Smith Nick: Budget Debate 
Smith Nick: Budget Debate 
[Volume:654;Page:4207] 
Hon Dr NICK SMITH (Minister for the Environment) 
: 
 I rise to congratulate the Minister of Finance on delivering a very balanced and sensible Budget in extremely difficult times. I take my opportunity to talk about how this Budget is a road to recovery for an economy that is on its back. I want to talk about the important investments in infrastructure. And I want to talk quite specifically about some of the environmental issues that are key to this Budget. I also want to give a little bit of a Nelson flavour and to show why this Budget is not just good news for New Zealand but good news for Nelson. 
Before I do that I challenge members opposite on a few of the points that they have raised. I will respond to Carol Beaumont who spoke with passion about education issues. This Budget spends more money on education over the next financial year then was spent on it in any year in this country’s history and for a Government to deliver that in the worst economic downturn since the Great Depression shows the level of commitment from this Government to skills development. 
I challenge three particular messages that have come from Phil Goff the Leader of the Opposition. He said—and I was gobsmacked to hear this—in his response to the Budget: “Stuff the rating agencies.” He may as well have said: “Stuff New Zealand.” This country depends on overseas capital to drive our economy. The price of that capital is determined by interest rates. Mr Goff was saying that interest rates do not matter. Treasury has said that a credit downgrade would cost New Zealanders an extra $600 million per year. I say to those who are concerned about jobs that interest rates matter. If there is a business out there wanting to invest and employ people the cost of capital is absolutely pivotal to the creation of those jobs. That is why I say to members opposite that you are economically illiterate when you cannot make the connection between a credit rating interest rates and jobs. 
Hon Steve Chadwick 
: I raise a point of order Mr Speaker. I am sure that you are not economically illiterate as the member alluded to. 
Hon Dr NICK SMITH 
: Let me be very explicit. I apologise Mr Assistant Speaker Barker. I was referring to the Leader of the Opposition and Labour members being economically illiterate by saying “Stuff the rating agencies.” but also saying that somehow they care about jobs. I say that jobs matter. One of the best paths to jobs is New Zealand being able to attract capital and that statement from Mr Goff was truly ignorant. 
Then there was an even more irresponsible statement from Mr Goff. He said that for one in five New Zealanders retiring in the next two decades there will be no superannuation. The finance spokesperson for the Labour Party went even further. He said that New Zealand superannuation is dead dead dead. That is nothing less than irresponsible scaremongering by a desperate Opposition. What has the Opposition come to when it will scare our elderly with any sort of rhetoric about an issue as important as New Zealand superannuation? It will stoop as low as taking superannuation down that track. 
Let me simply tell members opposite how to improve security. I will quote Susan St John who is hardly a friend of the New Zealand National Party. She said: “I think the Government’s very much in the short term done the right thing by not paying into the Superannuation Fund from money that it would have to borrow”. The Retirement Commissioner the independent person who has the responsibility for retirement income went even further in supporting what the Government has done in this regard. 
I challenge the members opposite who say they want to maintain the Government’s contribution to the Superannuation Fund: would they cut Government expenditure by $8 billion or would they borrow? Those are the choices; they really are the choices. Is any member in this House seriously suggesting that there should be a cut in Government expenditure of $6 billion to $8 billion in a year in which the economy is on its back? I do not think that any member is seriously suggesting that that is the right approach in this part of the recession. The only alternative is to borrow. Well I would like the next speaker for the Labour Party to answer this question. If we borrow $2 billion to put in the Superannuation Fund how does that improve one iota the security of superannuation in 20 or 30 years’ time? In 20 or 30 years’ time yes there is $2 billion worth of investment but there is an extra $2 billion of debt. The truth is that the security of superannuation will not have improved one iota. I plead with members opposite to stop scaring our elderly population with their ridiculous claims that somehow superannuation is at risk. 
Hon Maryan Street 
: It’s the baby boomers! 
Hon Dr NICK SMITH 
: Then I say to Maryan Street there is the third statement by Mr Goff which was truly ridiculous. He said that Labour had left the economy in great shape. I think that will go down in history as one of the great porkies of all time. Even before the election Treasury’s pre-election fiscal update showed 10 years of deficits. I ask members opposite—who are concerned about unemployment—when unemployment started to go up. Actually unemployment started to go up 18 months prior to the general election. Where were all the speeches from Labour members concerned about unemployment when it started to go up 18 months ago? I think there is one figure that says it all and it is this: over the last 5 years Government spending increased by 49 percent and during the same period the economy grew by 24 percent. Members opposite do not understand that only in the good times do Governments get to spend more and more. Thank goodness we have a National Government that understands the need to make choices in difficult times. 
Hon Steve Chadwick 
: The biggest porkie! Tax cuts guaranteed for all the country! 
Hon Dr NICK SMITH 
: I challenge Steve Chadwick to explain why during Labour’s term Government spending increased by 49 percent and the economy and tax revenue grew by only 24 percent. 
This is a Budget that delivers on home insulation. It is a Budget that delivers for hospices. It delivers on the Government’s commitments about Herceptin. It delivers on trade academies. It delivers for special education an area badly neglected by the previous Government. It delivers on youth guarantees. It is a good Budget a conservative Budget for our time.