Volume 631 Week 15 - Thursday 18 May 2006 
Volume 631 Week 15 - Thursday 18 May 2006 
[Volume:631;Page:3195] 
Thursday 18 May 2006 
Madam Speaker 
 took the Chair at 2 p.m. 
Prayers 
. 
Appropriation (2006/07 Estimates) Bill 
First Reading 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I move  
That the Appropriation (2006/07 Estimates) Bill be now read a first time. 
Bill read a first time. 
Budget Statement 
Budget Debate 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I move  
That the Appropriation (2006/07 Estimates) Bill be now read a second time 
. 
Budget 2006 demonstrates the importance to the Government and the people of New Zealand of the commonsense consistent long term view that has been taken over the previous six Budgets.  
Over the period from 2000 to 2005 New Zealand experienced very strong economic growth averaging nearly four per cent over the last five years. This has led to strong household income growth rising real incomes and very low levels of unemployment. Since December 1999 an additional 313000 jobs have been created in the New Zealand economy.  
This period of sustained growth the longest in the last thirty years has led to labour shortages and inflationary pressures.  
The consequential tightening in monetary policy in combination with declining terms of trade (especially the rising price of oil) lower net migration and lower profit growth caused a slower rate of growth in demand in the second half of 2005.  
Growth in Gross Domestic Product slowed significantly with two flat quarters in succession. Growth in tax revenues also began to slow.  
This lessening of the pace of economic growth is a normal adjustment to the imbalances and pressures which have arisen. GDP growth will fall from 3.7 per cent in the year to March 2005 to 2.1 per cent in the year to March 2006 and is forecast to bottom out at 1.0 per cent in the year to March 2007. Growth is then expected to pick up again after this soft landing averaging 3.3 per cent in the following three years.  
Other key indicators will tend to match or follow this cyclical pattern. In particular the current account deficit is expected to have been at its peak over the last year and to begin to slowly improve. Tax growth will show a lagged effect. Tax revenues will also be affected by timing changes to the provisional tax system which will bring a dip in tax revenues in 2008/09 with a corresponding rebound the following year.  
The strong economic growth in recent years led to a pattern of strong and rising operating surpluses and significant cash surpluses. This meant that the Government has been in the unusual position of funding all its capital needs – including transfers into the New Zealand Superannuation Fund – out of current income.  
This pattern has continued in 2005/06. In the current year the operating surplus has been boosted by two substantial items. One is the profit on the sale of Meridian’s Australian assets. The other is the high returns from the Crown’s financial institutions which have seen strong investment returns.  
Over the first nine months of the 2005/06 financial year the Crown Financial Institutions contributed $2.5 billion towards the operating balance. Of this the New Zealand Superannuation Fund accounted for $1.1 billion by earning a 19.5 per cent return on their assets for the year. This is an outstanding result. Excellent returns were also earned by the Government Superannuation Fund and EQC at 14.6 per cent and 14.0 per cent respectively.  
While the falling dollar has been a significant contributor to these gains credit must also go to the boards and management of the Crown Financial Institutions. On this occasion I would pay a particular tribute to Neville Young Chair of the Earthquake Commission who has overseen major changes and diversification and who retires from that position shortly.  
The success of the Crown Financial Institutions has had one impact of particular significance. The Crown’s net financial asset position including the Super Fund is now positive probably for the first time in our history.  
But this success is a good example of how and why the operating surplus is not necessarily available for either expenditure increases or revenue reductions. All the funds are dedicated to particular purposes and their income should be reserved for those purposes. This is especially so as in all cases the actual or potential liabilities far exceed the value of the funds.  
In any case years such as the last one with bumper unrealised gains will be offset by years of subnormal unrealised gains or even unrealised losses. The fool who spends on the upturn will find himself broke on the downturn.  
Because of these gains the operating surplus for this year is now expected to be $8.5 billion compared with the estimate of $5.6 billion at the time of the Half-Year Economic and Fiscal Update. The Operating Balance Exclusive of Revaluations and Accounting Changes is already in decline at $7.0 billion this year compared with $8.9 billion in 2004/05. In GDP terms this is a drop from 5.9 per cent to 4.5 per cent. The projected cash surplus is $1.8 billion.  
Running strong operating and cash surpluses over recent years has allowed the level of both gross and net debt and the cost of debt servicing to fall as a proportion of GDP.  
But it has never been the intention of this Government that the cash surpluses over the cycle as a whole would normally fully cover the cost of capital expenditure. Changing macroeconomic conditions will make this reality more obvious.  
As the effects of the slowdown flow through there will be a significant impact on the fiscal position. Lower nominal GDP growth smaller profits and a small rise in unemployment means that 2005/06 is expected to be the last year with a cash surplus for some time.  
Cash deficits are forecast of $1.5 billion for 2006/07 $2.1 billion for 2007/08 $2.7 billion for 2008/09 and $1.1 billion for 2009/10 in all some $7.4 billion over the period. Operating surpluses are also expected to fall to an average of $4.8 billion or 2.8 per cent of GDP. This however includes returns from the New Zealand Superannuation Fund. Excluding these the forecast operating surplus averages $3.8 billion or 2.2 per cent of GDP.  
This Government does not intend to react to this situation by slashing government expenditure thus making the slowdown worse. The fiscal prudence adopted over the previous six years in other words allowing the automatic stabilisers to work on the upside means they can now be allowed to work on the downside. This contrasts with the position in 1999 when the previous Government reacted to a downturn by such moves as cutting the level of New Zealand Superannuation.  
Budget 2006 therefore provides for new operating spending of $9.6 billion and capital of $2.7 billion over the next four years.  
Operating surpluses of the level proposed over the longer term are consistent with keeping gross debt roughly constant as a proportion of GDP. The Government is satisfied that with respect to gross debt the prudent level required under the Public Finance Act will be achieved during the forecast period.  
Gross debt as a proportion of GDP at 30 June 2006 is expected to be higher than forecast in Budget 2005 in large part for technical reasons associated with the Reserve Bank’s liquidity management operations. It is expected to continue to fall gradually over the forecast period and then stabilise over the longer term. This is consistent with the changed long term debt target of keeping gross debt around 20 per cent of GDP. This change will enable an appropriately flexible approach over the medium term consistent with maintaining low debt by international standards.  
Net debt excluding New Zealand Superannuation Fund assets is forecast to be 5.8 per cent of GDP at 30 June this year. This will rise slightly before stabilising at 7.2 per cent of GDP.  
Meanwhile the assets in the New Zealand Superannuation Fund are expected to reach $10 billion by 30 June this year. This compares with a forecast of $9.3 billion at the time of last year’s Budget. By the end of the forecast period at 30 June 2010 assets in the Fund should stand at $23.3 billion. Total Crown net worth will have risen from 8 per cent of GDP in 2000 to over 40 per cent of GDP in 2010.  
All this means something very simple. New Zealand is in a far stronger position to cope with the fiscal consequences of the demographic transformation which will occur over the next thirty to forty years than almost any other developed country. This will increasingly become a competitive advantage for us as other countries face increasingly difficult fiscal trade-offs which will be less challenging for New Zealand. Again governing for long term stability and security will pay off compared with governing for short term gratification.  
Madam Speaker Economic transformation lies at the heart of this Labour-led Government’s ambitions for the future.  
This Government does not subscribe to the theory that economic transformation consists of a period of actual intense pain followed by often hypothetical gains. This is particularly so when on past experience the pain seems always to be concentrated on ordinary Kiwis on low and middle incomes and the gains are made by a few.  
Economic transformation must build on an understanding of the need for continuous change and adaptation. A small and relatively isolated developed nation in the South-West Pacific – the most isolated developed nation in the world – has to build its prosperity on its flexibility and adaptiveness its responsiveness to changing market conditions and demands.  
That is why this Government lays equal stress on the welfare of families young and old and on the strengthening of national identity. These are essential underpinnings of a broad national commitment to that ongoing process of economic transformation.  
Madam Speaker Budget 2006 builds on the investments made in economic transformation over the past six years by committing $2.1 billion of new operating funding and $1.5 billion of new capital funding over four years.  
New Zealand must lift its productivity levels and increase the value of its exports. Budget 2006 invests new funding in upskilling the workforce encouraging new business and exports increasing research and development and investing further in the country’s infrastructure.  
The most important contributor to economic growth in a modern economy is human capital. The Government has already announced proposals for major changes to the funding system for the tertiary education sector which will underpin our commitment to quality and relevance.  
The new system of funding based on the concept of multi-year investment in an agreed plan will begin to be rolled out in 2008.  
The largest single item of increased spending in the tertiary education area in Budget 2006 is of course that for the interest free student loans policy. Uptake of student loans so far this year has been less than forecast and this is reflected in forecast new lending being $600 million lower over the forecast period than previously estimated.  
An additional $166.4 million of tertiary education initiatives in Budget 2006 will ensure New Zealand produces more graduates with the skills needed to transform this country into a high-wage knowledge-based economy.  
Over four years this includes $34.4 million to expand the number of Modern Apprentices to 14000 by December 2008 and $15.6 million more in the Industry Training Fund to increase the number of people participating in structured workplace learning.  
The Government has allocated $8.1 million over the next four years to expand Gateway to include all state and integrated secondary schools.  
Gateway a Labour-led Government initiative is currently available to decile 1-6 schools. It integrates school-based learning with structured workplace learning for senior students. Gateway has a record of success in assisting students into employment or further education.  
The Government is increasing spending by $33.5 million over the next four years towards improving the literacy numeracy and language skills of the workforce.  
Over the next four years this new funding will continue the progress we have already made in working with industry training organisations to improve the foundation skills of people employed at the low-skill end of the workforce.  
As experience is gained in these programmes it is my intention to expand them significantly in the medium term.  
School students and school leavers adults entering or returning to work and employed people seeking a change in jobs will have better resources to help them make the transition to the next stage of their working life as a result of a $12.7 million boost to Career Services’ capacity in Budget 2006.  
Students will benefit from $31.1 million over the next four years in new funding that includes an increase in the number eligible for student allowances and bonded merit scholarships.  
The package of initiatives includes a 10 per cent increase to the student allowance parental income threshold at an estimated cost of $14.3 million over the next four years.  
Those undertaking doctoral studies will have their student allowance entitlement increased when PhDs and professional doctorates are added to the list of Recognised Long Programmes for student allowances from 1 January next year. The Government has committed $3.8 million over four years to this policy.  
The bonded merit scholarship scheme will be expanded by 500 from next year at an estimated cost of nearly $13 million over the next four years. From 1 January 2007 1000 students a year will get help with course fees. The scholarships provide $3000 per academic year for course fees from the student’s second year for up to four years of study. Following graduation students are bonded to work in New Zealand for a period as long as the duration of their scholarship.  
These student support measures continue this Government’s commitment to making tertiary education more affordable; and keeping our high quality graduates in this country so they can contribute their skills and talents for the benefit of local employers and the New Zealand economy.  
The Performance Based Research Fund (PBRF) is to receive a $23.7 million increase over four years.  
The PBRF allocates research funding to tertiary education institutions on the basis of their research performance. Its primary focus is on rewarding and encouraging excellence in tertiary education research.  
This increase contributes towards meeting a Labour 2005 Manifesto commitment to increase the PBRF to a total value of $250 million by 2010.  
Research capability and linkages between tertiary education institutions and industry partners have been boosted by an increase in funding of $47 million over the next five years.  
Through Budget 2006 the Government has approved $40 million over five years to fund six projects as part of the Government’s Partnerships for Excellence initiative. This initiative has been an outstanding success in enhancing innovation encouraging greater private sector investment in tertiary education and fostering closer relationships between tertiary organisations and business.  
An additional $7 million will enable the Tertiary Education Commission to work with tertiary institutions to increase research in areas identified as important to New Zealand’s social and economic growth.  
Madam Speaker The second key area for action in relation to economic transformation is infrastructure. The Government’s announcements two weeks ago on telecommunications included unbundling the local loop provision for naked DSL removing the upstream limit on bitstream unbundling and increasing the powers of the Commerce Commission.  
Those announcements also indicated a commitment to proceed at least as far as accounting separation for Telecom. However it is expected that the Select Committee looking at the proposed legislation will also consider the merits of proceeding further on such matters as other forms of structural separation.  
Many will argue these changes are overdue. Certainly successive governments has been very patient with Telecom. But national interest must prevail. We cannot afford to be a barely middle range performer in telecommunications as a result of allowing the incumbent to continue to play a long defensive game.  
The Government is also aware of the importance of electricity generation and supply issues for business confidence and economic transformation. Much can be done in terms of energy efficiency and work continues in conjunction with Jeanette Fitzsimons and the Green Party on these matters.  
But increased energy efficiency will not of itself be sufficient. Moreover growing awareness of the seriousness of the consequences of human-influenced global warming the likelihood of high oil prices continuing and the uncertainties around future gas supplies in New Zealand mean there must be an emphasis on increased energy production from renewable resources.  
Work is proceeding on a range of solutions including the use of biofuels in conjunction with broader climate change policy initiatives. Significant contingency funding of $100 million has been set aside for the purpose in 2006/07.  
But it is also important that we ensure that economic and regulatory signals are consistent with both security of supply and broader sustainability and environmental considerations.  
A similar balance needs to underpin the other major area of infrastructure improvements: roading rail and land transport. The publication of Transit’s draft ten year programme earlier this year caused some consternation by implying that a number of projects that had previously been included were going to be dropped. That created both uncertainty and disappointment.  
Since the draft programme which posted a $642 million gap in funding for state highway construction over ten years more complete analysis has been done which indicates that over the next five years the shortfall over the whole National Land Transport Programme is $862 million. This would lead to even more delays in key roading projects unless there were also cutbacks in public transport funding which along with maintenance comes out of Land Transport New Zealand’s allocation before new roading projects are funded.  
Such a situation is unacceptable to the Government. There is a need for certainty in the forward programme over a credible time horizon. In Budget 2006 the Government is therefore committing to meet the funding shortfall over the coming five years which will allow the programme of activity as set out in August 2005 to proceed. This programme will be updated periodically to allow greater certainty going forward.  
The funding to enable the Government to pick up the slack and reinstate all the projects for the next five years which were previously in Transit’s ten year programme will mainly come from a special dividend of $800 million from Meridian. This will occur in large part because of the very successful sale of Meridian’s Australian Southern Hydro assets. The payment is due on 30 May 2006 subject to appropriate solvency tests.  
A separate announcement will be made on the key deliverables that Transit expects can be made with this commitment to funding.  
In addition the Government believes it is necessary to secure some cushion both to bring forward other key projects and to ensure the programme is not subject to any further uncertainties. Therefore I am announcing that over this period the Government will be prepared to issue up to $1.0 billion in infrastructure bonds. Of that Budget 2006 commits $425 million over the next five years to enable the following projects amongst others to be brought forward:  
Advancement of the Manukau Harbour Crossing by one year to enable substantial completion by 2011;  
Advancement by four or more years of the four-laning of Longswamp to Rangariri and the Rangariri and Huntly bypasses;  
Regional projects such as the Christchurch Southern Motorway Christchurch Western Corridor Awakino Gorge and Kopu Bridge;  
Road safety projects reduced environmental impacts on sensitive areas and increased walking and cycling contribution to local authority strategies; and  
A range of investigation projects to improve state highway access to high growth economic development areas such as  
State Highway 1 north and south of Auckland;  
Hamilton southern links;  
Kaimai ranges;  
Ngauranga to Wellington Airport; and  
Projects in Nelson and Queenstown. 
The Government funding includes provision for the following projects subject to the local share of funding also being made available:  
The investigation and preliminary design work for Transmission Gully to enable a construction start by 2011/12;  
A construction start on the Tauranga Eastern Corridor; and  
Caversham four-laning. 
A further announcement will be made tomorrow on a multi-million dollar funding package for the Waikato region following a report on Waikato’s transport needs from central and local government officials. This is in addition to today’s announcement of $1.3 billion in new transport funding.  
In Budget 2006 the Government is also delivering on its commitment to remove the tolling on the Tauranga Harbourlink Bridge under its confidence and supply agreement with New Zealand First.  
Madam Speaker This Government has nearly already doubled spending on land transport. These announcements mean both greater certainty and significant acceleration in addressing this fundamental area of infrastructure need. Even without levying a capital charge to reflect the true cost of the roading system this means that the days of retaining any petrol excise duties in the Crown Account are over.  
Between 2006/07 and 2010/11 the total revenue collected from road user charges petrol excise duty and motor vehicle registration is estimated to be $13.1 billion. Total land transport funding including the special packages for various regions is estimated to be $13.4 billion $300 million more than total revenue.  
Meanwhile the Government will continue to work with Auckland and other local authorities on efficient and effective improvements to the public transport system. This will include how best to enable local authorities to meet their contributions to local land transport costs. At the same time it is likely that further investment into the rail system will be required to ensure the maintenance of a national network.  
Madam Speaker One of the planks of the economic transformation agenda is ensuring that we have a regulatory environment that is appropriate to New Zealand’s unique identity as a small dynamic economy distant from its markets. At the same time it must provide assurance to international investors that New Zealand is a great place to do business and to invest in.  
The Government’s latest move is to initiate a review of our regulatory frameworks. This review will have both breadth and depth and will be largely informed and driven by those at the coalface.  
The review of regulatory frameworks to be led by the Minister of Commerce and Small Business signals this Government’s commitment to a regulatory environment that promotes economic growth business confidence globally competitive firms and social wellbeing.  
The review which will be announced in full by the Minister of Commerce next Monday will look at issues in existing regulatory frameworks that may be unnecessarily constraining business development and economic transformation.  
This Government intends to get down to the level of business owners to assess the real issues that are both constraining their development and frustrating their day to day operations.  
The review will focus on a number of issues including:  
particular issues arising from the implementation of regulation and the interaction between regulatory frameworks. Many of the concerns voiced by businesses indicate that problems are often around how the rules are being implemented on the ground rather than the rules themselves;  
particular studies into the compliance and regulatory issues facing different sectors. The purpose of this initiative is to improve our understanding of regulatory and compliance costs issues as they affect particular sectors and by doing so identify how to best assist key sectors that contribute to economic growth; and  
strengthening the processes used by Government to design regulation to ensure that new rules are robust responsive and based on sound analysis. 
The lead minister of the review being both Minister of Commerce and Minister for Small Business will provide small to medium sized businesses with the assurances they are seeking; that is that where regulation is required the most appropriate level of intervention has been selected that the legal framework is appropriate and that its delivery and enforcement meets the same criteria.  
Madam Speaker Budget 2006 builds on the work of the Growth and Innovation Taskforce and continues our commitment to transform New Zealand into a high value innovative export-led economy that can compete effectively in global markets.  
To that end there will be a $64.2 million increase in market development assistance for firms operating in offshore markets over the next four years and a $60 million boost to the venture capital market through the Government's Venture Investment Fund.  
Both are aimed at helping more New Zealand businesses to be globally competitive.  
By supporting firms to implement their marketing strategies in new markets we will help grow New Zealand's export sector. This is crucial to our economic prosperity.  
