Foss Craig: Taxation (Urgent Measures and Annual Rates) Bill — Second Reading 
Foss Craig: Taxation (Urgent Measures and Annual Rates) Bill — Second Reading 
[Volume:651;Page:113] 
CRAIG FOSS (National—Tukituki) 
: 
 In speaking to the second reading of the Taxation (Urgent Measures and Annual Rates) Bill I want to say that given the speech of the previous speaker the Hon David Cunliffe he may well not last quite as long as the Hawke’s Bay District Health Board did. I think his colleagues were all murmuring as he spoke and what happened last night was very indicative of the support they have for him. Earlier speakers—[ 
Interruption 
]—and I think we are hearing them again—are still fighting the battles of yesterday. They are still fighting the battles of yesteryear. I half expect something about the Viet Nam War and the Springbok Tour to come out and maybe it will in speeches to come. 
The comments about process and select committees were interesting. I think almost every bill amendment bill and budgetary announcement on KiwiSaver was passed under urgency—all bar one the first bill. They were all passed under urgency. They did not go to a select committee etc. The difference between this bill not going to a select committee and the various changes Supplementary Order Papers and amendments that were rammed through under the previous administration without their going to a select committee is a thing called the general election. The thrust of this bill went to the select committee of New Zealand in the general election. Part of our 100-day plan part of our core philosophy and part of our ongoing plan for New Zealand is quite simply an ongoing programme of sustainable tax cuts leading to growth. 
The previous speech was very revealing. The member spoke about people reverting to their true colours or something along those lines. I could not believe my ears when he said that everybody knows that the multiplier on a tax gain is bigger than the multiplier on a tax cut. We now see the justification for Labour taking the top marginal rate from 33c to 39c. And I will concede that it was in its programme that it put before the public—fair enough. But if we take what the finance spokesman said to its logical extreme we find that he is saying basically that we should hike taxes. He spent about 3 minutes talking about the multiplier on tax cuts versus the multiplier on tax hikes. I ask whether Labour is revealing its hidden agenda now that the election is over. Is it revealing what would have been in the mini-Budget of the previous Minister of Finance? Presumably that would have been in December if Labour had got in. I ask whether Labour would have actually hiked taxes because the logic of the previous speaker’s speech was about increasing taxes. 
Hon Darren Hughes 
: Why are taxes going up for people in Flaxmere? 
CRAIG FOSS 
: The gentleman who was the previous electorate member for Otaki asks why taxes are going up. He should turn to his left and ask that question of the gentleman who over the last 9 years was responsible for the greatest tax increase in New Zealand’s history. If he wants to make some further comment he should take a call later on. 
I still cannot understand the logic. If the previous member had actually said something along the lines that conditions are such-and-such and we need to maintain the status quo perhaps I would have found it logical. But when that spokesperson talks about multipliers I ask whether he is talking about hiking taxes. I ask what his policy is. Is his policy to hike taxes now? The logic of what that member just said totally contradicts what the previous Minister of Finance who is sitting behind him said in his Budget of May 2008 when he announced his first series of tax cuts. Dr Cullen himself is on record talking about ongoing personal tax cuts and now you are contradicting him. The factions and splits within the defeated Labour Party are starting to come to the fore. 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. I am sure you did not contradict Dr Cullen as this member has indicated. Mr Speaker the Hon Dr Lockwood Smith has indicated that he will be very strict on the incorrect use of “you” and I hope it will apply to the Government as well as the Opposition. 
CRAIG FOSS 
: I thank the member for bringing that to my attention. I apologise to you Mr Deputy Speaker. I will continue. 
We are starting to see some of the splits in the defeated Opposition come through. The Opposition members are contradicting each other on core policy contradicting each other on their vision of what may be needed to take New Zealand forward. This proposal the core policy in the Taxation (Urgent Measures and Annual Rates) Bill went before the public of New Zealand and 3 or 4 weeks ago over 1 million New Zealanders voted for it. 
