English Bill: Debate on Budget Policy Statement 
Text is incorporated into the Bound Volume 
English Bill: Debate on Budget Policy Statement 
[Sitting date: 13 March 2013. Volume:688;Page:8481. Text is incorporated into the Bound Volume.] 
Hon BILL ENGLISH (Minister of Finance) 
: 
 Well I think Labour is learning that until it apologises for its mess the public will not take it seriously. That is becoming increasingly evident. Labour thought it was going to bounce back into the start of the year and start looking like an alternative Government. In fact it is struggling to look like the alternative Opposition at the moment. It is still the Greens ahead of Labour by a long neck in the Opposition stakes. So that would be my advice to Labour: first apologise so that the public know that Labour understands why it was thrown out because it still has not acknowledged that 5 years on and second put a bit more effort into trying to head off the Greens on credible economic commentary credible education policy credible climate change policy and credible views about just about anything else the Government is doing. 
That is the job the Labour Opposition should be putting itself to and I will just tell the House a bit about the job the Government is putting itself to. In the light of the pretty extraordinary economic circumstances that have occurred around the world the Government has set out in the Budget Policy Statement four pretty straightforward priorities: first to responsibly manage the Government’s finances; second to build a more productive and competitive economy; third to deliver better public services within tight financial constraints; and fourth to rebuild Christchurch which is after all our second-biggest city. 
This programme comes from the Government following a couple of rules of thumb. The first is that we should focus on those things we can control. It is easy to get diverted and confused by the many events around the world that are intriguing and interesting and relevant to us but over which we cannot have any control. A most recent example of that which has upset prospects for Europe is the result of the Italian election—something over which we can have no control whatsoever. 
Secondly the Government is continuing on a pathway of moderate and considered change. Too often it has been the case in New Zealand that Governments have rushed into changes of one sort or another lost public support failed to win the arguments and seen those changes undone simply not accepted by the New Zealand public or accepted very reluctantly. The effect of that has been the country deciding that change is not good for us and that we need to go back to where we were. That is one of the things that have underpinned our patchy economic performance compared with Australia over the last 30 years. This Government has been determined to advance change as required in the economy at a pace and of a kind that can be broadly supported by a New Zealand public who in my view are more understanding of the economic circumstances and more understanding of the need for successful and profitable business than I can recall at any time in my adult life. So that is the context in which we have set out those four priorities. 
I will not go through all of them but I will focus on a couple of aspects of the Government’s priorities as set out in the Budget Policy Statement. The first is the Business Growth Agenda. There is much loose talk about jobs—a kind of magical thinking that somehow if the Government wanted jobs enough there would be a lot more of them. Well of course the Government wants jobs but wanting them is not creating them. The Government creates jobs by employing and of course we are restricted in whom we are going to employ by our finances and by the fact that we are finding that actually with a few less people we can offer better public services. So when the Government is not employing people someone else has to and that someone else is the private sector. I know that businesses are regarded by the Greens and Labour as nasty exploitative profit-wrenching people who should be punished if at all possible particularly if the value of their business goes up. That is actually where the incidence of a capital gains tax would fall: on successful businesses. That is who would pay it because housing is to a large extent exempt from the capital gains tax. 
There is only the Government and the private sector to employ people. We are limited. In fact we are shedding numbers very gradually so it is up to the businesses. The Business Growth Agenda focuses on a very simple decision: the decision of a workplace to employ another person and invest another dollar usually investing the dollar first and employing the person who comes with it. There is no silver bullet to make that decision a whole lot easier particularly when our export markets are not in great shape our exchange rate is relatively high and New Zealand consumers have been pretty careful with how they are spending their money. It is just not easy to create jobs in that environment and plenty of people would like to. They would like to see their business expanding. 
The Business Growth Agenda sets out in the most transparent way possible every policy move every policy idea and every policy decision the Government is taking to focus on making it easier for businesses to invest and employ. The publication of the documents laying out those 200 or 300 different items is an open invitation to the workplaces and the businesses of New Zealand to tell us the next thing we can do in addition to what is already on the list to make their workplace more successful and more likely and more able to employ another person. 
A couple of aspects of that have been highlighted recently. One is the tidying up of the apprenticeship scheme which was left in a disgraceful mess by the previous Government. 
Hon Members 
: Ha ha! 
Hon BILL ENGLISH 
: Well the Labour Government was actually training dead people—it was training dead people. It was paying for dead people. It was paying for tens of thousands of young New Zealanders who got no qualification credits at all—not just a handful. There were a lot who got a handful but there were tens of thousands who got none after the taxpayer had spent millions on training them. So out of the savings we have made from tidying up that system we have been able to relaunch 14000 new apprenticeships with a $1000 or $2000 bonus to assist with the purchase of tools and to encourage employers to take on young New Zealanders. 
Another example that has flowed out of the Business Growth Agenda is the Government’s determination to address the longstanding and complex policy problems around the Resource Management Act and more important in the long run the management of water because water is New Zealand’s most important strategic asset. Previous Governments have either not addressed it or failed to address it. We are now probably about halfway through a 5 to 6-year process that is going to give New Zealand the tools to manage its water for both environmental and economic benefit. 
One other initiative I will mention in this context is Callaghan Innovation which is a new attempt—and I believe that it will be a successful one—to work with the business community to reshape the Government’s intervention and support for innovation in business in a way that focuses it more on enabling new investment and new jobs because much of the spending has not been focused tightly enough on that objective. 
We are also managing the Government’s finances responsibly. As a member who spoke recently pointed out if you compare for instance the expenditure forecasts for 2014-15 back in 2009 it was going to be $83 billion. In that year we are forecasting to spend $73 billion. Public services will be better—significantly better—even though less money is going to be spent because the way we have approached the spending of taxpayers’ money has empowered and enrolled the whole Public Service in doing a better job with the resources it has. It has risen magnificently to the challenge as has the rest of New Zealand.