Shearer David: Taxation (Budget Measures) Bill — In Committee 
Text is incorporated into the Bound Volume 
Shearer David: Taxation (Budget Measures) Bill — In Committee 
[Sitting date: 20 May 2010. Volume:663;Page:11160. Text is incorporated into the Bound Volume.] 
DAVID SHEARER (Labour—Mt Albert) 
: 
 I want to lead on for a second from where Mr Boscawen ended just now in terms of what this Budget is doing to the productive economy. I think that buried in amongst the detail is a significant cost to farmers and other productive industries that want to be able to invest—for example to invest in capital. If they invest in the leading edge technology that will be able to drive and increase their businesses they no longer have the ability to claim depreciation. So they will not be able to invest in that way. That will be another impact on the productive economy. 
I have spoken earlier about the need to look at investments our savings rate and our ability to increase our exports and the complete absence of real incentives in this Budget for that to occur. I particularly touched on innovation and research and development. Frankly if we look at the history of our economy we see that it was innovation and research and development applied to our natural resources that made us wealthy. It is as simple as that. When we see the paltry amount of money that this Budget invests in research and development and innovation we know that this Government is not serious about moving New Zealand’s economy up the value chain and increasing its productivity. 
Stuart Nash 
: What’s the Labour budget on this? 
DAVID SHEARER 
: I can tell members right now that if Labour’s 15 percent tax credits for innovation and research and development had been continued business research and development would have doubled. The productive end of the economy is not being looked after in this Budget. 
The other part that is not being looked after is the people at the bottom of the pile. The previous Labour Government through the Working for Families scheme was able to lift 130000 people out of poverty and put them into productive enterprise. That was the legacy of the Labour Government. It was really touching last night to look at the  
Tagata Pasifika 
 TV programme and see the impact that this Budget will have on families at the bottom of the pile. I refer to the family of a husband wife and four kids on that programme. By the time they take off their rent their electricity costs the cost of running their car etc. they have $80 a week left to feed six people. According to the budgeting service the family need more than $200 for food; they are trying to get by on $80 a week. 
The family rely on Working for Families to give them the incentive—and I emphasise the word “incentive”—to move forward to get into productive work to do the best for themselves and obviously to benefit our economy. What will the family get from this Budget? They will get a kick in the teeth because as a number of speakers have said the Government has removed the indexing to inflation. That is what it has done with this Budget. So the Working for Families incentive that people receive will be slowly eroded over time. It is not only that poor family in Manurewa that will not benefit from the Budget; the many poor families in my electorate—which make up most of my electorate—will not benefit from the Budget at all. Most of them will find that the paltry tax breaks that the Budget gives them will be eroded by the GST increase by power prices by fuel prices by the tobacco price increase and by the accident compensation levy hikes. That is what will happen to the people in my electorate and that is what will happen to that particular family. Inflation as Mr Nash pointed out before— 
Craig Foss 
: 0.9 of the 5.9 percent. 
DAVID SHEARER 
: I get a bit tired of members on the other side quoting percentages at me. These people cannot eat percentages I say to Mr Foss; they cannot eat percentages.