Budget Debate 
Budget Debate 
[Volume:673;Page:19109] 
Budget Debate 
Debate resumed on the Appropriation (2011/12 Estimates) Bill. 
STUART NASH (Labour) 
: 
 It was with interest that I listened to the last National member Nathan Guy give his talk because he spent 7½ minutes of his 10 minutes discussing the wonderful things that Labour will do when it becomes the Government after the next election. I would think that someone who is a Minister in this Government would have spent at least three-quarters of his time talking about what the National Budget was going to deliver for New Zealanders as opposed to what Labour will do for New Zealanders. But no he spent about only 2½ minutes on the Budget and 7½ minutes on Labour’s manifesto. I am pleased that it has gripped him. I am pleased that he sees the wisdom of it. We will just reinforce his message that the things that a Labour Government will deliver will benefit all New Zealanders not just the very very few at the top. 
There are only three points that I would like to make in this speech. The first one is that this Budget is based on a whole lot of assumptions that are simply not correct. The second point I will make is that there is a $4 billion difference in the revenue figures over 5 years between the Inland Revenue Department and Treasury and that is something we should be really concerned about. The third point is that I would like to outline after Nathan Guy did what Labour will do to rectify the dreadful situation we have found ourselves in. 
The Budget as read last month is of concern for a number of reasons. We have heard about cuts to KiwiSaver and Working for Families. Those are just two examples where the Government has yet again taken money from those who can least afford it. For example in the Hawke’s Bay region Working for Families contributes about $120 million a year to the local economy. Taking money out of the pockets and therefore out of the stores and services of the economy which is already going backwards under this Government is simply not a way forward for the people of Hawke’s Bay. In fact the bay is going backwards under a National Government. This is of huge concern to me as well as to a number of constituents who have come into my office and people whom I engage with everyday. 
There is no plan for growth in this Budget. There is no incentive for businesses to seek export opportunities. There are no plans for addressing the massive inequality that has crept into society over the last couple of years. In large measure the tax cuts of $25 billion are seeing the most wealthy citizens do incredibly well but the vast majority who have seen an increase in the cost of living receive next to nothing. They have not been adequately compensated. I think the thing that really epitomises this is that the 600 to 700 New Zealanders who earn $1 million a year received a tax cut of $1000 a week yet someone on the median wage got about $10 a week. The level of unfairness around that is so stark as to be obscene. 
Bill English said in his speech that the Government was going to create 170000 jobs. In fact many of the National speakers have reiterated that figure of 170000 jobs. No one in this House wants to see that more than me. I would love to see 170000 jobs created. When the Minister of Finance was questioned about where those jobs would come from he had no answer. He simply had no answer. Then he said that there had been a commodity boom and he thought that that would create jobs. 
Let me give one example. In the forestry sector international log prices have boomed. It has been great for forest owners but it has caused immeasurable concern for our local processors. The Minister of Forestry is well aware of this. What is happening is the domestic industry simply cannot afford to purchase logs at an export parity price. So instead of jobs being created in the forestry sector jobs are being lost. I am not saying we should subsidise this at all. I am not saying that at all. I am merely pointing out that a commodity boom is not creating jobs. We are not going to see 170000 jobs created in this economy because of a commodity boom—quite the opposite. 
Let us have a look at the farming sector if we may for a second. It has $42 billion worth of debt—$42 billion worth of debt. This is of such concern to the Governor of the Reserve Bank that he has increased the liquidity provisions around rural debt. I do not think there are going to be many jobs created in the rural sector because of the commodity boom. So the question I have is where these 170000 jobs that Mr English said would be created out of the commodity boom are going to come from. There are not going to be any. This is a “borrow and hope” Budget. Not even the Minister of Finance himself can tell us where these jobs will come from. 
My second point is around the significant difference between the revenue forecast of the Inland Revenue Department and that of Treasury. Treasury’s revenue forecast is $4 billion higher than the Inland Revenue Department’s. I have had dealings with the department over the last couple of years through the select committee process and through my spokesperson role in the revenue portfolio. I can say that I have found Inland Revenue Department officials to be very reliable diligent and hugely competent. When they undertake forecasting I trust their numbers because they tend to be prudent if not slightly conservative. We are talking about the Government’s tax collector here. It is a department that has spent literally millions of dollars over the last couple of years on new systems and it is a department that understands tax and revenue because that is its role. Treasury officials however in my experience over the last 2 years have often been far too aggressive in their forecasting regularly overstating revenue predictions—much to the anger no doubt of the relevant Ministers of Revenue and Finance—and have often got it wrong. So when the Inland Revenue Department and Treasury differ by $4 billion we should have grave concerns. We should have absolutely grave concerns because $4 billion is a significant amount of money. I for one cannot understand such a discrepancy and why the Government went for the outrageously high number rather than the conservative figure. 
This demands a huge “please explain” from the Minister of Finance but he refuses to justify the assumptions behind the Treasury figures. Instead he states that there may be risks due to this discrepancy. There may be risk. That is the understatement of the decade. There is huge risk. This is very much a “borrow and hope” Budget without a plan. If this was a business plan presented to a board it would receive a fail mark. It would be thrown back at the chief executive officer and he would be told to sort it out because it was not good enough. I suspect that if the people of New Zealand were that Government’s board they would say the very same thing to Mr English on 26 November. 
My third point is that Labour has a plan. Labour has a plan for growth—for business growth and for social well-being—and it does not include selling State assets. That is not a plan for economic growth. What we are going to see over the next 5½ months is a series of well-costed initiatives rolled out that will create a vision and capture the imagination of the people of New Zealand. They are not going to be negative policies. They are not going to be selling State assets they are not going to be cutting KiwiSaver and they are not going to be taking money out of the pockets of those who can least afford it. 
There are three points I have made in this speech and three points I would like people to take out of it. The first point is that this Budget was based on assumptions that could not be quantified and the No. 1 assumption is that 170000 jobs will be created. We have seen absolutely no plan for where those jobs are going to come from. The second point is that there is a $4 billion discrepancy between the revenue forecast from the Inland Revenue Department and the revenue forecast from Treasury and that is hugely worrying. The third point is that Labour has a plan; this Government does not. Labour has a plan. Thank you very much. 
Hon DAVID CARTER (Minister of Agriculture) 
: 
 It is a pleasure to take part in the Budget debate and a particular pleasure to follow the Labour member Stuart Nash because he is the man who ran the despicable story about dairy farmers not paying enough tax. He is the man who has singlehandedly made sure that every farmer in New Zealand votes National on 26 November. That man went out there and said that dairy farmers do not pay tax. He picked 2009 the year of the drought the year of Fonterra’s lowest payout in recent years—in fact many of the farmers he talked about had actually been entitled to a tax refund in that year—and he compared their gross income and stupidly foolishly suggested that dairy farmers should pay tax on their gross income not their profit. Well that shows how out of touch that Labour member is. It shows how out of touch Labour is with the farmers of New Zealand. 
Then Mr Goff did better than that. He had a big conference here in Wellington. Mr Nash might have gone to it although I understand that as soon as he could he flew to Argentina to get away because he was not prepared to show his face in New Zealand. Ronnie Biggs did that. Ronnie Biggs went and lived in Buenos Aires; at least Mr Nash came back to face the music. Mr Goff then announced Labour would bring agriculture into the emissions trading scheme in 2013. Why? Because it is having trouble with its budget and it needs $800 million. That is $23000 per farmer—and it is no problem when one has annoyed every farmer in New Zealand by telling them they do not pay tax to then tell them they will be expected to front up and pay $23000 per sheep beef farm and dairy farm so that Labour can fund some other research and development tax credits. That was the policy of Mr Goff. I have no doubt Mr Nash helped to put it together because he is the spokesman on revenue. 
I say to the farmers who are listening tonight because  
Coronation Street 
 is boring that they should mark my words. Labour is talking about having a capital gains tax Labour is talking about bringing agriculture into the emissions trading scheme in 2013 at a cost of $800 million to that industry and Labour will restore the envy tax. That is the tax where according to Mr Nash and Phil Goff anybody earning over $60000 is rich and should pay a higher rate of tax. Well I am proud of what this Government has done with tax. We now have two-thirds of taxpayers in New Zealand paying a top tax rate of 17.5 percent. 
I acknowledge the valedictory speech made by John Carter before the dinner break. He has been a tremendous parliamentarian. He was the person who supported me through my by-election in 1994 and he made sure he gave me every support to get in here. We will miss John Carter for his humour for his hard work and for his absolute dedication to this House. 
I acknowledge that Budget 2011 was a tough Budget but it was a Budget for the time. It was a not a typical election year Budget. We did not hand out lollies like that Government did in 2005 that this country is still paying for. [ 
Interruption 
] We were fiscally responsible something that Mr Nash and Moana Mackey would not even understand. This was a Budget for the times. 
I still remember and I will never forget for as long as I am on this earth Michael Cullen crowing when he opened the books before the last election saying: “It doesn’t matter who wins; 10 years of Budget deficits.” That is the mess the legacy that that Labour Government left to this country. Full marks to Bill English full marks to John Key and full marks to this National caucus because we have got that deficit back and we are predicting Budget surpluses in 2014. That is a lot better than what the Labour Government left and those members should be silent and ashamed of themselves. 
This Budget also made a tremendous contribution to Christchurch. We are still struggling particularly after Monday at about 10 a.m. when we got another 5.8 aftershock. This Government has made a commitment of a total $8.8 billion booked in this Budget with $5.5 billion associated with the rebuild of Christchurch. The Labour members of Christchurch continue to go around looking for hard luck stories and trying to criticise this Government but I can tell Mr Nash they are on a loser. The people I am talking to respect the commitment of John Key and the National Government to Christchurch. The Budget of 2011 was about economic growth. History will show if Labour ever wants to look at history— 
Hon Shane Jones 
: One example of economic growth. 
Hon DAVID CARTER 
: Shane Jones should look at history before he is history. The tradable sector of the economy went into recession in 2004. That was long before the world had heard of the global financial crisis. 
Stuart Nash 
: Rubbish! 
Hon DAVID CARTER 
: Mr Nash denies it. Still today he denies that the tradable sector was in recession in late 2004. Mr Nash hangs his head in shame and I do not blame him because he should be ashamed of that performance. What we now have is an economy coming out of recession led by the agricultural sector which Mr Nash hates. He hates the farmers he is full of jealousy and he is not the only one on that side of the House. Those members all hate the farmers. It is the politics of envy as displayed by Mr Nash recently. 
What we now see is this year’s GDP growth at 2 percent—not good enough—next year’s at 4 percent and building from there on. This Budget builds on the productive base of this country which is the agricultural sector. 
Hon Steve Chadwick 
: That’s fairy dust. 
Hon DAVID CARTER 
: It was Labour I say to Steve Chadwick that termed agriculture a sunset industry. I ask whether Steve Chadwick remembers that. She would have finished school by then. In 1988 David Lange called agriculture a sunset industry. Well the farmers of New Zealand have not forgotten and I will make sure that they never forget Labour’s commitment to agriculture. 
I will talk now about one specific announcement about water that was in the Budget. It was announced a week before the Budget itself. It is this Government’s commitment to the sustainable use of water. Water is New Zealand’s greatest primary sector competitive advantage and as a nation we have made a mess of utilising that resource for a long time. In the Budget we have tagged $35 million to encourage the development of agricultural schemes. We signalled that we will put $400 million into future investment in irrigation schemes. 