The scheme supports firms to undertake market development initiatives such as market visits in-market representation advertising promotion and marketing collateral exhibiting at trade fairs and events and market research.  
It pays up to 50 per cent of a market development project up to a maximum of $100000 a year.  
This funding will also be important in the lead-up to Export Year 2007 and builds on other successful work undertaken over our last two terms of Government.  
Successful globally competitive firms also need access to good research and development to add value to their exports and strengthen their innovation.  
Budget 2006 commits $100 million extra into Research Science and Technology. $81 million goes to supporting key industries with further investment in pastoral energy biodiversity and biosecurity research and research capability in Crown Research Institutions. $16 million goes to accelerate the commercialisation of research.  
A greater proportion of research investment will be moved into longer term funding arrangements. This will lead to a growing emphasis on a multi-year funding approach to research science and technology.  
The Government also recognises the higher costs of assuring the security of New Zealand’s export goods for overseas markets following the introduction of tighter international security measures since September 2001. For this reason it has agreed to continue to fund a significant part of this cost for a further two financial years to allow exporters more time to make this transition.  
Madam Speaker Taxation policy clearly has a role to play in economic transformation. The coming fiscal year sees the full impact of the large changes to depreciation and other business taxation matters which came into force on 1 April. Only now is the significance of these beginning to be understood in some quarters.  
Further moves provided for in this year’s Budget include the payment of a subsidy for the use of a payroll agent by employers. This will be at a flat rate of $2 per pay period per employee for up to five employees. This will cost $79.4 million over four years.  
The other major change is the implementation of the Labour-New Zealand First agreement to lift the economic performance of the racing industry by the alignment of the racing gaming duty with that paid by casinos and by accelerating depreciation for bloodstock. This will cost $136.5 million over four years.  
Attention will now turn to the review of business taxation being prepared by Hon Peter Dunne and me as a result of the Labour-United Future confidence and supply agreement. A discussion document is being prepared with a range of possible initiatives for consideration and debate. Changes will be introduced from 1 April 2008.  
Madam Speaker The more successful we are in achieving our vision for economic transformation the greater will be our ability to deliver a better quality of life for families young and old. Over the next four years the Government will spend an additional $5.8 billion of operating expenditure arising out of decisions in Budget 2006. There will also be an additional $460 million of capital expenditure over the next four years.  
$1.85 billion of this will be as a consequence of the Working for Families package. About 85000 more families benefited from 1 April so that this year about 350000 families will gain from this targeted tax relief.  
Our ongoing reform of the welfare system is actively supporting more people into work. Under this Labour-led Government nearly 118000 fewer people are reliant on a benefit a drop in the number of beneficiaries of nearly 30 per cent. The Government believes that ultimately work is the best way out of poverty and provides the best social and economic outcomes for families in the long run.  
Making work pay through the In-Work Payment component of the Working for Families package improves people’s opportunities to make a better life for themselves and their families. Analysis of the Working for Families package suggests that by its full implementation in 2007 there will have been a 70 per cent reduction in child poverty using a threshold of 50 per cent of the median income.  
The Government believes family violence is a problem of critical importance. Its high incidence and its human cost are unacceptable. The Government has therefore committed $68.8 million over the next four years to programmes to help reduce violence in our families and communities. Projects target truancy disruptive behaviour in schools and at risk youth. Funding has been increased to strengthen community organisations working with victims as well as family violence prevention providers like Women's Refuge.  
The Government is committing $11.5 million for an information campaign aimed at changing attitudes to domestic and community violence. In addition there is also $8.9 million to tackle disruptive behaviour in schools.  
The largest additional spend on families is an additional $3 billion on the health sector over four years. The ability to fund at this level is the result of the balanced approach to fiscal policy that large tax cuts would clearly threaten. Just over half $1.6 billion is devoted to maintaining the real purchasing power of health care providers.  
This Labour-led Government has invested heavily in health care. We have built new hospitals from Kaitaia to Invercargill. We have provided funding so that by 1 July next year all New Zealanders will be able to enjoy cheaper doctor visits.  
Budget 2006 will fund initiatives in child health and the fight against obesity. They are crucial to the future of our health system and the health of New Zealand families.  
Child health sees an additional four year $80.4 million investment. Just over half of this $40.8 million will allow for the creation of a seamless oral health service for all those under eighteen. The failure to invest in oral health in the 1990s has led to the first deterioration in the state of children’s teeth on record. This must and will be reversed.  
$23.6 million will allow for the expansion of the number of Well Child checks for pre-school children. $16 million will be spent to create a universal newborn hearing screening programme. Research has long shown that preventable or treatable hearing problems can have a major impact on subsequent education performance.  
The greatest public health challenge facing New Zealand is the epidemic of obesity particularly childhood obesity. The failure to act could mean that the current generation of young New Zealanders could be the first to die younger than their parents.  
$76.1 million over four years will fund the largest campaign in New Zealand’s history to fight obesity. The campaign will be built on the Government’s world-leading Healthy Eating Healthy Action strategy that has already led to the trialling of exciting innovations since its introduction in 2003.  
The campaign will focus on initiatives with schools primary health care deliverers social agencies and food industry bodies.  
Improving the health care of older New Zealanders is a top priority for the Government. Budget 2006 provides an increase of $126 million for the aged care sector. Roughly half of this will go to residential care services.  
Madam Speaker The Government will continue to invest further in the pre-school and school sectors of the education system.  
In early childhood education the Labour-led Government is continuing to focus on boosting the number of qualified teachers and lowering the cost to parents. In Budget 2006 the $162 million funding package provides for the implementation of 20 hours per week free early childhood education from July 2007. It also includes $30 million over four years to enable the early childhood sector to move more rapidly towards its goal of all teachers being registered by 2012.  
Overall funding for early childhood education has more than doubled since 1999 from $261 million to $625 million. This Budget puts us on track to realise our vision of giving every New Zealand child a solid foundation through quality early childhood education.  
Through this Budget the Labour-led Government is making further strong investment in our schools and our teachers. Only through this continued investment will our school system remain amongst the best in the world.  
More teachers new classrooms and buildings and an overall boost to operational funding are all part of this package. This funding will put an extra 455 teachers into primary and special schools to further reduce pupil teacher ratios. Operational funding will also increase by $95.6 million over four years to ensure it stays ahead of inflation.  
Using technology to transform teaching and learning is the focus of a $33 million investment in ICT in schools over the next four years. This new funding builds on $300 million already spent by this Government on educational ICT since 2000. It will ensure new technology is used in a way that makes teaching more exciting and innovative and lifts standards for all students.  
This package includes the expansion of new technology into classrooms such as video conferencing and on-line interactive digital content for teachers and students. It will also provide remote schools with satellite broadband at a subsidised rate and introduce a national web-based enrolment management system to replace the old card-based system and improve attendance.  
Madam Speaker We want strong families living in safe and secure communities so that all New Zealanders young and old can share in the progress this country is making.  
Labour-led Governments are the only ones to have ever passed legislation enshrining victims' rights - in 1987 and again in 2002. Meeting the needs of the victims of crime is central to the Government's direction for New Zealand's Justice system.  
That is why this Government is directing new funding to help ensure victims of crime have access to effective support services.  
More than $10.8 million will be allocated over the next four years to progress and consolidate the restructuring of Victim Support which began in 2004. The funding will go toward ensuring that the organisation's structure and personnel meet the needs of the public and will include the hiring of more practice specialists and other key staff.  
This initiative means that there will be the right people in place to ensure that improvements in the quality and consistency of services reach those who need it most particularly the victims of serious and violent crime.  
In Budget 2006 the Government is committing a total of $164.3 million in operating costs and $52.3 million in capital costs over the next four years for the first tranche of the 1000 frontline sworn police and 250 non-sworn police promised under our confidence and supply agreement with New Zealand First. Altogether we expect to spend $387 million in operating costs and $114 million in capital costs over the next four years as we fulfil our commitment. The extra police will be recruited over three years with funding for the second tranche rolled out in Budget 2007 and the third tranche in Budget 2008.  
The considerable investment in building police numbers by 12.5 per cent over three years illustrates the Government’s commitment to providing safe communities.  
$1.1 million over two years from 2006/07 will be given to an ACC pilot project for families of children with sensitive claims so they can provide a supportive environment for their child ensuring their rehabilitation and recovery needs are met.  
This is in addition to the previously announced $9 million which will go towards non-government community family violence prevention service providers such as 24-hour crisis lines counselling social work support safe-house accommodation advocacy and information.  
Budget 2006 will boost ACC contributions towards treatment costs and rehabilitation by $18.4 million over the next four years.  
Specified treatment providers such as acupuncturists chiropractors occupational therapists osteopaths physiotherapists podiatrists and speech therapists will receive $12.9 million in funding and this will give New Zealanders with injuries more choice in the type of treatment provider they need or prefer.  
Home-based rehabilitation providers will receive $5.5 million to start to address the shortage of support workers providing home help and attendant care and to raise the quality of care given to injured New Zealanders.  
Madam Speaker From the beginning this Government has paid special attention to supporting the evolution of New Zealand’s national identity. That was given practical expression in particular by the Prime Minister taking the position of Minister of Arts Culture and Heritage.  
New Zealand’s identity who we are as a nation is comprised of many interwoven strands. In addition to arts culture and heritage it brings together many other strands. They include our position on defence and foreign affairs foreign aid our land and environment and in some respects the place of Maori in our nation as the original inhabitants the New Zealanders who by definition make us different from any other nation.  
This Labour-led Government has followed in the proud tradition of Peter Fraser and Norman Kirk in asserting our active role as an independent nation in an interdependent world.  
This has been evident in our defence and foreign affairs policies. Over recent years New Zealand has seen more of our troops positioned offshore than for more than a generation. That includes a wide range of small peacekeeping-roles in such places as Kosovo Sierra Leone and the Sudan.  
It also includes larger and at times more active involvement in Timor Leste Afghanistan Bosnia and the Solomon Islands plus a significant commitment over more than two decades in the Sinai.  
This has been accompanied by a major refit of the armed forces including light armoured vehicles light operational vehicles Project Protector and upgrades of the Orions and Hercules. The need to plan long term for the armed forces led to the creation this year of the Defence Sustainability Initiative commitment.  
Operating expenditure growth of $72.8 million for 2006/07 is the second instalment of that commitment. In addition there is a further investment of $305 million of capital as part of the Long Term Development Plan. This apart from existing commitments will also allow for the fit-out of Defence Headquarters and a deposit for the Defence Helicopter Capability Project.  
Official Development Assistance (ODA) will be maintained at the new plateau of 0.27 per cent of GNI rising to 0.28 per cent in 2007/08. This will bring total funding for ODA to $1.4 billion over the next four years.  
The $52.3 million of additional funding over four years for Arts Culture and Heritage is dominated by $24.9 million for New Zealand on Air Radio New Zealand and broadcasts to Pacific nations. Other funding includes $12.8 million to maintain capability in the New Zealand Historic Places Trust and a $10 million increase in Creative New Zealand’s baseline.  
Madam Speaker New Zealand’s national identity can scarcely be discussed without reference to the place of Maori in New Zealand society and the rate of progress on the settlement of historic grievances.  
This Labour-led Government is committed to addressing historical Treaty claims so that we can create a nation that provides stability opportunity and a unique quality of life for all New Zealanders.  
The Government’s stated deadline for lodging historical Treaty claims is 1 September 2008 with the aim of settling all claims by 2020.  
Over the next four years an additional $5.2 million will be allocated to increase the current Office of Treaty Settlements’ negotiating capacity by 25 per cent. This will bring the total number of negotiating teams to five. This will ensure we are able to settle all historical claims in a fair final and timely manner.  
There has been significant progress to date. Two weeks ago another settlement bill – the Te Arawa Lakes Settlement Bill – was referred to select committee. Currently the Government is in negotiation with over 20 groups covering several hundred claims.  
Treaty settlements are a key part of building a strong and confident nation. We have the most well-articulated mechanisms in the world for settling such grievances and successive governments have a right to take pride in the process.  
But Maori social and economic development is about much more than historical grievances.  
Six years ago Maori unemployment was high education participation and achievement low organisational capacity low and productive partnerships with government largely non-existent. In direct response this Government put in place a policy to build the capacity of Maori organisations and individuals to enable Maori to make positive changes for themselves.  
In 2006 we are able to identify significant gains for Maori across the economic cultural and social spectrum of New Zealand: Maori unemployment is at a 20 year low more Maori participate at all levels of education than ever before Maori are working across the economy the Maori language is thriving and Maori have experienced a cultural renaissance.  
A key shift in Budget 2006 is the reallocation of $23.9 million from existing initiatives to create three new investment areas to better position Maori to build and leverage off their collective resources knowledge skills and leadership capability to improve their overall quality of life.  
The Government's investment in Maori particularly through the focus on building the infrastructure of and Government relationships with Maori organisations has provided a sound platform for Government engagement with Maori communities and organisations. It has also resulted in an increase in the number of partnerships between Maori organisations and private/international partners to access finance product and market development opportunities and global markets – including those that seek to maximise the niche of distinctly indigenous products.  
The Government's overall objective for the next three years is to continue the transformation underpinned by the values of fairness opportunity and security. The Government's policy programme balances economic and social policy with three key policy foci: economic transformation; ensuring that families young and old are able to secure the opportunity to reach their full potential; and strengthening our national identity.  
Madam Speaker Budget 2006 is a Budget for the long term. At a time when the economy is moving through the bottom end of the cycle it shows that the Labour-led Government has put New Zealand in an enviable position to meet the challenges we face over the next generation.  
We have eliminated net debt. Assets are building up in the Superannuation Fund and the other crown financial institutions which are there for our long term needs.  
This Budget contributes significantly to meeting the demands of economic transformation. It continues the increase in the funding of human capital especially trades and technical skills. It promotes the improvement of early childhood education to lay a strong base for future skills.  
It further lifts our spending on land transport to overcome the neglect of the past. It foreshadows regulatory changes in telecommunications and elsewhere which will support a more dynamic economy.  
It supports families young and old through funding for large increases in the Working for Families targeted tax relief extensions of primary health care and better safety and security.  
It continues to promote our national identity as a proud and independent nation with a unique mix of peoples and cultures.  
It delivers on the promises made by the Labour and Progressive parties and on the confidence and supply agreements with New Zealand First and United Future and the co-operation agreement with the Greens.  
It is another milestone on the road to building a stronger fairer New Zealand that we can be proud of. It is a Budget for New Zealanders today and for those yet to come.  
Debate interrupted. 
Procedure 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I hereby present the Budget 2006 Speech the Fiscal Strategy Report 2006 the Economic and Fiscal Update 2006 (B.2 and B.3) the Estimates of Appropriations for the Government of New Zealand for the year ending 30 June 2007 (B.5) and the Departmental Statements of Intent 2006/07. I move  
That those papers be published. 
Motion agreed to. 
Budget Debate 
Debate resumed on the Appropriation (2006/07 Estimates) Bill. 
Dr DON BRASH (Leader of the Opposition) 
: 
 Helen Clark and Michael Cullen clearly believe there is a place for tax cuts—it is called Australia. This is the “Bondi Budget”. I move  
That all the words after “That” be omitted and the following inserted: “this House has no confidence in this Labour-led Government because for 7 years it has demonstrated a lack of vision and a lack of the policies to transform New Zealand into a high-income high-growth nation and has instead wasted the opportunities provided by buoyant international conditions by overtaxing New Zealanders and wasting billions of taxpayers’ dollars on low-quality spending programmes 
.” 
This Budget is not only incredibly boring as Michael Cullen promised but also profoundly disappointing. It will almost certainly be Michael Cullen’s last Budget and would certainly be if there were anybody else in the Labour caucus who could do it better. But Sue Moroney is not quite ready yet and Mark Peck has gone. Last year’s Budget was rightly dubbed the “chewing gum Budget” I think by the man who said he would never accept the baubles of office. He is not a man whose opinion I normally take seriously and the people of Tauranga clearly came to that conclusion last year also. But in calling last year’s Budget the “chewing gum Budget” he was right. It provided 67 miserable cents a week in 3 years’ time. 
This year we have the “brain drain Budget”—the “Bondi Budget”. Helen Clark and Michael Cullen want our grandchildren to be cheering for the Wallabies. There are two questions that should be asked about any Budget—what it does and what it says. Firstly what does it do? On the tax side of the ledger of course the Budget does absolutely nothing. It does nothing for hard-working Kiwis and nothing for New Zealand businesses. There is no recognition that Labour’s tax revenues have risen by 50 percent since the year 2000 twice as fast as the inflation rate over that period. There is no recognition that operating surpluses have totalled $28 billion over that period and are projected to be $14 billion over the next 3 years. There is no recognition that almost all Australians—certainly all those earning less than $180000 a year—now pay less tax in Australia than they would if they were paying tax in New Zealand. There is no recognition that added to the higher pre-tax incomes in Australia the ongoing tax reductions in Australia and the total failure of this Government to cut taxes in New Zealand the Budget will still further increase the incentive for New Zealanders to cross the Tasman. There is no recognition that the net outflow of Kiwis to Australia has more than doubled in the last 2 years—10000 in the year to January 2004 16000 in the year to January 2005 and 21000 in the year to January 2006. 
Over the last 7 years Michael Cullen has happily raised any number of taxes—personal taxes petrol taxes cigarette taxes road-user charges you name it. Only vigorous public opposition led by the National Party prevented the Labour Government from also raising a health tax a methane tax and a carbon tax. He is still thinking about a payroll tax. Which taxes has he lowered? Not one. Not a single one. Michael Cullen has made it clear by words and actions that he does not believe that New Zealand will ever be in a position to lower taxes and thus provide better incentives to hard-working Kiwis. The Budget surplus will never be huge enough for him to even consider letting hard-working Kiwis keep a little more of the money they earn. 
Six years back our company tax rate was the same as it is today—33 percent. Six years back that was lower than the company tax rate in the OECD on average. Now the average company tax rate in the OECD is 30 percent and continuing to fall. Now we are above the average. It is very clear that Michael Cullen has no intention whatsoever of reducing either the company tax rate or personal tax rates. 
 Australia embraces tax cuts—$45 billion of tax cuts were announced in its Budget last week. They are endorsed by the Australian Labor Party with Kim Beazley describing them as modest and overdue. Michael Cullen rules out any tax cuts. He simply does not understand that if New Zealand is to provide the high-quality health-care we all deserve the high-quality education we want for our kids and the high-quality infrastructure we need if the economy is to grow and prosper New Zealanders themselves must have the incentive to get ahead under their own steam which means removing the punitive tax rates and the heavy-handed rules and regulations that are the hallmarks of this Labour Government. 
Michael Cullen talks as if reducing taxes would be gifting money to taxpayers—as if tax revenue is first and foremost the property of the Government. The reality is the reverse. Hard-working Kiwis earn income and that belongs first to those who earn it. Government should take no more than is strictly necessary to fuel the ship of State. Reducing taxes is not a sign of Government generosity. Had National won the election last year it would have had an early Budget to ensure that tax rates and thresholds were reduced from 1 April this year. By the end of this parliamentary term 85 percent of all taxpayers would have faced a tax rate no higher than 19 percent. We would not have had police officers and experienced teachers facing the top tax rate. 
