Clark Helen: Budget Debate 
Clark Helen: Budget Debate 
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Rt Hon HELEN CLARK (Prime Minister) 
: 
 There is only a two-word response to that speech: “He’s gone!” The only question is: is it before the election or the day after? I am told by those who were watching that speech on television that the National MPs were sitting there looking like a whole lot of lambs waiting for the abattoir—that is how pleasant it was. 
Today the Leader of the Opposition told us that he admires the Australian Budget. Well wait for it—I am told that the average worker got around $6 a week out of that Budget and Aussies also got funding cuts in areas like health. What does that tell us about the National Party’s plans? Actually the Leader of the Opposition admitted today that there was no room for big tax cuts without spending cuts and that tells us the real agenda: tax cuts for the rich and their mates and spending cuts for everybody else. [ 
Interruption 
] 
Madam SPEAKER 
: Members are reminded to keep their interjections at a reasonable level. 
Rt Hon HELEN CLARK 
: I am very happy with the interjections—they are so helpful! 
Madam SPEAKER 
: The more that interjections come from one side of the Chamber the more they will come from the other. Then the speech will not be heard either by members in this House or by others who are listening elsewhere. The convention is that any interjections should be made in an orderly fashion and not by barracking. 
Rt Hon HELEN CLARK 
: The Leader of the Opposition has had weeks to think about what he might say in his Budget debate speech and to get the figures right. He came up with a figure about average annual growth being 3.7 percent over the past 10 years. Well a few quick calculations suggest that in the December years from 1990 to 1994 average annual growth was 1.7 percent and 4 of those 5 years were under a National Government. Over the following 5 years the average annual growth rate was 2.9 percent under a National Government. Of course in the last years since then from December 1999 through to December 2004 the average annual growth was 3.9 percent under a Labour Government. 
This Budget is about working for New Zealanders. It is about working for families. It is about working for our older people. It is about working for our young people for business for workers—for all Kiwis. This Budget is about planning for the future not dreaming of the past. This Budget is about taking New Zealand forward not going backwards. The backwards crowd is over there. This Budget makes big investments in what matters to New Zealanders—most important in business job growth savings health and education services for older citizens support for families and transport police and justice. This Budget works for New Zealand and New Zealanders. This Budget is possible because this Labour-Progressive Government supported on confidence and supply by United Future and often supported on policy by the Green Party has provided strong stable Government and run a strong economy. 
This Government knows what matters to New Zealanders. What matters is keeping the economy growing pushing up the value of what we produce and what we export and making sure that the gains of economic success are felt in homes across the land. This Budget delivers for New Zealanders. This Budget delivers because people in this Government understand what drives New Zealanders far more than a multimillionaire finance spokesman from the National Party will ever do. 
I congratulate the Minister of Finance on the Budget. Michael Cullen and I came into politics for the same reasons. We wanted the living standards and the quality of life enjoyed by New Zealanders to be among the very best in the world. We are indeed the generation that benefited from the opportunity and security that the very first Labour Government put in place in this country. That helped us go all the way with our education and it gave us the best possible start in life. The dream we have always had is to see the New Zealand of today deliver on the hopes and dreams that every family has for its kids as our families had for us and deliver the security that every family wants its older members and its sick and disabled members to have. 
The reward of 5½ years in this Government has been to see the New Zealand economy turn round and strengthen and grow. The last 5½ years have seen our economy grow at among the fastest rates in the OECD and faster than those of our top trading partners Australia the United States and Japan. Many businesses have benefited from that growth and New Zealand overall has benefited from the success that they have had. This Budget with its huge package of business tax breaks will help our businesses to grow further and faster and increase the value of what they do. The business tax breaks in this Budget are worth over a quarter of a billion dollars in this coming year. Over the next 4 years business tax breaks gross are worth about $1.4 billion and the net benefit taking away the carbon tax due in 2 years’ time will be over $700 million over those 4 years. These tax breaks are aimed at encouraging business growth investment and innovation in jobs and that is good for New Zealand. 
The last 5½ years have seen a spectacular growth in the number of jobs in this economy. There are more than a quarter of a million new jobs—around 264000 new jobs—in the New Zealand economy under a Labour Government. That is a very good result. Along with the new jobs has come a spectacular decline in unemployment. The average annual rate of unemployment in the March 1990 year was 7.4 percent. Today the average annual rate to March is 3.8 percent which is almost half. For Maori and Pacific New Zealanders unemployment is down by 52 percent. 
There has also been a spectacular decline in the numbers on unemployment benefits and benefits overall. There are now 85000 fewer people receiving an unemployment benefit than there were 5 years ago and overall the numbers of working-age people on benefits are down at more than 100000 lower than they were in 1999. Opposition parties talk about getting welfare numbers down; a Labour-Progressive Government actually does it and will do it again. The story now about jobs is not that there are too few of them but that we do not have enough workers and enough skills in the economy. That is why this Government is absolutely committed to moving people from benefits into work to increasing the incomes for our families at work to supporting our working families with children and to upskilling our workforce. 
This Budget sets another new ever-higher target for Modern Apprenticeships. There will be 9000 by December next year. Already we have over 7700 young people in Modern Apprenticeships and just this week the 1000th apprentice completed the full apprenticeship. The funding for industry training overall is up again. It is now over 100 percent up on what was spent in 1999 by a National Government—a National Government that left New Zealand without the skills we needed for a modern economy and society. 
