Clark Helen: Budget Debate 
Clark Helen: Budget Debate 
[Volume:647;Page:16233] 
Rt Hon HELEN CLARK (Prime Minister) 
: 
 Madam Speaker—[ 
Interruption 
] 
Madam SPEAKER 
: I explained to members what the rule is. I understand the positioning here to get permission to be able to make sure that other speakers cannot be heard. But there is the right in this House for all members to be heard. There is also the recognition that there will be a robust and vigorous debate particularly on matters of this order. There is not permission to be given for not being heard otherwise members will be asked to leave the Chamber because they will be creating disorder. Of course there can be interjections and of course people can express their views but every member in this House has the right to be heard. 
Rt Hon HELEN CLARK 
: I think the problem was that the Leader of the Opposition’s notes ran out at least 15 minutes before the end of his 20-minute speech. I for one am not prepared to believe a single word he said—not a single word. I read on Monday morning in the  
Dominion Post  
that he was promising every worker $50 a week or north of $50 a week. By Wednesday morning when  
Breakfast 
 on Television One interrogated him for 10 minutes and asked time after time: “Mr Key will you confirm the $50?” he replied: “No I can’t confirm the $50.” That man’s promises cannot even last 48 hours. 
The only thing John Key confirmed today was that any tax cut he gives will be funded by cuts in public spending. A vote for John Key is a vote for fewer teachers not more; fewer nurses not more; and more problems not fewer. That is the man who in every speech complains about people leaving New Zealand. He was very happy to leave New Zealand himself under a National Government—very happy to leave his country. 
Can I say to the Leader of the Opposition that I did care about the Springbok Tour—and I remember where I stood on it as well—just as I cared about the war in Iraq and I remember where I stood on that as well. I care about climate change. I have never said it was a hoax. I have never denied it. I have never then tried to say “Well I never said that.” and then gone back full circle to saying again that it was a hoax. Over here we believe in having a bit of consistency in policy. 
The Minister of Finance today delivered his ninth successive Budget. The last time a National Minister of Finance got close to doing that it was Robert Muldoon. I sat here through his eight Budgets in the period of that National Government. He got in such a funk in 1984 that he could not write the Budget. He called an early election and ran away because he could not make the figures add up. That has been the story of the National Party year after year. 
Everybody knows that this Budget has been drawn up against a background of a slowing international economy. I remember the last time that happened as well. It was in 1998 and Jenny Shipley was there with Bill English Maurice Williamson Nick Smith Murray McCully Tony Ryall and Lockwood Smith. What was their response to a slowing economy? They cut New Zealand superannuation. They sold one of New Zealand’s prime State assets. Contact Energy was sold and they penny-pinched and under-invested across the board—health education and the rest of it. 
Let us look at the contrast. Yes the international economy is slowing. What is the Labour Government doing? Superannuitants are getting more money in their pockets not less. We have not sold a State asset; we have bought one back—New Zealand Rail—and I am proud of it. We are investing properly in the future of our people—in education in health and in other things. There is a stark difference between these two approaches. 
We all know that Kiwis are paying record prices at the petrol pump. We all know that key items of food like dairy products are way up in price. Those prices are doing well for our dairy farmers but they hurt back home at the supermarket checkout. Then there is the global credit crunch and that has affected our households with mortgages and it has affected our small to medium sized businesses. Alongside the slowing global growth there has also been a prolonged drought. Our farmers have had a very very difficult few months and that has affected our whole economy. 
None of those things are the fault of the New Zealand Government—not a single one. But it is our responsibility to manage through them and to keep the New Zealand economy well positioned for upturn when it comes. That means not doing what Jenny Shipley Bill English Tony Ryall Nick Smith Lockwood Smith Murray McCully and Maurice Williamson did last time there was a slow-down and slashing and burning. It means carrying on investing and giving our people some genuine relief. I believe that Kiwis want relief from the cost pressures. But ask Kiwis: “Do you want that relief to come at the cost of less health care and less investment in education?” and they reply that no they do not. They want things kept in balance and that is what this Government does. 
In this Budget married superannuitants get a 5.2 percent increase in their income on 1 October. That is over $45 a fortnight. Our single superannuitants get an increase. They are benefiting from the tax relief and so they should. Society is judged on how its older people are treated and this Labour-led Government with support from our confidence and supply partners New Zealand First and United Future and with the support of the working and abstention agreement of the Greens has managed to deliver to vulnerable people. We have managed to deliver to superannuitants and I am proud of that. On 1 April next year we can add next year’s projected increase of close to $30 a fortnight to the 1 October increase of $45.88 a fortnight for our married superannuitants. That means that over the course of a year our married superannuitants will have an increase in their pay of 8.6 percent. That is phenomenal. 
Let us not forget the other things that matter to our older people. Let us not forget that this Labour-led Government with support from its confidence and supply partners is providing in this Budget for another 5000 elective surgery operations on top of already record numbers. Let us remember also that with the support of our confidence and supply partners—and this is a New Zealand First initiative—those who require a hearing aid will see the subsidy go up from $198 to $500. Another New Zealand First initiative is that those with a SuperGold card can look forward to free travel on public transport at off-peak times. Is that not good for our older citizens as well? 
