a long way to go yet. We still have a tax system that requires fundamental adjustment to its basic integrity. We have long argued for and will continue to support the alignment of the top personal business and trust rates at 30c in the dollar. We have long argued for and will continue to support couples with dependent children having the right to split their incomes for tax purposes to make it that little bit easier for them to get around their daily circumstances. The changes in this Budget do not go that far but they enable us to hold on to the possibility of achieving those goals in the future and we will certainly push all we can for that—and we will get there. I am reminded of this fact. 
We were part of the Government the last time personal taxes went down and it is no coincidence that we are supporting the Government this time when they go down. We just want to make sure that they go down that much further and we will. But beyond that there is a fundamental lesson that is implicit in this Budget and implicit in any debate about New Zealand’s economic performance in future—that is we have to boost incomes to boost our national prosperity and to boost our opportunity. That can come only through policies designed to boost productivity to make it easier for New Zealanders to go about their business and for their businesses to prosper and succeed. In that respect there are some good things in this Budget. 
We welcome the improvements in terms of the investment in physical and intellectual infrastructure—I will come back to that in a moment. We also welcome the significant moves made in terms of softening business compliance making it much easier for those in our small to medium sized enterprise sector to get on with the job they want to do rather than being unemployed tax collectors as so many of them feel they are these days. Those are good steps. The international tax review foreshadowed in 2006 which was announced in preliminary detail last year and is now to be introduced in legislation in the next month or so is an extremely positive step forward. It aligns us with many of our trading partners. It makes it possible for New Zealand businesses to expand overseas but to retain their operating base in New Zealand. The introduction of the active/passive distinction in terms of investment and manufacturing income will be extremely positive and beneficial and it will be welcomed by many. 
I spoke before about physical and intellectual infrastructure. It is good to see the investment that is going into our transport system—into road into rail into shipping and into all modes—because that is as much about helping us to be competitive economically as it is about meeting our obligations in terms of the Kyoto Protocol and other international commitments. We welcome particularly the adoption of United Future’s policy regarding the reduction in the age at which the parental income test applies for student allowances. The reduction in age from 25 to 24 is a good step forward. As far as we are concerned it is the first step along the way towards having a universal allowance system. That is something we will continue to push for and we welcome the fact that we have been able to take that step in this year’s Budget. 
We note that the Budget will provide for 5000 more elective surgery procedures to be funded. That sounds good and to those people who will benefit I say “Good luck and well done.” But it is a drop in the bucket. It is about 3 percent of the number of elective surgical procedures currently performed in the private sector. We need to do much much more than that if we are to make a significant impact on waiting lists in New Zealand. The only way we can achieve that is by effectively utilising all of our resources public and private to best advantage. Five thousand is a drop in the bucket; a drop in the bucket that is beneficial but it is not nearly enough to turn around the mounting waiting lists in New Zealand. 
We also welcome the fact that the Budget makes provision for about $22 million of expenditure towards the implementation of various aspects of  
Medicines New Zealand 
 the national medicine strategy that we announced at the end of last year. As a result of this we will now move towards the establishment of a national formulary for medicines in New Zealand. We will have a much more effective system for making sure that patients in hospital actually get the medicines that they are properly prescribed to be getting. Believe it or not we have a big problem at the moment of patients not always getting the medicines that they are prescribed for various reasons. We have put in place programmes that will ensure that happens and that in turn is part of leading to a much healthier much better and much fitter society. That has to be a good and positive step and it is also one of the critical goals of the  
Medicines New Zealand  
programme. 
Overall this Budget continues a trend that I think has been apparent through the life of this Government of a series of quite significant building block changes that have been made and often not noticed because although the Government has been good in my view at putting the building blocks in place it has fallen short in terms of its ability to articulate a vision for the future of New Zealand. I think that as we look back on this Budget and at the eight previous Budgets introduced by this Minister of Finance we can see what has been his underlying objective: an economic transformation of New Zealand. But one has to go sifting through all the bits of the jigsaw to find it. I think that where New Zealanders are at today—and maybe this is why the approach of the Leader of the Opposition which is all fluff and no substance has some appeal—is that they are looking for that vision that sense of hope and that sense of optimism. 
This Budget is full of detail. There are a lot of positive steps within it. The challenge that the Minister and his colleagues face over the next little while is to go out and sell that to New Zealanders as being a coherent consistent rational and positive programme for the future. I think that in many steps it is a step in the right direction. But in so many other steps more work needs to be done and that will be the preoccupation of whoever occupies the Treasury benches next year. 
RODNEY HIDE (Leader—ACT) 
: 
 Let me say that the ACT party will be putting two votes behind Dr Cullen’s tax cuts so we will be voting for the legislation but sadly we cannot bring ourselves to vote for the Budget. We view the tax cuts as a baby’s steps some faltering steps in the right direction but the Budget falls short. In fact it is like every one of Dr Cullen’s Budgets. It is all about carving up the cake rather than enabling Kiwis to bake a bigger one. We see the result of those policies today. 