Hon Member 
: How much? 
Hon DAVID CARTER 
: Four hundred million dollars. But it will not be irrigation at all costs. We announced a national policy statement on water quality and quantity—something that was not done by the previous Government despite 9 long years of promises to do so. Finally we announced an enhancement scheme. This Government with the enhancement scheme announced in the Budget will now commit a total of $268 million to tidying up some of the degradation of our water. 
This was a Budget for the times. I am proud that we are fiscally responsible. We made changes to KiwiSaver. Mr Nash talked about us cutting KiwiSaver. Well we have made a change to the tax credit. 
Hon Steve Chadwick 
: You’ve decimated the scheme. 
Hon DAVID CARTER 
: The member’s tax credit has been cut by half—from June next year I say to Steve Chadwick. We are telling the people of New Zealand to go and vote with that information and if they support the National Government and its progress on a growth agenda rather than the politics of envy from the other side to vote accordingly. 
At this stage the polls suggest to me that most New Zealanders are being very fiscally responsible. They know this country has overextended. They know this country went into recession in the tradable sector in 2004 under the mismanagement of Helen Clark. They know that Helen Clark still texts members of the Labour caucus on a regular basis to give them instructions. It is no wonder that Labour is still polling at about 20 percent. 
Until Labour members detach themselves from the failed policies of the past decade they have no show of delivering to this economy the economic growth that will give New Zealanders the standard of living they deserve. I am making sure as a member of the National caucus and the National Cabinet that this Government continues to focus on economic growth and on the standard of living of all New Zealanders. 
Hon SHANE JONES (Labour) 
: 
 Kia ora ano tatou. First I support a tiny part of what the previous speaker David Carter said—that is the part about Mr John Carter the long-suffering representative of Tai Tokerau or I should say Northland. He has demonstrated in my case that the person to beat him from my side of the House is yet to be born. I say that with a fair level of affection because John Carter has been a very diligent local MP since the 1980s after he replaced Mr Austin in rather controversial circumstances at the time. But things all move on. Unfortunately that is where I part company with the previous speaker. I am disappointed that the Minister of Agriculture could stand and deliver such a pigheaded and arrogant speech. I know he believes that he is the best Minister of Agriculture. He constantly derides Mr Anderton. But Mr Anderton could call a meeting anywhere in this country and more people would show respect to Mr Anderton than to that Minister. 
David Carter demonstrated why he and his colleagues on the basis of this Budget do not deserve to continue to govern after the election. They believe as is evident through his superciliousness they have a born-to-rule manor-derived perpetual right to enjoy power. I accept that some of the metropolitan members of Auckland who have recently declared war on Mayor Brown over his railway proposal—I will come to that in a moment—have a more balanced view than Mr David Parker. This is a man who is about to deliver like Mr Joyce— 
Hon David Carter 
: I agree. 
Hon SHANE JONES 
:—Mr Carter—another subsidy in terms of water reform to a group. It should be made to pay. If the State is to allocate funds to develop water storage and water harvesting the primary beneficiaries of that should be made to pay. In the context of the fisheries industry when changes are made the holders of those property rights pay. Why should the favoured caste of friends of the Minister of Agriculture Mr Carter in the South Island expect to enjoy an open cheque book? 
I accept that Telecom as a consequence of not only this Budget but also Mr Joyce’s meandering will get an open cheque because of an ill-conceived broadband proposal. But if one is to open up water for wholesale exploitation then those whose land values will rise remarkably those whose production will grow significantly ought to be made to pay their fair share. It is not acceptable that those who have the ability to pay and who will enjoy a tax-free capital gain on their land all of a sudden should gain access to a significant amount of the Crown’s largesse in order to create water capacity. 
There was a brilliant opportunity for the Government to put into practice what it preaches about the virtues of private enterprise. There was no commitment to facilitate the use of private enterprise capital which is what should really underline the proposal. There was absolutely no desire to deal with the property rights issue which I can assure members will arise once the Government starts to treat water as a tradable property right with a perpetual character to it. I can see now that iwi will be the first to flee from the very timid and quite hopeless in all honesty water forum which delivered something that was very quickly diluted by the Minister for the Environment anyhow. 
The Minister of Agriculture points to the Budget as being one that provides a platform from which to propel the development of agriculture. On that point it represents—unless he has misled himself or we have misconstrued what he said—a new subsidy for a group of New Zealanders who always will have us believe that they do not like subsidies. I say that if we are to extend water infrastructure into the productive base of New Zealand’s agricultural economy we should make the water users pay for their fair share. I guarantee members that the moment that the Government moves to give a private character to water we will be looking at the next rout of seabed and foreshore politics. It will be a rout for any Maori group that supports that Minister to further privatise water. That is very disappointing yet again at a time when we should be talking about the issues that afflict the daily lives of Kiwis—that is the absence of their savings the cost of living the absence of jobs and no clear distillation of where the new jobs will come from for young Kiwis. They will certainly not come out of this Budget. 
I turn my attention to the Minister of Transport Steven Joyce. A certain acronym is applied to his style of politics but for fear of joining the rather rude company of John Carter I will not elaborate on the acronym. Steven Joyce is a man who has sent hate mail to Auckland. This is a man who has said to those Aucklanders who enjoy between eight and nine million rides on the train each year that he knows better than them. I accept that a degree of confidence and a degree of robustness in politics is what we look for but I think that this Minister has completely overreached. He has sent a very disappointing highly ideological and deeply personal response to Aucklanders. Admittedly it was directed to Mayor Brown. The reason that Steven Joyce does not like Mayor Brown is that although the Government backed the super-city it dislikes the leader of the super-city. The leader of the super-city wishes to follow through on his vision and develop based on a vision for the future an Auckland that can cope with the anticipated geometric rise not only in people but in economic activity and the inevitable arrival of vehicles involving all the challenges of transport. 
Let us just see what the Minister of Transport did. In this Budget the Minister of Transport after providing a gift—and good on them in Wellington—has stuck the ratepayers of Auckland with a $500 million bill. The exact opposite has been done by David Carter. He is seeking to distil a similar amount of money and hand it over as a gift to his friends in the South Island. That will not go unimpeded by members on this side of the House. So Mr Joyce has delivered a $500 million bill. Then he claimed all the credit for the electric trains which were Labour policy. What did he do and say after international experts had been secured by Mayor Brown in the super-city? He said the plan could progress in terms of statutory designations if the people of Auckland paid for it but the plan was one that he found distasteful the plan was not one that fitted his vision of Auckland and the plan would never be funded in the foreseeable future by his Government. 
That is why National’s polling is telling it that Steven Joyce and a number of his other colleagues are burning electoral support in Auckland. They are not burning electoral support because those voters in “Strugglers’ Gully” have given up on them; they gave up on them a long time ago. They are now eating into the core support of those Aucklanders who No. 1 want to have a modern city and a modern transport system that includes rail. They know that the price of gas is going up. They know that more Aucklanders need to use public transport so that they can witness an improvement in the way that goods and services are moved around the city. They want to see a city whose full potential will be realised in the next 30 40 or 50 years. It is a tragedy that this Budget is silent on that matter; and it is conspicuous in that it stings Aucklanders with the new $500 million bill whilst at the same time delivering an unfathomable subsidy to Telecom—the corporate friend of the Government—and to a certain narrow caste of farmers known to Mr David Carter. 
For that reason the Budget in the key area of transport infrastructure which is a lifeline and an economic connector fails. The sooner that more Aucklanders and more New Zealanders realise that this man this transport Minister has a tunnel vision of what he sees as the future the better it will be. But woe betide any politician or any member of the Auckland community who might try to challenge Steven Joyce. That is why his pigheadedness rudeness and superciliousness are a sign of the past and the sooner that he joins it the better it will be. 
CHESTER BORROWS (National—Whanganui) 
: 
 I rise to take a call in this Budget debate and I want to place on record my grateful thanks for the support and encouragement of the retiring member the Hon John Carter for the help that he has been to me personally as a junior member of this House previously as a candidate in several elections and as a fellow member of the Parliamentary Rugby Team and for being an all-round good mate. The House will be the poorer for seeing him head away from here and off to the Cook Islands in his new role as the High Commissioner to the Cook Islands. We are grateful for the legacy that he has left within the National Party particularly within the Northland electorate. So our thoughts and our care go with him and with Leoni. 
Tonight I want to speak about the recent Budget and the plight of young children in our country especially those who are the most vulnerable. I am pleased to see that young children in care have been given some significant encouragement and some ongoing support. The Budget directs money to young kids in the care of the State and I want to underline the huge responsibility we have as the State to care for the young who are far too vulnerable and far too at risk to leave in their own homes. As a person who has removed children from their homes I have been witness to the agony of making the decision as an agent of the State to remove a child from the care of his or her parents. It is done knowing that those parents love that child as much as they know how to love knowing that they care as much as they know how to care and knowing that in many respects they lack the skills necessary to be able to raise a child in the manner in which he or she deserves to be raised. 
When one has been confronted with the hurt and the pain while recognising as a parent the agony of what it must be to have your children taken from you one removes those children only as a last resort. We have about 5000 children in the care of the State at present and until now we have done very little to understand what their drivers their inhibitors and their risk factors are. This Budget provides $43 million to assess medically mentally and educationally the children who are in the care of the State. 
Of those whom we did assessments on—and this is only those with severe enough behavioural problems that flagged the need to do that assessment because until the provisions of this Budget assessments were not done as a matter of routine—we found some horrifying home truths. We found that 65 percent of those children had emotional and behavioural problems 41 percent had mental disorders 41 percent needed dental health treatment that had been withheld from them and 37 percent could not hear properly. Even without assessment we knew the plain obvious and terrible truth of those children: 50 percent had parents with drug or alcohol problems; one in four had a mother with a criminal conviction; one in five had a parent with a mental disorder; only half of children in care ate breakfast before they were placed into the care of the State; and half of all youth suicides in this country—God’s own country—were inflicted by children in care. They are killing themselves because we the State have failed to offer sufficient hope for those young people to see that their crack at life has a chance of success. 
It is not a surprise to look at the statistics. A child who has a parent who has been to jail has a seven-times-greater chance of growing up and going to jail. A child who has two parents who have had a custodial sentence has a 15-times-greater chance of growing up and going to jail. But a child growing up in the care of the State has a 17-times-greater chance of growing up and going to jail. The National Government does not accept failure on that scale. It rejects it and it has provided in this Budget the ability to bother about the kids who are in care to care enough to make those assessments and to find out the drivers of their situation and the inhibitors to their progression. 
Two weeks ago the Social Services Committee took its inquiry into child and youth offending to Australia as part of the committee exchange programme and we met with several Government agencies and 16 non-governmental organisations over 5 days. Australia struggles with similar risk factors and indicators of failure that we do in New Zealand. They fail their indigenous people especially the young in similar ways. They are gradually waking up to the fact that the ways of the past are failing the most vulnerable in their care. In New South Wales and in the Northern Territory 100 percent of Aboriginal children in the care of the State will go on to go to jail. 
