Cullen Michael: Budget Debate 
Cullen Michael: Budget Debate 
[Volume:618;Page:13738] 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 The member for Northland claims to have his nose to the ground. The only time he does that is when he is pulling his head out of the sand. 
I am very pleased to be supporting the Budget at the conclusion of this debate. What is the National Party opposing in this Budget? First it is opposing more money for hard-working families in New Zealand. What National members are all saying—look at them sitting there the serried ranks with faces and minds totally blank—is: “There’s not a penny in this Budget for me so I’m voting against it.” On this side of the House we are saying: “There is a lot of money in this Budget for the people who need it; that’s why we are voting for it.” A three-child family on $40000 a year will by April 2007 be receiving an extra $124.77 a week plus anything extra for childcare plus anything extra from the accommodation supplement. That does not pay for the member’s nightly visit to the Chinese takeaway but for ordinary people in this country it makes a huge difference to their level of family income. 
National members are opposing $3 prescriptions for the over 65s. Why should they not? They charged for people to go to public hospitals when they were in Government. They introduced a new income test on the pension when they were in Government for a brief period of time. Of course they would oppose cheaper prescriptions for the elderly. They are opposed to the business spending to support businesses in New Zealand. They are opposed to the money for training methods which would help Shane Ardern learn how to drive a tractor properly at some point in the future or at least to be able to tell a new tractor from a clapped-out one which he cannot tell at the present time. 
National members are opposing the new money for childcare assistance. They are opposing the new money for out-of-school care and recreation. They are opposing the new money for transport in Auckland because that is part of what is built into this Budget. 
What were the alternatives? Not surprisingly National members had a little caucus and they asked: “What would we most like from the Budget?”. With one voice they put up their hands and said: “Tax cuts for me please.” So the National Party’s policy is tax cuts. Well sort of because what is its policy on tax cuts? Two years ago Dr Brash said there should not be any tax charged once one reached a certain level of income; that the tax rate should be zero above a million dollars a year or so—which he was approaching at that point. He was one of my employees in that respect. Then about a year ago— 
Deborah Coddington 
: Who presented that report? 
Hon Dr MICHAEL CULLEN 
: Goodness me Deborah Coddington has woken up again. 
Then a year ago Dr Brash was saying that the priority was to reduce the top personal tax rate. Then in March this year he said: “No no we didn’t mean that. We should reduce the middle tax rate first then we will reduce the top personal tax rate.” Then he said: “Well we will still reduce the top personal tax rate anyway.” Why are they confused? It is because Washington is too busy to make up its mind what the National Party’s tax policy should be. Until Washington makes up its mind National members will not know what their policy will be on tax cuts. 
Then we had the true absurdity. By means of questions and speeches we reached the point where both National and ACT were arguing that people would be better off if they had less income but a lower effective marginal tax rate. They thought that people should take a $100 a week cut in income in order to have a lower effective marginal tax rate because they would feel better about that if they did. If by some chance somebody came along and told them they had won Lotto and were now the Chief Executive of Telecom and so their income had gone up from $25000 a year to $1.5 million they would say: “Oh good I will be so much better off and I will no longer have to get family support from the State to support my family and children.” The member needs to get his head out of the sand because his nose is not to the ground. People prefer more money in their pockets. 
Then we had John Key’s policy. John Key is developing a new policy—at least he thinks it is new because he has not been around very long—to borrow lots more money and spend it so it is hoped the economy will grow and we can pay back the debt. It is called borrow and hope. 
Hon Harry Duynhoven 
: I remember that. 
Hon Dr MICHAEL CULLEN 
: Yes 20 years ago there was a little short fellow who sat in this seat for quite a long time. He had this funny kind of laugh. His policy was borrow and hope and it turned out to be borrow and no hope. We spent something like 20 years fixing up borrow and hope from that gentleman. That is Mr Key’s policy—the wizard of international finance. 
National’s health policy is to abolish the primary health organisations and to pay more for pharmaceuticals. Its policy is to lift the restrictions on Pharmac and let the drug companies charge what they want. We will pay more for pharmaceuticals and John Key will borrow more money so we can pay more for pharmaceuticals. That was another brilliant policy announced by Dr Hutchison at one point. That policy was very Washington—pay more to the pharmaceutical companies.  
National’s final policy is what I call “go with a glow”. National’s answer to all our prayers is somehow to change the nuclear-free policy because if we do that there will be a light upon the hill or somewhere which will be a nuclear ship coming into New Zealand. By these means miraculously National believes we will get a free-trade agreement with the United States and our incomes will suddenly rise to the level of those of Australia—even though Australia already has a free-trade agreement with the United States so there is a slight problem in that respect. Nobody believes a word of it because National’s latest policy is to go and ask the United States whether it likes it and then National will put it to the people by way of a referendum. So the United States will be the Lower House and the people of New Zealand will be the Upper House in the National Party’s view of the constitution. Once a policy has been signed off by Washington and the Pentagon we are allowed to do it in New Zealand. 
All National’s other spokespeople said the Government was not spending enough in their areas. They wanted more spending on early childhood education health tertiary education police courts prisons on absolutely everything—and less tax and to reduce debt faster. All these miracles would be done by National in one fell swoop. 
Shane Ardern 
: No trouble. 
Hon Dr MICHAEL CULLEN 
: There speaks the economic genius from Taranaki. That member has finally decided that if he drives a tractor far enough up the parliamentary steps then sooner or later enlightenment will descend upon him and he will achieve this miraculous Holy Grail—he can spend a lot more tax a lot less and save a lot more simultaneously. This is known as “Shane-nomics” or something of that sort.