Bradford Sue: Budget Debate 
Bradford Sue: Budget Debate 
[Volume:608;Page:5856] 
SUE BRADFORD (Green) 
: 
 When Dr Cullen delivered his 2003 Budget last week he was obviously proud of its modesty and conservatism and unashamed of the fact that he is boasting of a $4 billion surplus and giving millions of dollars to rich men’s yacht races while a third of our country’s children continue to live in poverty.When people like business owners and farmers have a decent surplus that is the time that they are most likely to invest in future production whether it is to improve the fertility of the soil or the stock to expand productivity or to do any number of a range of useful things. People like Dr Cullen would I am sure commend such farmers and business people on their fiscal wisdom in following such strategies. However when we have a directly analogous situation with a large Government surplus what does the Minister do? 
Rather than investing in that part of society that has the greatest need and from which our highest social judicial economic and educational costs derive Labour has seen fit to put off—possibly indefinitely—any real or substantial increase in support for low-income families and children. As Susan St John from the Child Poverty Action Group said in the group’s post-Budget briefing last Friday: “The poorest children in New Zealand—around 300000 of them—do not even get a crumb not even a lick of the ice cream because their parents’ incomes are below these thresholds.” She was referring to the fact that although Dr Cullen increased the thresholds for the abatement of family support that action had no impact at all on the many families who live below the threshold level already. While giving an increase of $34.5 million over 4 years to raise income thresholds for family support the child tax credit and the parental tax credit the actual effect of that increase will be to lift the threshold by less than $500. The movement on thresholds simply equates to forecast inflation for this year and does nothing to address the underlying issue that there have been no inflation adjustments since their inception. 
 As all of us are aware from briefing papers from the Ministry of Social Development to the incoming Government in late 2002 even after one term of a Labour Government 30 percent of New Zealand children are still living in poverty. Research done by the ministry itself and by others also continues to show strong links between poverty and all sorts of other negative outcomes and the effects of poverty continue to cost the New Zealand taxpayer immeasurable amounts each year. It is foolish to save money now for a retirement fund when we will be paying for it later with to name just a few: an ongoing high number of people on the unemployment benefit and all the other benefits that mask unemployment; continuing high rates of truancy now probably caused in many cases by the housing transience that so many poor families suffer; high criminal offending rates; lower productivity due to shortages of skilled and educated workers; and increased hospitalisation of children. Children from the 20 percent of homes in which families bring in the lowest incomes of all are three times more likely to be sick than those from the top 20 percent of homes. 
In the past New Zealand has seen itself as a country that looks after its children. However in recent studies New Zealand falls well below other countries in the provision of financial assistance to families. Even the UK after years of Thatcherism retains to this day a universal child benefit paid at a reasonably high level regardless of family income and the source of that family income. The assistance offered to families by our neighbour Australia also remains more generous than ours with a maximum tax credit of NZ$66 a week for every child under 13 years abating from NZ$32000 up to NZ$83000 when it goes to zero. New Zealand rates are currently $47 a week with abatement starting at $20000. 
In one recent UK study New Zealand was ranked 17th out of 22 countries looked at in terms of Government assistance to children. This is a disgrace and the Green Party believes that there are a number of things this Budget should have contained if this Government really had a serious commitment to ending child poverty and to reducing entrenched social and economic inequities in our country. 
First of all the child tax credit should be extended to all families including beneficiaries. This would cost around $250 million—6 percent of the Budget surplus. Secondly the Green Party would like to see an increased level of family support to reflect actual changes in the cost of living since it was first introduced in 1988. Further the level of the parental income threshold should be raised to reflect the cost of living increases since the payments were introduced and not just that for this year’s cost of living. 
Thirdly we believe that this Budget in a year of surplus should have introduced a universal child benefit. New Zealand is one of the few countries in the world that continues to have targeted rather than universal financial support for children. The Green Party went into last year’s election campaigning for the immediate introduction of a universal child benefit like the old family benefit at a very modest rate of $15 a week for the first child and $10 a week for second and subsequent children. We estimate that this would cost approximately $600 million a year to implement or 15 percent of Dr Cullen’s surplus. To take a quick look at an historical comparison the New Zealand family benefit became fully universal in 1946 and was paid then at a rate of 10/- a week per child. That was equivalent to 1 day’s pay for a labourer. Today on minimum wages that would equate to $61.60 a week per child which makes what the Green Party is asking for look very restrained indeed. After all research shows that a couple with four children need 69 percent more income to have the same standard living as they would without children. Do we want a society without children? 
This Labour Government should be acting now while it can to meet the desperate needs of families with children today especially those who are struggling the hardest no matter what their source of income. Labour should not go on leaving the children of those who have carried the can for the policies of Roger Douglas Ruth Richardson Jim Bolger Jenny Shipley and the rest to go on paying an unimaginable price while the rest of us are able to get on with our lives. 
In saying all of this however I would like to be fair and acknowledge the Labour Government for some of the better initiatives contained in this Budget including for example moves to cut doctors fees for under-18-year-olds accessing primary care organisations; the $55 million over 4 years for early childhood education; the extension of the community internship programme which was originally a Green Party Budget initiative; the commitment to meeting the goals of the Mayors Taskforce for Jobs for 15 to 19-year-olds by the year 2007; increased subsidised childcare hours from 37 to 50 hours per week for low-income parents taking up full-time work; and the building of a somewhat inadequate but welcome additional 318 State houses over 4 years. These are all good measures. 
But even looking at housing the Green Party believes that Dr Cullen and his Government should have considered doing substantially more than is on offer in this Budget. Housing continues to be a crisis issue for families in places like the Auckland region Northland and an increasing number of other localities like the top of the South Island and Dunedin. I was at first delighted to see the $43 million in capital and $26.7 million in operating costs allocated by Dr Cullen for what he called in his Budget presentation third-sector housing. However I was really disappointed subsequent to that to discover that in fact it is the Government’s intention to put most if not all of this extra funding into local Government housing rather than into genuine community housing projects. Ever since arriving in Parliament I have been pressing the Government to engage more constructively and creatively and on a larger scale with third-sector housing providers and it is sad indeed that Labour continues to prefer to put what resources it has into local councils which may simply do another John Banks and sell their social housing off when there is a change of ideology at the top. Genuine third-sector projects have the potential to build homes for families in desperate need right now in places like Auckland and the Hokianga. If nothing else I hope that what crumbs remain from local government’s table will be offered to existing competent third-sector providers now. 
In conclusion I will give a quick quote from Dr Gay Keating Director of the Public Health Association who summarises exactly how I feel about this Budget: “A failure to use this Budget to break the cycles of disadvantage will cost this country in the future through increased health and social welfare costs. What may appear prudent in 2003 may turn out to be an expensive mistake in 10 years.” I sincerely hope that Dr Cullen and Steve Maharey will come good on their oft-repeated promises to provide substantial relief for low-income families in the 2004 Budget but I have to say that the children of the disenfranchised and the disempowered victims of Rogernomics and “Ruthanasia” have waited already for far too long.