We would think that given the wealth resources and responsibilities of the State a child committed to the care of the State would be better placed to succeed to live with more hope to have more aspiration surrounded by more care and more protection to have better health outcomes and to have better socialisation than another child because in spite of the rough start that they have had the focus of the State agencies is concentrated upon them. But it is not. In fact it puts them in a greater risk of danger. It places fewer protective factors around them and opens them up to even greater risk factors. I can say at this time thank goodness for a National Government. Children who are in the homes of the State can look forward under a continuing National Government to better care better situations and better prospects than what they have had until now. 
National is confronting child abuse. We are encouraging New Zealand to debate how we nurture and protect our children. Our green paper on children will invite Kiwis to have their say before forming a children’s action plan. It will help foster children to get a home for life and support to help parents and foster children into permanent care. Last year saw the launch of the Home for Life package by our Minister for Social Development and Employment the Hon Paula Bennett. It gives those foster parents who are prepared to commit long term to young people in their care the certainty of support from the State and the knowledge that they will not then be cast off and left alone. The support is not only financial but also emotional. It is ongoing in that they are able to call back to the State at any time. It ensures that things are in place such as respite care to ensure that foster parents get the breaks they needed so they can gather themselves and regroup because the commitment they have made to these young people is ongoing and for ever as far as that young life is concerned. 
In health there is more maternity support with a focus on first-time mothers and a 24-hour PlunketLine that is fully funded. We have seen PlunketLine under threat under previous Governments. We need to acknowledge this one fact: in this modern world that we live in we can identify an at-risk foetus. We have quoted it in this House before; I have done it myself. We can recognise an at-risk foetus. We know that the mother of a young child who grows up to fail in all those areas of social policy of a young child who grows up and goes to jail was pregnant at a very young age. She was pregnant three times before she was 20 probably to different fathers. We knew that she left school with no qualifications and she is either working on the lowest wage or she is on a benefit. We know that she smokes tobacco. We know that she is dependent on alcohol and probably some other substance. We know that she has no positive role models acting in the role of a parent or a mentor as far as parenting goes. We know if we can identify dad that he comes from the same demographic. 
We know that about 3 years ago this world with all its collective wisdom landed a spaceship on Mars yet it tends to do nothing about the early identification of the young people we know are most at risk. Thank God that this Government through this Budget is doing something about it. I am proud to be part of that Government. 
MOANA MACKEY (Labour) 
: 
 Tena koe Mr Assistant Speaker Robertson. Thank you very much for the call. I too put on record my congratulations to the Hon John Carter on his valedictory speech tonight and his new post in the Cook Islands. I think it is testament to the relationships he has had with people all around this House that any one of us could have added another three or four stories to the stories he told in his speech today. I wish him and Leoni all the best. 
I have sat through a lot of Budgets in my life. I am not ashamed to admit that since about 1993 I think I have seen every Budget live either up in the gallery or here in the House. I would take the afternoon off work or university and come to watch it. Without a shadow of a doubt this was one of the worst Budgets I have ever seen in my life. It was bad on a number of levels. I will make a few comments about the speech from Chester Borrows. I do not doubt at all his sincerity. I do not doubt that at all and I do not doubt at all his desire as we all desire in this House to see the terrible ramifications of child abuse and of violence against children mothers and families dealt with in a way that actually delivers results. But it astonishes me for him to stand there and not realise that the changes his Government has made over the last 3 years—changes that were very much brought home in Budget 2011—have made things only harder for the very families and children he was talking about. The people he was very eloquently defending and discussing in terms of what needs to be done are the very people who are hurting the most. The problems he outlined have only got worse under this Government’s watch. So although I do not doubt the sincerity of his comments at all I really am just astonished that there is this complete disconnect from reality with National members. 
National members just cannot understand the damage that is being done in our most vulnerable families. I take one example: family violence prevention cuts. If the Government is really serious about child abuse about the impact on children of witnessing violence why—why—would it cut family violence prevention funding and funding for Women’s Refuge? Women’s Refuge funding was cut. I do not know whether it is a deliberate disconnect; I do not know whether those members just do not get it. But I would love to see some kind of backing-up of the very fine words we heard from Chester Borrows—words I believe we all very very passionately agree with but are I am afraid just empty words when we look at the actions of this Government over the last 3 years. 
This Government confirmed however that there is no plan. There really is no plan. We said last year we did not think there was a plan we said 2 years ago we did not think there was a plan and this Budget confirmed that there is no plan. We need judge this Government only on the benchmarks it gave itself. What was it going to do? Firstly it was going to close the gap with Australia. Where did that benchmark go? The Government has stopped talking about it. It does not talk about closing the gap with Australia. Number two: we were going to be aggressively coming out of recession 18 months ago. No one talks about us aggressively coming out of recession any more. 
Chris Tremain 
: Yes they do—4 percent growth. 
MOANA MACKEY 
: “Four percent growth” says Mr Tremain. This week—2 weeks after the Budget—Treasury has already had to say as Labour was saying on the day of the Budget that the Treasury figures were overly optimistic they were fairly fluid and flexible and in fact it has now had to downgrade them. Two weeks! We had the Budget only 2 weeks ago yet Treasury already has to pull the figures back in and say what Labour was saying on Budget day which is that those figures were absolutely untrustworthy—absolutely untrustworthy. Where will these 170000 jobs come from? Jacinda Ardern pointed out that in last year’s Budget the Government promised 170000 jobs—or a bit fewer than that number. Well they did not appear in the last financial year. They are being promised again but there is no plan. There is no plan. 
Chris Tremain 
: They never promised 170000 in one year. They beat the forecast as you know by 10000. You don’t like that. 
MOANA MACKEY 
: We actually have to do something if we want to create jobs I say to Mr Tremain. We actually have to do something. Just wishing jobs up out of thin air will not do anything. 
National members really love rewriting history. It absolutely kills them that they inherited from the last Labour Government an economy that had zero net debt which the IMF and Bill English said put us in a very very good position to weather the recession. When National took over Government and inherited low unemployment and low Government debt—because Labour had resisted National’s continuous calls for tax cuts and saved for the rainy day—what did it do? It squandered it. The legacy of this Budget is a $17 billion deficit that has grown on this Government’s watch—seven or eight times what Treasury predicted it would be when National took over in 2008. What happens to personal responsibility? All of a sudden it is everyone else’s fault. It is not National members’ fault that they have not done anything for 2½ years—not a single thing! The Australian Government had an enormous economic stimulus package $5 billion of which was housing. It has added 20000 State houses to its social housing stock. It has done up 80000 more. It kept builders in business. It kept income tax flowing from those workers. It kept GST flowing from the houses built. What did we do? Nothing. The Government brought forward by 6 months some projects that Labour had already agreed to fund. 
Let us look at housing in this Budget. If we really want to see an area that shows that there is no plan and that the emperor has no clothes we need look no further than housing in Budget 2011. The Minister of Housing Phil Heatley put out a press release saying that there is a $45 million contingency fund for the community housing sector. Great news. But when we actually look at the numbers we discover that in fact the overall housing budget has been cut. Out of that $45 million Housing New Zealand Corporation has to carve back and suddenly find $21 million so that it can pay a higher dividend to the Government. The Government has increased the dividend from Housing New Zealand Corporation by $21 million so that money has to be found elsewhere. We also find out that about $30 million worth of programmes have been cut including the Housing Innovation Fund. The day before the Budget the Minister of Housing did a question to himself—a patsy question—in the House saying what a great scheme it was all the time knowing that the next day that scheme would be gone in Budget 2011. 
The Rural Housing Programme another great Labour initiative we thought the Government supported is gone. Then there is the Healthy Housing programme for Housing New Zealand Corporation to insulate State houses. We all remember the song and dance routines we used to get from the Minister of Housing Phil Heatley. He used to jump up and down about what a great Minister he was and how terrible Labour was conveniently ignoring the fact of course that he had hocked off 13000 State houses when National was last in Government and had carried out no modernisation and that Labour had spent 9 years repairing that damage. Let us just rewrite history on that front as well! The fact is that all those programmes are gone. Housing New Zealand Corporation will have to come up and find this $45 million that apparently will be given to the community housing sector. We do not actually know that. Then Minister Phil Heatley says the money will not go to some of the niche providers. They will have to find money elsewhere. I would like to know who the niche providers are. I visit a lot of housing organisations and I would like to know. Is the Salvation Army a niche provider? Is the New Zealand Housing Foundation a niche provider? Is the Community of Refuge Trust a niche provider? Is the Nelson Tasman Housing Trust a niche provider? Is Habitat for Humanity a niche provider? Is the Queenstown Lakes Community Housing Trust a niche provider? Is Monte Cecilia Housing Trust a niche provider? If they are these people will not get the money. The amazing thing about housing in Budget 2011 was that there was no detail. In fact there was only a contingency fund. The money has not actually been appropriated yet and it will be up to $45 million. The big question is what will be cut at Housing New Zealand Corporation to pay for that $45 million because there is no new money. In fact the money has gone backwards. I can tell the House right now that State housing and State house tenants will bear the brunt once again of this Government. 
David Carter talked about the politics of envy. Apparently when people on low incomes see a Cabinet Minister giving himself hundreds of dollars worth of tax cuts every week and say that that is not fair Mr Carter calls that the politics of envy. He is nodding. Well I tell the Minister that those people are not envious; they are angry. Perhaps if the leader of National got out and visited a food bank once in a while or went back and talked to State house tenants about just how great this Government has been for housing then maybe Mr Carter would not make offensive statements like that. I tell Minister Carter that people are not envious; they are hurting they are struggling to put food on the table they are struggling to keep a roof over their heads they are struggling to pay for the basics for their kids and they are angry. They know that a Government that prioritises tax cuts for the very wealthiest New Zealanders which are paid for by the very poorest is not fair. Labour says that is not fair and we think it is time that some of that balance was put right. We think it is time that the hard-working families in this country—the families that Chester Borrows talked about who are struggling to raise children in difficult circumstances—get a little bit more than just nice words from this National Government. We may have a Prime Minister who is very good at the photo opportunities and who is very good at smiling and waving but when it comes down to it and when we go out and talk to people who are really suffering we find that this Budget does a lot of damage. As Phil Goff has said this Budget does not help but it does hurt. 
Hon Dr JONATHAN COLEMAN (Minister of Immigration) 
: 
 I will start by paying tribute to the Hon John Carter who gave his valedictory speech in this House today after 24 years of fantastic service to the people of Northland and the New Zealand Parliament. I certainly wish him well in his new post as High Commissioner in the Cook Islands. 
While I was listening to the previous speech I was thinking whether it was showing us where Labour is going wrong. When we listened to the member Moana Mackey we heard a very garbled economically illiterate message poorly crafted in a totally unsaleable way. I was thinking that if we sent that member out to my electorate of Northcote on the North Shore of Auckland sent her down to Birkdale where people are not having the easiest of economic times but actually understand what this Government is trying to do we would find that that member with that message would be met with completely blank stares. There is a fundamental disconnect between the message that that crowd on the other side of the House thinks is saleable in New Zealand and the message that the people of New Zealand are actually hearing. People have seen with this Budget that we have a Government that has a clear direction that knows it has to balance the books and that is predicting clear economic growth in the years ahead. If people want a simple message it basically is that next year we are halving the deficit we are halving it the year after and then it will be gone. Who can argue with that? 
That member was talking about families struggling and families who are angry. Well I tell you what— 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Order! 
