Graham Kennedy: Budget DebateText is incorporated into the Bound VolumeGraham Kennedy: Budget Debate[Sitting date: 22 May 2014. Volume:699;Page:18273. Text is incorporated into the Bound Volume.]Dr KENNEDY GRAHAM (Green): The Minister of Finance opened this debate by saying what a privilege it was to deliver his sixth Budget. In response New Zealanders will make sure he is unable to deliver a seventh because his Government’s budgetary policies are taking us down the road of traditional macroeconomic policy: short-sighted in time mired in 20th century ideology and limited in 21st century vision. I say this to the Hon Chris Finlayson and he should listen: it is the great-uncle of all Budgets cynical in tone and mercantilist in nature.The Budget has one laudable component: it aspires to eliminate the current account deficit and enter a new era of surplus. That is a necessary aspiration and the Government is on target towards a wafer-thin surplus which it is claiming as the ticket to electoral victory this year. This nutrient-thin cake is sugared with the icing of vanishingly small social handouts to families. This is designed to have the Government appear as a benign patriarch—a better and brighter future for all New Zealanders. That future according to the Prime Minister and the Minister of Finance revolves around growth.The transparent shortcoming of this election Budget is that it is intrinsically flawed. It is flawed because it wilfully disregards the difference between sustained growth and a sustainable economy. The Government cites as its overarching objective the goal ofwhat it calls sustained growth. What could be better than sustained growth? The concept conjures up a poster image of jobs health and education all in the context of stable interest and exchange rates and a wizard-like balancing of the books.Now and again the Minister used the phrase “sustainable growth” in lieu of “sustained growth” without seeming to know the difference. That is a problem because the concept of sustained growth is flawed. A sustained trend simply means a continuing trend. We can have sustained growth. That just means it is aspiring to go on for ever. We can have sustained growth for a while that is unsustainable—so-called sustained growth that goes on and on until it breaches the carrying capacity to sustain it.We cannot have infinite material growth on a finite planet. That in fact is already occurring at the global level. The ecological footprint breached Earth’sbioproductive capacity in the early 1980s. That curve has continued upward ever since. That curve has continued with the growth in global population and per capita consumption continuing remorselessly. It is a new form of sustained growth—sustained but not sustainable.What does that mean for the national economy our macroeconomic planning and our budgetary judgment for 2014? It means that when we come to formulate our priorities we must begin with the goal of sustainability rather than sustained growth. It may be that sustained growth can occur within the context of sustainability but if it cannot it must not be the goal.National’s four priorities in this Budget were identified as responsible management of public finances a more productive and competitive economy delivery of better public services and the Christchurch rebuild. By way of contrast let us consider one overriding Budget priority—responsible management of the nation’s economy in the context of global sustainability. Let us consider four supporting goals to that. One responsible public finances towards a balanced net international investment position; two higher economic productivity; three better public services for greater social equity and higher quality of life as measured by the genuine progress indicator; and four the Christchurch rebuild.Bill English ended his last Budget statement with the comment that “New Zealand is among the first developed countries to achieve a return to normal economic settings.” but the global economy is on anything but normal economic settings. Bill English may wish it were but it is not and never will be again. Until we regard ourselves as ecological stewards in our budgetary planning until we regard ourselves as being responsible for sustainability above all else those economic settings will never again be normal. That is what is so deeply flawed in this 2014 Budget.