What does the Budget do on the spending side of the ledger? Well Government spending goes on and on much of it to minimal effect. We all know about the twilight golf and the radio singalong courses and the incredible waste in the tertiary education sector when Steve Maharey was in charge. We all know that Government spending on health has increased substantially in recent years. But we also know that that vast increase in spending has bought almost nothing. The number of operations has barely changed at all in the last 6 years. Many tens of thousands of people sick in pain and very often frightened are on waiting lists even after thousands have been culled from those lists on Pete Hodgson’s instruction and Treasury says that there is so little information on this sector that it is impossible to tell whether or not money is being sensibly spent. This is a monumental scandal. 
We all know that spending on new prisons has blown totally out of control. Yes we need more prisons and National does not accept Damien O’Connor’s proposal of simply letting 30 percent of the prison muster go home. But it is surely a national disgrace that the budget for building four new prisons should have been exceeded by $490 million with huge amounts being spent on consultants and consultations and an extraordinary $11 million on landscaping the new prisons. 
We all know that scattered throughout the Government is a huge amount of spending which is not only of limited value but is also of negative value. I tell Phil Goff that it is positively counter-productive. Take for example the $13 million allocated for a school programme designed by the Parliamentary Commissioner for the Environment to promote learning and education on sustainability. This programme actually advocates reducing GDP per capita reducing living standards and forsaking economic growth as a goal because otherwise we face planetary collapse. National certainly cares about the environment about clean air and clean water and about protecting our native fauna and flora but we do not see reducing living standards as having any part in our policy programme. 
More generally we would make sure that the money taken from taxpayers to ensure that Government services are provided where and when they are needed is spent with the same care with which taxpayers spend their own money. 
What else does the Budget do? Let me talk very briefly about the unbundling of the local loop prematurely announced as the result of the most serious leak in New Zealand Budget history. Every person who understands the extraordinary power of the Internet wants New Zealanders to have faster and cheaper access to the Internet. The National Party absolutely shares that desire. For that reason we will support the unbundling legislation as least as far as sending it to a select committee so that the proposal can be considered on its merits and on the basis of hard evidence. We will be particularly interested to hear the views of the Government’s own Telecommunications Commissioner who so far at least has opposed unbundling; perhaps he has changed his mind. We will certainly weigh all the evidence carefully. 
Most of the rest of the Budget’s so-called initiatives are simply a reclassification of existing programmes. 
So much for what the “Bondi Budget” does. What does it say? First it states that growth in the current year will be only 1 percent. By contrast the Australian Budget expects Australia to be steaming ahead at over 3 percent. Over the next 3 years Michael Cullen forecasts the New Zealand economy to grow by less than 7 percent in total; Peter Costello expects Australia to grow by 10 percent. 
A few weeks back the Government Statistician revealed that productivity in the two-thirds of the economy for which output can be measured accurately had picked up markedly since the late 1980s but it had slowed again quite sharply since the year 2000—and we should not be surprised at that. This Government prides itself on doing a whole lot of things that bit by bit erode the potential to improve productivity. What does this all mean? It means that the gap between average after-tax incomes in Australia and average after-tax incomes in New Zealand—20 percent in 1999 33 percent last year—will keep on growing. It is not at all unrealistic to expect that gap to be 40 percent or more by the time this parliamentary term is over. 
The survey by the Swiss organisation IMD published last week tells a similar story—in 1 year New Zealand dropped from 16th to 22nd place in its survey of competitiveness and Australia improved from 9th to 6th place. We all remember Helen Clark coming into office in 1999 with a great fanfare and promising to lift New Zealand into the top half of the OECD within a decade. Well now she no longer talks about achieving that objective within a decade; indeed she does not put a deadline on the objective at all. It is just something she aims to achieve over time which at least is more honest because on current policies and current trends Helen Clark has much more chance of becoming Secretary-General of the United Nations than she has of getting New Zealand into the top half of the OECD in one decade or indeed even in three decades. 
Hon Bill English 
: That’s her real ambition. 
Dr DON BRASH 
: That could well be her real ambition as my colleague Mr English points out. 
New Zealand has not moved up one place in the OECD rankings since Labour came into office. The only hope of getting New Zealand into the top half of the OECD within a decade would be if the OECD widened its membership to include a whole bunch of low-income countries. The OECD already groups New Zealand as a low to middle income country along with Hungary South Korea Portugal Greece Spain and the Czech Republic. It does not have to be this way. With the right policies and the political will New Zealand could move up the international league tables again and once again be a country where our children choose to live and build their homes. 
This Budget confirms that Labour has given up the fight. Tragically for New Zealand this Labour Government has coasted along on the back of strong export prices low interest rates and a strong inflow of people after September 11. It has been redistributing income certainly but it has been doing absolutely nothing constructive to increase incomes. Indeed this Government does not even understand how to increase incomes and it continues to send all the wrong signals to hard-working New Zealanders. The Government says to people: “Want to get ahead under your steam? If you’re a family breadwinner on the average wage we’ll take more than half of every extra dollar you earn off you. Think you can save up to send your kids to university? You’re nuts! We’ll give them interest-free money to encourage them to start life with a big slug of debt.” 
The tragic reality for New Zealand is that Helen Clark and Michael Cullen are interested only in their own political survival. They are not interested in New Zealand’s future. Last year Treasury provided them with a great set of recommendations to speed up our growth rate. Michael Cullen dismissed Treasury’s advice as an “ideological burp”. Treasury advised Michael Cullen that KiwiSaver would not materially change the amount of saving New Zealanders do and that it would do nothing to reduce the balance of payments deficit. The Institute of Economic Research told him that KiwiSaver would redistribute wealth but do nothing to create it. Again Michael Cullen simply ignored their advice. I have not seen what Treasury’s advice was on Labour’s student loan bribe—and I do not need to. No rational policy maker would have argued for such a blatantly political bribe. I do know that Treasury estimated that the cost of that bribe was much greater than Helen Clark claimed before the election. 
This Budget lacks urgency and it lacks vision. Instead of boosting the economy’s capacity to grow it focuses on redistributing what we currently have. New Zealand’s economy needs to be more competitive and productive and under a National-led Government that is where the focus of the Budget would have been. That means lower taxes which give people the incentive to get ahead under their own steam. That means investing in the infrastructure this economy needs to grow. That means ferreting out waste and low-value programmes in the public sector to ensure that every one of the dollars taken from taxpayers provides good value for money. That means fixing the Resource Management Act so that the investment needed to lift living standards can proceed quickly and efficiently without damage to our environment. It is now blindingly obvious that it will take the election of a National Government to give Kiwis the future they truly deserve. 
Rt Hon HELEN CLARK (Prime Minister) 
: 
 That speech was the parliamentary equivalent of the last rites—and I saw more than a few priests along the front bench wanting to administer them rather sooner than later. As they think about the epitaph for the Leader of the Opposition I suggest something like this in keeping with the speech: “Ask not what you can do for your country; ask what good things you can say about Australia and run down your own country while you are doing it.” 
I think there is only one message for Dr Brash: if he thinks it is so hot over there he should go and live there. And by the sound of it he is. I think he has just gone to buy his air ticket. Any casual listeners tuning into Parliament and hearing that speech would think they had got Radio Australia. They would have thought it was the Australian Parliament. And I think the Leader of the Opposition should go. He should go over to Australia and enjoy its higher unemployment. He should go and enjoy the fact that Qantas today announced that a thousand jobs are to go down the gurgler—adding to that unemployment. 
Dr Brash should go and enjoy the fact that after the Australian Budget was delivered consumer confidence went down. Today’s  
New Zealand Herald 
 has the headline: “Tax cuts fail to buy confidence” under which it states that high interest rates “wipe the smiles from the faces of consumers”. That is the sort of Budget Dr Brash wanted—a Budget that would put up interest rates fuel inflation and drop consumer confidence. I say that Dr Brash is welcome to his new homeland and I think he might just have gone in that direction. 
This Budget invests in New Zealand and New Zealanders. This Budget is about transforming our economy it is about making life better for all New Zealand families and it is about building our unique national identity. This is a Budget that delivers on the promises Labour made during the campaign. During the Minister of Finance’s speech I heard members opposite say: “That’s been announced before.” That was a promise we were keeping in every single case. 
Hon Dr Michael Cullen 
: They don’t know the identity of the nation. 
Rt Hon HELEN CLARK 
: No it is a very foreign idea to the National Party. Everyone remembers “no ifs no buts no maybes; the surcharge will go”—and it went up! 
This Budget also delivers on the confidence and supply and working agreements we have with other parties in this House and I thank New Zealand First United Future and the Green Party for the formal arrangements that make it possible to govern and to deliver this Budget. 
Labour offers steady predictable stable and progressive Government. This is our seventh Budget for the fifth Labour-led Government and every Budget we have brought to this House has been another step in building a stronger economy making life better for our families and investing in those things that make New Zealand a special place to live in and be part of. I think most New Zealanders appreciate that this country has gone ahead under Labour. The facts speak for themselves. 
Our country has grown ahead of the OECD average under Labour and even at the bottom of the economic cycle growth will be positive on an annual basis. Our Government is ranked sixth in the world in terms of Government contribution to a country’s competitiveness and we continue right up there at the top of the employment rankings. We have the second-lowest rate of unemployment in the OECD. I know that if we go back and compare the average annual unemployment rate to March with what it was under National 7 years ago we will find that it is exactly half of what it was then. Those results are spectacular. More than 313000 more Kiwis are in jobs today under Labour. There are 313000 more jobs than were there before. 
However as good as these results are we know that New Zealand can do even better. We know that as other countries lift their economic performance so we must lift ours. That is why in the Prime Minister’s statement that I give at the start of the year—given this year in February—I set out the aspirations for our Government and the work programme for economic transformation. This Budget and recently announced policies follow through on that statement. 
I said in that statement that faster cheaper broadband was a top priority for the Government and that the lack of it was holding New Zealand back. Now our Government has announced policy to get that faster cheaper broadband. I might say I have heard support expressed for that from just about every corner in New Zealand except the National Party. I can only agree with the  
New Zealand Herald 
—the National Party has defined itself as the chief appeaser for Telecom. The National Party needs to explain why it continues to back a set of rules that showed they could not deliver what New Zealanders are entitled to in telecommunications. 
We are serious about transforming this economy and we will act to see that our people get modern infrastructure and services. That applies to transport as well. The faces of National members went down when the Minister of Finance read the Budget’s transport provisions. The truth is that our Government inherited a huge infrastructure deficit and nowhere more so than in the transport area. The spending cuts under a National Government meant that transport missed out time and time again. 
Even before this year’s Budget this Labour-led Government had virtually doubled spending on land transport since 1999 and public transport spending was up almost fivefold. This Budget takes total land transport funding under a Labour-led Government up by 134 percent since 1999. That is an incredible figure. The Minister of Finance has set out the extra $1.3 billion that will guarantee our country’s State highway programme for the next 5 years. That will speed up work on major projects to ease traffic congestion in the metro cities and keep up the momentum right around the country. In addition the Waikato will be waiting to hear tomorrow the additional funding to be announced for that fast-growing region’s land transport network. 
These investments mean that over the next 5 years this Labour-led Government will spend $300 million more on land transport than we take in by way of any user charge on petrol road users and motor vehicle registration fees. These are huge investments in the modernisation of New Zealand and only a Labour-led Government could have made those investments. 
I know that National members are very depressed about the transport spending but that increased spending is not the only feature of a Government that is very strong on stepping up economic performance. Take for example education and skills. We are delivering on the promises we made to New Zealanders for more apprenticeships for young people more opportunities to experience workplaces while at school through the Gateway programme more possibilities for industry training and more investment in literacy and numeracy programmes in the workforce. Most of the people in the workforce in 10 or 20 years’ time are in work today and it is critical to lift their skills as well. 
We are delivering more investment across our tertiary institutions and in our students. Under this Budget more students will be eligible for student allowances and for scholarships for university study. Of course this Budget implements another policy the National Opposition has heard about before and opposed—that is interest-free student loans. National members hate it because they know it more than cancels out the miserable little tax rebate they had planned for their policy. The interest-free student loans policy has given our young people and our graduates new hope for their future in New Zealand. If they stay here they know that their debt is manageable and that they can plan ahead. That is what it is about. The National Party drove them out with high debt. Labour says: “Stay and make your contribution here and you will be rewarded for that.” That has to be a win-win for New Zealand. 
In the area of science and research which is so critical for the transformation of our economy spending is up yet again. We have increased the investment in science and research by 65 percent since 1999. We do think there is a critical role for Government in supporting innovation across our primary industries our high tech industries our environmental technologies and our biosecurity. There can be no old economy in New Zealand. The whole economy has to be a new economy driven by innovation. 
This Budget also increases investment in the commercialisation of research and in venture capital to help young Kiwi firms with high growth potential. This Budget builds up to Export Year 2007 with more funding allocated to market development assistance for Kiwi companies. As was promised in my February statement a major review of regulatory frameworks is under way to make sure that our economic performance is not unduly constrained by overregulation. In all the barracking that went on from Opposition members I kept hearing them say that there was nothing for business. I just heard quite a lot for business and working with business to improve the New Zealand economy is very important to this Government. 
I also want to say that this Budget invests massively in New Zealand families. I know that Working for Families is transforming the lives of our families across New Zealand. We are seeing countless reporting and Government members are getting countless letters and emails from families saying that it is easier to make ends meet. It is no wonder it is easier—over the next 4 years 350000 Kiwi families will share over $6 billion of family tax relief. That averages out across 350000 families to about $88 a week. 
For some reason I do not hear the National members praising tax relief for our hard-working families. They want it for themselves; they want it for their rich friends. They would sell billions of dollars of State assets and cut health and education to give people like themselves tax cuts while leaving ordinary families in the lurch. This Government invests in New Zealanders and their families. It invests in health education housing and policing—all those areas that guarantee opportunity and security for our families. We do deliver on our policies. 
I especially want to mention the health spending in the Budget. Since 1999 this Labour-led Government has increased spending on health by—wait for it—77 percent. There has been a 77 percent increase in health spending and this Budget sets out yet another $3 billion over the next 4 years. That could never have been afforded by the National Party—it would never have made that a priority. This Labour Government is building new hospitals. We are increasing the numbers of treatments and operations we are making visits to the doctor and the chemist more affordable and we are especially targeting the health needs of our children and older citizens. We see investment has gone up this year in the school dental service in well child health care and in home-based and residential care of older people. 
Simon Power 
: That’s old stuff. 
Rt Hon HELEN CLARK 
: By Jove! It is old Labour stuff to be supporting the health system—it certainly is. The other thing about this “old stuff” is that it is good to be supporting the health of our children and older citizens. 
This Government is investing massively in the fight against obesity. I repeat what the Minister of Finance said in the Budget speech: if we do not act as a country we face the very real possibility that today’s generation of Kiwi children will be the first to die younger than their parents. Who wants to have that on their conscience—other than National Party members? 
This Budget continues very significant increases in the education system and in the needs of our children and that was well outlined in the Budget speech. Since 1999 in real terms funding is up by over 31 percent in our schooling system. There is big investment in this Budget in early childhood education. Another $162 million has been allocated over the next 4 years as we lead up next year to the provision of 20 hours of free early childhood education for all our 3 and 4-year-olds. 
We are investing in housing because nothing is more fundamental to a Kiwi family than having a decent home. We are investing in policing and as a result of the agreement with New Zealand First this Budget rolls out the funding for those 1000 extra front-line police and also for the 250 non-sworn police staff. There is a lot of investment in the Budget on tackling family violence and those important issues. 
I conclude by saying a word about the importance of building— 
John Key 
: Give it away—the Budget’s hopeless! 
Rt Hon HELEN CLARK 
: Far from my giving it away National’s leader just gave it away. He went and got his ticket. If that is not giving it away I want to know what is. That leader would rather go and buy an air ticket than listen to the Prime Minister in the Budget debate. I can understand him doing that though because after hearing the sad last rites he just ploughed his way through I would be feeling like having a rather stiff whisky if I were him. 
This Budget promotes what is unique and special about our country. It puts resources into areas like historic places. I am waiting for Nick Smith to interject about this issue because he virtually crippled the Historic Places Trust when he was the Minister of Conservation. This Government had doubled spending on the Historic Places Trust by the time of the last Budget and we have just put it up by 47 percent again because we actually care about Kiwi heritage. We do not let it crumble and fall down in the way the last National Government did. 
Hon Trevor Mallard 
: Is there a place there for Don? 
Rt Hon HELEN CLARK 
: There might be a last resting place somewhere in a heritage home. 
As a Labour Prime Minister I am very proud of the Budget. I am proud of the Budget because I know that only a Labour-led Government could have delivered it. I know that this Budget is based on a clear vision about the future of New Zealand and that is a vision to transform the economy to make life better for all our families young and old and to build our national identity and celebrate the things that are special about us. 
I congratulate the Minister of Finance on the Budget. I thank him for all he does to ensure that this Government’s Budgets actually take New Zealand ahead and spread the gains to all our families. He has done a wonderful job for this country and he will keep on doing a wonderful job for this country. 
While the Leader of the Opposition books his fare to Canberra where he would obviously feel so much happier we will keep on doing the business supporting Kiwi families and making it better in our own country. If there is one lesson Dr Brash really does needs to learn it is that Kiwis do not vote for people who always run our country down. Kiwis vote for people who are proud and celebrate this country and who want to take it ahead. 
Rt Hon WINSTON PETERS (Leader—NZ First) 
: 
 Madam Speaker I very much appreciate being given the call even if it is 20 minutes too early. This debate is already shaping up to be something like television’s  
Survivor 
 series. Don Brash has got the wrong day. We have already considered the Historic Places Amendment Bill which is to do with artefacts and the Coroners Bill which is to do with how to treat the deceased. The  
Survivor 
 series follows tribal life. The members of one side of the tribe are working together to try to make government work while on the other side there is a bunch of malcontents who are plotting and scheming among themselves like some sort of parliamentary version of  
Lord of the Flies 
. 
 They lack leadership—that is obvious; they know it. They lack purpose. They lack policy. And they wonder why they just keep losing and their arrogance depicts that every day in the way they despise the place they sit in—and how badly they do their jobs. There is one message that those commenting on the Budget should remember in respect of 2006—that is it is an MMP Budget and it demonstrates that if parties work together they can achieve positive things in the national interest. [ 
Interruption 
] 
I say to members opposite: “Eat your heart out!” I know it hurts but all through the remainder of this speech I want them to ask themselves one question: “What has my party done for my National supporters these last 7 years?”. The answer is: “Nothing.” How tragic! All the effort all the money all the highflying hoopla and public relations and the answer is doughnuts for hard-working National Party supporters. We suffer from no such demise. Some parties have matured under the change from first past the post to MMP 10 years ago and I am pleased to lead a party that has demonstrated just how successful it can be in achieving real progress for its constituents and which is seeing its policies make a difference to the lives of all New Zealanders. 