Hon Dr JONATHAN COLEMAN 
: —I tell one what—they will be pretty angry if they get a Labour-Greens Government. They will be pretty upset because in actual fact the cost of living will go through the roof. A Labour Government would put up tax rates and it would cripple our prime export earner farming with a punitive emissions trading scheme that would come in 2 years early. I tell the House that the average person in New Zealand will find it very very difficult under a Labour Government because Labour has absolutely no plan. 
But we see under this Government and we see here in this Budget a clearly laid out manifesto for the coming election. It shows that we will be getting rid of debt and growing jobs—170000 jobs. The Prime Minister in question time today clearly laid out where those jobs will come from. We will see more money going to the more vulnerable growth in vital public services and New Zealand returning to prosperity. Quite clearly the public of New Zealand will have a choice at this election. They will be able to choose between the sound economic management of a proven Government with a Minister of Finance who has delivered a fantastic sensible Budget that will get this country on the right track and with a Prime Minister who has worked in world business in the money markets and who knows how economies work and in contrast Phil Goff who has promised $5 billion in unfunded spending promises which that crowd over there should they ever retake the Treasury benches will be expecting the public of New Zealand to fund. 
What is even worse is that Phil Goff does not understand the details of his own policy. When he announced a research and development tax credit of $800 million he did not understand that fundamentally one cannot cap a tax credit and when it is actually fully priced out we find we are talking about $1.55 billion. So why would the public of New Zealand trust the possibility of a Labour Government whose members do not understand the books and who do not understand their figures when they know that under National things are getting better all the time? 
If members want to talk about a party rewriting history I note that those people over there keep on saying that the tax cuts were for the rich. Well the fact of the matter is that two-thirds of the tax cuts went to the lowest two tax bands; 75 percent of the tax cuts went to two-thirds of the population. So we can see that it is not actually as those people—[ 
Interruption 
] Members opposite get so angry because they do not like to be contradicted. They think they will be able to go around the country telling what one frankly could generously call untruths like that the tax cuts were for the rich like that we are selling assets when they know their talk is actually just a falsity. 
The question that the public will have to answer is if we do not progress with the mixed-ownership model which will raise between $5 billion and $10 billion how will those guys over there make up the difference in revenue? How will they do it? The revenue spokesperson should get up and say. Well the clear answer is that Labour would borrow more and more. It is not focused on the deficit and it is not focused on reducing debt. It is focused on borrowing more money so that it can fund more election promises. That is a reckless plan for economic failure. 
Moana Mackey was trying to make out that the last Labour Government left the books in a decent place. Well if we look at the fact that it spent $1 billion to buy KiwiRail we see that was nothing short of economically irresponsible for an asset that we would now struggle to get $100 million for. To think that the last Labour Government did anything other than fund election promises would be absolutely wrong. That is what it did all the way through. KiwiSaver had become unsustainable Working for Families was completely unsustainable and student loans were unsustainable. We have had to shape that back into a decent package that is sustainable and affordable for New Zealand in the long term. We can ask people in the streets; they know that we are on completely the right track. 
Hon Steve Chadwick 
: And it’s ageist. 
Hon Dr JONATHAN COLEMAN 
: Someone over there claimed that the student loan measures are ageist. I tell members that for every dollar lent to people over the age of 55 the State was getting back 3c. But suddenly because we have made a change to make the policy affordable we are ageist! Actually we have been completely practical about this and I can tell the House that in the long term people will thank us. 
If members want to look at how well the economy is actually doing I tell them that last month was a record month for New Zealand exports. Exports exceeded imports by $1.1 billion which is the biggest margin for a month in the history of New Zealand. Commodity prices are going through the roof and that is great for the New Zealand economy. 
Stuart Nash 
: That’s because the country is in recession. 
Hon Dr JONATHAN COLEMAN 
: I feel sorry actually for really practical people like Stuart Nash who is left over there. He knows what is going on but he has the sad job of having to get up day after day and put up incorrect arguments to back up his failing leader Phil Goff. He is a loyal guy but he knows that he will go down with the sinking ship. The major danger over there at the moment—I know that Mr Assistant Speaker Robertson has a safe seat—is that half of those members will be gone. 
Darien Fenton 
: You wish! 
Hon Dr JONATHAN COLEMAN 
: As those polls continue to decrease people like Darien Fenton will get more and more desperate. They will be calling for more and more left-wing extreme socialist policies to try to shore up the base and the harder they try the lower they will go in the polls. 
Let us look at some of the really positive spending initiatives in this Budget. Health will receive $2.2 billion over 4 years. What an amazing difference we have made in health with 1000 extra nurses and 500 extra doctors since this Government came to power. 
Hon Steve Chadwick 
: People are getting sicker. 
Hon Dr JONATHAN COLEMAN 
: That is not true. Mortality and morbidity rates have improved over time. Steve Chadwick knows that; I do not know why she would say something so ridiculous. New Zealanders no longer have to go to Australia for cancer treatment under this Government. There are 400 extra operations per week. The last Government culled people off operation waiting lists. Education will receive another $1.4 billion over 4 years. Members opposite will spread the falsehood that early childhood education funding has been cut but actually it has gone up by $550 million. Kindergarten teachers are getting a pay rise. 
We can see the theme: clear progress is being made the economy is growing and Treasury is predicting jobs to come. If members think Treasury officials are being optimistic they should go and talk to them for a while because they are economically some of the most pessimistic people one could ever meet. Talk to any bank economist and their forecasts for job growth are even higher. 
The crowd opposite will go around feasting on a diet of gloom and doom. They will tell New Zealanders how bad the situation is but ultimately they cannot fool the people. The people know who is on the right side of the argument and I have to say that it is the National Government. 
DAVID CLENDON (Green) 
: 
 Kia ora e te Whare. I am pleased to take an opportunity to speak in this debate on the Appropriation (2011/12 Estimates) Bill. In his Budget speech the Minister of Finance informed us that the main task of this Government was to “return New Zealand to sustained prosperity.” The primary theme of this Budget as it has rolled out has been that this longed-for prosperity that we are promised will somehow be achieved by a mix of public sector cost-cutting an assault on the most vulnerable and least well-off in our society and an enthusiasm for a return to the extraction industries that fuelled the growth of our economy in the 19th and early 20th centuries but at an enormous and largely irreversible environmental cost. 
In amongst this propensity—this obsession almost—with cut cut cut it seems the Government has lost its way. One possibility seems to have eluded the Government—that is rather than cutting into the provision of very necessary and important social services we should instead seek to improve the income streams and revenue so that there is more to go around and we can improve quality of life and create a better economy. An unfortunate albeit important characteristic of the New Zealand economy is that it is a low productivity economy and that is generally accepted I think by all shades and all political hues. We do not manage to generate a high return on our investment in capital labour energy or other resources. 
Although we do not share—in fact we are as far as anyone could be from sharing—this Government’s obsession with the chimera of catching up with Australia which is apparently the solution to all ills it is worth noting that productivity growth in the Australian economy has surpassed that of the New Zealand economy now for a number of decades but historically New Zealand did better than Australia in productivity growth. The turning point was the massive assault on the economy and on society that followed 1984 from which our economy has never recovered. It is to everyone’s advantage that we improve the productivity of our economy that we get more return from every unit of energy and that we get more labour productivity so that New Zealanders can perhaps reduce their internationally and historically high average number of hours worked. We can get more value from our use of our natural capital which ultimately underpins and will always underpin our financial capital. 
Improving productivity is a necessary and certainly a worthwhile objective but sadly nothing in this Budget will contribute to that end and help to generate the outcome of a more productive and therefore more sustainable economy. Rather than slicing budgets and cutting New Zealanders’ access to those critical and important social services we should be looking for and investing in a comprehensive strategy to increase productivity which will deliver not only economic but also social and significant environmental benefits. It is interesting that this Government’s sole contribution—or attempt at a contribution—to productivity improvement given that the Government is pro-business and talks so much about cutting the public sector was to establish a bureaucracy in the form of the Productivity Commission. The irony is lost on no one that the Government looked to a bureaucracy to deal with what is essentially a social and business sector opportunity. We have no need for a relatively expensive and ultimately fruitless Productivity Commission to discover what the issues on low productivity are. Anyone who engages with the business sector reads trade and professional journals listens to economic commentators or indeed engages with the unions academics and researchers or small and medium enterprise owners and operators absolutely knows what most of the problems are around productivity and we have a whole suite of solutions available to us none of which focus initially on the affordability of houses or the movement of freight across our wharves. It is interesting to look as I have done for references to productivity improvements in this Budget. In the Budget speech the word appeared four times once in the context of acknowledging that “Exports growth and productivity have all stagnated.” So it is acknowledged that productivity is an issue but sadly no solutions are offered. 
Growth in itself according to the way this Government understands growth is problematic. We know that if growth is understood simply as increasing GDP year by year it is a fruitless and ultimately self-defeating exercise. In a different context we have a much broader and much more sustainable macroeconomic picture of genuine sustainable growth a steady State economy that is able to deliver goods and services to us to our society and to protect our environmental quality over time. As for the reference to exports I say that yes exports can and will be at least in the short term part of our recovery and part of the answer but the whole picture is much more complex than simply desperately trying to export more and more low-cost commodities which seems to be this Government’s only solution to building economic activity. 
Again I quote from the Budget speech: “The public sector has a wider role to play in lifting productivity and national saving.” and I could not agree more. The public sector can demonstrate leadership. The Government spend in our economy can be targeted in such a way that it will contribute to increasing productivity and reward those companies and services that provide the mechanisms and means for improving our productivity but sadly rather than letting that leadership emerge from the public sector again we saw this slash and burn this destruction of the capacity of the public sector even to achieve its basic tasks let alone leadership in the economy. 
It must be said that the broadband initiative is one mechanism that can deliver productivity improvements and one hopes it will albeit it is a very expensive solution. It is the only content within this Budget that offers anything much in the way of allowing New Zealanders to do more with less and improve their quality of life along the way. 
We are told that the much-touted mixed-ownership model will raise productivity of the businesses involved through sharper commercial disciplines as if the Public Service is not in itself capable of delivering decent and efficient management of those resources. 
The energy sector in itself rather than being milked as a cash cow if directed and modelled correctly could ultimately produce income export through the development of new technologies. 
We had a very good definition of how we can improve productivity and I quote once more: “By investing in new capital increasing skill levels introducing new innovations encouraging entrepreneurial activity and promoting natural resource management New Zealand can achieve productivity growth higher incomes and a better standard of living.” That came about 3 years ago from then Treasury secretary John Whitehead when speaking to The Icehouse the entrepreneurship centre at the University of Auckland. 
Increasing skill levels is a critical part of productivity. Instead we see our tertiary sector and indeed our secondary sector struggling to maintain the capacity to educate and to train. We are losing capacity in just about all of the trades all of the skills all of the professions because this sector has not been sufficiently resourced. It has not been respected. Morale in the tertiary sector is as low as I have ever seen it in 15 years of a quite close relationship with it. 
In respect of new innovations I would like any Government member to point me to where in this Budget they are encouraging and supporting innovation in industry in business in design and in development. Where are the incentives for people to take the risk? Where is the support for the companies that have a very good idea? We have many of those companies. Where is the support to turn that idea into a saleable exportable commodity particularly in the area of weightless commodities like intellectual property rather than product that goes out in containers? We have an extraordinary opportunity in this country to improve our performance by investing in skills by supporting and valuing innovation and this Budget is simply a lost opportunity to advance that. Kia ora. 
