Cunliffe David: Taxation (Annual Rates and Budget Measures) Bill — First Reading Second Reading In Committee 
Cunliffe David: Taxation (Annual Rates and Budget Measures) Bill — First Reading Second Reading In Committee 
[Volume:672;Page:18886] 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 The Government touted this Budget as the “Zero Budget”. The Government was right. It is a “Zero Budget” because it is a zero out of 10. It has zero ideas zero leadership and a zero chance of making New Zealanders better off either in the short term or in the longer term. 
The Taxation (Annual Rates and Budget Measures) Bill contains some of the worst parts of this Budget. It is a great pleasure that we will be addressing it right up front in the House in urgency. I thank the Government for the opportunity to do so. 
There is absolutely no doubt that the foundation upon which this bill rests is precarious. It is precarious because this Budget is a bridge to nowhere and the road is paved with fudges and double-talk. It is paved with for example a broken promise not to sell State-owned enterprises and other assets which provide $7 billion of the baseline in this Budget. It is paved with a $1 billion unprecedented fudge that Roger Douglas would never have signed off as Minister of Finance. The unspecified cuts are not even allocated to an individual department. It is a $330 million a year whim out there somewhere in the cloud because the Government does not want people to know before the election where the cuts will come from. 
The road is paved with a $4 billion difference between the revenue estimates from the Inland Revenue Department and those from Treasury. Guess whose numbers were higher! Treasury’s. Guess which numbers the Government is working off! The higher ones. The Inland Revenue Department does not believe the growth numbers in this Budget. It does not believe them. There is no reason why it should. These are rosy glow growth numbers. When one strips away the Christchurch earthquake and the Rugby World Cup sugar rush the sad truth is that at the end of the 4-year period we are still left with growth of only 2.2 percent. That is below the previous long-term average of 2.5 percent. Even then the Inland Revenue Department does not believe that the money will actually come in. That is why its numbers are $4 billion below those of the Crown. 
The road is also paved with a $650 million a year theft from the personal pockets of public servants partly because their departments have been forced to pay their KiwiSaver contributions out of baselines. But it does not stop there. This Budget raids the superannuation scheme for public servants as well. It is iniquitous. It is $650 million a year and that is not even the fine print. 
The road is also paved with the fudge that the $5 billion Canterbury Earthquake Recovery Fund will not be paid for by the Crown; it will be sucked from the public through these new Canterbury reconstruction bonds. They are much less secure than if the Crown was putting its balance sheet fully behind Canterbury’s recovery. The rhetoric is not matched by the reality. It is yet another fudge and yet another zero out of 10 for this Budget. 
Most of all sadly this Budget is paved with the sacrifices of middle New Zealand families and working Kiwis who will have their KiwiSaver slashed and their Working for Families abated more rapidly. What does that mean in real people’s language? It means 20 bucks a week less for a family with two KiwiSavers—$10 a week less each—because the member tax credit is cut in half. That is if they are contributing 2 percent. The bill changes the default up to 3 percent. Well is that not heroic of this Government? It has not even reversed its reversal; it has half reversed its reversal. The Government has half reversed the reversal it made last year when it took the contribution from 4 percent to 2 percent. This year it has gone back up from 2 percent to 3 percent. Wow! That is leadership! 
Hon Steve Chadwick 
: Who pays? 
Hon DAVID CUNLIFFE 
: The punter pays. The family pays. The employer tax credit has also gone and employers have to match the 3 percent contribution if that is required. There is a problem with that because it creates an incentive for them to hire people who are not on the higher threshold. It therefore opens up the potential for discrimination between employees. 
On Working for Families the numbers are even worse. The abatement threshold and abatement rate have both been changed and the amount clawed back for a family of four on $80000 by April 2012 is $12.33 rising to $24.77 in 2014 $37.42 in April 2016 and then $50.30 a week. This is for a family of four on $80000—that is two $40000 incomes—who are struggling to pay the bills feed the kids put school uniforms on them and take them to soccer or rugby. Those families are being penalised up to $50 a week by this Budget from Working for Families alone let alone the $20 a week they lose in KiwiSaver which equals $70 a week. Let us not forget that last year they got hit with $30 a week cut per child in early childhood education. It is iniquitous. 
When will these cuts stop? When will middle New Zealand stop having to pay for the tax cuts the Tories gave their rich mates? They have made choices. This is not about the earthquake and this is not about the New York stock market; this is about the choices this Government has made in this House about who gets what and who gets shafted. We know who has been shafted again today: middle New Zealand. 
The Maori Party looks on. Well this is what the Maori Party paid for. I wonder whether that party’s people are happy because most of them get Working for Families. They get Working for Families and they are I hope in KiwiSaver— 
Hon Tariana Turia 
: They don’t earn $80000. 
Hon DAVID CUNLIFFE 
: I tell Tariana Turia that those families are $70 a week worse off. That member has brought a $70-a-week penalty to a Maori family of four living in Ngaruawahia New Plymouth or Te Tai Tonga. That member’s party has penalised those families by $70 a week. Any family with two adults and two children on $80000 a year loses $50 a week from Working for Families and $20 a week from KiwiSaver. When will it stop? 
What would a good Budget look like? What would this bill look like if it were a good bill? It would contain changes that allowed us to earn more work more create more and export more but it does not. There are zero new ideas to help New Zealand export zero new ideas to grow productivity and zero new ideas to create jobs. There is not a shred of an economic development strategy and not a shred of a real savings plan. KiwiSaver has shrunk not grown. National said the savings gap was crucial and that it would lead on savings policy. National said that savings would be the centrepiece of the Budget but what is it? A $20-a-week kick in the guts for a family with two KiwiSavers. That is the centrepiece of National’s Budget. Working for Families is worse. It is all for nothing because it rests on a foundation that Treasury knows in its heart of hearts is as flimsy as a house of cards. 
It is paved with broken promises such as the promise not to sell State assets and to get a mandate to do so. But National has booked the money now before the election. National promised not to cut KiwiSaver but it has booked the money now and we are passing this bill under urgency even though it supposedly does not hit town until April next year. What kind of a mandate is it when we are passing this bill under urgency 6 months before the election? That is absolute rubbish. That makes a mockery of democracy. Members opposite cannot keep a straight face because they know it is flimflam. They are clowns and they do not deserve to be taken seriously by the New Zealand public. 
Here comes the member Hekia Parata who is smiling like a Cheshire cat. She knows she has taken $20 a week out of KiwiSavers up in the East Cape and she has taken $50 a week from people getting Working for Families who are struggling to make ends meet up in Ruatoria. Ruatoria will be “Rua-poor-ia” after this bill goes through because every person on Working for Families will be poorer as a result of this bill. 
This is a zero Budget with zero ideas zero leadership zero compassion and a zero chance of re-election.