English Bill: Taxation (KiwiSaver and Company Tax RateAmendments) Bill — Second Reading In Committee Third Reading 
English Bill: Taxation (KiwiSaver and Company Tax RateAmendments) Bill — Second Reading In Committee Third Reading 
[Volume:639;Page:9459] 
Hon BILL ENGLISH (Deputy Leader—National) 
: 
 The member Charles Chauvel who thinks he will be the member for Wellington Central but he will not be demonstrated the kind of cargo cult that Labour is trying to build up around the KiwiSaver system. It is only Labour people with that kind of champagne socialism attitude who think people on $11.25 an hour are saying: “Oh yeah I’d love to put away $18 a week.” People on $11.25 an hour are the last people who will go into the KiwiSaver scheme and they are also the first people who missed out in this Budget. If the Government had kept its promise to move the tax thresholds to allow for inflation people on $11.25 an hour would at least have received something—it may have been chewing gum but at least they would have received $2 or $3 a week. This would have been some recognition that they are paying a bigger percentage of their income as tax than they were 5 years ago simply because of inflation and a lazy big-spending Government.  
The reality I say to that member is actually much different from the cargo-cult mentality that he is trying to cultivate. People on $11.25 an hour even people on $15.25 an hour will be the least likely to opt in to KiwiSaver. The Government’s message to those on $11.25 an hour is “Cut your spending profligate!”. The Government says that these people are the ones who are causing inflation the ones driving up the housing market. The Government is telling people on $11.25 an hour to cut their spending because they are part of the savings problem. 
I guess that would have some credibility if the Government was cutting its spending. But of course it is not. There is a record new spend in this Budget; it has never been $3.8 billion before. It will be $3 billion or $4 billion next year. Is that not typical? This is champagne socialism. People on low incomes have to cut their spending to be patriotic while MPs and bureaucrats on high incomes go on spending up large taking money out of their cash deposits in the bank and shifting it into KiwiSaver with no increase in their rate of saving. What a hardship! They are thinking: “This is a terrible scheme; we will have to shift some money around.” 
The Labour MPs believe Dr Cullen who has told them this scheme will create a whole lot of new savings. Well it will not. There are only two ways to get more savings into KiwiSaver: to shift it from somewhere else or to spend less. Labour are telling us today that the people they expect to spend less are the ones on $11.25 an hour. Well I invite Mr Chauvel to get out to the supermarkets and tell the people stacking the shelves and serving on the counters that Labour’s vision for them is to give up $18 a week—and give up all prospect of pay increases for the next 4 years because the employer has been compelled to put the pay increase into their KiwiSaver account—and get it all back in 40 years’ time. I invite Mr Chauvel to come with me to the supermarkets around Wellington. We will get all the staff in the morning tearoom and tell them the truth: that Labour says: “Put $18 a week into an account. We can promise you jam in 40 years’ time if you give up your bread now.” 
That is why yesterday Labour members were looking really worried about this scheme because they know what a big gamble it is. The people who will take the tax advantages of this scheme vote National. They will bank it—they will. Their accountants are all on the job today. But the low-income person and the small employer have been ambushed. Small employers have been ambushed by the compulsory contributions which they never expected and which come just after they have had to find the money for the 4-week holiday and the time-in-lieu provisions of the Holidays Act. Low-income people have been ambushed by a Labour Government they thought supported them.