It is no coincidence that New Zealand First’s first five policy platforms from the 2005 election—on senior citizens immigration law and order the Treaty of Waitangi and an export-led economy—feature so strongly in today’s Budget. That is called making a contribution. [ 
Interruption 
] If the member wants to go to a dog-dosing strip we will get him microchipped. [ 
Interruption 
] Which ear? The Ministry of Foreign Affairs and Trade and overseas aid both benefit from the Budget. Transport infrastructure benefits from the Budget—in particular around New Zealand in Tauranga. The communications system benefits. The racing industry benefits. The Maori world and the grievance industry are going to be fixed in the immediate term. And the list goes on. 
New Zealand First fought a lone crusade at the last election as all members know in respect of the plight of seniors. Other parties were happy to pay lip service while claiming that it was too expensive to do anything real to help the elderly. And it was not true. We said that too many of our seniors were struggling and that we were serious about improving their lot. We have and it is the cornerstone in the supply and confidence agreement. We have $126 million going now for the aged-care sector. That is new money. That funding cannot come soon enough for that sector but at least it is a start. 
It is important to note here however that it is not simply a matter of getting increased funding for this but of making sure that the money actually gets to where it is intended to go. For too long now district health boards have been siphoning off funding intended for aged-care people into other areas. That practice must end with this Budget and we call on the Minister to make that happen. But this increased money represents real progress. Nobody can deny it. We were the only party at the last election campaigning on the golden age card and about this time next year it will be a fact. It will make the money that the elderly get go a lot further. That will represent a real boost to the living standards of all our seniors. It goes hand in hand with the increase to over 66 percent of the average working wage going to married couples now since 1 April. I am particularly pleased and so are my colleagues to see the increased funding of nearly $500 million in the police budget for 1000 extra front-line police over three Budgets by 2008. It is not only 1000 extra front-line police but in addition an extra 250 support staff to go with it. That is a promise made and it is a promise kept. I ask my National Party critics what promise they have kept in the last 7 years. Can they name just one? 
Brian Connell 
: Tauranga. 
Rt Hon WINSTON PETERS 
: Was that a win? I do not think so. That is not what I am hearing back home. [ 
Interruption 
] We know that Tauranga is going to get a bridge toll-free. That is another promise kept. [ 
Interruption 
] I do not go along with that humbug. He has had no affect whatsoever never will and they are regretting it already. 
We are pleased to see extra funding going into the Treaty settlements process and we would add a word of caution. We do not believe that the Government has done enough on this front; there is much more work to be done but as with many things in politics we are pleased to see the Government moving in the right direction. We are also pleased with the changes that have been announced with regard to the immigration sector. Members know that New Zealand First has been criticised as a party up hill and down dale around New Zealand. But the fact is there is a comprehensive review going on because nothing is as important as our border security and what one’s citizenship in a country might mean. In short the review we have asked for is under way as we speak. We are confident that by working closely with the Government we can see real progress and change. Securing our borders and valuing our citizenship as I said lie at the core of what New Zealand First stands for. 
New Zealand First has long advocated for an Export Year to give that vital sector of the economy a much-needed boost. Although that aspect of our supply and confidence agreement did not get the fanfare it deserved in the long term it will be the most important thing that we do in the next 3 years. If we can grow our exports at a significantly faster rate then we will see flow-on effects throughout the entire economy—from greater productivity to higher wages through improved living standards through to the lifestyle choices that are linked to that. We all benefit from a stronger export sector. We are totally committed to a successful Export Year 2007. 
Some have called it a Budget leak. I am talking about unbundling the loop which I would have thought given the National Party’s predicament it would be all for. We in New Zealand First prefer to call— 
Hon Member 
: Which loop? 
Rt Hon WINSTON PETERS 
: Well it is actually multi-loop really. We in New Zealand First prefer to call the announcement of local loop unbundling “unfinished business” which can finally be put to bed in the interests of every user of telecommunications at home and in business. It has been a long scandal—16 long years—while they have been price gouged and there has been no political movement. Members might remember that in 1998 as Treasurer of this country I sought to do just that but I was stopped by the National Party. Yes I was there is no doubt about it. Members should go back and look at the facts. In July 1998 we announced that a full-scale review would take place; then the National Party paranoiac about the mates it had and its protection racket decided to stop it. That is what has happened all these years since. I am pleased to say that that will all be over and we will sort out one of the biggest compliance costs that New Zealand has—the need to comply with telecommunications necessities in business. National members talk about taxes all the time but this is real and it is fundamental. 
New Zealand First is pleased with the progress made by the Hon Peter Dunne and the Hon Michael Cullen with regard to business taxes. It will take some time but if we want to change our economy the best and fastest way we can do it is to attack that sector in particular in respect of a more sympathetic export tax regime. That is what we argued for. More profoundly as I travel around the world I see the necessity for it. At least a review of the regime to do with business taxation is under way and we look forward to engaging in it. 
We have already seen as members know a major boost to the racing industry. Good heavens I was across in Brisbane just a couple of days ago at the Australasian Racing Ministers Conference and the Australian Ministers were all whingeing and complaining and saying that they were going to write to their federal Treasurer Mr Costello because the guy in New Zealand had an unfair advantage on them. Is that not a turn-up for the book? I said to them that for God’s sake they have had 20 years’ start and they should give us a break but they said they had to write to the federal Treasurer. But I kind of think that at the speed things move at the federal level we still have a fair start on them and can make a good advantage. 
The point is that National Party members talk about tax cuts. They should go and ask the racing industry about tax cuts. The racing industry has them. The industry has had a massive reduction from 20 percent to 4 percent in respect of gambling duty and has huge depreciation allowances on stallions and brood mares. The racing industry got tax cuts. [ 
Interruption 
] Here we go again. Somebody over there is claiming that that is National Party policy. People say that imitation is the most sincere form of flattery. But my response to that is for them to look at the National Party website from 2002 2003 2004 and 2005 and tell me who is telling the truth. Is it Lindsay Tisch or Winston Peters? It is a purloining exercise of the type that National Party members engaged in on the Treaty of Waitangi on law and order and on so much of New Zealand First’s roading policy. They just stole it lock stock and barrel and claimed it as theirs. 
The trouble is that they cannot sell it. They have a leader who reminds me when he gets up and compares New Zealand with Australia of that famous line from  
The Mikado 
. The line is probably unknown to the gentlemen sitting over there but it goes like this: “Then the idiot who praises with enthusiastic tone all centuries but this and ev’ry country but his own;”. That is Don Brash. He having backed the Douglas revolution and Ruth Richardson has the temerity to pick the eyes out of politics by now using the Australian comparison. Goodness knows everyone knows that Australia went down the incremental change pathway of policy reform. We suffered a revolution. Thank God it is over. Had we gone down the same pathway as Australia at somewhat the same speed I believe we would be 35 percent larger in real terms as an economy. Let not Don Brash tell us that he has something new to offer—he has not and nor do his backers and those who support him. 
It is great news to see that a long-lauded and extolled policy of New Zealand First—that all road taxes go into roading—is now a budgetary fact. Yes it is. I congratulate the Minister of Finance on deciding that that is a wise policy—because it is. We will finally address the enormous vacuum of infrastructural investment that we have suffered for the last 20 years. We will at last do that and it is good. Tauranga will be grateful for a new toll-free harbour bridge as well. Some people talk and some people do. National members are like used-car salespeople—plenty of pre-sales talk but no after-sales service. 
I have to say something about the Ministry of Foreign Affairs and Trade. It is the ministry that is the front face and facade of this country in so many parts of the world. Its budget is up in respect of overseas aid and the ministryx. That is important because there is so much to do—more so these days in an ever-changing more complex and more difficult world—in our neighbourhood and farther offshore. 
Hon Bill English 
: What a statesman! 
Rt Hon WINSTON PETERS 
: Yes I am a statesman actually unlike someone who is not prepared to admit what he wrote and not prepared to concede that he wrote it—someone who makes statements and then rushes off and lets Bill English come down to carry things in the House. Has anyone ever seen such an image as what was on TV last week? Bill English gave a press conference with the other pretender and contender standing behind him—the big fella overlooking him—whilst the so-called leader hid from the television. If I were a back-bencher I would look hard at holding a meeting in a smoke-filled room preferably late at night because I would know I had work to do. [ 
Interruption 
] I will not put one on for members tonight. I am sorry that offer was over a long time ago. 
When I watched Dr Brash’s press conference last week I was reminded of a political novice—he clumsily held a press conference without even knowing what the press conference was about. People can make some mistakes in this game but they cannot make mistakes like that. The National Party is led by a man who is actually worse than a dead man walking. He is a political novice clumsily moving from one screw-up to the next. Whether it is walking the plank or dropping press gaffes it goes on day in and day out. But it is not just he who is dysfunctional—so is his party. 
No one believes he will be leading the party at the next election. The answer lies in the latest episode of the  
Survivor  
series:  
“ 
In Opposition 
”. 
 There is one obvious contender—the guy everybody else is picking to win—the one with the money and the ostentatious manner. He is self-made—worshipping his creator—he seems to have it all and is prepared to show it all off. There is nothing wrong with that except his mates—strangely—do not like him and I wonder why. Mr Key—the “Earl of Parnell”—can just see in the dim distance his electorate of Helensville and Kumeu; and because he refuses to live there I want to tell the member about that electorate. “Kumeu” in Maori means “to tug the udder” and we are saying: “Tug the ‘udder’ leg mate!” It is a fact that he does not live there; he refuses to live there. 
Of course there is the other member whom National tried last time—and it was such a disaster—namely Bill English. I knew he could not make it until his voice broke but National members did not understand when they chose him that that was the problem. Then there is the crazy character. He is the one who got the leadership job as deputy leader and the job lasted 2 weeks. They made him the “Bluegreen” man. That juxtaposition would be enough to make anybody nuts. He has been tried in the leadership role before and I wonder why and how he has still survived. 
Then there is the hard woman who is a female version of Darth Vader. She is prepared to trample over all tradition and anybody else in her way. The problem is that if one looks like Darth Vader sounds like Darth Vader and breathes like Darth Vader then there is a good chance that one is Darth Vader. The National Party should know. They have tried a Darth Vader before if members remember. She wanted to govern on her own and took National to the worst result since 1936 but its members never learn. They have the effrontery to come along to our meetings and demand that we support them. It is true; it is a fact. 
There is one other guy; the tough-talking runty guy. Everybody knows he is all wind and no action. He has such a jaundiced view of the world and is always finding the negatives—but never the solutions to fix anything. He has tried law and order but nobody could really take him seriously because he looked as tough as a pansy blowing in the wind. I ask members whether they can remember the speeches on law and order he used to make. All the guys in Mount Eden and Paremoremo prisons used to quiver at the knees. What a joke! Now he is trying on the health sector and again it is all wind and no action. 
There was so much promise and so many false starts that one wonders whether it is a case of puberty blues or just a lack of capacity on the part of the younger members. On the back bench I see the despair and every day I feel it as someone very conscious of my fellow MPs. As Jonathan Hunt did we always worry about these young MPs and how they handle things. The concern and sheer angst on their faces worries me. 
The real issue is though that on the question of this  
Survivor 
 series for National nobody cares. That is why New Zealand First is here celebrating the parts of the Budget that this tribe of politicians—New Zealand First—has delivered on. We want all New Zealanders to know we are a party that is there to make their lives better and to make this country great again. While others are falling apart around us we have stood firm in our work for the benefit of all New Zealanders and that is putting New Zealand and New Zealanders first. 
JEANETTE FITZSIMONS (Co-Leader—Green) 
: 
 I thought that after the comedy act I might return to the Budget. This is a “flat earth” Budget; it is based on the earth being not just flat but infinite. It is a Budget for a world where natural resources are limitless where the atmosphere can endlessly absorb greenhouse gases and where we can always live way beyond our means and never be called to account for it. This Budget ignores the huge changes that happened over the last century it ignores the modern equivalent of the Copernican revolution and it assumes that we can carry on as we have always carried on. 
First it assumes—with a big increase since previous years—that oil prices will increase to $68 a barrel and then stay steady throughout the rest of the planning period. We know barrels are already over $70 and have been for some time. So once again officials are behind the game. I ask members whether they seriously think oil prices will not rise further. This pattern has been going on for years and one has to ask how much longer Treasury and the Reserve Bank will base their assumptions on the futures market. 
The Greens pointed out the gross errors in the assumptions in the 2004 Budget that predicted that oil prices—wait for it—would fall to $19 a barrel and stay there. Somewhat red-faced the next month in its June quarter report the Reserve Bank again predicted falling oil prices but only to $30 by May 2005. When May 2005 came oil was around $47 to $48 a barrel. In the September 2005 quarter the Reserve Bank predicted that oil would stay at $58 for the rest of 2006 that is this year—the price is currently over $70—and then would fall to $40 by the end of 2007. This year’s March forecast—the latest gospel from the Reserve Bank—predicted the fall to $40 would still happen but not until the end of 2009. Treasury’s update in December last year finally abandoned $40 and predicted a climb to $54 but not until 2009-10 and the prices holding steady this year at $59. Apart from a very brief dip in February oil has not been at $59 since that prediction was made. Now $68 is the new benchmark. The Government is behind reality and blind to the long-term trends. 
No one in Government has ever publicly questioned that wildly inaccurate information or why there is no agreement between the Treasury and the Reserve Bank except on their agreement that the price trend will be forever down or as of today steady when it has for years now been consistently up. Why does anyone continue to believe those people? Why does the Minister of Finance not tell them to get real? How can anyone construct Budget after Budget on totally unrealistic and discredited figures? I guess only someone who believes in a flat earth could do so. 
Flat-earthers also assume that climate change does not stop business as usual; in fact accelerated business as usual is the plan. Yet in just the last year we learnt that levels of carbon dioxide in the atmosphere are now the highest for at least 650000 years—since before there were humans. We have reports of ice melting at unprecedented rates acidification of the oceans slowing of the Gulf Stream thawing of the tundra and freak storms droughts and floods. People are looking to the Government for a lead and what is the Government doing? It said in December that it would start work on a brand new policy having abandoned the old one but Cabinet has not even signed off the work plan yet. 
Meanwhile the Government assumes that Fonterra’s goal of growing dairy output by 5 percent per annum can be achieved without crashing our fresh water systems and our Kyoto commitments. It assumes we can continue to allow our current account deficit to grow forecasting it to reach $14.5 billion this year a whopping 9.3 percent of GDP. This is much much larger in percentage terms than any of our trading partners even Australia and the US which are also living well beyond their means. It assumes that the rest of the world will agree with these assumptions and that they will happily continue to buy our unsustainable products and give us the credit to continue to live beyond our income. I do not think so. 
Let us look at the big triumphant announcement in this Budget. What is Michael Cullen most proud of funding this year? Roads. There is a gigantic slug of $1.3 billion for more roads on top of the billions that fund roads already. Nearly as much as is being spent on the Working for Families package will be spent on tarmac. But there is nothing to close the funding gap for public transport. Not a cent—only a statement that the Government will work with local government to help them meet their funding contributions. There is not a cent of money; there will just be some talkies. 
It is recognised around the world that new roads generate new traffic and they invite people to take the car instead of the bus or the train. For a Government that has a sustainable development programme of action with a key issue being energy to announce this is a breathtaking insult. For a Government that has a Land Transport Management Act and a national strategy that requires transport funding to be integrated balanced and environmentally sustainable it is probably illegal—if anyone wanted to test it. This is a mad petrol-headed road-building tarmac-focused vote-seeking Budget but I cannot work out whose vote the Government members actually think they are courting. 
It certainly will not be Auckland. Does no one over there read the Auckland papers? Letters to the editor are clamouring for better public transport. Aucklanders have moved out of their cars since fuel prices rose and the use of public transport has doubled in just a year despite a fare increase. Buses and trains are absolutely chocker at peak hour and people are demanding more. Many surveys have shown that over 80 percent of Aucklanders want spending on public transport including a commuter rail system not spending on new motorways. The numbers are overwhelming. 
Hon Judith Tizard 
: Sorry; that’s not true. 
JEANETTE FITZSIMONS 
: If someone thinks that is not true I will show her the survey figures. 
So who do Government members think will vote for this? Are they really only interested in the votes of petrolheads and boy racers? The irony is that this roading binge has been largely paid for by the success of an electricity company that is dedicated to 100 percent renewable electricity and has done so well out of that commitment that the Government has raked in the profits. Now that sustainable company’s success is being used to fund massive unsustainability. 
The Budget pays lip-service to sustainability and climate change with a contingency fund of $100 million to reduce carbon emissions but it spends 13 times that amount increasing our carbon emissions by encouraging a huge increase in traffic on new roads. That is one step forward and 13 steps back and taxpayers will foot the bill for that in 2012. We know nothing yet about how the climate change fund will be spent. I sincerely hope it is not for Treasury to speculate on the carbon market by buying and selling credits as it has suggested it should do but rather to fund serious reductions of greenhouse gases in New Zealand. 
The 2006 Budget holds levels of overseas development aid at 0.27 percent of gross national income (GNI) through to 2006-07 rising to achieve a massive 0.28 percent in 2007-08. These figures are ungenerous by international comparisons and they position us at third to last in the OECD rankings for overseas development aid—well short of the UN targets of half a percent by 2010 and 0.7 percent by 2015. This Government cannot claim in the Budget speech to be following in the proud tradition of Peter Fraser and Norman Kirk when the Labour Government under Norman Kirk achieved a level of overseas development assistance of 0.52 percent of GNI and New Zealand was poorer at that time. 
If the earth were really flat and infinite there would be quite a lot to praise in this Budget. We welcome the slight easing of eligibility for student allowances and bonded merit scholarships. The Greens believe it would be a very worthwhile investment to offer a living allowance to all full-time tertiary students but at least this is a step towards our eventual goal. We are pleased to see more of the health budget invested in illness prevention. From a purely financial perspective this has to be good economics. It is the sort of innovative thinking that the Greens have been advocating for many years. From the patient’s perspective it is about hugely increased quality of life. In particular we welcome funding for preventing obesity and its likely consequence diabetes and funding for children’s oral health. We look forward in the near future to further Green Party - Government initiatives such as the nutrition fund to promote healthier eating. We also welcome programmes to tackle violence—especially violence against women and children—in schools and with women’s refuges. 
 There is little in this Budget for economic transformation towards sustainability and much that leads away from it. But we do recognise the new funding for biosecurity biodiversity research and remediation of contaminated sites. There are still too many biosecurity incursions and we need to do more to prevent new organisms from reaching New Zealand in the first place but this boost to surveillance and response preparedness is essential if we are to deal to those organisms that do get here. 
We are pleased to see an increase in the funding for environmental research and the science budget—though actually it does not go much beyond catching up with inflation. There is a need for new and improved weed and pest control methods given the potential impact of new organisms on the environment our health and the economy. The need is all the greater given the reality of climate change. Pests that may not have been able to survive here in the past may be able to in the future and species indigenous to New Zealand may struggle as the atmosphere warms especially if they cannot move to a habitat where conditions suit them better. 
