English Bill: Taxation (Urgent Measures and Annual Rates) Bill — Second Reading In Committee 
English Bill: Taxation (Urgent Measures and Annual Rates) Bill — Second Reading In Committee 
[Volume:651;Page:151] 
Hon BILL ENGLISH (Minister of Finance) 
: 
 It is interesting hearing from a Leader of the Opposition who cannot tell the difference between a decile 1 and a decile 10 school and I expect that reflects the kinds of dilemmas that the Labour members will have to deal with over the next few years as they try to decide who they are. Let us just—[ 
Interruption 
] Well the public is not listening either to be quite frank. I think that is the difference. 
Let me make a couple of points clear. This is a different tax package from the previous Labour Government’s tax package. There has been ample opportunity over the last 12 months for everyone to poke and prod and discuss the details of it and the public did that. Then there was a general election. The only reason we have this bill with the National Party’s tax package in it is that the public of New Zealand voted in a different Government. If the public wanted the former Labour Government’s tax package they had the opportunity to vote for it and they did not. 
One of the reasons they did not is the spin and crocodile tears that the nasty dirty previous Labour Government had got into the habit of using. Let us just look at some of the stories Labour members are telling. The member from Hutt South—I do not know how he managed to win the seat actually—talked about taking cash out of people’s pockets. 
That is actually just wrong. No one is going to be worse off as a result of our passing this legislation. 
Hon Darren Hughes 
: Oh yes they are. 
Hon BILL ENGLISH 
: No they are not. The Labour Party keeps putting up some cases where if Labour had been re-elected and if it had kept its promises about taxes which it never did before then some people would have got more. That is bound to be the case when this is a different tax package. The thresholds and rates are different. But let us talk about some of the people— 
Hon Darren Hughes 
: That’s intellectually dishonest and the member knows it. 
Hon BILL ENGLISH 
: Well it is just a different tax package. I know the Labour members find it very difficult to understand that if one gets elected into Government it is to execute one’s policy and that when one gets thrown out of Government it is because people did not want one’s policy. 
Hon Darren Hughes 
: Arrogant! 
Hon BILL ENGLISH 
: Well no; that is what the voters think. I just accept their verdict. 
Let us take some of the people whom Labour members say they are crying about—the 630000 low-income New Zealanders who will get the independent earner rebate. They got nothing under Labour in 9 years of low incomes in the best economic period of a generation and they know that. Every person without children who was earning under $44000 got nothing—nothing. Full-time earners earning $24000 to $44000 got zero. The reason families do not get a big benefit out of this package is that in the last 2 or 3 years they have had big benefits. Their after-tax incomes have gone up very substantially. National has locked in the Working for Families package in its entirety and now it is the turn of the 630000 people for whom those members now cry crocodile tears but for whom for a decade they did nothing to help. Now it is their turn and National is delivering a tax package that will give 630000 low and middle income earners—yes; members of unions who voted for us because they thought Labour would give them something—some benefits. 
Those people waited loyally for a decade and they got nothing and Labour is telling us today that we are making a mistake in giving it to them. Well that is what we will say when we go back to our electorates to people earning $35000 who got nothing from Labour in 10 years. We will say that we promised them something and here it is and that Phil Goff is trying to stop it—630000 people. The Labour caucus thinks that Mr “Phil-in” is the answer. Well the reason he is not the answer is that he has not understood that fundamental political problem for Labour. 
These personal tax cuts deliver substantial weekly gains to the 630000 people who were ignored by Labour despite the fact that in three elections in a row a good proportion of them voted Labour. That is why those Labour members are out of touch and out of Government. Those people got tired of being told that it was the students it was the people with families or it was the bureaucrats who would get the next $300 million but those hard-working battling Kiwis who do not happen to have children would get nothing. 
This is a balanced package because we are locking in the gains families made which were considerable and we are keeping them in their entirety— 
Hon Dr Michael Cullen 
: Oh what a generous man. 
Hon BILL ENGLISH 
: —we cannot have everything I say to Dr Cullen as he used to tell everybody—and we have added to that a mechanism that provides increasing weekly incomes for 630000 people who earn under $44000. These are not the higher-income high fliers. These are Mr Cosgrove’s heartland voters which is why he lost the party vote in his electorate. I ask when Labour members are going to figure that out and when they are going to figure out that some people hearing the crocodile tears today from Labour just will not believe it because they know it is wrong. 
What about other people who earn under $20000? Well 300000 of them are beneficiaries. I ask what the Labour Government did for those people through a decade of the best economic times we will see in a generation. Mr Goff did not mention them but I bet he will now he is in Opposition. He will go on and on about what National is doing to beneficiaries when he did nothing for them. When Labour members go on about who is affected by the changes in these tax rates I say that a big part of that group under $20000 are beneficiaries. The other group are superannuitants. Superannuitants are the biggest single group who earn under $20000 and they are considerably better off as a result of these tax cuts. In our constituent clinics we are going to say to them: “We promised you more super through lower taxes and we have delivered you more super through lower taxes. It’s that simple.” They’ll go: “Well that’s a fair cop. I didn’t vote for you but next time I will because you kept your word.” That is the other big group under $20000. 
The Labour Party will cry crocodile tears. There will be some people where the rates and thresholds mean that compared with what Labour would have done if it had been elected— 
Hon Dr Michael Cullen 
: No it’s the current law. 
Hon BILL ENGLISH 
: Well the 2005 “chewing gum tax cuts” were the law and we remember what happened to that. Broken promises on tax cuts meant half the people did not believe Labour would keep its promises on these tax cuts. 
Hon Darren Hughes 
: That’s not true. 
Hon BILL ENGLISH 
: Well I ask why Labour members are in Opposition if they had such a magnificent tax package. It has to be because people did not believe them and they were right not to believe them because the last time Labour made promises about tax cuts it broke those promises. 
This bill is a step in a direction of a broad based - low rate tax system. It delivers benefits for many people who missed out on the benefits of economic growth in the last 10 years and we are very pleased to support it.