I will make a couple of other points about something someone spoke about yesterday during the first reading. Opposition members talk about the debt to GDP ratio and someone made fair play of that yesterday. I would like to note that in the 1990s which the Opposition often talks about the previous Prime Minister Helen Clark would often talk about a debt to GDP ratio of 40 percent or even 45 percent at some stages as being prudent. Yes good global economic conditions took New Zealand’s debt to GDP ratio down to about 17 or 18 percent. In the Budget of 2008 it was around those levels. Of course as the skeletons started to come out of the closet and as the ticking time bomb started to tick louder we saw in the Pre-election Fiscal and Economic Update that it was forecast to nudge 30 percent I think with a decade of deficits. Of course those deficits have to be funded in some way. It is interesting that when I point that out the Opposition goes very quiet. 
I will raise two other points. Opposition members constantly talk about low-income earners. Well I will make just a couple of points. There are many low-income earners in New Zealand—the Opposition is quite right—and that is because of the last 9 years of a Labour Government. Incomes have come down somewhat compared with those of comparable economies around the world. That is why there are a lot more lower-income people in New Zealand than in comparable economies and that is why many of those people voted the National Party into Government and threw the Labour Party out. I would like the member opposite the Hon Darren Hughes who is interjecting to note that. 
Everyone needs a doctor at some stage. We all want police we all want chippies we all want plumbers and we all want good teachers. We want all those people and funnily enough all those people are on the highest marginal tax rate in New Zealand 39c. It is those people who have been leaving this country in droves for a brighter future elsewhere after the last 9 years of a Labour Government. That is why they have been going across to Australia. We all have friends family and whanau over there who are getting a higher after-tax income than they could get here after 9 years of the previous administration. Low-income earners in New Zealand have to pay more for their plumber chippie truckdriver—you name it—because they have all gone to Australia. We are trying to build an economy that is attractive enough to bring them home. 
I will make one other point. It has not been mentioned but it needs to be mentioned because there has been talk of debt funding etc. Somebody was talking about debt projections etc. Well I ask what the total quantum of the Accident Compensation Corporation (ACC) mess is. The people over there in Opposition must have a fair bit of knowledge of it. I ask them for the total quantum. I ask them to give it to us to the nearest $50 million. The Government accounts are not narrowed down to the nearest cent; they are approximate and there are contingent liabilities in there. You ask us for a debt projection; I ask you to put on the table all your knowledge about all the— 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. 
Mr DEPUTY SPEAKER 
: I know what the Hon Trevor Mallard is going to say. Members cannot use the word “you”. It brings the Speaker into the debate and that is not allowed. 
CRAIG FOSS 
: I apologise again Mr Deputy Speaker. 
I ask members opposite who have any knowledge of any other black holes of any other ticking time bombs to put them on the table. They should put them on the table so that we have full knowledge of them. Then and only then will you see the forward projections that you are demanding right now. I suspect that the reason you want those projections so badly is that you know there are more ticking time bombs to come. 
There are two questions left hanging. The ACC annual report did not have anything in it about this nonsense. Under the New Zealand International Financial Reporting Standards there is an obligation to put— 
Hon Trevor Mallard 
: I raise a point of order Mr Speaker. It is not your report. 
CRAIG FOSS 
: I did not say that. 
Hon Trevor Mallard 
: That’s exactly what you said. 
Mr DEPUTY SPEAKER 
: The member cannot use the word “you” or “your”. Please confine your debate to the subject and do not use those terms. 
CRAIG FOSS 
: Thank you Mr Deputy Speaker. I did not mean to use that word and if I did I apologise. I meant to say “the report”. 
Under New Zealand International Financial Reporting Standards which the ACC’s accounts and annual reports are prepared under this mess should have been noted. The Government accounts are prepared under those standards so the Pre-election Economic and Fiscal Update should have noted this mess—at least in the contingent liabilities. Where was any mention of the ACC mess? Where was anything about the Government Shared Network mess? What other messes have we got coming? 
New Zealanders should be very very fearful of the legacy of the previous administration. We are discovering more and more by the day and it is not a pretty picture. Members opposite are fighting old battles because they do not want to talk about the future and they do not want to talk about the appalling state they left the books in.