For years both the Greens and select committee reports have pointed out the serious inadequacy of funding for cleaning up contaminated sites. The pitiful $2 million a year in the Contaminated Sites Remediation Fund is mostly used for investigations and has resulted in only five projects to start clean ups. So we are pleased to see the amount nearly double but it will still take decades to deal with the 40 to 60 most seriously contaminated sites let alone the thousands of lesser ones. We also need to address the creation of new contaminated sites today. As the Youth Environment Forum pointed out in its excellent presentation here just a few weeks ago we still allow hazardous contaminants like electronic waste and millions of appliance batteries to be disposed of in landfills. The Minister was at that presentation and I am glad he has listened to our young people. 
Ironically one of the most important things the Government has done to help this move towards a more sustainable economy is to decide to regulate for local loop unbundling unconstrained bitstream naked DSL and to require at least an accounting separation of Telecom. The Greens have been calling for these changes for some time and in particular moved an amendment a few years ago to the Telecommunications Act to unbundle the local loop. If this country is to move towards a “post-oil economy”—and those are the Prime Minister’s words—then a world-class information technology infrastructure will be a vital component of that. High-speed Internet can help us to overcome our geographical distance and free up the creative and innovative talent that is so abundant in New Zealand. We look forward to seeing the benefits of that over the next few years. 
Among these initiatives that the Greens applaud are a few we have negotiated with the Government—none of which were mentioned by the Minister of Finance. They are aimed at economic transformation into a sustainable economy that responds to the new imperatives of a round and finite planet. It is a big call of course—transforming the economy with a mere $26.5 million at this stage but there is more value in those few dollars than in the disgraceful sop to the road builders or the doubling of the vote for the Security Intelligence Service. 
I hope Rod is looking over our shoulders today and rejoicing that the Buy Kiwi Made initiative he negotiated with Michael Cullen on Radio New Zealand during the election campaign is finally bearing fruit and is funded to the tune of $11.5 million over 3 years. Rod was passionate about the importance of increasing our domestic manufacturing and producing capability supporting our workers reducing our dependence on imports and ensuring less of the world’s non-renewable resources are used to make and transport the produce that we use each day. 
The first major initiatives in Buy Kiwi Made will include a media marketing campaign a boost in the level of information available to consumers about buying locally made goods and services and support for the long-running Buy New Zealand Made campaign. We are also very keen to ensure that Kiwi firms and Kiwi products get a fair go in Government and local government procurement practices in business to business transactions and on providing more support for the development of “buy local” initiatives like craft markets and farmers’ markets. I particularly want to salute my colleague Sue Bradford who has picked up this initiative of Rod’s and is running with it strongly with support from Trevor Mallard. 
Our only other level one initiative in our agreement with the Government is to develop and enhance energy-efficiency programmes including building the scale and reducing the cost of the solar water heating industry. I have been working with officials on designing this programme which is quite complex and we expect funding to follow when the work is complete. 
Our education for sustainability Budget initiative developed by Metiria Turei sets in place a long-term plan to provide our young people with the tools and skills they will need to deal with the ecological social and economic problems that this generation seems determined to leave them. The $13 million over the next 4 years is a serious investment in future-proofing our country and will steadily increase resources and support for schools. Excellent initiatives are operating at the moment—the Enviroschools programme and the environmental education and professional development programme which is a Green Party initiative from a previous Budget and a wide range of community and marae-based environmental education programmes. This money will build specifically on the first two which in turn will support the others. 
When it comes to organics New Zealand lags way behind European countries like Sweden Denmark Germany Austria and the UK. Despite the promotion of our clean green image less than 1 percent of our agricultural land is in organic production—it is actually a tiny 0.24 percent. In Austria it is 12.5 percent. That means we are missing out on the expanding international niche market for organic food and organic retailers are finding it hard to source sufficient organic food. We need more growers and the Green Party Budget initiative of $2.2 million will establish an advisory service for organic farmers and aims to help as many as 200 conventional farmers convert to organic production every year. That will provide advisory services education research and other assistance to enable the mentoring of new organic farmers by experienced ones. 
These Green initiatives stand like beacons of a new direction in a Budget that is overwhelmingly about the old direction. The public are already sensing that new direction. Thirty years ago when the Greens first warned that economic growth based on resource depletion was unsustainable and that there were unacceptable environmental and economic consequences from the burning of fossil fuels we were a voice crying in the wilderness—out of step with the Muldoon Government political consensus and public practice. Today as the public leave their cars at home because they cannot afford to fill the tank as they trade in their gas-guzzlers for more efficient vehicles as the motor trade tells me that it is saddled with 6-cylinder cars it cannot sell as commuters fill the buses and the rail carriages until there is standing room only and demand better services Green warnings and Green solutions are at the centre of the public debate here and around the world. It is time they were heard by Governments. 
It is interesting how little support there has been for the last-ditch stand of the flat earth climate deniers who have just launched their climate science coalition. Even a year ago they would have got some traction with the wishful thinkers. But over the last year the public have seen the evidence piling up. 
Managing an economy is about managing not just financial capital but natural capital while at the same time taking care of human capital. We have more than 20 years of research and practical application that charts ways of doing this. We have international measures for the ecological footprint of nations and the genuine progress indicator can be applied universally. Yet we continue to measure only money flows in the market exchange. As long as we count only the growth in the exchange of goods and services we will not move beyond flat-earth economics. Growth in the money value of what we buy and sell only makes sense in a world where there are no resource constraints and where unlimited pollution can be absorbed by an unlimited environment. But the earth is not flat. 
So we find this Budget disappointing in the areas that really matter—future-proofing our country against the challenges that are approaching. As in the last term we will not vote for it. Looking across the House there is nothing we could vote for there either so we will abstain—independent and free to make up our own minds on each issue. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: There is to be no indication of support from the galleries at all. If it happens again you will be asked to leave. 
TARIANA TURIA (Co-Leader—Maori Party) 
: 
 “A key task the Government has set for itself is closing the divisive and debilitating gaps that have opened up throughout New Zealand society … the most urgent and visible gaps exist between Maori and Pacific communities and others … The Government will not stand back … We are determined to close the gaps. Our very foundations as a country demand it.” In his first Budget speech for the new minority Government Dr Cullen made a pledge to the nation that the Government would close the gaps. Yet just over a month ago the United Nations special rapporteur on the situation of human rights and fundamental freedoms of indigenous peoples reported on the significant disparities that continue to exist between Maori and non-Maori with regard to employment income health housing and education as well as in the criminal justice system. Just last week this Government’s  
Decades of Disparity III: Ethnic and Socioeconomic Inequalities in Mortality New Zealand 1981-1999 
 report was released. The historical and social processes that systematically disadvantage Maori such as colonisation discrimination and racism are still having a clear impact on ethnic disparities in mortality. 
The Maori Party turned to Budget 2006 with expectations that a reasonable Government would address such disparities. We hoped that a responsible Government would want to achieve genuine progress for Aotearoa. We assessed this Budget against our ideals of achieving sustainability well-being and a quality of life. What will this Budget do to ensure that Maori enjoy a quality of health and life that restores their ability not just to survive but to thrive? Will it do anything to address such issues as why the survival rate from cancer even adjusting for age and stage is lower among Maori than non-Maori? Will it do anything to address the fact that Maori are dying 7.6 years earlier than the population overall? 
For 15 years manaaki tauira awards have been allocated based on financial need academic merit and commitment to Maoritanga. Between 8000 and 9000 awards every year have been made to support low-income Maori students in their right to achieve. The awards have helped Maori to achieve their educational potential as have the Maori and Pacific higher education scholarships of $10000 each that have been awarded to give Maori and Pacific Islanders further access to tertiary education. These scholarships have been available since 1973 but with one slash of the pen manaaki tauira and the tertiary scholarships have been terminated—or as Dr Cullen said “reallocated.” The Maori Party commends the amazing efforts of Maori in tertiary education. We recognise the vital role of all three wananga which offer opportunities to students who have been failed before—students whose success these Government members are now trying to claim as theirs; students 35000 of them who through the actions of this same Government have been condemned to be beneficiaries and dependent on the State; and students who have had the rug of hope pulled from under their feet. It is hardly progress. 
While Labour members are clapping and patting themselves on the back has anyone noticed that the Minister of Maori Affairs did not even get a bean? How will he explain that to our people? Two days ago the Minister of Maori Affairs trumpeted the promotion of rawa matauranga and whakamana as leading the way in a Maori potential framework. How hollow those words sound today because I understand that his money has been “reallocated” as well. This morning at the national hui to introduce a genuine progress index my co-leader Dr Pita Sharples predicted that the only time Maori would be represented in the Budget today would be in relation to the cutting of programmes designed to advance the interests of Maori. His words have rung true. 
We wonder about the value of community vitality. The Maori Party is committed to recognising the importance of vigorous social support networks in maintaining a quality of life. It matters to us that people are not isolated marginalised or outcast yet this Government’s Budget puts all the emphasis on the control and punishment end of the spectrum. How does this Government say it will make families feel more secure? It will spend $500 million to provide 1250 new police; $33.9 million will be dedicated to road policing; and $9.5 million will be spent to control students who cause problems or are disruptive bullying or violent with schools getting more help to tackle disruptive behaviour. This is called progress. 
But what is being done in the streets the homes and the communities of those children before they get to school? We are pleased to learn that Victim Support and family violence prevention services are getting a look in. These are both vital services for restoring a state of well-being for our families. But let us get real. The sum of $500 million is going to the police and $20 million is going to victims and families suffering from the impact of violence. It hardly adds up. 
 This Budget is about power and control at all costs with only token efforts made to actually provide the tangible support that people need to take control of their own lives. The Maori Party believes that whanau are best able to determine their own solutions and we must support them to restore their rights and responsibilities to do so. It is not about more speed cameras more paddy wagons more fingerprinting and more lock-ups. The GDP grows but the gaps that this Government claimed to want to close will only widen. Real progress will come when people become aware of the need to use their lived experiences and belief in themselves rather than when their experiences are belittled and politicians define their reality. Only those affected can make the necessary changes. 
The investment the Government should be making is in helping people to do for themselves. It should be about acknowledging volunteers who are the unsung heroes of every neighbourhood. Thousands of New Zealanders every day are asking the Government to give them a chance so they can do things for themselves; they say that if they have a problem they should be their own solution. The Government loves volunteers—people who do things for nothing—but it does not care about them because they do not grow the GDP and no one takes the time to cost their significant voluntary time. 
Taking care of ourselves is also about taking care of our natural resources so how about today’s spin rate on ecological integrity? A whopping $4.5 million will be spent over the next 3 years through Vote Environment to clean up contaminated sites. That is little more than $1 million a year to fix up 30 years’ worth of neglect at Paritutu one of the largest historical polluted sites in New Zealand and to address the contamination and the waste disposal build-up occurring at Kawerau and Maketu which was so serious that it grabbed the attention of the special rapporteur and is now part of the international literature. One million dollars is all that the restoration of those places—restoration that is needed so our children can inherit the legacy our ancestors left us—is worth to the Government. The quality of our natural resources of air water and soil and the ecological footprint we leave behind is of little consequence to the Government. We are being sold short and so is the future of this country. 
Police pollution power and pests—those are all Ps but there is no investment to help P-ridden individuals and communities. This morning the former Labour Cabinet Minister John Tamihere said on  
Morning Report 
 that this Budget would be very good for the Maori Party because of its lack of attention to Maori matters. John Tamihere is right; it does lack attention to Maori matters. He would know because he is a powerful authority on these issues. He tried to close the gaps not only though his work with the Waipareira Trust but also in his time as a Labour Minister. We think we have premier quality of life because we live longer and we have more possessions but we have so many other things that are wrong for us. Today more families are living in poverty than were so in 1998. Our natural resources are depleting and we have climate change which has been affected grossly by human behaviour. We are developing into a nation of exclusion where the poor are not able to participate but actually contribute to the economy through loan sharks and through keeping numerous bureaucrats and agency officials in jobs. 
The Maori Party looks forward to a future Budget that is about genuine progress for Aotearoa—where the gaps can be measured where the gaps no longer continue to exist and where we count not only what we have taken from the environment but also what we have left behind. 
Hon PETER DUNNE (Leader—United Future) 
: 
 It could be tempting to describe this Budget as solid but unspectacular but to do so would be to overlook a number of key pillars that lie behind it that have not been challenged in the course of this debate thus far. 
The KiwiSaver scheme which gives New Zealanders the opportunity to save for their future and make a contribution to their retirement has not been attacked in this debate nor has the Working for Families package. In fact the significance of that package has not been fully appreciated—$165 a fortnight on average goes to the qualifying families in this country—and I have not yet heard anyone come up with an alternative that will deliver more to those families. The infrastructure spending contained in this Budget is $13.4 billion in total which will see significant investment in roading right across the country. I am delighted to see the progress in respect of roading that is being made here in Wellington. In passing I ask the Greens who become upset about new roading because they think people will not be encouraged to use buses what on earth they think buses travel on to get people to and from work. Then we have the Telecom unbundling which no one has yet come out against. 
The point I am making about those pillars is that they shape the future direction of this country. Any constructive criticism of the Budget needs to put in place alternatives to those pillars—and there have not been any. 
Now it is time to move on the next area of transformation. The Minister of Finance made reference in his Budget speech to the business tax review that he and I are conducting. We will be releasing a series of proposals in the next couple of months we will be inviting widespread participation in and consultation on those proposals and we will be doing so for this reason: we want to boost productivity in New Zealand and ensure that our business sector enjoys a tax regime that is comparable with that of our major trading partner Australia in particular. But we also want to make sure that the things we do are sustainable and link into the pillars I have already referred to. 
Beyond that other issues need to be addressed. This Budget introduces the theme of families young and old. United Future has talked about families for a long time. I am delighted that this year a total of $6 billion of expenditure will be committed to that theme. Not long ago in this House we could look at a Budget and not even see any reference to family issues so that has been a huge step forward. But other matters that affect families will be coming on to the agenda in the next couple of years. One of the big issues about family income is the spread of that income and that is why we secured agreement from the Government to prepare a discussion document—which is always the preparatory way one goes about making tax policy changes—on income splitting. That document will be released in early 2008 and sufficient time for debate on it will be given before policy proposals are developed. 
Many New Zealanders enjoy what has emerged as almost a tradition in this country and that is the support we give to the voluntary sector through charitable donations. Now that the Charities Act is in place and the registration process is under way it is time to look again at the way in which we treat charitable donations for tax purposes. We will be developing proposals in that area towards the end of this year. 
All of those things are about making this country a better place for New Zealand families and United Future is delighted with the initiatives contained in the Budget that take us forward in that area. I refer to the $6 million that will be provided over the next 4 years for the Children in the Middle programme which is being trialled on the North Shore in Auckland. That programme will help children who are caught in the middle of difficult parental situations to get a step ahead. I am delighted that $23 million more is going to Plunket to complete the roll-out of the Well Child Framework. 
Christopher Finlayson 
: What about PlunketLine? 
Hon PETER DUNNE 
: I tell Mr Finlayson that I am on record as saying that we ought to be funding PlunketLine. If the member puts up some proposals in that regard we will support them because PlunketLine is iconic. The Government knows that—I have told it that many times. The member opposite ought to giver credit where credit is due. There will be $10 million more for— 
Christopher Finlayson 
: You’ve been in Parliament for 20 years. 
Hon PETER DUNNE 
: Absolutely and we have seen— 
Christopher Finlayson 
: And what have you done about Transmission Gully? You’re all talk. 
Hon PETER DUNNE 
: Mr Finlayson has been a member of Parliament for 5 minutes. Most people do not know who he is. I am giving him more publicity than he has ever had. He will not be here for 20 years—or anything like it. 
As I was saying—and the Budget made particular reference to this—we will see a huge improvement in funding to the Council of Victim Support Groups. One of the things that came through in a seminar in Upper Hutt last week—a seminar in which everyone but the National Party played a constructive role— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: I am sorry to interrupt the honourable member but there is a debate going on across the House. Members know that rules permitting interjections are predicated on the assumption that the person who is being interjected against has the call. Interjections are not permitted when they are directed to a member who does not have the call and that is happening on my left and my right. I ask Mr Dunne to please continue. 
Hon PETER DUNNE 
: The point I was making is that we support the fact that over the next 4 years nearly $11 million will go towards improving support for victims. Victims of crime are long forgotten in terms of the way in which we approach penal policy in this country and we welcome that change. We also welcome the fact that there will be an increase in apprenticeships to 14000 by December 2008. Anyone who spends any time talking to small businesses knows the value of the Modern Apprenticeships scheme and the training opportunities it provides and that extension is well worth it. 
As far as parents are concerned we welcome the fact that this Budget will increase thresholds for liability for student allowances to about $39270 from 1 January next year. Put alongside the changes made to the student loan policy and the improvements to Working for Families this is an important step towards alleviating the burden that many families feel in trying to support a student who is not eligible for student allowances. 
We are delighted at the $126 million that will go to home-based support services and aged-based residential care for older New Zealanders. This will allow a number of critical issues to be addressed relating to the payment of nurses and also home-care providers who have been long overlooked. They will get the assistance they need to ensure not only a fair deal for them but also that the many many elderly people who prefer to stay for as long as possible in their own homes in their own surroundings are able to do so in a state of security and dignity. We are also pleased to see the increased funding for the Office of Treaty Settlements to enable more progress to be made in that area. 
This Budget sets in place the framework for the next decade and beyond. Many of the changes that it makes—or builds on—are ones on which there is now an emerging bipartisan consensus. I have not heard anyone either in the election campaign or in Parliament subsequently come back and say: “We’re going to get rid of Working for Families we’re going to stop spending on infrastructure we’re in favour of retaining the existing arrangements with regard to telecommunications and we’re going to scrap the KiwiSaver scheme.” If people want to have a debate about options they should put up some options. But they should not come down here spend their time criticising around the fringes then quietly accept the pillars on which transformation has been based because that is where New Zealanders are at today. 
The reason that members opposite are not making the progress they think they ought to be making is that the vast majority of New Zealanders are not interested in petty arguments; they are interested in how policies affect them. New Zealanders see that things are improving for them in a number of areas and they want those chances to continue. This Budget gives them that hope and opportunity. 
RODNEY HIDE (Leader—ACT) 
: 
 The ACT party rises to oppose this Budget. There is nothing in this Budget to make hard-working Kiwis better off. There is nothing in this Budget to improve the nation’s standard of living. Last year Michael Cullen underwhelmed a nation with his “chewing gum Budget”. Expectations this year were at rock bottom yet still Michael Cullen managed to disappoint. There is nothing in this Budget; it is a Clayton’s Budget. What we have now is no plan no policy no vision—nothing. We have a Government that is on automatic pilot where Government officials run Government policy and where the Government just gets bigger and bigger and takes more money each and every year. There is nothing in this Budget for the people of Epsom. There is nothing in this Budget for New Zealanders. 
Michael Cullen is clearly tired and this is a tired Budget. Michael Cullen has no ideas and his Budget has no ideas. Michael Cullen has no vision or plan and this Budget has no vision or plan. This Budget leaves New Zealanders with no hope—no hope for something better; no hope for a better tomorrow; no hope for getting to keep more of the money they work hard for; and no hope of becoming equivalent to then passing Australia or the other countries we like to compare ourselves to. 
