Cullen Michael: Appropriation (2004/05 Estimates) Bill — Third Reading Imprest Supply Debate 
Cullen Michael: Appropriation (2004/05 Estimates) Bill — Third Reading Imprest Supply Debate 
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Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 I move  
That the Appropriation (2004/05 Estimates) Bill be now read a third time and the Imprest Supply (Second for 2004/05) Bill be now read a second time 
. These two questions involve the final stage of the Budget debate—the third reading—and the second reading of the Imprest Supply Bill which is normally moved in concurrence with it at this stage to provide for expenditure through to the end of the financial year including expenditure in advance of appropriation and to incur expenses and liabilities in advance of appropriation. 
There is a spectre haunting the Leader of the Opposition and that spectre is the fact that the New Zealand economy is going very well and is in good heart. When one has committed one’s professional life to being “Dr Misery Guts” it is difficult indeed to respond to almost untrammelled consistent economic success. 
Madam DEPUTY SPEAKER 
: No. The member should refer to other members by their correct names. 
Hon Dr MICHAEL CULLEN 
: Ah! Oh right. 
Madam DEPUTY SPEAKER 
: The member knows he must call members by their correct names and not by a name that is derogatory. 
Hon Dr MICHAEL CULLEN 
: Dr Brash—the appropriately named Dr Brash in this case—has spent his life being miserable about the economy and now is faced with an economy that is out-performing not merely his expectations but—I have to be fair—even the Government’s expectations. 
The problems we face are those created by growth and success not the problems of misery failure and social division such as those of the 1990s. Firstly we have had strong growth making us one of the key successful economies in the OECD over the last 4 years. When could we have said that for 4 years in a row in some decades in New Zealand’s economic history? Not since the early 1970s. Secondly we have low unemployment. Our unemployment rate is now the second lowest in the OECD though to be fair the National Party caucus is not counted in the figures. Thirdly there is moderate inflation which is securely within the 2 to 3 percent band. Fourthly we have growing household incomes particularly because of the growing levels of employment. For the first time in our history more than 2 million New Zealanders are employed and they are looking forward to the implementation of the Working for Families package which will deliver massive gains to 60 percent of all New Zealand families with children. But of course those at the top end will miss out and that will cause terrible problems for those members opposite. Indeed 60 percent of that money will go on families who are in employment—not that Dr Lockwood Smith would know anything about families; whether they are in employment or out of employment. 
The social report released only a couple of days ago shows that New Zealand is in the top half of the OECD for the majority of the key social indicators that count. What is important to people is the life they are enjoying not some abstract measure of per capita gross domestic product (GDP). We are catching up in terms of per capita GDP. We are catching up on the rest of the world particularly on the rest of the countries in the OECD. For the first time in a very very long time our economy on a per capita basis is growing faster than most other developed economies. We are on a roll. 
But then we had Dr Brash appear and for about the third time he has unburdened himself of his strange views in an Australian financial magazine. He seems to scurry across to Australia to write his little bits and pieces hoping they do not get noticed back home in New Zealand. Previously—and I will say this quite carefully—he appeared to be the Rip Van Winkle of New Zealand politics. Having spent four decades asleep he woke up to find that the natives were getting restless and he had some trouble understanding the changes that had occurred in New Zealand society in the interim. But now he has become the Cassandra-like figure going around as one of the cartoonists said with billboards plastered with “The End is Nigh” on back and front. The end must be nigh according to him because life is getting better under a centre-left Government and that simply cannot be true according to Dr Brash—it may be what is happening but it cannot be allowed to happen. We have seen all the newspaper headlines and comments: “Bumbling Brash loses plot” said the  
Otago Daily Times 
 as it tracked his movements around the country. Fran O’Sullivan—no great friend of the left let it be said—saw “no road map for the future” in Dr Brash’s comments. According to John Armstrong Don Brash’s comments “not only bordered on the ridiculous it was silly politics to boot”. And of course we had the  
Dominion Post  
stating that what Dr Brash said was “simply wrong”. 
So what do we see? First of all according to Dr Brash we are becoming a Pacific State country in terms of our economy despite the fact that our GDP per capita is 10 to 30 times that of the Pacific States. But Dr Brash is just about ready to put on his lava lava and throw in the future as far as the New Zealand economy is concerned. Secondly he says that Australia is doing better than New Zealand. Well let us have some facts. Fact: between 2000 and 2004 Australia’s economy grew 3.1 percent per annum on average; ours grew 3.5 percent on average. Fact: Australia’s inflation rate averaged 3.6 percent; ours averaged 2.5 percent. Fact: Australia’s unemployment rate averaged 6.3 percent; ours averaged 5.1 percent. We are going to hell in a handcart according to Dr Brash but it is certainly a Rolls-Royce handcart as far as most New Zealanders are concerned. With regard to GDP per capita Dr Brash says we are going backwards. Well here are some good figures. He used to like figures in the old days when he took some notice of them. In 1990 when the National Government took office Australia’s GDP per capita was 39 percent higher than ours. By 2000 Australia’s GDP per capita was 47 percent higher than ours. We went backwards from 1990 to 2000 in terms of per capita GDP. By 2003 Australia was 30 percent ahead of New Zealand. 
Hon Member 
: Oh come on! 
Hon Dr MICHAEL CULLEN 
: “Oh come on”—yes! Of course he said “30 percent” and he was right but what he did not say was that it was 47 percent when we became the Government. He left all of that out because it does not matter. Although Australia is seen as being the most successful developed economy in recent years we beat it on every major economic figure in that period of time. Yet again we are carrying on doing that and yet again we are beating them in the individual pursuit event. 
Of course in 2000 Dr Brash was not worried about Australia and New Zealand growing differentially. Then when he was the Governor of the Reserve Bank and supposed to do something about economic growth he said that whether the growth rate was differential was neither good nor bad; it just meant New Zealand was different in some respects. Why does he see Australia as the model? Is it because of its higher tax rates? Is it because of its higher public liability insurance? Is it because of more regulated labour markets? Is it because Australians have longer holidays and shorter working years? Is it because Australians have higher welfare dependency? Is it because Australia has more active business-support funding? Is it because it has a higher level of economic regulation and economic nationalism than New Zealand has? 
What is it that Don Brash wants to do? He wants to take a holiday—yours! He has suggested dropping all benefits to the able-bodied. He has promoted raising the age of eligibility for New Zealand superannuation. On many occasions he has lamented the absence of a capital gains tax and has supported removing local control of resource planning issues. None of that will address New Zealand’s comparative performance. He says: “Woe is us! We’re behind Australia so what we have to do is adopt policies that are even more different from Australia’s than they are now.” Now that is pretty illogical. 
I invite Dr Brash having returned from his unsuccessful provincial tour of the last year or so to stand up to address Parliament to stop attacking his country when he is overseas and to tell us what a National Government would do apart from the failed policies of the early 1990s that were designed to impoverish New Zealanders and drive social wedges between us.