Cullen Michael: Budget Debate 
Cullen Michael: Budget Debate 
[Volume:608;Page:6026] 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 It is a pity that that member did not read some of the Australian newspapers today because Mr Costello gave some tax cuts and only 20 percent of the Australian public supported that. The great majority would rather the money had been spent on more health and education. I want to start with that because ACT has invented a whole new form of economics. Mr Prebble says that if one has an operating surplus of $4 billion—it was actually $1.36 billion but never mind—on accruals accounting one can spend the lot. 
Let me run through for the simple minds on the back bench of the ACT party—they are all back-benchers there—the simple facts of accruals accounting. Let me give them my simple car example. Suppose a person’s income is $30000. That person spends $20000 on the ordinary cost of living and buys a car worth $10000. The ordinary person would say there would be no money left. Accruals accounting would say that the money spent was $20000 plus the first year’s depreciation—say $2500. That person has made a profit of $7500. Mr Prebble says that one spends the $7500. How can one do that? One has to borrow the lot. 
 So at the end of the year one still has a car but one now has a debt of $7500 and one then repeats the performance year after year. That has a name and it is what Sir Robert Muldoon used to do as a form of government. He ended up borrowing to pay for the groceries. Where does that lead us? By 1984 and 1985 it led to one tax dollar in four being spent on interest payments on servicing the Government debt and that is now the ACT party’s version of neoclassical economics. My God! Adam Smith and all the rest of them must be turning so fast in their graves that if we could stick two wires into them we would not have a power crisis this winter in New Zealand. But of course National is more subtle. When I was asked before the Budget what the reaction would be I said “You can guarantee what it will be: business will say it doesn’t do what they want”— 
Hon Richard Prebble 
: I raise a point of order Mr Speaker. The reason I am cutting off the member is that an ACT member was cut off. We had an undertaking that we would be able to speak and we are now told that the ACT member of Parliament cannot speak on the Budget. The ACT party’s rights in this House have been cut off not because of points of order—the ACT party has not been raising points of order and objecting to the Budget—but because of institutional racism. One can now get up speak in Maori get double the time and thus cut off the ACT party. If we are going to allow that then the ACT member of Parliament should have been able to give a speech. It is absurd that we are now in a position where mainly Government MPs can get double the usual length for a speech and speak in Maori as much as they like knowing that the effect of that will be that a legitimately elected member of Parliament is not able to speak to the Budget. The Government should have allowed Heather Roy to speak and I want to record the fact that it is a complete outrage that that has been allowed to occur. 
Mr SPEAKER 
: Heather Roy did have a very short speech— 
Hon Richard Prebble 
: Not the time she was entitled to. 
Mr SPEAKER 
: I understand that but I did call the member. I am bound by the Standing Orders on page 95. I have no room to manoeuvre. At the end of 13 hours and 50 minutes I must call the Minister in reply. 
Hon Dr MICHAEL CULLEN 
: When I responded I said: “I know what the National Party will say. It will say ‘We should have surpluses and be responsible. We should spend more money on nearly every vote and we should cut taxes.’ ” And what did it do? 
John Key 
: What’s wrong with that? 
Hon Dr MICHAEL CULLEN 
: Mr Key asks what is wrong with that—Mr Key who has pretensions to replace Mr Carter who has pretensions to replace Mr Brash who has pretensions to replace Mr English. What is wrong with that is that it does not add up—six into two does not go in the kind of arithmetic we do in Budgets. Post the Budget every little back-bench National spokesperson rushed off and said: “What a mean miserable lot the Government are for not spending lots more money on my bits.” Then Dr Brash said: “We should run good surpluses. It is very sensible and very conservative in this situation.” Then the business spokespeople said: “We should have big tax cuts starting with those with the highest incomes.” That was the National Party’s form of fiscal management. It was not quite as lunatic as the ACT party’s form of fiscal management but it was pretty close to it. It wants surpluses more spending and lower taxes—it wants everything! 
It is no wonder that Mr English is the last of the baby-boomer generation. He is demand-fed and wants everything instantly at every moment. He was brought up in that atmosphere and he will carry on with it for the rest of his life. What a dreadful speech he gave when he got up after me. It was a dreadful appalling whingeing apology for a speech as his eyes crossed round as he wondered what on earth he was saying as he does time after time in this House and outside of it. 
What was National’s position? The Government had betrayed students by putting a limit on fees! When he was asked what the National Party policy was he said there should be no limit on fees at all and that they should be able to go as high as the institutions want to put them. I have a feeling that students would rather be betrayed by us than completely shot in every different part of their body by members of Parliament opposite me. 
What is National’s position on electricity? The principle of the great market-orientated National Party is that electricity should be free. If we need more generating capacity to have a margin the extra should be free. Father Christmas is going to come down early for Christmas and build us some more power stations for which I say thank you to Father Christmas the fairy godmother the tooth fairy or Dr the Hon Lockwood Smith—whoever it may be in that particular case. I have always thought of Dr the Hon Lockwood Smith as the tooth fairy. Then we had Mr John Key—who is supposedly National’s new bright young spokesperson on finance— 
John Key 
: If I do say so myself! 
Hon Dr MICHAEL CULLEN 
: He does say it himself in every press statement. He said: “What do you do with management of funds? Invest at the top of the market.” John Key’s measure for success as to how to make a million is to buy when the market is at its top. I have to tell Mr Key that that is not how George Soros got there. It is not how the successful ones have operated. 
The National Party showed in this debate that it still has no idea of what it stands for. It believes that it is the natural party of government but everything about National is totally unnatural. There is nothing natural about it at all. I repeat that Mr English looked like a rabbit praying for a rifle and a searchlight to put him out of his misery. The thought among National members is that they should swap him for Dr Brash and the point of doing that will be about as useless as feeding a dozen oysters to a eunuch. 
So what is National going to do? It is waiting for the next generation but Mr Simon Power is the silent member of the front bench. He scarcely rises to his full bulk and speaks forth in the House. He has gone and disappeared so now maybe Katherine Rich will come forth at some point in the future and be the new leader of the National Party. 
Then we had the wonderful pro-family policy that said: “If you are a low-income family and your kid doesn’t go to school you should have your income cut.” What a brilliant idea that is! That will really encourage family life amongst low-income New Zealanders! National said we should also give a tax cut to the rich because as we all know when a tax cut is given to the people at the top for some reason they all go and work harder whereas if they get a tax increase they work less hard so that their income can go down even faster. 
 I have never understood why the National Party thinks people on high incomes are so stupid that if they have to pay a slightly higher tax rate they will decrease their income level faster to get their own back on the people who put the tax increase in place in the first instance. It has not worked. We were told we would create no jobs;there are over 100000 new full-time jobs. We were told that the economy would not grow; it is one of the fastest-growing in the OECD over the last year. I was across in Australia yesterday and they were very complimentary about this Government and about New Zealand—about what is happening in this country. I have here the latest Macquarie research handout talking about the new tradition in New Zealand of responsible fiscal policy. That is the external view of this Government and I am happy to be judged by those international standards. 
The question was put that the following amendment to the amendment to the amendment in the name of Rod Donald be agreed to: 
that all the words after “has no confidence” be omitted and the following words substituted: 
in the Labour-led minority Government because of its failure to invest in achieving a self-reliant economy its refusal to properly nurture a just society and its unwillingness to seriously protect the environment.