PAUL QUINN (National) 
: 
 Can I join as one with other members in congratulating the Hon John Carter on his next career step and farewelling him. Others have spoken on this and I add my support to those comments. 
We have just heard a most extraordinary speech from the member who has just sat down. It was extraordinary. About the only part I could agree with him on was his last comment when he did not quote verbatim but referred to comments made by the immediate past Secretary to the Treasury John Whitehead about what was required to improve productivity. I agree with those comments. The sad reality is that there was negative productivity for the whole of the previous administration. I have the figures here I say to David. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: The member will refer to the member by his full name or his title. 
PAUL QUINN 
: I say to David Clendon that I have the figures here straight from Statistics New Zealand. The fact is that what this Government is doing is necessary to achieve the exact things that the previous speaker set out in his speech. That is exactly what we are doing. 
Although Opposition members like to prattle on about where the plan is I say to them that if they want this country to wallow in the misery of people under Stalin Khrushchev Brezhnev and their ilk then they can well wallow in that misery. But let me tell them that this Government and the people of this country acknowledge that we are getting on with the job of building a future based on a strong economy. This Budget follows and builds on the previous two Budgets and particularly on the last Budget which created an environment for the change process of savings and investment and established a coherent sustainable and equitable tax system. 
The Government’s job is to set the strategy to create the right environment in order that our entrepreneurs and business people can get on with the task of creating jobs and increasing exports and that is exactly what is happening. For the first time in about 8 years our tradable export sector through our good administration and guidance of this country in allowing export people to get on with their jobs has returned to the black. I will come back to that a bit later. The Government’s job is to allow people to pursue their dreams and their aspirations. It is not for the Government to run their lives. The Government’s job is to ensure equality of opportunity; it is not to do as the previous administration did which was to coordinate mediocrity. The Government’s job is to empower not prescribe. Let us remind ourselves that equality of opportunity does not guarantee equality of outcome as Metiria Turei might have us believe. Egalitarianism is not about mediocrity; it is about equality of opportunity. The Government’s job is to provide the tools and create the aspirational pathways for people. 
Let us talk about the Government’s strategy seeing that the Opposition still does not get it. Let us just talk about some of the things. Firstly the Government is focused on better public services not on a bloated Public Service. We have already heard from previous Government speakers about the measures that have been taken such as increased expenditure targeted to improve the outcomes from primary schools from early childhood education and from secondary schools because that is the future. That is the future of this country and that is where this Government is focusing its attention. 
We have had comments during the debate on the taxation bill and again in the Budget debate about the fact that part of the Budget has requested that the chief executives of Government departments find a million dollars. It was commented that this was an extraordinary event and that if it happened in a Cabinet that Mr Mallard was in then there would be trouble. Well that just confirms that Mr Mallard is the bully he is. The fact of the matter is that $650000 of that million dollars is already targeted through putting KiwiSaver deductions straight back to the departments. In fact those people are paid significant salaries to run their departments. That responsibility is not the Government’s and not the Ministers’; it is the chief executive officers’. [ 
Interruption 
] I know that Dr Prasad in his day probably struggled under the burden of responsibility in the Families Commission so he probably does not understand what I am saying. 
Another factor in the strategy that this Government is undertaking is to bring public debt under control by reducing public borrowing from $300 million per week today to $100 million per week in the next financial year so that by 2014 we will be in surplus. 
Dr Rajen Prasad 
: If you sell everything you won’t. 
PAUL QUINN 
: These issues have to be dealt with. If Dr Prasad does not understand them I would be happy to take him aside and give him a lesson in economics but other than that I cannot do much. The fact of the matter is that the issue of public debt and getting borrowing under control has all to do with maintaining interest rates at a low level which of course underscores the investment drive. Ongoing development of infrastructure is another issue. 
I will talk about business in innovation and trade and the tax credit scheme. It is fascinating. The retiring Deputy Commissioner of the Inland Revenue Department Robin Oliver in an article written a week or so ago was scathing about the concept of tax credits. My colleagues have already canvassed the various issues there. I was fascinated that in terms of this research and innovation Labour it was reported had Sir Paul Callaghan address their—what was it—symposium— 
Aaron Gilmore 
: Congress. 
PAUL QUINN 
: —congress yes. But it seemed to me that they actually missed the most important three words that Sir Paul Callaghan said. He said we require entrepreneurial genius. That is exactly what he said. That is the most important part. That is actually the most important part because it is entrepreneurial genius that will actually create the opportunities that Labour wants. Let us talk about the  
Hobbit  
films. There are people wanting to get on with letting entrepreneurs do their thing with some innovation. But what did members opposite want to do? Kill them! They wanted to kill them. In fact the fundamental issue is that we must continue what the  
Time 100  
magazine issue calls encouraging the mind in its “Builders and Titans” category. 
BRENDON BURNS (Labour—Christchurch Central) 
: 
 I now understand why Trevor Mallard unusually invites his opponent to public meetings when he calls them. When we hear Paul Quinn equating democratic socialism with Stalin it suggests that I should start talking about 1930s Fascism and equating that to National which of course is a nonsense. 
I will start my speech on the Appropriation (2011/12 Estimates) Bill tonight by acknowledging that Budget 2011 includes $5.5 billion for the rebuild of my city of Christchurch. I acknowledge that. It is 60 percent of the public cost of the infrastructure rebuild of my city. I think any Government would have done that but it is important to acknowledge it because nowhere will more of that money be spent than in my electorate of Christchurch Central. Recently with other MPs I had a tour of the central business district’s inner core the red zone which I had not personally been into for some weeks. It reminded me somewhat of the set of a science fiction movie. There was a very eerie feeling in that city centre where a thousand buildings are to be demolished. There was no noise taking place. We had a reminder only yesterday morning at about 8.30 that we are not yet out of the woods in respect of aftershocks continuing in Christchurch. 
The defining piece of the Budget for me and for Labour is the assertion that the Government wants to go down the track of selling 49 percent of State assets Meridian Energy Genesis Energy Mighty River Power Solid Energy and Air New Zealand. I put on record my opposition to those sales and say that in the late 1990s Telecom was sold by the Government for the sum of $4.5 billion. It accrued $14.5 billion in dividends and payments back to the owners in the period before it came back on to the sharemarket and in part back into New Zealand ownership. That is a fundamental indication of the folly of selling State assets. When they are making returns to the taxpayer in the hundreds of millions of dollars per annum there is absolutely no logic in selling them other than some sort of market-driven ideology that says that is sound policy. 
I acknowledge that the National MP from Christchurch Aaron Gilmore is in the House tonight. I raise again in this House this question. I ask any member opposite to take a call at some point to deny the proposition that the Canterbury Earthquake Recovery Act includes a provision that allows the sale—the forced sale if need be—of Christchurch City Council assets and those of the two other territorial authorities affected by the Canterbury quakes the Selwyn District Council which owns substantial forestry assets and the Waimakariri District Council. 
I asked the Parliamentary Library to write me an analysis of what contribution one of those Christchurch City Council assets has made to the ratepayers of Christchurch. That asset is the Orion power network which services most of Canterbury. Since 1993 the Orion network has returned back to its majority shareholders—the Christchurch City Council which owns 89.3 percent of it—some $875 million in dividends and other payments. In other words it has returned nearly $1 million a week to the ratepayers of Christchurch—nearly $1 million a week. 
I ask members opposite to stand up and tell my constituents there is no prospect of those assets being sold or part-sold by a new term National-ACT Government because I think that is the agenda. The reason I think it is the agenda is that it is there in Budget 2011 which outlines the philosophy that it is absolutely acceptable to sell State assets. That rationale is laid out in National’s Budget. If reducing debt is an appropriate rationale for the sale of State assets then again I ask Aaron Gilmore who is sitting opposite to take a call and deny that there is any prospect—any prospect—of Christchurch City Council assets being sold including Orion the majority stake in the port company the majority stake in the airport company Enable Network broadband the Red Bus company and others. What is the position? I think the people of Christchurch deserve to know explicitly because I think the exact scenario is that there will be nothing before 26 November on this front but that after that there will be a cough and a splutter and an announcement that we have to sell off Christchurch’s assets to fund the debt that has been generated. 
I acknowledged at the start of this speech that the Government has taken on responsibility for funding 60 percent of the rebuild of the infrastructure in Christchurch. I acknowledged that. That is a responsible position. I acknowledged the Government for taking account of the need to rebuild the infrastructure of Christchurch and for meeting 60 percent of the costs. But I want to know on behalf of the people I represent whether the agenda is that that cost will at least in part be funded by the sale of our assets. We stood against the tide in the 1990s when other councils sold off their assets. We were the “People’s Republic of Christchurch” and proudly so. Across the political divide in Christchurch people want to keep those assets because they know the contribution those assets have made. I have given one indication of that contribution—nearly $1 million a week from Orion. The very facility that was being used by civil defence and for a short time the Canterbury Earthquake Recovery Authority to start the recovery process was the Christchurch City Art Gallery. A lot of that funding came out of assets such as Orion. I would like Aaron Gilmore to take a call and give us an assertion an assurance that this is not in prospect in a re-elected National Government because I think it is on the agenda. I wanted evidence of that and it is there in black and white in Budget 2011 with the outline of why this Government believes asset sales are appropriate to reduce debt. 
I will talk for a moment about the comments made by John Whitehead the outgoing Secretary to the Treasury on  
Q+A 
 the Sunday before last. I thought Guyon Espiner gave him a good grilling on the jobs forecasts. In the Budget 170000 jobs are forecast and 4 percent per annum growth is forecast for the year after next. The comment back from John Whitehead was that Treasury’s record for such predictions was second-to-none. I asked the Parliamentary Library to analyse that record. The Parliamentary Library tells me that Treasury’s growth forecasts have been wrong for 28 of the last 30 quarters. In the  
Q+A 
 interview John Whitehead also confirmed that Treasury supported Michael Cullen in building the surpluses that were built through the time of the last Labour Government rather than giving tax cuts because as he said they stood this country in good stead for the economic downturn that followed. So much for National’s rhetoric about Labour’s economic management. Then he talked about Treasury’s concern about the growing inequality in New Zealand. Well I have to say we are lagging at 26 out of 30 in the OECD. We have to ask what is in this Budget to address that inequality. What is in there? Will people be made better by asset sales? Will they be made better by KiwiSaver cuts? 
Will they be made better by the cuts in training? I am astounded and appalled that in a Budget that supposedly says we need to build skills is a $90 million cut from training. I went with Phil Goff to the Christchurch Polytechnic Institute of Technology trades training campus a couple of weeks back. The Christchurch Polytechnic Institute of Technology is gearing up to build its trades training facility there but the point is that we will see about a thousand extra trade trainees in Christchurch and they are also going to be affected by that $90 million cut. We need tens of thousands more jobs in Christchurch. Currently the household labour force survey estimate of unemployment in Canterbury is that 10500 people aged 15 to 24 are unemployed. That is appallingly high. We need a plan and this Budget does not contain one. 
Dr CAM CALDER (National) 
: 
 It is a great pleasure to rise and take a call on the Appropriation (2011/12 Estimates) Bill. I take the opportunity to pay tribute to my colleague the Hon John Carter who is a gentleman a good man and someone who has contributed hugely to our country. He will be sadly missed in the House. I wish him well in his retirement to the Cook Islands. I am delighted to hear from his own lips that he intends to return and take the field again for the Parliamentary Rugby Team. 
