Hereora Dave: Budget Debate 
Hereora Dave: Budget Debate 
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DAVE HEREORA (Labour) 
: 
 I want to contribute to this debate by supporting my previous colleague’s comments surrounding tax cuts. We do not support tax cuts. They are a thing of the past. They are the National Party’s policy mindset of the past. 
Maori are better off under this Budget and overall better off under this Government. This Government is committed to supporting whanau hapu iwi and Maori communities. It delivers help so that whanau get ahead with added security for the future by building on the progress introduced to public health and education services with extra support for businesses and for families with children. The recent Hui Taumata made it clear that the path to development is through education employment and enterprise so that it is Maori enterprise. Maori are reversing the narrow-minded cul-de-sac of dependency and are therefore meeting the challenge that enterprise offers. The Government is very conscious of this and welcomes those initiatives as the Budget allows supportive measures that reinforce Maori enterprise. 
Many Maori in business will benefit from the business package of the Budget of 2005. This package makes changes to tax and depreciation laws in order to encourage savings ensures a more productive use of capital improves access to overseas capital and skills and reduces compliance costs. 
More New Zealanders are in work and more are back at work than ever before. In fact unemployment is at just 3.6 percent—the lowest recorded in two decades. With Maori unemployment dropping from 18.9 percent in March 1999 to just 8.7 percent this is the first time in over 20 years that the Maori unemployment rate has been down to single digits. I bet that National wishes that that was a deep dark secret! 
But let us not take things for granted. That did not happen on its own. It did not just fall out of the sky. It certainly was not caused by the National Party. No let us give credit where credit is due. It happened through careful considerate policy planning by Labour. We accept the value and the importance of providing a real platform of change of being inclusive and of inviting people into processes that deliver. 
One of the major programmes that continues to be funded in this year’s Budget is the Working for Families package. A family with four children and on a single income of $55000 a year will be better off under the package by nearly $150 a week once it is fully implemented by 2007. By contrast that family would gain just $39 a week from a reduction in income tax to a 20 percent flat rate. The fiscal cost of a flat tax at that rate would be around $5.5 billion. How would the National Party fund that? That means every cent knocked off the top personal tax rate of 39c in the dollar would cost $115 million dollars; every cent off the upper-middle rate of 33c would cost $95 million; the lower-middle income rate of 21c would cost $325 million for every cent and every cent off the bottom rate of 15c would cost a further $215 million. The approximate cost of changing the personal rates from 33c to 30c is a total—listen to it—of $1725 billion. 
One does not have to be a rocket scientist to work out that tax cuts are expensive. How does the National Party intend funding that proportion of tax cuts? Would it slash them from health? Labour will not. We are investing into health by committing $109 billion a year by 2008-09 meeting the full costs of maintaining real population-adjusted spending for the health and disability sector. 
 Does National intend to fund tax cuts by cutting funding for education? This Budget does the reverse. We are increasing our investment in early childhood education by $152 million over 4 years as we continue to deliver on our commitment to make early childhood education more affordable more accessible and of the best quality possible for all New Zealand families. Will National take it out of housing? Or will it go back to its dismal failed policies of the 1990s by selling off assets? New Zealanders are absolutely fed up with the National Party compromising health education and housing. Or do we just agree to the sale of our assets for the sake of National using tax cuts as a policy plank for the coming election? That is not surprising; that is how hopeless National is. 
This Labour-led Budget maintains a strong credible fiscal stance. It is fair and inclusive. It helps Kiwis build a stake in their country and it builds the conditions for growth. It secures the future for the nation as a whole and for New Zealand families. With careful financial investment it means we can afford to invest in health education and social services. 
It is a Budget for the future that saves for the future. The new KiwiSaver scheme is intended to begin operation on 1 April 2007. It is linked to a new scheme to assist modest to middle income families with a deposit for a first home. Those who are KiwiSavers for a minimum of just 3 years will qualify for an additional subsidy of $1000 a year up to a maximum of 5 years at the time of the purchase of their first home. 
This is a Budget with vision which builds the conditions for growth and it could have been achieved only by sound fiscal management. If the National Party had its way it would fund tax cuts by cutting spending on health and education by selling off State housing stock and by returning to failed old archaic policies that it tried in the 1990s. It has no new ideas no surprises no vision—nothing new. 
The Budget further creates solutions boosting New Zealanders’ capacity and choices through skills and training. Who cut the apprenticeships scheme? Who cut Maori Trade Training? It was National. We are doubling the industry training funding—$136.7 million will be invested annually. Modern Apprenticeships has been successful. Our target is 8000 Modern Apprentices by 2006 and industry training—those upskilling on the job—to nearly 140000. Our target is 150000 in industry training organisations this year moving to 250000 by 2008. That is a real commitment. 
The new Kapohia nga Rawa initiative provides funding of $14.8 million over 4 years for outreach and community workers to work with whanau to provide information and advice on education career planning financial management and housing. That will certainly assist Maori development and enterprise. 
In terms of promoting an understanding of the Treaty of Waitangi the Budget invests $1.2 million to develop and stage a major touring exhibition focusing on the treaty. The exhibition will be created by the Treaty of Waitangi Information Unit. It will visit 35 locations around New Zealand where it is estimated over 250000 New Zealanders will see it. That is about investing in our nationhood. 
 To improve the quality of life for kuia and kaumatua the Budget increases funding for cataract hip and joint operations. Over the next 3 years we aim to fund an extra 7500 cataract operations and we will fund ongoing increases in the number of hip and joint operations. 
The Government’s primary health strategy focuses on prevention and primary health organisations and clusters of health service providers are an all-important part of our strategy within this Budget to give cheaper doctors’ visits. There are now 77 primary health organisations able to offer lower-cost health-care for many of the 3.8 million New Zealanders enrolled with them. 
I finish by saying that we are supporting the celebration and preservation of Maori culture. Budget 2005 increases funding for kapahaka to help with regional planning and projects. We are also making housing more affordable. We are increasing State housing stock thus helping to reduce waiting lists and waiting times in the areas of high-housing need especially in Auckland. Other Government programmes to ensure better housing include programmes of income-related rents for low-income State house tenants rural housing programmes to address substandard housing community renewal programmes to improve housing and social conditions and healthy-housing programmes to reduce health risks in overcrowded homes. I extend my commitment to our Minister of Finance Dr Michael Cullen and thank him for a very stable managed way of presenting our Budget 2005.