The big dark secret in this Budget was leaked. How characteristic it is that the big dark secret of this Government’s Budget was the pinching of New Zealand’s largest company’s property rights. That is what unbundling the loop is all about; it is about taking control of something owned by other people. Then what did the Prime Minister follow that up with? She is going to split Telecom into two because she is such a wow of a business person. And then we had David Cunliffe the Minister of Communications saying: “Oh we will have to make Telecom’s dividend a bit smaller so that it puts a bit more money into infrastructure.” But what happened? This Budget’s big dark secret wiped $2 billion worth of equity off New Zealand’s largest company. That was the impact of this Budget’s big dark dirty secret. 
Michael Cullen talks about investment— 
Hon Clayton Cosgrove 
: How are those elevated heels? 
RODNEY HIDE 
: It must be sad to be Clayton Cosgrove must it not? He never gets a date; he has no one to go dancing with. He chased his secretary around Parliament and even she would not look at him. I feel sorry for that man. He sits there every Sunday night watching me dance just riven with envy and hate. Why? Because he is a dirty filthy socialist and he hates joy. He hates people having fun—what a miserable person! It is a shock that he is from North Canterbury where people stand proud and know how to enjoy themselves. I just feel sorry for him. If he gets a few dancing lessons maybe he too could get a date and not have to chase his staff around. 
Michael Cullen is all about wanting investment but why would people invest in New Zealand’s infrastructure? Why would they invest in a tolled road? Why would they invest in the energy sector when this Government can come along and pinch their investment take it off them tell them who can use it and tell them what price can be charged? I am sorry to say it but this Government with its unbundling of the loop has made a terrible terrible mistake for which all New Zealanders will pay. 
Of course we also have this problem: Michael Cullen thinks that the strength of the economy is measured by how big the Government surplus is. That is rubbish. The Government does not grow the economy; people do—the private sector. So we have “Scrooge McCullen” sitting on an $8.5 billion surplus generated by the people of New Zealand—Government spending is out of control but there is still an $8.5 billion surplus—and saying: “No tax cuts: not this year not next year and not the year after that.” But I say to New Zealanders: “Don’t worry—ACT is on the way!” That is right. We will have a tax cut. 
What about the Government’s roading? There is a ring road State Highway 20. Do members know where it ends? 
Chris Auchinvole 
: No. 
RODNEY HIDE 
: In Helen Clark’s electorate. 
Chris Auchinvole 
: Really? 
RODNEY HIDE 
: But oh no—the road cannot go through Helen Clark’s electorate. It is held up there. Does that not summarise what this Government is about for New Zealanders? We have to wait—wait in the traffic wait for health care wait for justice wait for the police wait for everything. 
I see that old Clayton Cosgrove has gone off to have a cry now. He has just realised he is dateless and he cannot dance. Oh he has popped back. He has got over it. What a loser! 
Here are some of the things we should be doing in this Budget. First we should be cutting taxes properly across the board. We should have a timetable to produce a top rate of tax in New Zealand of 15c in the dollar—15c for personal tax and 15c for company tax. With GST that would leave all the money needed to run the essential functions of Government and to do a whole lot better than this shambolic Labour Government. Second we should have a taxpayers’ bill of rights. The Government taxes New Zealanders hard it spends New Zealanders’ money and New Zealanders get no say in it. We say that in the modern age— 
Hon Mark Gosche 
: Who is we? 
RODNEY HIDE 
: Mark Gosche wants to know who “we” is. That is how un-switched on that Government is. It has stopped listening to the people. We need a taxpayers’ bill of rights and we need a regulatory responsibility Act. 
Hon Mark Gosche 
: Where’s your caucus? 
RODNEY HIDE 
: Do members not feel a bit sorry for those members sitting opposite? There is all that middle level. They have no chance of getting into Cabinet. 
The Government has a choice. The Government can promote policies that sap the wealth of the country and generate dependency—and that is what this big-spending hard-taxing big-government Labour coalition Government has generated—or it can develop the policies that allow people to prosper and that allow New Zealanders to stand up free proud and independent. That is what New Zealanders want because we are a free and proud people. 
People have had enough of this Government. They have had enough of its arrogance and they have had enough of its anti-fun attitude to life. That includes dancing—Lianne Dalziel does not like dancing and it is easy to see why is it not? But come the next election that crowd will be gone and we will see Budgets that will provide a vision for New Zealand. There will be hope for the people and a prosperous and free future. 
SHANE JONES (Labour) 
: 
 Recently from hither and yon visitors kids and the elderly have come to the House and noted how improved are its performance tone and general status. Of course I have concluded that that was due to the absence of a certain party one member of which is now crawling around on her belly with a gun and singing “I shot the sheriff but I didn’t shoot the deputy.” and another has been doing a lap dance. But the most important thing that has happened during this period of time—in particular during this week in relation to that party—is that my distant relative Donna Awatere Huata got out of jail. All those people who are trapped along with Rodney— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Order! 
SHANE JONES 
:—along with the honourable Mr Hide and who are regretting the hours and minutes they were wandering around Epsom watching trees that had been visited by stray dogs and perhaps mistaking Mr Hide for one of the canine characters the SPCA have to take in— 
Hon Clayton Cosgrove 
: Bulldog! 
SHANE JONES 
: The first bulldog we know that will be microchipped is the lap dancer. 
Hon Lianne Dalziel 
: Or lapdog! 
SHANE JONES 
: No I did not say that—to say that in his absence would be to cast great aspersions on dogs. There is nothing that that particular member can say or has said that will make one jot of difference to this Budget. 
This is a very good Budget. Why? Because it shows up Opposition members and those deluded speakers in the House—including some of my whanaunga from the Maori Party—for their shallow thinking and absence of ideas. What are they all saying? They are all saying that life is better in Australia. Well I endorse what the Prime Minister said and I also endorse what my whanaunga Winston Peters said—I have no idea how he became so humorous so suddenly when speaking about the Coroners Bill and various other things—that if Dr Brash wants to walk the plank he can put it right across the Tasman go to Bondi buy a surfboard and stay there. If there is one thing young people do not like in Aotearoa it is for leaders and for people who purport to have a vision for the country to put the country down—to divide people and constantly to bemoan the fact that the exercise they were a key part of has not delivered the goods. Don Brash will not stand up and take responsibility for the key part he played during that exercise. No one drove ideological excesses further and harder than the bloke who wanted to sell New Zealand Post and who wanted to get the unemployed to go to Kaitaia Murupara and Moerewa—not to Kohimarama or Remuera; oh no kahore—to collect some measly benefit. That was unlike our approach which was to ensure that everyone went into work. 
This Budget is replete with fantastic statistics. Those statistics show that our Dr Cullen has been a fantastically responsible manager in the economic sphere. How do we know that? We know that because of the buoyancy and wealth that has been consistently generated in the sharemarket. But I can almost hear Opposition members starting to ask about Telecom. Those managers in Telecom are the authors of their own misfortunes; they had every opportunity to see and hear to maintain their customer base and to replicate what other far-thinking key institutions such as British Telecom had done. So it is a bit rich for the well-heeled highly paid managers of Telecom to put the blame on to this House—that will not wash at all. 
It may be said that Dr Cullen has been too miserly. Well Dr Cullen has ensured that our books are balanced. He has ensured that we have a long-term future in dealing with one of the most terrifying human tsunamis that is on its way which is the greying of the entire OECD population. I invite members to go overseas and identify a country whose people are better suited and better prepared than we are through the Cullen fund and investment of that nature to deal with the ageing of our population. Members will find very few countries that can exceed what Dr Cullen has done in terms of sophistication and preparedness. 
Let us move on to talk a little about who is growing wealthy in Aotearoa. If the indiscriminate strategy of tax cuts is pursued that will have a disproportionately fantastic impact on a person who already has a lot of dough but we on this side of the House did not come into politics to enrich those who are already doing very well—I certainly did not. We came into politics to ensure that those who need a hand up or those who have suffered as a consequence of historical problems or dislocation from the labour market can enjoy basic protections. The vulnerability of such people is not preyed upon or exploited; we assist them so they can be key contributing members of both civil society and the economy. 
Our friends from the Opposition talk about the need for business-friendly approaches. I ask them to name one single idea that is likely to capture the popular imagination of people in this country from north to south—brown people white people Asian friends—other than the idea of impoverishing those who have been struggling in order to enrich a very narrow range of people. That is not the recipe for a buoyant or cohesive society. That is why what we are going to hear more about will never ever see the Opposition restored in the foreseeable future to the place we currently occupy—that is a position of responsible stewardship on behalf of all people. As the Maori say: te iti me te rahi. 
Let us talk about the investment in infrastructure. In that respect our friends from the Opposition have had ample opportunity to put ideas into practice. However as announced today in the House we are going to increase the investment in roads by over a quarter of a billion dollars over a 3 to 5-year period. But what do we hear? We hear criticism in the absence of any alternative other than to fall back on the tried and quite divisive ideas of the 1990s to privatise everything to marketise everything and to strip society of the key institutions that keep us together. Unless we invest in infrastructure we will not have people in society upwardly mobile—able to hop on the escalator and escape from the circumstances that may have put them at the wrong end of the equation. We will not have that at all based on National’s type of thinking. 
Let us talk about those who are actually in business. A number of us have been up and down the country recently and we know that small to medium sized businesses are in a state of total happiness. They know there is not a hope in hell that we can have tax cuts and then roll out hospitals in Kaitaia the South Island and other places. Our friends on the other side of the House do not admit to the fact that parties cannot promise tax cuts to private enterprise and at the same time go back to their electorate clinics in their constituencies and promise to maintain key essential services. Deep down National members know that what they are saying makes them unelectable so they never tell the truth about what they are proposing to do should they ever—God forbid—have the opportunity to control the Treasury benches. 
The people who are generating wealth can see over recent times not only that the capitalisation of the share market has grown $30 billion in real terms under Labour’s stewardship but that Labour is very good for business. Of course there is a narrow range of people who have been surreptitiously funding the National Party and who do not want to be identified. They do not like to mix. Why? Because they want to pull out the Edmonds Cookery Book from the 1980s and 1990s and re-run that same old scratched record. It will not do. People in New Zealand will not be hoodwinked as they were before and the tiny minority will not be able to wander off camp up overseas and enjoy their ill-gotten gains while the vast bulk of New Zealanders are left to pick up the pieces. Do members know why there is a differential between what happens to wages in Australia and what happens to wages in Aotearoa? There is a deliberate strategy to smash working people and to smash the institutions that function as their voices—as the medium for their advocacy. This is a great Budget and there will be plenty more to come. 
Dr the Hon LOCKWOOD SMITH (National—Rodney) 
: 
 I want listeners to the debate today to know that the member who has just resumed his seat is no other than Shane Jones who is Labour’s great new hope. He is Labour’s great new hope to replace its tired front bench. Today we heard a tired performance from Michael Cullen. We heard a tired performance from Helen Clark. The Prime Minister was just winding down; she was so tired. But I say to Shane Jones that I think he actually makes a better job of asking his patsy supplementary questions at question time than he made of that speech. He is sitting in the Prime Minister’s seat now. We know he has grandiose aspirations but I will give a bit of friendly advice to Shane Jones: the patsy questions are a good thing for just a little bit longer because he has more to do. I know that the current members of Labour’s front bench are very tired very poor performers but he has a wee way to go yet. 
The Prime Minister was all smoke and mirrors trying to claim that this was an investment Budget. We have heard it all before. I guess if one calls spending on chippies and Coca-Cola investment one could call this an investment Budget. Of course Michael Cullen and Helen Clark argue that spending on chippies and Coca-Cola is investment—investing in one’s future obesity! I guess one could claim it is investment. That is what the Budget will produce—an obese flabby Government here in New Zealand. 
The Australian Budget which was delivered the other day offered something totally different. That is why we call Dr Cullen’s Budget the “Bondi Budget”. This Budget will be far better for Australia than for New Zealand. 
Dr Cullen told us in his Budget speech that the latest estimate of the Government’s surplus was $8.5 billion—one of the biggest surpluses I think in New Zealand’s history. But that is not enough to give hard-working Kiwis a tax break. The surplus is $8.5 billion but that is not enough to give hard-working Kiwis a tax break! Dr Cullen said he could not give people a tax break because the economy has turned down a bit. It will grow at only 1 percent next year so he cannot give people a tax break. But of course in the last 2 or 3 years the economy has been bubbling along and surpluses have been fantastic but he still found excuses not to give Kiwis a tax break. 
The truth is that Dr Cullen and Helen Clark do not believe in giving New Zealanders a tax break. Dr Cullen and Helen Clark simply do not believe that people should get the benefit of having more of their own money. They believe they know best. They will tax New Zealanders as much as they think the ballot box can cope with. Dr Cullen and Helen Clark will tax New Zealanders to just under the level that they will revolt against. They will do that because philosophically Helen Clark Michael Cullen and the Labour members believe that they know how to spend our money better than ordinary New Zealanders. That is incredible arrogance. Members on this side of the House say to all the ordinary hard-working New Zealanders who are listening today that they deserve a reward for their efforts. They deserve a Government that takes less of the money they earn. 
We need only contrast this with what is going on in Australia at the moment. The Australian Budget gave the people of Australia A$37 billion in tax cuts. That is NZ$45 billion. Everyone in Australia is saying that is great for the economy and for the people as everyone shares in the country’s success. I lived in Australia for 6 years and I know that Australians are great at sharing and celebrating success. All Australians say those huge tax cuts are great for their success. 
Hon David Carter 
: Even Kim Beazley. 
Dr the Hon LOCKWOOD SMITH 
: Even Kim Beazley and the Australian Labor Party said that the tax cuts were great for Australia. In fact Mr Beazley said they should have come sooner. 
Here in New Zealand we have a Labour Government. Helen Clark and Michael Cullen know better. They do not believe in letting people have the chance to pursue their own dreams. No Helen Clark and Michael Cullen know better. Everyone in Australia is saying the tax cuts are great because Australia will be able to attract more skilled people. This “Bondi Budget” is like a huge magnet sitting off Australia’s coast and pointing towards New Zealand. It is just sucking people out of New Zealand and into Australia. 
Young skilled people in New Zealand who are going upwards in life earn about $60000 to $75000. In Australia the tax rate at that level is 30 percent. In New Zealand it is 39 percent which is 30 percent higher. Members should listen to this—we in New Zealand have a 30 percent higher marginal tax rate than Australians. That is why we call this Budget the “Bondi Budget”. 
In the last 3 years the number of people leaving New Zealand to go to Australia on a permanent basis—the net permanent loss to Australia—went from 10000 3 years ago to 15000 last year which is a rise of 50 percent in 1 year and in the last 12 months 21000 New Zealanders have gone. In the last 3 years under this Labour Government the number has doubled. New Zealanders are voting with their feet and they are going. This “Bondi Budget” will see more New Zealanders go to Australia. 
It is not just about the tax differences. The growth projection in the Australian Budget was over 3 percent a year over the next 3 years. In New Zealand it is 1 percent next year. That means Australia will have more jobs higher pay more health-care better education and even more broadband because these things relate to standard of living and higher income. 
National does not accept Dr Cullen’s excuses. Dr Cullen says that New Zealand is inherently not as good as Australia. He says that we cannot dig coal out of the ground and that we are inherently not as good. Members on this side of the House do not accept that view. We say that Labour should remove the roadblocks such as the tax burden the tightening straitjacket of regulation and the failing infrastructure. It should get rid of the roadblocks in order to let our economy grow. 
The surplus in this Budget is huge. The sum of $8.5 billion just rolls off the lips but it does not mean a hell of a lot. However $8.5 billion is almost $6000 for each and every household in this country. That is how much money Dr Cullen is taking from our hard-working New Zealanders who should have the chance to use that money to pursue the hopes and dreams they have had over the years. Instead they have to suffer the political programmes imposed on them by this Labour Government. Government members say that Working for Families is nirvana; that it gives money to hard-working families. The problem is that when people try to get ahead and earn another dollar this Government takes most of it off them. The Government almost totally controls people’s lives now. Nothing destroys people’s hopes and dreams more than the destruction of the opportunity to earn another dollar and to do something better for their children and their families. This Government takes that next dollar off those hard-working families and leaves their dreams trodden under its political feet. It is time this country had a better Government and that would be a National Government. 
Hon CLAYTON COSGROVE (Associate Minister of Finance) 
: 
 As the Associate Minister of Finance I am proud to stand beside Michael Cullen on this Budget. I am very proud of it. I make an observation about Dr Lockwood Smith a former senior member of the National Party. Only three senior members were sitting beside him to listen to that speech. The rest of the members were from the D-team—the new boys and girls. That is the stature in which he is held. 
Dr Smith talked about the Government investing in chippies. I agree with him. I can report today that we are indeed investing in chippies and plumbers and electricians—all those people. We are putting more money into the apprenticeships that Dr Smith destroyed. This Government is backing 14000 young people into apprenticeships—yes that includes chippies sparkies and plumbers. Dr Lockwood Smith led the charge in the 1990s and deliberately destroyed apprenticeships. Well I am sorry but we put them back we increased them and we will increase them again. 
 Just for a quick second I have to address a couple of things Rodney Hide said. Members will know that I used to get at Rodney Hide now and again. But now old twinkletoes has found his calling in life he ain’t worth even having a go at. I say that Krystal would have made a better speech than the limbo dancer Rodney Hide. I say that he should stick to the elevated heels and the shorts. He looked a bit like the Michelin man. He should stick to that. 
I turn to National members and say that after the speech made by Don Brash the body bags are out. The old grey warbler warbled for the last time. I recall a Prime Minister—I think it was David Lange—who in a debate leaned across and said to an American student that he could smell the uranium on his breath. I lean across and say to Dr Brash today—I cannot do it as well as David Lange did; I wish I could—that everybody on this side of the House can smell the formaldehyde on his breath. All those little young new National MPs who rocked up in the last election to support the walking dead—the corpse that walked—are now thinking that maybe they blew it. They are asking whether Gerry Brownlee is a Key man in this whole leadership thing or whether he is an English man. They do not know. 
Let us look at this Budget. It is about economic transformation. To use a key phrase of a great Australian Prime Minister it is the one that brought home the bacon and the Government is putting the bacon slicer into National members over there. I challenge National members to say which of the Budget commitments they would reverse. Would they reverse apprenticeships? I did not hear them say anything. Would they reverse student loans? I did not hear anything. 
Hon Member 
: We’d give tax cuts. 
Hon CLAYTON COSGROVE 
: National members talk about tax. Let us have a look at tax. As of this year 350000 families— 
Dr the Hon Lockwood Smith 
: Look at us! 
Hon CLAYTON COSGROVE 
: I do not want to look at the member; I laugh at him like everybody else. He gave another vein-popping speech. [ 
Interruption 
] I do not know whether he is a doting or a dating MP. 