This year’s Budget carries on with new funding for Working for Families. Already on 1 April this year most families receiving family support received in the pocket another $25 a week for their first kiddie and $15 a week for each other child. This financial year the new in-work payment starts for families working at least 30 hours a week for a couple and 20 hours a week for a single parent. As well this financial year in this Budget the family tax credit goes up and the abatement thresholds for all forms of family assistance go up as well. When Working for Families is fully in place by 1 April 2007 our families with children that are on $25000 to $45000 a year will on average be $95 to $100 a week better off. If I were a Kiwi family I would grab that 95 to 100 bucks better off a week any day over a $6 Aussie tax cut. As well of course our families will benefit from the overall changes to the tax thresholds that the Minister of Finance has announced today. 
Working for Families also includes the big improvements in both housing subsidies and support for our children in childcare and after-school care. Yesterday I had the privilege of going out to an out-of-school care programme for children in the Hutt Valley and announcing very big increases because with the money in this Budget we will be able to fund another 100 out-of-school care programmes for our children. With this Budget we have again increased the thresholds for the eligibility of families for support for childcare and out-of-school care. More families will get it. Seventy percent of our families will get support for childcare costs and out-of-school care costs from this Budget. 
I also want to say that the saving initiatives are incredibly positive for families and for our young people. The new KiwiSaver scheme in this Budget will give people a hand up to start saving with $1000 being paid into their accounts by this Labour-Progressive Government. We are making saving very easy. Workers will be placed in the scheme unless they opt out. KiwiSavers will be saving for their retirement and for their first home if they want to. Those who are KiwiSavers for at least 3 years will qualify for a deposit subsidy for their first home of $1000 from the Government for each year up to a maximum of 5 years when they buy their home. That is a big leg-up for Kiwi families aspiring to homeownership. Our Government believes in supporting Kiwis to be financially secure in their retirement and we want to help more people buy their first home. Owning one’s own home has always been part of the Kiwi dream. Virtually everybody in this House has realised that dream—why not other Kiwis? That is what KiwiSaver is about. 
The Budget continues the big investments the Government has been making in education overall. It provides more funding for early childhood education more for schools—for teachers and operations grants—more for tertiary spending and there is good news too for our tertiary students with another $57 million over 4 years for student support. There are 500 new fees scholarships available from this Budget paying up to $3000 a year towards fees. Yes students will be bonded to work in return and that is only fair. We have also adjusted the parental income thresholds so that more of our students again are eligible for student allowances. We are allowing students to earn considerably more from their part-time work before their allowances are affected. And very important for the sixth-year medical students whom we are very keen to see stay in New Zealand their trainee intern grants are going up by 10000 bucks a year to over $26700. That reduces their need to borrow and encourages them to stay and work in our country not somebody else’s. 
For older New Zealanders this Budget continues in the tradition of the last five Budgets of making life better. From the time we were elected we have kept our word to older New Zealanders. In 2000 we reversed National’s cuts to superannuation and restored the agreed superannuation formula. In our first term we set up the New Zealand Superannuation Fund so that New Zealand superannuation would always be secure for future generations. This year another $2.1 billion goes into that fund taking the total invested close to $6.5 billion. 
In our last Budget we announced the doubling of the number of orthopaedic operations that are to be done over a 4-year period and we are on track to achieve that doubling. This Budget puts in place a 50 percent increase in the number of cataract operations per year a goal to be reached in 3 years’ time. Last year around 8000 cataract operations were done; in 3 years’ time 12000 cataract operations per year will be done. This matters to older citizens. 
As well this Budget sees the beginning of the phase-out of asset testing on older people in care and this has been an issue of principle for our Government. Of course it is expensive but it will be done. From 1 July this year—barely 6 weeks away—the amount a single person in care can keep before asset testing starts rises from $15000 to $150000 and for a couple where one partner is in care it is up from $30000 to $150000. Also in this Budget are big increases in funding for our older people in residential care because we want the very best care for our older people that this country can pay for. We want better wages training and working conditions for our home-care and residential care workers. Also older people will be the big winners from the huge improvements to our rates rebate scheme starting on 1 July next year. Up to 300000 ratepayers will be able to have up to $500 per year deducted from their rates bill. Over 5½ years this Government’s record for older citizens has been one of steady improvement. We do not make all the promises that minor parties make because we know that we could not keep them. They know they could not keep them either but that does not stop them from making them. 
Health spending overall is a huge winner in this Budget—up by close to $1 billion this year and over $4 billion over the next 4 years. Health is one of the most basic services that our people expect a Government to provide and a Labour Government takes that responsibility very very seriously. It is a matter of record that this Labour-led Government runs strong Budgets and a strong economy. Over six Budgets we have run strong surpluses. We have invested in basics and in infrastructure. We have made big investments for the future in the Superannuation Fund and now in the savings initiatives. 
This Labour Government led by Helen Clark and Michael Cullen will not return to the deficits and borrow-and-hope Budgets of past National Governments. The National Party has not learnt a thing from that experience of the past. It is promising billions more in tax cuts and spending. That is not only voodoo economics; it would also take New Zealand back to a failed past of failing public services funding cuts and misery for Kiwis. 
New Zealand has done well under this Labour Government. Strong Budgets investing in the future and in the basics have been very critical to that success. I thank our partners who have supported us in this House for being able to run a strong stable Government and economy. Only one message can come from this Budget: for a strong economy and for better living standards and services for New Zealand and New Zealanders people should vote for a Labour-led Government.