During the course of this debate we have heard a lot of comments about how the Opposition members have not really been addressing the issues facing our country in a time of unparalleled financial stress. I have to say we have heard a lot from the Opposition about coats of paint on historic buildings and new carpet. The Leader of the Opposition did attempt to address the economic situation in his speech on the Budget a couple of weeks ago. It was a guttering candle of a speech compared with the Prime Minister’s arc light oratory. In the Hon Phil Goff’s speech he made a comment that the global financial crisis finished in 2009. It was an astonishing claim yet sadly all too reminiscent of the wild flights of ersatz economic fantasy that erupt from those opposite on occasions. It was interesting to watch the Opposition benches. David Cunliffe choked Grant Robertson’s jolly demeanour slipped for a while and Shane Jones just grinned to himself and continued drafting a possible future leadership acceptance speech. The rest of the Opposition caucus failed to notice and remained in the ordinary state of torpor that is their default position. 
A statement like that from their leader is yet another reason why Labour lacks any economic credibility with hard-working New Zealanders. These New Zealanders know even if the Hon Phil Goff does not that the US economy—the largest in the world the engine room—has a horrendous Budget deficit sky-high levels of debt and a housing market that has seen a bigger percentage drop in value than was witnessed in the great recession of the 1930s. There is no indication yet that it has stabilised. In addition the Federal Reserve is debating a third round of quantitative easing. That is the US which is the engine room of the world economy. 
Is there any good news across the Atlantic that Mr Goff perhaps had privileged access to? No there is not. A few days after his speech the European Union raised €4.75 billion for Ireland and Portugal by a bond sale executed by the European Commission on behalf of the EU member states via the European Financial Stabilisation Mechanism. The $60 billion European Financial Stabilisation Mechanism is the lesser-known of the two bailout funds that the European Union has set up to deal with the ongoing European debt crisis. The other the European Financial Stability Facility is headquartered in Luxembourg. It is essentially an independent offshore bank with €250 billion to lend to various troubled member states. The idea behind both bailout mechanisms is to sequester the peripheral countries in trouble from the international markets giving them time to undergo austerity measures and cut Budget deficits. 
The global financial crisis is alive and well. These mechanisms may be of doubtful legality but the European elite are prepared to sweep any such concerns under the rug. Of greater concern because they have no control over it and because it could potentially scuttle all efforts to suppress the crisis is the mounting populist angst in the countries doing the bailing out and the countries being bailed out. The rise of Euro-sceptic parties in Germany and other core eurozone States is leading to a lot of turmoil among the students youth and unions in the streets of Spain Greece Portugal and other peripheral economies which could potentially further deepen the economic storm by derailing those efforts to mitigate it. Amid the confusion Fitch Ratings has downgraded Greece further below junk status and Standard and Poor’s lowered Italy’s rating outlook the next day. 
Unlike Mr Goff this Government recognises that these are tough times. This is a Budget for tough times. This is a Budget of respect and a Budget by a Government that has respect for the hard-working Kiwi families who are at the core of our society. The previous administration cynically encouraged New Zealanders to mine the fool’s gold of bountiful access to cheap international credit. This diverted attention from the Labour Government’s supervised neglect and woeful underperformance of our tradable sector as well as the general parlous state of our economy under Labour’s watch. Fuelled by ever spiralling amounts of borrowed money New Zealanders embarked on an unproductive spending frenzy on houses and consumer goods. Household debt rose to a peak of 159 percent of disposable income by mid-2008. Since inheriting an economy in crisis this Government has worked constantly to cushion New Zealanders from the harshest edges of the recession whilst at the same time working to turn the economy around in the face of the worst global financial crisis in decades—a crisis that continues to this day—and an almost apocalyptic series of natural disasters here at home. 
We have made no secret of the size of the challenges we are facing. Every New Zealander knows that the Government has been borrowing $380 million per week. They understand that such large borrowing cannot continue and that it is patently unsustainable. If we keep doing what we have always done we will get what we have always got. We believe that New Zealand can and must do better than that. New Zealand’s hard-working families agree and they understand the need for change in how New Zealand is run. Across the country New Zealanders understand clearly why we need to get spending down which we are doing why we need to cut out waste which we are doing and why we need to make “New Zealand Incorporated” work more efficiently export more and start to pay off that burdensome debt. 
What is the Opposition’s plan to grow our economy? Sadly there appears to be no plan just more tax borrow spend and hope. It is more lazy shotgun thinking from which the country suffered so grievously under the last administration. Labour has signalled its intention to take GST off carrots and raise the taxes paid by hard-working New Zealanders—an oddly perverse version of a carrot-and-stick policy. Under Labour New Zealand would borrow a staggering stratospheric extra $45 billion from 2008 to 2014. It is a decision that would virtually guarantee to drive New Zealand into an economic morass and fiscal bog. If Labour’s economic flights of fancy were ever implemented the international credit agencies would be tolling their equivalent of the Lutine Bell for another economy lost. New Zealanders know that Labour’s profligacy is not an option. They know that we have to grow the economic cake and be prudent guardians of the public purse. 
We are taking a balanced and considered approach to find our path back to surplus protecting health education and income support for the most vulnerable as we do so. It was a great pleasure for me to go to Manurewa recently to visit Wiri Central School and see the pilot of a health programme in the school to swab kiddies’ sore throats early and avoid that appalling ravage of rheumatic fever which affects far too many in our community in New Zealand today. It is an example of more spending in areas that matter. There is more spending in health and we have some very very good spending in education. We are spending an extra $550 million in early childhood education which is going to improve the participation for Maori and Pasifika children. They are the people in our society who currently miss out. Thank you. 
DARIEN FENTON (Labour) 
: 
 It is a pleasure to take a call in this Appropriation (2011/12 Estimates) Bill debate on Budget 2011. I have listened to many of the speeches today from National Government members and I believe that they know deep in their hearts that this Budget is a Budget that hurts but does not help. This Budget is a giant con on the New Zealand public. It is a recipe for more borrowing asset sales cuts to front-line services and economic stagnation. 
Many National members have spent more of their time talking about Labour than about National’s Budget. It is a very very interesting phenomenon is it not? It makes me think they are very very worried and it confirms for me just how out of touch they have become with Kiwis who are struggling to make ends meet. I think that deep down National members are quite embarrassed. I think Sam Lotu-Iiga is very embarrassed by this Budget. We can tell. 
This Budget confirms what we already knew: National has no idea how to get our economy moving. It is reverting to the same old policies of past National Governments: asset sales and punishing low and middle income earners. 
The truth is that the New Zealand economy is in a fragile state. It is barely emerging from a deep recession where it has lingered much longer than it should have because of bad policy directions from the National Government. For 3 years now John Key’s National Government has promised us that good times are just around the corner and we are supposed to believe that from this Budget. We are supposed to believe that from the Budget’s projections for hundreds of thousands of jobs and 4 percent growth. For goodness’ sake! 
Under this Budget New Zealand will continue to go backwards. Reductions in the deficit in the future rely on the sale of our assets and the Government—this is the cheating and the con thing about this Budget—has already banked that money just as it has already banked the $1 billion cuts in public services even though no one knows where they are coming from. 
The Budget is a litany of broken promises from this Government. A disgraceful deception is being visited upon the people of New Zealand. Job growth—170000 jobs in the next 4 years—is predicated on shonky figures that do not stack up. They are fairy tale figures. We have had those airy-fairy promises from John Key in the past. Do members remember the National leader’s promise that 4000 jobs were going to be created with the cycleway? What did we get? We got 200. Somehow now we are expected to believe the magic numbers in this Budget. Even Treasury is saying that those figures are not quite right. It has seen them before in past Budgets and they do not stack up. 
Along with all of the other things we have heard from the National leader John Key is his promise to close the wage gap with Australia. But now the 30 percent wage gap with Australia has become a competitive advantage according to Bill English. A couple of weeks ago Paula Bennett declared to this House that any job is a good job. I thought that was incredibly revealing because it shows a stark difference between John Key’s National Government and the Labour Opposition. Of course people need jobs and the best way out of poverty is jobs but they must be decent jobs not jobs at any cost. They must be jobs that are paid a fair rate for a fair day’s work. That is why Labour will increase the minimum wage. 
I will talk about the minimum wage and why we will increase it to $15 an hour because we have heard denigration from the Minister of Labour and others. Let us be honest. New Zealand workers have low wages compared with other developed countries and raising the minimum wage is just one effective part of lifting pay rates to build a solid base for a high-wage high-skill and high-value economy. There are other parts to that base and other colleagues have talked about them. The truth is that New Zealand has a huge inequality gap and the gap between low incomes and high incomes grew significantly after last year’s tax cuts for the rich. 
The National Government members have consistently said they want New Zealand to catch up with Australia but they fail to acknowledge the wage differential. Now they are saying it is a competitive advantage. The wage differential is a huge problem for New Zealand’s economy. It is not just our skilled workers who are leaving in droves for Australia; many unskilled workers are leaving too because they can earn so much more even on the minimum wage. The minimum wage went up last week in Australia. It has gone up to an equivalent of NZ$20.29. But many more Australian workers receive that. Australia has a system that recognises skill. It has a system that recognises industry. There is a whole range of minimum wages. 
The Minister of Labour said today that 6000 jobs would be cut if we increased the minimum wage to $15 an hour. There have been numerous studies on increasing the minimum wage including increasing the minimum wage for youth—people under 18. The truth is that there are mixed views but the ILO the International Labour Organization which is the United Nations body for workers’ rights and employer-employee relationships says that increasing the minimum wage contributes to both hiring and firing and it depends on the country’s conditions and on what is happening in that particular country. 
The interesting thing about this is that the counterargument that increasing the minimum wage increases unemployment implies that dropping the minimum wage increases employment. Do we have any evidence of that? We have never seen any. There is no such evidence. In fact during the 1990s when the youth minimum wage for workers under 20 was $4.20 an hour we had the highest youth unemployment we have ever seen in this country. 
The good thing about raising the minimum wage is that it increases demand in the economy. Low-income people spend most of what they earn. Increasing the minimum wage is a much more effective measure for the economy than tax cuts for people with already high incomes. Actions speak louder than words. In tough times we have to make choices and we have to choose priorities. 
The difference between this Government and the Australian Labor Government’s Budget which we saw a couple of weeks ago is very stark. Despite lower unemployment in Australia than in New Zealand there is a strong focus in its Budget on jobs and skills. Instead of focusing on job creation—and I really do not think this Government knows what that means—this Government has repeatedly cut taxes. That seems to be its only strategy. It has cut taxes. So those on personal incomes and those benefiting from company profits have had a bonanza with a total cost of the two tax cuts since National became the Government of over $5 billion a year. 
It is no wonder that we now have a National Government Budget that is trying to convince the New Zealand electorate that there is no alternative to further cuts in Government spending. The last time I heard that was from Ruth Richardson and Bill Birch. 
There are other cuts in the Budget and if I had time to talk about them I would. For example this Government appears to have given up on productivity and worker engagement. The Government thinks productivity comes from building more roads. It does not seem to understand that productivity changes happen in the workplace. Yes businesses grow our economy but who is part of business? Who helps create business? Who helps create the wealth? It really intrigues me that our Government believes that the workers who actually do the work are not part of the economy and this Budget confirms that. 