Three hundred and fifty thousand New Zealand families will get $6 billion worth of targeted tax relief. That means that no one in this House—except maybe one or two—on our large salaries will get a tax break. That is true. But those people with families—350000 of them—will be looked after to the tune of targeted tax relief of $6 billion. National proposed an across-the-board tax cut; that is true. It proposed an $11 billion tax cut. John Key said repeatedly on radio as the old grim reaper Don Brash waddled around the election that half of the cut was based on borrowing. I challenged my opposite number in the election campaign about it. She denied it and then I read the quote out. What would $11 billion of tax cuts have given? It would have given me and Dr Lockwood Smith 95 bucks a week and it would have given most of my constituents $10 a week. If that is the tax policy National members support they are welcome to it but the country rendered its verdict on them. 
I ask members to look at transport. My colleague Mark Gosche said that when Dr Cullen read out the transport stuff Maurice Williamson was nodding. Either the vertebrae at the back of his neck were a bit loose or he agreed with us. I think it was the latter. The National transport policy was going to take 6 years to put all the petrol tax into road funding. The Government has done that in far less time than that. Let us look at the details: excise tax registration road user charges plus $300 million out of general taxation all into public transport and roads. Would National reverse this? I do not hear anything. I do not hear any warbling. 
Hon Maurice Williamson 
: No we would not reverse it. 
Hon CLAYTON COSGROVE 
: No Maurice said that National would not reverse this—good on him. Maurice is the most loyal man in the National Party. The Government has taken 118000 people off the benefit which is a 30 percent reduction in people on a benefit. Would National reverse this? I do not hear anything because National is bereft of policy. The Government has created 313000 jobs since 1999. Would National members reverse this? Yes they would because National’s tax cut policy would be coupled with an expenditure cut so deep that it would do what it did in the 1990s and drive people back on to the dole queues. The Government does not agree with that. 
Would National reverse the assistance to small businesses to get payroll agents so that people running small businesses can get out from behind a desk and back behind the counter to grow their businesses? Would National members reverse this? [ 
Interruption 
] They say they do not know because they have no policy. I say to them that the Government has put more money in education transport and student loans. The student loan scheme is a cracker. During the election campaign National members said that there would be over-subscription for student loans and we would be up to our armpits in debt. But students are not silly people—unlike that mob over there—students are prudent fiscal operators generally. It is undersubscribed. We now find out from the Treasury forecasts that the loan projections are down. Yet again I ask National members—including Maurice Williamson—whether they would reverse it. There is no answer. They are like a possum caught in the headlights ready to be reversed over in the next election. 
National members talk about tax relief. I say to them that there are 350000 families sitting out there today saying the Government’s tax relief is good. They deserve a Government that is willing to back them and to spread the largesse that we get in to where it is needed and where it is targeted. 
I say that this is a fantastic Budget. I say that this is Don Brash’s last gasp. What record of National’s matched our record on reductions of benefit numbers—beneficiaries off benefits and into jobs? What was National’s legacy in the 1990s? We put $23.6 million into well child checks because we know that kids who cannot hear properly are probably unlikely to learn a heck of a lot and go on and be productive citizens and get jobs. Will National reverse this? I do not hear anything from National members. Will they reverse 20 hours a week free childcare for our kids? I ask them to lay it on the table now. The silence is deafening. That sound of silence will be the sound that ushers forth the political coffin and political career of Don Brash on a slow march to the beat of a drum as he is taken out of the door and buried somewhere over the horizon because we know that he is gone. 
Shane Jones 
: Bondi Beach. 
Hon CLAYTON COSGROVE 
: Bondi Beach. I used to think the National Party was patriotic. Well National members have demonstrated some patriotism today but not towards New Zealand. The Prime Minister is right—if Australia is so good then they should get on their bikes and go there. I say that I am proud to be a Kiwi. I am proud I was born here. I am not an apologist and I do not have a cultural cringe about our country. But if Don Brash wants to go over and watch Shane Warne play cricket and a few other things he should go over there. If he wants to go over there and drink XXXX and sit on a beach he should go. I can see Don Brash with a knotted handkerchief with the old trousers rolled up in a deckchair on Bondi Beach fending off—no one. He can go there but he should stop running this country down. We in this Parliament are supposed to be in here standing up for our country and standing up for what we believe in. But the old grey warbler got up and said: “How great thou art.” about Australia. Well he should tell that to the 1000 Qantas employees who got bumped into the dole queues of Australia today. He should tell that to the millions of Kiwis who stand up every day and are proud of their country. They are the people who watch their sports teams with pride who go to the schools and volunteer for community services with pride. 
I say to those people that they should not go to a National Party meeting because what they will be doing there is handing out scores for the rugby league in Australia and handing out air tickets for people to go there. Well if that is National’s policy it is welcome to it. I say that I stand for New Zealand. I stand for a progressive Government and a progressive nation that is moving us forward and transforming us and National members stand for nothing. 
RON MARK (NZ First) 
: 
 I want to start my speech with an observation which I hope the National Party might note. It is an observation that was first made by a professor of law at the University of Canterbury Professor Philip Joseph in an article on the Auckland District Law Society’s website. Professor Joseph noted: “This election the realisation has finally dawned that under MMP we no longer directly elect governments. We elect parties and they form governments. No one party wins or loses elections.” He went on to say that when the National Party leader Don Brash formally conceded the election in the wake of the counting of special votes he used first-past-the-post language not MMP language and that this was an indication that the process of completely understanding MMP was an ongoing one. The message clearly was that National still had not got it. 
The article goes on to say that the fact that voters delegate to party leaders the task of forming Governments reinforced the weighty responsibility on political leaders to try to arrive at accommodations. This is the message. The article continues: “Professor Joseph said media references to a ‘mandate to govern’ were First-Past-the-Post language. ‘We no longer elect a government. There is no longer a mandate to govern.’ ” He said that “the 2005 government arrangements involved an entirely new framework”. I suggest they also involve a new way of thinking that clearly the current Government understands and the lady-in-waiting is still yet to even realise. 
This Budget is I believe a truly MMP Budget. This Budget demonstrates an ability to work together in the best interests of all New Zealanders. It exemplifies an acceptance of the public expectation that politicians work together. It recognises the diversity of New Zealanders’ views and opinions that are reflected in the make-up of the House of Representatives. This Budget recognises the common goal shared by the parties that make up this House—or at least those who wish to participate—that are committed to stable governance security and prosperity. The Budget is an MMP Budget that I believe respects honours and delivers on the commitments and the contracts signed between Labour Jim Anderton’s Progressive party United Future the New Zealand First Party and yes the Green Party. 
I offer my congratulations to United Future—to Mr Peter Dunne and his little team—on the concessions they have won in terms of recognition for family and business. I look forward to seeing the final report on the review of business taxation and the consequential cuts that may come from that. I offer my congratulations to the Green Party on the work it has done its Buy Kiwi Made policies and the other concessions it is still working on with the Labour Party. 
I am immensely proud of the work New Zealand First has done and the concessions policies and parts of the Budget that specifically enable New Zealand First policies that were campaigned for to now be delivered on. Let me just remind a few people that we campaigned for senior citizens’ policies. There were five key issues. We have always supported the senior citizens. I remind the National Party about saying: “no ifs no buts no maybes; the surcharge will go”. Well National members were right but it certainly did not go during their nigh on 7-year tenure in Government. It went only when New Zealand First got to the Government benches and forced it to happen. Here we see contained in the Budget today $126 million over 4 years for elder care something we campaigned on and we have delivered. 
I have to say that New Zealand First campaigned strongly on immigration issues and I ask members to look at the result. I ask members to look at the review and look at the direction we are now going in as a country. We have delivered. We campaigned strongly on the issue of the Treaty of Waitangi gravy train and strongly on the fact that we should have an end date—a terminal date—for claims and that is in progress now. 
We campaigned strongly for an export-led economy. I heard Rod Donald campaigning on the same thing and sometimes I thought he was singing directly off a New Zealand First song sheet. The fact is that some parties are working constructively towards an export-led economy and the Rt Hon Winston Peters is working towards that. The nation will see the results and the benefits of that which will empower New Zealanders and improve their prosperity and that is certainly not something that will come from Mr Key baying at the moon and screaming for more and more tax cuts. 
New Zealand First campaigned strongly on law and order and we have attacked the Government vigorously over the previous 6 years. We highlighted the deficiencies and the failings in the Department of Corrections’ home detention the failings of the 111 system the failure of the police to respond and the increasing loss of confidence New Zealanders had in the police. Have we delivered? By crikey we have. Have we fixed it? Yes we have. We now have in this Budget historically the biggest increase for law and order—for the police—that this nation has ever seen in one fell swoop. There is a 12.5 percent increase in staffing. It is in the Budget the commitment is there and it is more than we got from the National Party behind-the-scenes people who actively sought to undermine the coalition and tip it upside down. 
Here is the point. New Zealand First is providing supply and confidence but for us to do that we must have confidence that Ministers will live up to their obligations as per the supply and confidence agreement. That is happening and is reflected in this Budget. Look at the law and order policy announcements some of which may have escaped some people. There is $10.8 million over 4 years for a restructure of Victim Support. We applaud that. I went to the Prison Fellowship seminar on Sunday and I heard the word “victim” used three times. I heard the words “Mongrel Mob” used so many times that I lost count. New Zealand First has stood strongly for victims and $10.8 million may not be a lot but it is a move in the right direction and we will continue to advocate for them. 
There is $11.5 million over 4 years for a community prevention campaign to reinforce the unacceptability of family violence and to change attitudes towards violence and abusive behaviour. We all know that for many of these offenders violence starts in the home. New Zealand First gets lambasted by some people who do not like my Young Offenders (Serious Crimes) Bill because it seeks to lower the age of criminal responsibility. They continue to harp on at me and say: “Oh you’ve got to deal with violence in the home.” We know that! We are working on that. We do not work on just one issue like the myopic idiots that I sometimes run into on the streets and debate with. We work across a range of areas. 
The money allocated towards curbing truancy towards following up on these kids and identifying which kids are not at school is all part of a law and order policy. We in New Zealand First know that truancy is the precursor to juvenile delinquency which is a precursor to youth crime which is a precursor to adult crime. If we want to stop adults ending up in jail we have to stop kids wagging school. We applaud that initiative. 
I have to say that $500 million injected over and above to give us 1250 police—1000 uniformed staff and 250 non-sworn staff—is pretty good. From New Zealand First’s perspective I say we have fought long and hard for law and order and for our men and women who face the daily grind of enforcing the law on the streets of our communities and making our streets safer. We have delivered and we will continue delivering over the next 3 years because our final goal in 2010 is to have police-citizen ratios in New Zealand equivalent to those of Australia. The Government has pledged that it will work with us to achieve that. This is a blue-ribbon day for the police force and I applaud this Budget. I am exceedingly happy. New Zealand First has delivered. 
Hon PETE HODGSON (Minister of Health) 
: 
 I too am extremely happy. I am very very happy that 8 months ago when this country last went to the polls the decision was made that $11 billion worth of tax cuts tempting though that bribe may be would be set aside and that more New Zealanders would vote for a major party that said it wanted not to proceed with tax cuts and that it wanted not to proceed with the slash and burn that would go with it. 
I tell members that today the New Zealand health system receives an increase of three-quarters of a billion dollars—$750 million per year every year. That is the increase in this Budget today for health. It is about an 8 percent increase and it approximates the amount of money that a National-led Government would have had today in total not just for health but across all votes—for health and education for police and conservation for social welfare and for anything else that the Government of the day wishes to support. There is the difference. That is the increase in one vote—$750 million extra is going into health. It approximates the total new spending that a National Government had it ever been elected to office would have been spending today. That is the difference between investment and reckless unaffordable tax cuts. 
I am so pleased that the people of New Zealand made that choice despite the size of the bribe and despite the $1.2 million worth of assistance from the Exclusive Brethren. It was a wise choice and I am proud that the New Zealand—[ 
Interruption 
] Oh National members do not like me talking about the Exclusive Brethren. Instead they are saying that the interest-free policy on student loans is a bad idea. They should come to Dunedin North where I come from and see whether that lit fires under young lives. The first person whom I walked into and to whom I said that there will be no interest on student loans—a person in my office—promptly burst into tears and said: “I’ve got my life back.” That is what she said. She burst into tears and said: “I’ve got my life back.” She did not know that that was going to happen and her first response was to burst into tears. 
I say to those people who think that cancelling the interest on student loans was a bribe that if they think that punishing young lives and blighting them with that much debt that attracts that much interest is a good way to get ahead this Government strongly disagrees. “Ocker Don” thinks that. “Ocker Don” thinks that the idea is to stick a bunch of interest on young people’s lives to give tax cuts to the rich and to decide that that is the best way to emulate Australia. He is the same guy who screwed the hell out of the economy as soon as it tried to recover whenever it tried to recover at any time during the 1990s. He stuck his foot on its neck again screwed it down and then said there is a gap between Australian and New Zealand incomes. “Ocker Don” is the reason for part of that gap. 
Mr DEPUTY SPEAKER 
: A proper address for members please. 
Hon PETE HODGSON 
: We need to reflect on what has already happened in the health system under this Government in 6 years. We need to reflect that there has been a hospital building or hospital extension programme that has involved or will involve 22 projects. The latest new hospital was opened in the Wairarapa the week before last. There are new hospitals or extensions to hospitals happening all around the country from Kaitaia to Invercargill. Not far from where we sit in this Chamber a new hospital is being built—an entire new hospital—in Wellington and so it is around the country. That is one of the things that can be done when one decides to invest in services and when one decides to invest in quality public services. 
Take a look at mental health. [ 
Interruption 
] As the member interjects—and I do not know who that member is—let us talk about mental health. I would say to that member that mental health expenditure has doubled under this Government. Is that a good thing? Is doubling the expenditure on mental health and ensuring that it is spent on mental health—ring-fencing it so it must be spent on mental health and improving the lives of New Zealanders who suffer from mental health conditions—a good thing? Because I am proud of it. 
Have we thought about the very remarkable success of the largest immunisation programme ever undertaken in our history against meningococcal B? Have we thought about how many people and how many children have died from meningococcal disease this year compared with 2 years ago? The numbers are startling. Those are young lives saved and young lives not blighted if the child survives—they often survive in a terrible condition—and that is a remarkable thing this country has had to do for itself because we had a disease that no one else had. 
I am delighted that we have put democracy back into health. The previous National Government took elected officials out of the health system in one night in the “mother of all Budgets” in 1999. Annette King put them back in they are here to stay and I am delighted about that. 
I am delighted at the primary health care strategy. I am delighted that most New Zealanders will have cheaper visits to doctors and that from 1 July next year the 45 to 64-year-olds will get their turn. They too will see a big reduction in the cost of going to a doctor and will see the benefits of having cheaper access to primary health. That will cost $110 million this year which will increase investment in health to $540 million per annum from 1 July. I am proud of it. Taxpayers are telling people who are sick that they will give them a break because each of us will be sick at some time in our lives. 
I am delighted that elective surgery is up 8 percent except where one looks at it on a case-weighted basis in which case it is up 15-odd percent. I am delighted that medical interventions are up by a little over 20 percent. I am delighted that we have more than doubled funding for home-based support services for New Zealanders who want to stay in their own home longer. That happened before this Budget and this Budget increases funding for home-based support services by 16 percent in 1 year. That is not the sort of thing a Government can do if it has reckless tax cuts on its mind. 
I am delighted to have the support in this House of other parties. I see Barbara Stewart and Ron Mark from New Zealand First. Ron Mark has just resumed his seat. He spoke passionately again about older people’s health. He did it again because New Zealand First has been doing that for a while. I am delighted that we have increased investment into home-based support services by 16 percent for older people. I am delighted that we have increased the investment into residential services by more than $40 million in 1 year. 
I acknowledge the support of United Future. Judy Turner makes a real contribution to the health debate in this country and Peter Dunne as an Associate Minister of Health is responsible for the long-term medicines project a job I am sure he will do well. 
I acknowledge the work of Sue Kedgley and the Greens who have looked at the issue of obesity especially childhood obesity through the lens of nutrition and have done so repeatedly with particularity and precisely— 
Dr the Hon Lockwood Smith 
: It is a shame they do not know much about nutrition. 
Hon PETE HODGSON 
: Dr the Hon Lockwood Smith has decided that the Greens do not know much about nutrition. Dr the Hon Lockwood Smith who took far too long to get his PhD ought to revise his view of what the Greens know of nutrition. I understand what the Greens know about nutrition and I say that Sue Kedgley is a champion for this issue. The Greens are champions for this issue. I also acknowledge Sue Bradford who has a much more intense understanding of mental health than Dr the Hon Lockwood Smith will ever have. 
I must say that I have not ever received much support from the ACT party or from the National Party. All they want to do is to ankle tap Pharmac. It is the most cost-effective part of our health system and they want to go after it. 
Chris Tremain 
: Who set Pharmac up? 
Hon PETE HODGSON 
: The previous National Government set Pharmac up. It was a great thing to have done. Simon Upton did it and now the National Party in its new incarnation—full of people who are not as clever as Simon Upton—wants to pull it to bits. I say that those people are wrong and that Simon Upton from the National Party was right. 
I also say that the idea of demanding tax breaks for people who take out private health insurance is a way of reducing cost-effectiveness not of improving cost-effectiveness but the National Party never sees that. The National Party’s call for part-charging in hospitals or for having a lack of universality in our primary health care system would deliver the sort of public health system that this country rejected soundly in the 1990s. 
I am delighted that we have doubled the increase in expenditure on promoting physical activity and nutrition. We will get on top of the issue of obesity by doubling funding in this area in 1 year. I am delighted that we have a 4-year child health package for oral health for rolling out well child checks and for the creation of a universal hearing screening programme for the newborn. I am happy I am proud and I think New Zealand will be too. 
CRAIG FOSS (National—Tukituki) 
: 
 The “Bondi Budget” has now been read. From what I heard today Labour is as good as dead—dead thinking dead vision dead boring dead old and dead tired. 
Hon Member 
: Is that a list MP? 
CRAIG FOSS 
: No I am not a list MP; I knocked one of that member’s guys out. What an incredibly boring amount of waffle. There was no vision no passion no looking forward no backing of Kiwis and no fighting off the front foot. It was just the same old waffle from a tired old socialist Minister of Finance from a tired old socialist Cabinet with a tired old socialist Labour caucus who incidentally clapped only about three times during his entire speech and they were all for announcements that had previously been made. Sure there was a couple of billion dollars here and there but I do not think that means much to the Government. Thirty-three pages of the speech took about 50 minutes to read and there was really nothing new in it. What were the highlights? I have been looking at the doughnut and it is obvious that there is nothing in the middle. 
The Bledisloe Cup Budget battle has been lost by Labour which has gifted it to the Aussies. The 2006-07 Labour Budget team did not even bother to take the field. Those members have given up. They are obviously too tired. The Aussie Budget team—the Bledisloe Cup Budget team—must be wondering what on earth has happened to the great Kiwi spirit of can-do of backing ourselves of number eight fencing wire and of Kiwis fighting above their weight. The Australian Government has won the Bledisloe Cup Budget battle because it backed trusted and invested in its people to the tune of $45 billion worth of tax cuts for the next financial year. 
