Parker David: Questions for Oral Answer — Questions to MinistersText is incorporated into the Bound VolumeParker David: Questions for Oral Answer — Questions to Ministers[Sitting date: 19 June 2014. Volume:699;Page:18717. Text is incorporated into the Bound Volume.]5.Hon DAVID PARKER (Deputy Leader—Labour)to the Minister of Finance: Which of the statements if any by NZIER chief economist Shamubeel Eaqub does he agree with most: that interest rate rises will punish the provinces that “one of the biggest issues of this generation is the widening gap between the haves and have-nots” or that “The gaps opening up in New Zealand are really big across geographical race and education lines”?Hon BILL ENGLISH (Minister of Finance):I do not agree with those statements. I do agree with other statements made by the same commentator when he said: “It reeks of xenophobia … poor policy making … a populist knee-jerk reaction” and “sloppy.” That was Shamubeel Eaqub talking about Labour’s housing policies.Hon David Parker: Is the Minister aware that over the past 5 years there are 7800 fewer people employed in the Waikato there has been a loss of 7300 people employed in Manawatū-Wanganui and 2100 people employed in Wellington and there are 6200 fewer people employed in Southland or is he so out of touch that he does not know what is going on outside Auckland and Christchurch?Hon BILL ENGLISH: No I disagree with that and the member is so out of touch he cannot remember there was a thing called the global financial crisis. So when he compares numbers prior to the biggest recession in 30 years with the recovery afterwards then of course he is going to find that in some respects some numbers have still yet to improve. But in an economy that produced 84000 new jobs over the last year that has closed up those gaps very considerably and probably faster than people expected.Hon David Parker: Given that two-thirds of GDP growth is coming from construction activity which makes GDP growth other than construction closer to 1 percent than 3 percent what is his plan to boost economic growth aside from another earthquake?Hon BILL ENGLISH: Well I am aware of the numbers around housing and it is slightly ironic that the member’s party has spent all year castigating the Government for not building enough houses and now that they are being built apparently it is bad for the economy. Saying that we should not count the benefits of construction is a bit like saying that if you take out the tries the All Blacks scored they did not actually win the game.Hon David Parker: Is he really so out of touch with New Zealanders that he denies inequality is rising when homeownership rates are at the lowest in 50 years and dropping and child poverty is rising?Hon BILL ENGLISH: Well as I think the House has discussed before most measures of income inequality in New Zealand show that it is not getting worse. It is simply not the case that the rich are getting richer and the poor are getting poorer. When the member talks about inequality of ownership of assets then I would hope that his party will see its way to supporting the Government’s programme to free up the supply of housing because a fast-rising housing market is likely to drive inequality in the ownership of assets because it favours those in the market as against those who are out of it. In that respect we agree on the objective—that is a slower-rising housing market. It is a shame we have not been able to agree on the tools because the Government has got good tools for addressing that driver of asset ownership.Hon David Parker: Does the income inequality figure that he just referred to exclude capital gains?Hon BILL ENGLISH: The income inequality measure that I referred to is not one measure actually it is a number of them. They are all set out in the document originally commissioned by the previous Labour Government which thought it was going to use it as a political tool in Opposition to demonstrate that inequality was getting worse. But actually it does not demonstrate that. Any measure of income inequality shows that it is flat and vaguely falling. In respect of capital gains—Hon David Parker: I raise a point of order Mr Speaker. It was a very simple question. It has already—Mr SPEAKER: Order! I agree with that but the member rose to his feet just as the Minister was about to address the portion about capital gains and I would like to hear that answer.Hon BILL ENGLISH: I understand that measure is aimed at income measures not capital measures and I cannot actually tell him whether it excludes capital gains but it probably does.Te Ururoa Flavell: Does he agree with Professor Jonathan Boston co-author of Child Poverty in New Zealand who suggested that the poorest Kiwi children are now no better off than some children in the slums of India and what steps can be taken towards introducing a living wage to address the immediate impacts of income deprivation in too many New Zealand families?Hon BILL ENGLISH: Well I certainly disagree with Dr Jonathan Boston’s comments and I think it discredits the campaign that he has been part of. If his advice to New Zealand politicians is to copy conditions in Indian slums because children are better off then we certainly feel free to reject that advice. Secondly can I acknowledge the Māori Party’s efforts over recent years. It has lobbied hard to increase the minimum wage to the kinds of levels that the living wage has been set at. We just do not agree with it going that high; we think it would destroy too many jobs. But we do acknowledge the intent of the Māori Party to help those who are on the lowest incomes.