The tax cut that is pushing up our superannuitants’ pay forms part of the $10.6 billion tax package—the $10.6 billion tax package—that the Government is delivering over the next 4 years. That starts on 1 October with a cut for every taxpayer. Those cuts are fair because those who are the lowest earners benefit the most—and that is the way it should be under any Government—because the lowest tax rate falls to 12.5 percent. By 1 April 2011 that 12.5 percent rate will apply to the first $20000 of earnings. 
Hon Dr Nick Smith 
: What a cynical bill—just cynical! 
Rt Hon HELEN CLARK 
: I am starting to think that this must be a very good Budget because I think Dr Nick Smith will have a heart attack if he gets much more upset. And although one cannot comment on the absence of members I do note that some are very happy to shout at others and then when they get their comeuppance they are not around to hear the reply. 
So what do the tax cuts mean for our Kiwi families? They mean a lot especially because the Government is also bringing forward the adjustments for inflation into the Working for Families payments. 
Let us take our Kiwi family on the average household income of $72000. Let us assume that the income is split with two-thirds from one partner and one-third from the other. Let us assume that they have two children at primary school. The $45 extra they get in the pay packet on 1 October is equivalent to a 3.6 percent increase in their take-home pay. That is not bad. By the full implementation of the tax package on 1 April 2011 that Kiwi family will be $82 dollars a week better off. That is equivalent to a 7.5 percent increase in take-home pay on today’s money. The one-earner family on $45000 a year—which is very close to our average wage—again with two primary school - age children will see the equivalent of a 3.7 percent increase in their take-home pay and it will be 7.6 percent by 1 April 2011. 
The tax relief in this Budget is important. So is the fact that this Labour-led Government is maintaining investment in the critical areas of health education housing and infrastructure. We know that although people want tax relief—and we are delivering it—they do not want it at the expense of the basics and we have to balance these things. 
For our families that 5 percent increase in school operations grants means a lot because if we do not look after that the schools come back to families for money they do not have to put into the school system. It might be the Tory way to keep putting that cost on to families but it is not our way. Our parents and our schools have high expectations—as they should have—and we need to meet those expectations. This Budget also funds the teacher-pupil ratio of 1:15 for our new entrants in schools. What can be more important in the school system than looking after small children turning up at the age of 5 and needing to learn the basics? 
For our families the money that goes into heath care is absolutely critical. If any Government eases up on that then Kiwi families pay the cost. They pay higher doctors’ fees they pay more for their drugs and they wait longer for treatment. That may be the National Party way—we all heard John Key talk about reviewing every area of public spending to try to squeeze out the money for the tax cuts. That is what he said. That is National’s way not our way. 
 In this Budget we are funding new initiatives in health like the new vaccine against cervical cancer. Over the years that vaccine will save the lives of thousands of New Zealanders. If we have a way of preventing a deadly cancer from developing then we should take that way and we have funded it in this Budget. 
The investment the Budget makes in housing is also critical for our families. We have invested in retrofits for warm and healthy housing saving people money on their power bill and improving their health. It was only a few weeks ago that along with the Hon Mark Burton I visited a lady in her home in Tokoroa. That home was being retrofitted. It had a heating system that was unhealthy and caused breathing respiratory problems. That lady with the support of a Labour Government and others who work with us is getting a clean healthy heating system and I am proud of that. 
I am proud too that this Budget for the first time is coming up with investment for shared-equity loans for our first-home owners. That is a way for families on modest incomes to get into their own home in the big cities. 
Hon Dr Nick Smith 
: It’s a joke! Twenty for Nelson? Don’t make us laugh! 
Rt Hon HELEN CLARK 
: The city of Nelson is one that benefits but Nick Smith opposes it. It is absolutely unbelievable that the local member for Nelson would try to stop people in his city getting a shared-equity loan. 
There is a lot in this Budget that adds to New Zealand’s economic capacity. The increase in operational spending on research science and technology is close to 6 percent. There is the huge investment in the Fast Forward fund so that our agriculture and food industries can earn more for their producers and for our country. There is the major investment in broadband. It is not a subsidy to a Telecom monopoly which is the National Party way but contestable funding that gets the maximum investment from the private sector. Under Maurice Williamson and a National Government the National Party protected Telecom for years. It caused us all to pay a lot for poor services. That is its legacy to New Zealand and it is not something we want to be known for. 
Hon Maurice Williamson 
: If it was all so bad why did you wait 8 years? 
Rt Hon HELEN CLARK 
: I really am beginning to think this is a very good Budget because I am getting such hysterical resistance from some members opposite. I can only feel encouraged in my efforts. 
I come back to saying that we have all seen Governments take different approaches to managing their way through economic difficulties. Some Governments cut the pension. Some Governments sell State assets to try to manage the books. Some Governments penny-pinch on health and education. But this Labour Government is putting up superannuitants’ income. It is looking after our families. It is investing in health education and housing and never never never is it selling our State assets. It is buying them back because we believe in that for the future of our country. 
I believe that this is a fair Budget that gives timely relief to our taxpayers. I believe that it invests in our future and it is able to manage through this current international downturn because over the years when the international economy was in better shape we addressed the critical deficits—the years of underspending in health and education and on the police the prisons and the transport system. We are now in a position to give relief where it is needed to maintain investment and to position ourselves for the upturn that Treasury forecasts in these Budget papers.