Dr Wayne Mapp 
: How much did we get? 
CRAIG FOSS 
: We got zero I think. It looks like a doughnut and smells like a doughnut—we got absolutely nothing. Dr Cullen does not even trust New Zealanders with their own money. Quite simply I say to Dr Cullen he should not take it in the first place or at least he should give back so much of what he has taken. He takes so much more than he needs. 
I point out to Government members that they seem to confuse our comparisons with Australia with their own mediocrity and acceptance of where New Zealand is at the moment. They could be no farther from the truth. My 47 colleagues and I are fighting to try to get this country back up to some semblance of a First World nation because under this Government’s watch we have plummeted. Can those members show me an economic statistic from anyone other than some left-wing socialist thinktank where we have performed? What has happened under this Labour Government is a disgrace especially with the economic conditions we have had in the last 6 years. Those members accept that Australia is better and they talk about one-way tickets but with one-way tickets at least we could go and visit the 500000 New Zealanders who live in Australia. Those New Zealanders were pushed out there. They will be attracted to stay by the Australian tax cuts and there will be a lot more New Zealanders to come. 
The 2006-07 Budget was one opportunity. Every year the Government has one opportunity and one shot. It has one chance to try to reverse the tide of New Zealand’s slide down the international credit ratings but our economic rating is still plummeting towards the Third World. It had one chance and it blew it. It bungled it; there is nothing new in the Budget. 
Again I challenge those members to think of something new in the Budget which took 50 minutes to read. “Uncle Scrooge McCullen” has our surplus—our $8.5 billion to $9 billion surplus—stashed away. It is locked away in his safe and no one is to come near it. Outside an election year Dr Cullen says it is not a surplus but all sorts of re-evaluations and financial trickery. I tell Dr Cullen that it is a surplus. He can manage the cash however he likes—$9 billion is $9 billion. The $9 billion he has locked away stashed away for another election year promise is $9 billion that is not being used leveraged off or borrowed against to invest in New Zealand’s future. It is not being used to back New Zealand’s future. A $9 billion surplus apparently is not a surplus until election year. It is $9 billion from this economy that is not available to add value to back New Zealand and to back Kiwis. 
How dare Labour abandon and sacrifice the future of our country for the sake of its silly socialist dogma. How dare Labour limit and throttle the investment in our future and our country to whatever the cash surplus seems to be. The cash surplus can be whatever we want it to be and the surplus $8.5 billion to $9 billion is the surplus that is available. How dare the Government give two fingers to those who want to risk and invest their own capital in the future of this country. How dare it give those people two fingers by having a punishing marginal tax rate of absolutely backward research and development write-offs that do not allow us to invest in the future of this country. How dare Labour give two fingers to those on hospital waiting lists when private hospital capacity is running at only about 50 percent. How dare it do that. This is my country and my future. The Government constantly has an eye on the short-term polls while my party and I are looking towards the medium and long-term future of this country because if we do not another 600 Kiwis per week will be headed towards the airport. 
In the Budget document there are many figures and some facts apparently. Billions of dollars from the Government’s coffers have been talked about and they are obviously at the point of bursting. Well here are a few key numbers that I think are a result of that $9 billion surplus. We could have some audience participation if you like. What does this number mean? Because of overtaxation and the $9 billion surplus we have this number—24000. Do members want any clues? The number of New Zealanders who have been on a waiting list for over 6 months is 24000. That is the result of not reinvesting a $9 billion surplus into our economy. Operations that have been taken for granted in First World countries such as hernias take anything up to 12 to 18 months to be done in New Zealand. That is not the New Zealand I want to live in. 
Here is another number—11000. Does it ring any bells? The number of New Zealand families still waiting for a State house is 11000. If we had had tax cuts those families could be helped to purchase their first home rather than have that purchase controlled by the socialists across the other side of the House. [ 
Interruption 
] All those members can do is to rave on about what may or may not have happened in the 1990s. This Government has been in office and has had the chance to do something itself for 7 years but that number is 11000. 
Here is another number—300000. Does it ring any bells? The number of New Zealanders sentenced to dependency on welfare is 300000 because of the high and punishing marginal tax rates and the Government has not even addressed those. For 300000 people and their families there is no incentive whatsoever for them to get up. They are trying to they want to they are good Kiwi battlers but Dr Cullen makes it so hard for those people so why should they bother? They will go to Australia. 
Here is another interesting number that some members might know—$1.70. That is about the price of one litre of unleaded petrol. It is about $1.70. How on earth are New Zealanders going to be able to afford to pay for the crippling cost of energy without a tax cut? The Minister says that New Zealand cannot afford tax cuts because Australia has all the minerals—it is all underground. How on earth does that explain why Australia’s after-tax income has moved from a 20 percent increase to a 33 percent increase over New Zealand’s after-tax income in the last 6 years? Have Australians found another 50 percent of minerals in their country over the last 6 years? It is absolute nonsense! By the way Singapore has no minerals at all but it is doing pretty well. Those Governments are backing their people and are ambitious for them. 
This Budget has been called an investment Budget by the Prime Minister. Good grief! This was the Prime Minister talking of her years of experience in the real world other than the 25-odd years I think she has been in this House—listen carefully! Interestingly Mr Cunliffe recently gave us investment advice and wiped $200 million off the savings of New Zealanders. That was just last night. What a joke! 
This Budget is socialism pure and simple. It is not about backing New Zealanders. It is not about a better and an ambitious future. It is simply a transfer of wealth confidence and opportunity to Australia. There is nothing more socialist than that. A fair and efficient tax structure will allow New Zealand once again to compete. Only a National Party tax plan and God can defend New Zealand while advancing Australian tax cuts simply mean that more New Zealanders will move to Bondi. 
I seek leave to table a summary of the Australian Budget that outlines $45 billion - odd of tax cuts over the next year which could be used as a good reference point for Dr Cullen. 
Document by leave laid on the Table of the House. 
SUE KEDGLEY (Green) 
: 
 What a strange fixation the National Party members seem to have with Australia. They are like younger envious children who constantly compare themselves with their older sister. It is like the classic inferiority complex or cringe that I thought we had left behind over a decade ago. Dr Cullen’s speech was littered with compelling catch phrases about economic transformation and national identity. Sadly despite that it was a business-as-usual Budget. It was a Budget firmly based on a business-as-usual model that is rapidly becoming obsolescent and indeed redundant in a world of rocketing oil prices and accelerating climate change. 
There were some positive initiatives in this Budget—a Budget that Ron Mark has described as an MMP Budget. Some of those initiatives came from the Green Party and we applaud those on obesity health promotion and telecommunications deregulation. But sadly for the most part it was a Budget based on short-term thinking and a Budget carefully crafted to win votes at the next election rather than to equip New Zealand to withstand the looming threats that confront us—particularly the facts that in a few years’ time we may very well face the prospect of world oil prices permanently trading at US$100 a barrel and face climate change accelerated to the point where a major effort will have to be made to take carbon out of our economy. This is a Budget that Marshall McLuhan would have said is one that looks to the future through a rear-vision mirror. 
The Budget puts off the hard questions such as what we will do to reduce our greenhouse gas emissions and how we will secure our energy supplies into the future so that we are independent of volatile and rapidly rising oil prices. Where is the plan in this Budget to reduce our dependence on oil? Other countries such as Japan and France have had such a plan since the 1970s. Why in 2006 do we still not have a plan but just Treasury officials running around with wildly unrealistic and out-of-date predictions about the price of oil? 
And where is our plan to reduce our greenhouse gas emissions? We signed up to the Kyoto Protocol. We promised that we would return our greenhouse gas emissions to 1990 levels by 2008 and of course if we do not we will be penalised by having to buy emissions credits. Instead of providing measures to return us to the 1990 levels this Budget invests in a roading binge the like of which we have not seen in recent decades. Inevitably that will increase our emissions which will mean that in a couple of years’ time we will have to spend a billion dollars on buying emissions credits from countries such as Russia which have reduced their emissions. It is simple common sense that we should spend a billion dollars now on future-proofing our economy and reducing our greenhouse emissions rather than pay a billion dollars in a few years’ time to Russia much as Russia may need the money. But now that the Government has abandoned the carbon tax there is no policy to address the issue of reducing our greenhouse emissions. 
Where is the plan to increase the proportion of our energy that comes from renewable resources which has been steadily declining? Where is the plan to shift our tax base to encourage the things we want such as productive work and to discourage the things we do not want such as pollution and waste? Having abandoned the carbon tax there is really no incentive whatsoever on industries or agriculture to reduce their waste and pollution. There is no system of “polluter pays” so the price we pay for most of our goods does not even begin to reflect the true cost—environmental health and otherwise—of producing those products. 
If we take food for example we find that effectively we pay twice for our cheap food at the supermarket: once at the checkout counter and a second time in the taxes we pay for the environmental costs of producing that food and of course for the escalating health costs of coping with nutrition-related illnesses such as type 2 diabetes heart disease and so forth. The Ministry of Health says that every year 9000 New Zealanders die prematurely from nutrition-related diseases. That is way more people than die from alcohol violence cigarette smoking and road deaths combined. About 30 lives a day—210 every week—are lost as a result of poor nutrition. So we are delighted that after years of campaigning about that serious public health crisis the Government is beginning to grapple with it and is investing $76 million in a campaign to fight the obesity epidemic. We congratulate Pete Hodgson on recognising that the obesity epidemic not waiting lists is the real health crisis that confronts New Zealand. We have been working with the Government on initiatives in that area and we look forward to further initiatives such as a nutrition fund to encourage healthy eating. 
We are delighted too that the Government has finally begun to take the organics sector seriously. It has agreed to a Green Party Budget bid to invest $2.2 million over the next 3 years in establishing an organics advisory service to help farmers to convert to organic and more sustainable forms of agriculture. It is frankly astonishing that a country that markets itself as being at the leading edge of innovative agriculture has been so slow to embrace organics—a farming method that sustains rather than destroys our environment. Only 0.24 percent of our land is in organic production. It is astonishing too that the National Party which claims to be the farmers’ party is so reluctant to embrace organics. 
One of the problems is that there is really no incentive to switch to organics because producers and growers do not have to pick up the environmental costs of conventional agriculture such as polluted waterways eroding soil and contaminated sites. The taxpayer and society pick up those costs. For example the Government is spending $1 million a year just on picking up old pesticides from farms—things like DDT. I applaud that initiative but we have to ask why the producers of the pesticides are not spending the $1 million on picking up the old pesticides like DDT that are lying around on New Zealand farms. Why does the taxpayer have to pay for that? Why is it not the responsibility of the pesticide companies? Creating a policy environment that is much more favourable to organic and sustainable agriculture and that helps farmers to convert to organics makes simple economic and environmental sense. By switching to organics we will solve most of the problems we have created with conventional food production. We can protect our wildlife reduce pollution and treat animals with respect. Why would we not support incentives to create all of those environmental and other savings? 
Those are very positive Budget initiatives but one initiative we are horrified about is the binge spending on roading. Smart Governments around the world like the Swedish Government are investing heavily in public transport. In fact Sweden is investing twice as much in rail as it is in roading in order to reduce its dependence on oil and because public transport is about five times more energy efficient than cars. But we are doing the opposite of Sweden. We are investing billions of dollars in new motorways at a time when I do not believe one MP in this House fails to believe that fuel prices will continue to rise. We should be investing in public transport which is collapsing. The public transport infrastructure is collapsing around us. We have clapped out 50-year-old train carriages and 23-year-old trolley buses. We have decades of deferred investment in our public transport infrastructure. Commuters are switching en masse to public transport because of the rising price of oil and we cannot even get on the buses if it is raining. I cannot get on a bus in my area if it is raining; the bus just whizzes straight past me because it is full. 
In New Zealand and in cities like Wellington in particular we are completely out of step with other places in our transport priorities. The rest of the world is looking at environmentally friendly public transport but Wellington is looking at ditching our environmentally friendly trolley bus network. Land Transport New Zealand which was set up to promote sustainable transport is bickering about the subsidy it pays for trolley buses and that is putting the entire network at risk. This Government may be putting the entire trolley bus network of Wellington at risk under its watch. That is a tragedy. That is where the $1 billion should have been spent not on more roads. 
Hon RUTH DYSON (Minister of Labour) 
: 
 This is a very very good day for the Labour-led Government and it is a very very good day for the rest of the country. This Budget delivers an investment in the future of the sort of country New Zealanders want to live in—as they watch the Leader of the Opposition pack his bags leave his current position and go to Bondi. That is a good place for Dr “Bondi” Brash. I have one piece of advice for the Leader of the Opposition as he packs his bags and heads for the golden sand across the Tasman: he should remember that the pension in Australia is both income and asset-tested. He is really risking his future by saying he would have a better life over there. Dr Brash should stop knocking New Zealand and start to back his own country and promote the good things we have done and will do in the future. 
This is a Budget that only a Labour-led Government could have delivered and I am very proud we have had the privilege to deliver the Budget yet again. If we had had the Budget that the National members campaigned on just a few months ago before the last election we would have been sitting here listening to policies of slash-and-burn across the entire social service sector and across our infrastructure systems in order to deliver $11 billion worth of tax cuts. Where would that money have come from? It would have come from our public health system from our public education system from the tertiary sector and from our social workers. It would have come from all the services that the Labour-led Government has spent the last 6½ years rebuilding so that we can again have the sort of security opportunity and choice that New Zealanders want and deserve. 
We really support families as being the basis of New Zealand society. A strong family is a secure family. A strong New Zealand family enjoys the economic independence of paid work whenever possible and has security and protection for family members who are not able to work. That is the basis of New Zealand society. We now have the second-lowest rate of unemployment in the OECD—the lowest unemployment rate in New Zealand for three decades. Why does Dr Brash never quote the unemployment figures? When we had a question in the House within the last week on New Zealand’s unemployment figures did the National Party ask a supplementary question? There was no supplementary question on unemployment from National because more New Zealanders are in paid work now than there have ever been in the past. We should be proud of that. 
New Zealanders should be proud of other international comparisons as well. In the  
Doing Business in 2006 
 report which was prepared by none other than the World Bank and the International Finance Corporation which country was rated as No. 1 in the world for doing business in? Was it Australia? 
Hon Member 
: No. 
Hon RUTH DYSON 
: It was not Australia. Was it the United States? No it was not. Was it the United Kingdom? No it was not. 
Hon Lianne Dalziel 
: Pick me! 
Hon RUTH DYSON 
: The Minister of Commerce and Minister for Small Business thinks she has the answer. 
Hon Lianne Dalziel 
: It was New Zealand! 
Hon RUTH DYSON 
: That is correct. New Zealand is the No. 1 country in the world for doing business in. 
Last year the OECD said our active labour market policies and our support for helping people on benefits to get into paid work was an international success story. Again was that information from the OECD quoted by the leader of the National Party? No it was not. The World Bank looked at our pension provision—our New Zealand Superannuation Fund—which Dr Michael Cullen should be very proud of. He is too modest to boast about it so I will do so on his behalf. It is a fantastic superannuation fund. The World Bank said that New Zealand under the Labour-led Government’s leadership was at the cutting edge in terms of superannuation policy. 
Who are the people we look after the most? Who are the people we support the most under the Labour-led Government’s policy? We support the people who are the most vulnerable: our families—young and old—people who are not able to support themselves and people who are not in paid work. Those people deserve the strong support of the Government. We restored the level of superannuation; we put the superannuation rate in the law and established the fund. We also have the KiwiSaver programme so that more New Zealanders will save for and invest in their future—for their own financial security. That has really changed the future support of New Zealanders. They know they will have financial security in their old age. 
We are supporting families by lowering the cost of doctors’ visits. We know that under the National Government’s policies in the 1990s more and more New Zealanders stopped going to the doctor and the nurse because they did not have the money to pay for those visits. So we have put money into our primary health organisations. They have passed it on to doctors and I am sure that the overwhelming majority of doctors have reduced their fees. 
Shane Jones 
: Not Dr Brash. 
Hon RUTH DYSON 
: We did not pass it on to Dr Brash because he is not the sort of doctor who makes people well. 
We have put a huge investment into land transport infrastructure. We know that we had a big reduction throughout the 1990s—in fact throughout the late 1980s as well—in the funding of our infrastructural investments. So transport has had a huge boost and finally we are spending more on our land transport infrastructure than we are receiving in revenue through petrol excise duty and motor vehicle registrations. That is a huge investment in the future of New Zealand. Many projects have been under doubt and local authorities up and down the country have been concerned about that. Those people will go to bed tonight very happy to know that in their area they will have the investment in transport infrastructure that they want. They will be very proud of that. 
As well as the investment in our transport infrastructure and the local loop unbundling which I think has been mentioned through the Budget announcements we have continued New Zealand’s very proud history of social innovation. We are trying to create a society that has the hallmarks of fairness and inclusion where every New Zealander gets a fair go. That is the New Zealand way. It did take a big hit in the late 1980s and in the 1990s but New Zealand is now firmly back on track and is at the forefront of developing its national identity. 
We have reinforced the critical relationship between social and economic development. We have put a very strong emphasis on the well-being of families. We have taken an active approach to social assistance. We are helping people to move into sustainable work rather than processing benefits or punishing the people who are on benefits. That approach is working. We are helping people to get work when they are able to work and are supporting people if they are not able. We now have 2.1 million New Zealanders in work. We have a 68.5 percent labour participation rate which is the highest rate we have ever had and unemployment is at 3.9 percent. 
We have worked very hard to achieve those figures in social partnership with the trade union movement with the business community—the Council of Trade Unions and Business New Zealand—and with local authorities. Central government has worked with those groups because we know that social partnerships deliver the outcomes that New Zealanders want. We do things together because we have shared goals. Since 1999 we have reduced the number of people on the unemployment benefit by nearly 73 percent. Is that good for those people? Yes. Is that also good for New Zealand? Yes. 
What is the biggest barrier facing New Zealand employers at the moment? Is it that employers cannot sack people quickly enough as Dr Mapp proposes? Is that the answer to the problem? I say the answer is to get more skilled workers into New Zealand so they can fill the vacancies; it is to invest in New Zealand skills and to ensure we have a country that is attractive for people to come to. Under Dr Mapp’s proposal people from overseas would take one look at New Zealand and wonder why they would want to come here and risk their security by doing so. They just would not come here. 
We have had a very strong focus on families since we first came into office in 1999. We have invested in comprehensive cross-sectoral programmes to make work pay for families to prevent and reduce family violence and to improve people’s access to affordable quality services in both health and education. We have made housing more available and affordable and we have strengthened both universal and targeted services for families. 
I conclude by saying we have done those things because we have worked hard to make MMP work. I acknowledge our partners in making MMP work: the Progressive party New Zealand First United Future and the Green Party. We have all worked hard to achieve progress for New Zealanders because we believe in care about and are proud of this country. We are not packing our bags and going to Bondi. We love New Zealand. We want to stay here and keep making it a better country for every New Zealander to share in. 
Hon MAURICE WILLIAMSON (National—Pakuranga) 
: 
 The one person in the world tonight who— 
Debate interrupted. 
The House adjourned at 6 p.m.