The Government has cut a number of things in the Budget. I have not got time to go into them but I do want to mention while I have the chance the cuts to health and safety funding. This comes at a time when we are seeing more people dying and being hurt in our workplaces than ever before. The Department of Labour is being forced to reduce its role in health and safety. The number of people who are being trained as health and safety representatives is being cut by two-thirds. It has been proven over and over that worker engagement is a critical part of improving health and safety but the shameful record of this Government is that it has cut health and safety funding and tragically the price of that will be paid in more workplace accidents and deaths. 
Hon GEORGINA TE HEUHEU (Minister for Courts) 
: 
 I am very pleased to take a call in the debate on Budget 2011. It is a great Budget a Budget for our times delivered in very challenging circumstances and that is why it is a responsible and balanced Budget. I take issue with the previous speaker Darien Fenton who said that the Prime Minister said a couple of years ago something like “good times are just around the corner”. I doubt very much that he said that. Maybe if he indicated that we had certain plans to return things to a better footing sooner that would have been before the Christchurch earthquake. That would have been before the two Christchurch earthquakes. I certainly take issue that he said that good times are around the corner. 
The reality is that someone—and that is our Government the National Government—has had to take a very pragmatic look at where our country is. There is no doubt that times have been challenging. When National took power in 2008 we were right on the cusp of an international global financial meltdown and last year and earlier this year our country saw one of the worst disasters that we have seen in the form of the Christchurch earthquakes. But those are the challenges that are thrown up for the Government of the day to confront and our Government is doing just that. 
Budget 2011 is about building our future. It sets out the next steps of the Government’s programme to build faster growth to increase national savings which were minimal to nil and to create sustainable jobs—jobs that are built on savings exports and productive investment. This is about building a platform for savings and growth and setting a faster return to surplus. The Budget takes steps to ensure that the Government returns to surplus by 2014-15 which is a year sooner than forecast. The forecasts are for economic growth of 4 percent in 2012 with 170000 new jobs being created by 2015. 
Importantly the Budget creates the $5.5 billion Canterbury Earthquake Recovery Fund. It commits us all as New Zealanders to rebuilding Christchurch because the well-being of Christchurch is critical to New Zealand’s future. The fund will fund infrastructure schools temporary housing trade training welfare and business support and demolition costs. In fact Clayton Cosgrove who is sitting across the Chamber would know a lot more than I would about what is required down there but I am very proud that our Government has made the commitment— 
Hon Rick Barker 
: I think my money is on you Georgina. 
Hon GEORGINA TE HEUHEU 
: Well he is a Christchurch MP. We have got some here as well. I am very proud that we have made that commitment to our fellow New Zealanders in Christchurch. 
The Budget invests $4 billion in front-line public services in areas such as health education and supporting young people into jobs. It makes changes to KiwiSaver to Working for Families and to interest-free student loans to make those schemes sustainable into the future and to reduce the need for Government borrowing. 
As I said this is a Budget for our times. It takes steps to ensure that we return to surplus earlier. It puts a focus on repaying debt and raising our national savings because that is what encourages investment and supports the creation of jobs. We want to ensure that future generations of New Zealanders—our children our grandchildren—are not saddled with enormous amounts of debt and that taxpayers’ hard-earned taxes go to the things that matter most—teachers police doctors front-line services more surgery more education a better education—because that is what our children deserve. I will take just a minute to congratulate the Minister of Finance on bringing forward a responsible Budget under the leadership of John Key. It is a very sensible and a very balanced Budget. 
I now turn to one or two of the areas that I have a particular interest in. At a time when the words are austerity and wise spending I am very pleased that extra funding has gone into the justice area. As Minister for Courts I say that the extra funding going into justice to help make communities safer and to make sure that our court services are run more efficiently is very welcome. As part of making sure that communities are safer I remind myself and others that courts are a part of the community. In our law and order policies we have delivered on promises to put public safety first not least in the courts and this year—2011-12—will see a further roll-out to boost court security. We will spend another $2.5 million this year which means we have spent $6 million with another $3 million to go in the 2012-13 year. Court security has been an ongoing focus for me since I took over as Minister for Courts. I am very proud of the fact that court security has improved. Already our court security officers in the current year to date have conducted 1350000 screenings and have taken into temporary custody 10000 items such as knives pocket knives scissors wooden clubs nunchakus and so on which can hurt and harm court users. We have 83 court security officers and this Budget will deliver another 11 to bring a total of 94. By 2012-13 we will complete our programme with a total of 105 court security officers. I am very proud of our Government putting safety first and our law and order policies and justice policies have seen that become very much a priority for us. 
I turn now to some of the spending that will benefit in particular Maori and Pacific communities. I am very proud that in recent times more children are being immunised. In 2007 only 74 percent of children under 2 were fully immunised; now 88 percent get the immunisations they need. The immunisation rate for Pacific children has increased as has the immunisation rate for Maori children. This will be an ongoing focus for us. 
In education the Budget delivers an additional $550 million over 4 years for early childhood education with a focus on increasing participation for Maori and Pasifika children and for children from low-income families. It is estimated that within 25 years one out of every two children born will be Maori or Pacific so it behoves all Governments to make sure that we put a real focus on the education of all New Zealand children but in particular because there is lagging in Maori and Pacific communities in those communities as well. In terms of Maori achievement there is extra funding to reprioritise to build new kura there is $12 million over 4 years for lifting Maori achievement and $9 million over 4 years to support iwi to develop school and community - based Maori language learning. 
There is extra funding for trades academies and wider youth guarantee initiatives to keep 16 and 17-year-olds engaged in education and training. This clearly again is aimed at low-income families Maori and Pacific because they are the future workforce particularly in Auckland. In terms of Pacific Island affairs in particular I state that $1.2 million of the $4.8 million that was appropriated last year will be available this year as well to put into education skill development and entrepreneurship for Pacific peoples in Auckland. As I said this is a good budget for challenging times. It is a sensible budget. I am very pleased to have taken a call to support it. 
CAROL BEAUMONT (Labour) 
: 
 I too rise to speak on Budget 2011 and to oppose it. As the Labour list MP based in the Maungakiekie electorate before I do that I note in the House the tragedy that occurred in the Maungakiekie electorate on Saturday 4 June. An explosion took place on a worksite in Onehunga at a Watercare project when workers were attempting to reconnect the Hunua 4 and 3 pipelines. At that time a worker on site Philomen Gulland was killed. I extend my condolences to her family and particularly to her children who no longer have their mother with them. Also I extend my sincere thoughts and hopes for Ian Winson who remains in a serious condition in hospital. 
A number of other workers were also injured. My thoughts are with them their families and also their co-workers who were with them at that time and experienced the tragedy. They had to see things that many of us hope never to see. Local residents also were shocked and saddened by the events on Saturday 4 June. I also acknowledge the work of our emergency services. They did a brilliant job as they always do. They really were fantastic. 
Many questions remain to be answered in relation to this incident. I stress that fact and acknowledge my colleague Darien Fenton who referred to the issue of safety at work. When we go to work in the morning our family and friends expect us to return home safely at the end of the day. Sadly for a number of workers in Onehunga on Saturday that did not happen. 
I return to the Appropriation (2011/12 Estimates) Bill and Budget 2011. I rise to oppose this Budget. I believe it is a blueprint for more borrowing for asset sales for service cuts and for economic stagnation. After previous recessions we saw our economy rebound reasonably quickly; under this one the recovery is at best anaemic. We are as many commentators say sitting on the edge of a double-dip recession. That does not happen for no reason; it happens due to a lack of a plan and the deliberate choices of Government. 
There is no plan to grow our economy to create jobs or to invest in our people. In fact one of the things that always horrifies me is listening to the spin from the other side of the House. I listened to Peseta Sam Lotu-Iiga talk about the bill that brought into place the changes to KiwiSaver and Working for Families. He referred to alterations streamlining and modifying. They are cuts. He was talking about cuts; he was talking about cuts to KiwiSaver. In fact the bill itself talks about reductions and lower maximums. They are cuts. 
What does that look like for struggling families for low and middle income New Zealanders? The changes to KiwiSaver mean costs. It costs more to save for retirement. It also creates uncertainty and reduces confidence in what is an important savings scheme in our country. We probably all acknowledge the importance of savings. Working for Families cuts means that over 50 percent of families currently receiving Working for Families will get less. That is a cut. 
Those are some of the changes. They put pressure on families and families are already under pressure. It costs more to buy food. Domestic violence statistics have been going up at the same time as the Government cuts funding to domestic violence prevention services. All of those things should be worrying and the Government should be doing something about them. It should be offering a way forward. But this Government is out of touch with ordinary New Zealanders. It is out of touch with low and middle income New Zealanders. The Prime Minister talks about people having to go to a food bank because they make poor lifestyle choices. When Annette King and I visited the Salvation Army food bank in Royal Oak recently that was certainly not what the people there told us. They have unprecedented demand from people in the workforce as well as from those who are unemployed. I tell the Prime Minister to visit a food bank and then tell us about lifestyle choices. 
I look forward to telling people in the Maungakiekie electorate that changes in this Budget are not cuts; they are just alterations modifications and streamlining. That is typical National spin. In the speech announcing this Budget it was heralded as being stronger and more ambitious and building our future—building our future. We will not be building anything in this country given the skill shortages that we face the reduced industry training numbers the reduced numbers of apprenticeships and the fact that this Budget makes further cuts. It cuts $90 million over 4 years out of industry training. That is just ridiculous. 
Lifting the skill levels of our workforce has a number of really positive spin-offs. It provides opportunities to people to get work progress at work improve their wages and get greater job satisfaction. It provides an opportunity to lift our workplace productivity which is necessary to improve our economy and to get growth. It improves wages and conditions of work. It provides employment security and it gives people the opportunity to change as work changes and therefore to maintain employment. Investment in skill levels lifts levels of literacy and the education of the people in New Zealand. That impacts on families individuals communities and workplaces. It impacts on our economy. This Government is cutting the money that is spent on industry training and that is an absolute disgrace. 
What is meant by a “stronger more ambitious New Zealand.” and “building our future.”? As I said we do not have enough skilled people to quite literally build our country. Money has been invested into Christchurch—I acknowledge that as others have tonight—but the number of trainees in building and construction in this country has declined dramatically over the last 2 years. The number of people in industry training generally has declined over the last 2 years. The number of people in apprenticeships has declined and that is despite the need for rebuilding in Christchurch the need for rebuilding more houses in Auckland and the need to deal with leaky buildings. But fewer and fewer people are training in the building and construction sector. That is a disgrace as well. This Budget has no measures to counter that decline and we continue down a path of no investment in skills and training. I ask how we will fill that gap. 
I have to say that Budget 2009 and Budget 2010 were notable for the lack of new and significant initiatives in the skills area and in Budget 2011 we see $90 million of cuts in that area. Business groups unions and the wider community recognise this fact but there is still no plan. Phil O’Reilly from Business New Zealand who is often very positive about this Government has said that what the Government has announced so far is helpful with regard to Christchurch but we have not yet seen a strategy that he could discern or could put his hands around and say: “Here it is.” and “This is what we are going to work on.” Phil O’Reilly is saying there is no plan or strategy around skills and he is right. 
