Cunliffe David: Taxation (Annual Rates and Budget Measures) Bill — In Committee Third Reading 
Cunliffe David: Taxation (Annual Rates and Budget Measures) Bill — In Committee Third Reading 
[Volume:672;Page:19000] 
Hon DAVID CUNLIFFE (Labour—New Lynn) 
: 
 I rise to take a call but I was engrossed in this incredibly exciting  
Dominion Post  
article which aptly sums up the Budget as “A big fat zero”. Moving on this speech is about the Taxation (Annual Rates and Budget Measures) Bill. This bill vests part of the Budget in legislation. As we have discussed earlier and throughout this debate the first question that must be asked again in the House is why we are being forced to do this under urgency today. Fundamentally there is a deep paradox at play. The Government has said it will seek a mandate from the public on the changes proposed in this bill. It said it will go to the 2011 election in which case these changes should have gone into Budget 2012 once a mandate had been obtained. As the Government has not done so it is either the case that the Government has unmandated legislation and therefore fiscal consequences or it has broken an election promise. It can logically be only one of those alternatives. Treasury has signed off on this bill so I assume that means Treasury’s view is that this is not unconstitutional and not unmandated. It must therefore logically be the case that Treasury believes that the Government has broken a major election promise; if not one then several. 
The Government said it would not cut KiwiSaver and this bill cuts it. It said it would not cut Working for Families and this bill cuts it. Most people I talk to are struggling. They are struggling as prices rise faster than wages. They are working hard they are doing everything right but they just cannot seem to get ahead. Every week I hear stories in my electorate of people who week after week are cutting back just to put food on the table or to pay the power bill. National’s third Budget should have addressed this but unfortunately it makes the struggle that much tougher. It does not help but it does hurt. It is a tinkering Budget that does not have a plan to get the economy going again. It does not address the problems that are at the core of this moribund economy and that have undermined our chances of putting people back to work. 
The best way to get a deficit down is to get the economy growing again. We in Labour will be continuing to outline our plan to get the economy going over the next few months. We will present a credible strategy for rebuilding the New Zealand economy with a fully costed package of measures. There is no doubt that we need to be saving more as a country. There is no doubt that the intention of building up national savings is worthy but there is also no doubt that reducing the incentives available to New Zealanders to get them into the programme while simultaneously taxing the employer contribution before it benefits the employee is not the best way to do that. One can expect that the Labour Opposition will be bringing to the public a better plan for increasing national savings for the benefit not only of those saving but also of all New Zealanders. 
Selling assets is just as short-sighted. This bill contains the tax rates which are predicated on a fiscal balance. That fiscal balance is supported by the illusion of capital flows that should not yet exist. There is no mandate for asset sales. All the polling tells us that New Zealanders hate the idea of the so-called mixed-ownership model which makes people pay twice for things they already own. Every New Zealander owns Mighty River Power Meridian Energy Genesis Energy and 80 percent of Air New Zealand. New Zealanders own them already. They do not need to buy them twice and of course what will happen is that most of those shareholdings will pass to the control of foreign multinational corporations thereby undermining the economic sovereignty of this country. 
That might be less awful if it solved the problem but it does not. It is like taking a teacup full of water and throwing it on a raging bushfire except in this case there is nothing raging about the New Zealand economy; it is raging nowhere. Just as importantly this does not therefore solve our debt problem. What will the Government do when debt increases further and there are no assets left to sell? This is not a plan that will grow our economy. There is nothing in this bill nothing in the regulatory impact statement and nothing in the Budget that shows a plan to create jobs and growth. 
A rosy glow is forecast of 4 percent growth in 2012-13 which nobody believes. Nobody believes it. The rating agencies patently do not believe it because this Government has just got a C- or a D from Standard and Poor’s which means: “We will believe it when we see it.” Increasingly that is now the view of the mainstream media which are questioning the flimsy thread of credibility upon which this Budget hangs. They do not believe that it is right that there should be $1 billion of unspecified cuts. They do not believe that it is right that there should be $4 billion of difference in cash flow between the Inland Revenue Department and Treasury. They do not believe that it is right to raid the piggy bank of public servants by taking $650 million from their retirement fund. They do not believe that it is right to take more out of the KiwiSaver of teachers than we are putting back into early childhood education. None of that is right none of it shows any vision none of it shows any boldness and none of it shows any plan. 
New Zealanders are hungering and thirsting for a way out of the economic wilderness and they have been waiting for three Budgets now for a credible plan to get them there. It was not the Job Summit. It was not the cycleway. It was not the rolling maul of tinkerers. It was not suspending payments to the Superannuation Fund. It was not huge tax breaks for upper-income earners and it is not cutting KiwiSaver and Working for Families and flogging off assets because that is all this Budget does. 
The crime of this Budget is not only what it does do. It is not only the measures that attack KiwiSaver and Working for Families that are in this bill but it is what it does not do. This Budget does not provide hope it does not provide vision it does not provide a plan and it does not provide a way out of the fiscal nightmare that this conservative Government has wrought upon New Zealand. Government members will say that it is Labour’s fault when it is not. Labour left the country in surplus to the tune of 7.6 percent of GDP. They will tell us that it is the earthquake’s fault but it is not. The earthquake is responsible for only 10 percent of the accumulated debt and their economic mismanagement is 90 percent along with the global financial crisis. 
They will tell us that they are being fiscally responsible and they are not. There is nothing fiscally responsible about making up numbers. There is nothing responsible about a billion dollars of cuts when we do not know where they are coming from. There is nothing responsible about imagining 170000 jobs that do not exist and will not exist or Standard and Poor’s would have taken them at their word. 
I have given up waiting for Bill English to have a new idea. I have given up waiting for Bill English to get a vision for this economy. New Zealanders are giving up on this tired listless useless National Government. National will be a one-term Government. How do I know that? Because the polling is telling us—wait for it—that 48 percent of New Zealanders believe the country’s economic management is on the wrong track and 32 percent believe it is on the right track. I have been here for four terms and I can tell members opposite that when the economic right track / wrong track numbers cross over the Government’s popularity is sure to follow—and they are sure to follow. As quickly and as surely as night follows day they will be making the pilgrimage to this side of the Chamber after 26 November when the public is called to vote upon this rubbish Budget and throw it out.