The forecast for economic growth next year is 1.5 percent. I remember that when Michael Cullen became the Minister of Finance he said—I know that Michael does not remember this—he would be judged by whether he achieved a 4 percent growth rate. Well the judgment is in I say to Dr Cullen and the rate is 1.5 percent. We look at the forecast for inflation and we see it is knocking the top of the target band. It is over the target band for the entire forecast period. We look at interest rates and we see that they are high and are staying high. In fact for any taxpayers with a mortgage—a reasonable mortgage—the high interest rates knock out everything they have received in terms of tax cuts. I have to say that that is a bit sad. 
It was great to see Sir Roger Douglas and Richard Prebble were here earlier. I was reminded that when they read a Budget everyone would tune in and I was aware that when Dr Michael Cullen was giving his Budget speech everyone had tuned out. It is a bit tough when Dr Cullen starts to get down to reading out that the Government is to grant $4 million to obesity research and that Budget item is deemed to be worthy of mention. 
Hon Dr Michael Cullen 
: Well you’ve done all right. 
RODNEY HIDE 
: Well I agree with Dr Cullen. He could save his $4 million by having the Minister of Health come and talk to me. Dr Cullen could have come across here. He said in his Budget that he would spend $2 million—imagine that announcement in a Budget speech—on funding the Civil Aviation Authority to get the best practice. That shows how “Think Small” Michael Cullen has become in his ninth Budget. He has famously announced $1 million for local government to deal with climate change. 
I have to say that I actually sympathise with Michael Cullen. He has put a Budget together he has put it out there and he has made the trade-offs. We hear everyone—New Zealand First Peter Dunne the Greens and the Maori Party—complain about what is not in the Budget but nowhere did I hear of an alternative plan. I heard John Key say that National had a plan and I thought that was great. The National Party has 48 MPs plus Taito Phillip Field so I thought it was going to be great. I heard the House go quiet because we were going to hear the economic plan but all I heard was silence. 
I tell the House not to worry because the ACT party with just two MPs has come up with an economic plan which I am proud to present. 
Gerry Brownlee 
: This won’t take long. 
RODNEY HIDE 
: I am happy to take Gerry Brownlee’s slot and go right through the plan. First we need to set a goal for New Zealand. I ask Mr Brownlee why we do not set the goal of beating Australia by 2020. Why is it that every political party in this House is content to be second-rate behind Australia? Why is it that we were content to have 70000 people leave New Zealand last year? Let us set the goal of beating Australia. We would not accept being second-rate in rugby so why would we in respect of the economy? 
Hon Dr Michael Cullen 
: We are! 
RODNEY HIDE 
: Michael Cullen accepts that we are. But I can tell members that over here in the ACT party we do not accept that. We do not like being second-best. ACT asks having set that goal—and this is the difference between this goal and the successive goals that Michael Cullen and Helen Clark have set—what then needs to be done to achieve it? I was actually surprised by the amount of agreement about what is needed. Everyone we spoke to—and it was quite a diverse range of business leaders community leaders economists and policy advisers—was in rough agreement about what is needed. But what is lacking is the guts to do it. 
Ron Mark 
: Hear hear! 
RODNEY HIDE 
: That is what is lacking. That is what Ron Mark agrees with. We actually lack the guts in this Parliament to do what is needed to get this economy going to get New Zealand moving forward. 
But I tell members not to worry because the ACT party has come up with a plan. We thought we would copy Helen Clark and put it on a pledge card. The card is not paid for by the taxpayer I have to say; we rushed down and paid for it ourselves. We also found that when one puts an economic plan together for New Zealand in order to beat Australia it cannot fit in a wallet. It requires some detail and it requires some substance. No one can say the ACT party does not have an economic plan for New Zealand no one can say the ACT party has not set a big goal for New Zealand and no one can say the ACT party lacks policies. At present we lack the MPs but we are planning to change that too. 
I want to show members what we have done with this plan. We have had help from John Ansell and it has been rather good. We have set the policies down here on the right-hand side. 
Gerry Brownlee 
: On the left. 
RODNEY HIDE 
: On the left if one is looking at it. We have set down in the next column what the benefits are—we are all good at doing that in politics. We have set down in the next column the other countries where it is done—and we were amazed at how many countries around the world are following good practice policies. We have in this column the benefits and we have along here what at the best estimate it would mean for economic growth. At present that is one thing we do not allow for. Sure we can talk about money for things such as buying back the trains having the emissions trading scheme doing this and doing that but it all adds up to a smaller economy to a smaller pay packet and to more New Zealanders working creating and producing in Australia. So we have in this column here the best estimates we could get of what it would mean for economic growth the trade-offs that we get for not having this policy and what that would mean— 
Ron Mark 
: Watch out that National doesn’t steal it. 
RODNEY HIDE 
: Well I would love National to steal it. That is fine. I would like New Zealand First to steal it too. I would like Dr Cullen to steal it—I say to Dr Cullen that it is not too late. 
So in this column we ask New Zealanders to say whether they agree with the plan. This is what this election will be about. It will be about which party people vote for. Will it be Labour National the Greens or the Maori Party? But then there is the ACT party which is the only party with the plan and with the big goal to grow the cake. We are sick of politicians just carving up an ever-dwindling cake. Thank you very much. 
Hon DARREN HUGHES (Deputy Leader of the House) 
: 
 I move  
That this debate be now adjourned 
. 
Motion agreed to.