As Peter Conway from the Council of Trade Unions says the Government should say that jobs are a priority and therefore it should increase skills and investment subsidies. It should look at skills development programmes and really try to focus on getting people back into work and getting the economy moving. When I asked the Prime Minister today about the $90 million that has been cut out of industry training and how he thought it would help the 77000 young people who were not in school training or jobs he completely failed to answer the question. There is no answer: it is an absolute shock. 
Once again National has failed New Zealand and New Zealanders. The Government is not serious about ensuring growth and jobs. It is not serious about lifting our skills and productivity. That is in stark contrast to other developed countries including our near neighbour Australia which in its recent Federal Budget has invested enormous amounts more over and above the higher baselines. 
RAHUI KATENE (Maori Party—Te Tai Tonga) 
: 
 In my maiden speech of 11 December 2008 I drew upon the wisdom of the late Dr Martin Luther King who said: “Injustice anywhere is a threat to justice everywhere. We are caught in an inescapable network of mutuality tied in a single garment of destiny. Whatever affects one directly affects all indirectly.” 
I come to this Budget thinking again of the injustice of poverty. This is not a concept that we heard about in the Budget speech from Mr English. He talked about making changes to Working for Families to better target assistance towards lower-income families. He talked about channelling resources into key social programmes while ensuring they are well targeted and protect the most vulnerable. He also talked frequently about the need to take a responsible longer-term approach a prospect seriously threatened by rising debt which leaves the Government vulnerable and less able to meet future shocks. Yet nearly 3 weeks after those statements were made today we heard the staggering news provided by Treasury that suggests that the Government is borrowing about $100 million per week more than it needs to borrow. As Treasury pointed out that amounts to $5 billion more than is necessary for this financial year. 
Although the Government seems to have been quite relaxed about over-borrowing at substantial amounts it appears that New Zealanders have been the ones who have taken the more conservative approach regarding expenditure. In the survey released yesterday by Sorted New Zealand it was found that 56 percent of New Zealanders are less willing to go into debt since the recession. In fact out of a polling group of 700 only 4 percent of those surveyed were willing to take on new debt. 
I wish to place this Budget into the context of many of the constituents who call on us. According to Statistics New Zealand’s food price index between September 2010 and April 2011 milk cheese and eggs have increased by 2.5 percent fresh milk has increased by 3.4 percent and petrol has risen by 17.1 percent. On top of that electricity prices rose by 72 percent under Labour in 9 years—that is by 8 percent a year—and they have then risen by 9.5 percent in the 2½ years since National took office. These are some of the bread-and-butter issues that our families are coping with day in and day out. For too many of our families no matter how diligently they budget and no matter how much they have tightened their belts and tried to make the money last unanticipated crisis events occur: a death in the family a bad case of flu the loss of school uniforms or the loss of wallets. And all the time prices rise and rise and the money-go-round speeds up. 
The effect of some of these events these life shocks can be tempered in most families because they may have the benefit of a bit of give and take in the budget. But for the 240000 children of parents who rely on income support that flexibility simply is not there. So we come to the injustice of poverty. All of us know that a child who grows up in poverty is three times more likely to be sick than other children. We know too that opportunities in employment training and education are inevitably influenced by the income levels in a household. 
The Maori Party has always given priority to protecting the vulnerable. By that we mean the elderly the young the disabled the disadvantaged those who have not and those who may live on the margins of our community. In one of the most fundamental transformations of our time we have sought to restore whanau responsibility: to invest in collective and mutual obligations through the initiative of Whanau Ora. We were therefore delighted that Whanau Ora through the 2011 Budget has been supported to grow and to build on the incredible momentum it has developed. But we also were vigilant in our call for a responsible Budget that takes account of the sharp edges of recession but that also invests in our mokopuna. Our call has been to eliminate poverty. We believe that poverty reflects worse on those who have but do not share than on the have-nots. So at the end of last year I wrote to every party in the House seeking their support to hold parliamentary cross-party talks on child poverty. I repeated that call in the very first speech I gave when the House resumed this year and I highlighted seven simple solutions that could help us to eliminate poverty. 
We know that addressing poverty will take a long-term approach. The first and most immediate response is to care for and support those who are living in poverty now. But also we must develop long-term measures that strengthen whanau and communities so they are not living in poverty. As a result of our advocacy the main benefit and superannuation payments were increased by 2.02 percent from 1 October 2010 to specifically take into account the rise in the rate of GST. In addition to that one-off increase between April 2010 and April 2011 main benefit rates increased by 3.75 percent. We did our best with the minimum wage and an increase was announced earlier this year although it was not nearly as consequential as we had argued for. 
We have developed a very successful Mara Kai programme. We have funded over 450 mara kai nationwide to support whanau to grow their own kai and to rebuild community connections at a time when money is tight. This is about community resilience. I have consistently raised the issue of removing GST from healthy food. Fifty Kaitoko Whanau workers nationwide work with all members of a whanau to support them to access proper support to advocate for their needs and to ensure that as a whanau they are all moving forward together. We have invested in cadetships trade training and professional training which resulted in over 1800 training and employment outcomes: some 1550 training placements and 252 jobs. Under our emissions trading scheme negotiations the Maori Party halved the petrol and power levy increase. Electricity would have increased by 10 percent; we got that reduced to 5 percent. Petrol and diesel prices would have increased by 7c per litre; we got that reduced to 3.5c per litre. That would have cost the average whanau about $165 more per year if the Maori Party had not intervened. About 1500 low-income Maori whanau have had their homes insulated as a result of the Maori Party negotiating a 100 percent subsidy for housing insulation for those with a community services card. 
I come back to the seven simple solutions to support children whanau and families. Our strategies are to set a deadline to eliminate child poverty by 2020; to designate an official poverty line at 60 percent of the median household disposable income after housing costs and to set a net income to prevent poverty; to increase the minimum wage to at least $15 an hour; to raise core benefit levels including superannuation and the veterans pension; to simplify Working for Families including the extension of the in-work payment to all families; to investigate the reintroduction of a universal child benefit; and to establish a neighbourhood renewal fund which may include incentives to encourage living more collectively such as community gardens and after-school care. 
I come back to my call for a cross-party parliamentary approach to addressing poverty. I am really proud that tomorrow my colleague Metiria Turei and I are holding the very first meeting of this auspicious forum. It will be a great day indeed when our shared ideas truly do make the difference in terms of addressing the injustice of poverty and developing a better future for all. 
CLARE CURRAN (Labour—Dunedin South) 
: 
 Thanks for the opportunity to speak on the Budget. Before I start I will join with my colleagues across the House in paying tribute to the Hon John Carter. I think it is important to acknowledge his contribution. During my 2½ years in Parliament I have enjoyed the contact I have had with the Hon John Carter. I have found him at all times to be a gentleman— 
Hon Clayton Cosgrove 
: Struth! 
CLARE CURRAN 
: —a gentleman and honourable to boot. So I would like to put that on the record. 
Dr Rajen Prasad 
: Unlike some others whom we could name. 
CLARE CURRAN 
: That is correct. 
I disagree that this is a Budget for our time as at least one of the members across the House has said tonight. It is one of the worst Budgets that I have known in my history not only in this Parliament but in this country. I heard one of my colleagues Moana Mackey talk about that earlier on tonight and I say this Budget represents gloss. It is all about gloss— 
Hon Clayton Cosgrove 
: Lip gloss. 
CLARE CURRAN 
: Well I do not know about lip gloss; it could be lip gloss. But it is gloss papering over the cracks—pretence; whatever we want to call it. I like to call it making stuff up because I think that is what this Government does. I have heard comments about austerity with regard to spending and all I can think is that that is a crock. 
At the heart of this Budget lies a disconnect and the disconnect is between telling us that we all have to tighten our belts and that we have to make the most vulnerable people in our society particularly the ones on benefits go out and look for jobs—and the jobs do not exist. At the same time the Government blames everybody else for the situation that we are in. It is the fault of the previous Government of the global financial crisis or of the earthquakes—anything other than the Government’s own policies and its own way of doing things. So we have people who cannot find jobs and who have found themselves in circumstances where they do not have jobs being forced to go and look for jobs. But the jobs do not exist because this Government is not investing in them. I do not get that. There is not a plan there. Where is the logic in that? I think logic is important. There is more to life than logic but that plan does not have any logic. These people are vulnerable. Many many thousands of people in our country are looking for jobs and instead we have a Budget put before this country that is about more borrowing selling our important assets cutting more services and economic stagnation. 
There is no credible plan and that is the real problem behind the Budget. It is about making promises that cannot be delivered on making claims that are not true and making stuff up. It is also about the Government being out of touch with ordinary Kiwis who are struggling to make ends meet. 
I will tell members about one of those people because one of them came into my office the other day and this is just the tip of the iceberg in terms of what is happening around this country. This man is in his forties. He has worked hard all his life. He has done a lot of work. He is not what we would call a skilled worker in the sense of being a tradesperson but he does skilled work. He does not have a qualification but he has worked hard all his life. He is what we would call a labourer and there are lots of labourers out there. He has a house and a mortgage and his partner works in the kitchen of a mental health facility which was reshuffled last year so her hours were cut down to 16 per week. Because of that he and his partner moved in together so that they could manage the mortgage. This man also has two children from a previous relationship for whom he is paying child support. He is doing the right thing but he is seriously struggling. He cannot pay his mortgage. He is getting more and more seriously behind. 
So what does this man do? He goes to Work and Income day after day looking for jobs and saying he wants to work. He asks how he can find work and says he will do whatever it takes to find work. He says he would like to get a qualification. He has applied for more than 50 jobs by the way and has not had any luck because there is so much competition in my city as there is in every community around this country. This man is interested in training; he wants to do anything. He wanted to get a fork-lift licence but he cannot get the fork-lift licence because he cannot afford it and Work and Income will not pay for it unless he has a job offer. That is a catch-22 situation—this guy is in a catch-22 and he cannot get out of it. He came to my office because he does not know what to do. He is desperate. He is a hard-working person with responsibilities and a mortgage. He faces losing his house and his dignity and that is not good enough. What does this Budget do for him? 
People like this man are the vulnerable people. They are not thieves. They are not rorting the system as some do at the other end of the spectrum. This man is a good honest decent hard-working bloke who is trying to make his life better and basically just trying to get by. What does this Government do? It makes him feel guilty it makes him feel bad and it makes his life harder—and there are thousands perhaps hundreds of thousands of people who are in his situation at the moment. 
Turning to the other part of “making stuff up” I will talk briefly about the elaborate charade that this country has been put through during the last 2 ½ years by the Minister for Communications and Information Technology—or the “Minister of Miscommunications”—Steven Joyce. He has been trying to put in place a programme to provide this country with the infrastructure that will underpin the technology that we will need as we go into the future: ultra-fast broadband. A whole series of incidents involving making stuff up obfuscating secrecy and not being upfront with the public has occurred. The first one was the pledge that was made in 2008 that 75 percent of New Zealand households would be connected to ultra-fast broadband within 10 years. The pledge was that 75 percent of New Zealanders in their homes would be connected to ultra-fast broadband at a cost of $1.5 billion. The most interesting thing about that and it involves the current Minister— 
Hon Clayton Cosgrove 
: Who? 
CLARE CURRAN 
: The Minister of—what is he—“Miscommunications” Steven Joyce. 
Debate interrupted.