Brash Don: Questions for Oral Answer — Questions to Ministers 
Brash Don: Questions for Oral Answer — Questions to Ministers 
[Volume:606;Page:3916] 
11.  
Dr DON BRASH (NZ National) 
 to the  
Minister of Finance 
: Does he agree with the Prime Minister’s statement that the reforms implemented by the Government over the 1990s left “the poorest New Zealanders an estimated twenty to twenty five per cent worse off” as stated in her speech to the Eighth Women’s Conference of the International Confederation of Free Trade Unions; if so what evidence does he have to support such a claim? 
Hon Dr MICHAEL CULLEN (Minister of Finance) 
: 
 Yes. The Prime Minister’s speech clearly identified benefit cuts and the move to market rents as having an impact on the poorest New Zealanders to that extent. It is simply a matter of record that in 1991 the National Government reduced many benefits by 20 percent and in some categories by 25 percent. Market rents would have compounded those cuts. 
Dr Don Brash 
: Would the Minister be surprised to learn that Statistics New Zealand data on income distribution shows that real average disposable incomes for the poorest 20 percent of New Zealand households actually rose between 1991 and 1998 after having fallen by nearly 5 percent during the previous 5 years of Labour Government rule and will he now seek to correct the Prime Minister’s mistake on this matter? 
Hon Dr MICHAEL CULLEN 
: No that is a function of the changes in the labour market rather than changes in the income of people on benefits. 
Dianne Yates 
: Has he seen the claim that: “In 1990 Australia’s GDP per capita was 5 percent above New Zealand’s and by 1999 it was nearly 40 percent above.”; if so will the Government do better than we did in the 1990s by working in partnership with industry to create jobs? 
Dr Don Brash 
: I raise a point of order Mr Speaker. This supplementary question has nothing to do with the primary question. 
Hon Dr MICHAEL CULLEN 
: It is about the movement of relative incomes which is what the primary question was about. 
Mr SPEAKER 
: It is close enough. 
Hon Dr MICHAEL CULLEN 
: Yes indeed. The claim was made by the former Governor of the Reserve Bank— 
Gerry Brownlee 
: I raise a point of order Mr Speaker. I appreciate that you have given a ruling but I ask you to reflect on that ruling and come back to the House about it tomorrow. When you see the  
Hansard 
 and look at the question asked by Dr Brash the response from Dr Cullen the supplementary question from Dr Brash and the further response from Dr Cullen and then consider the question asked by Dianne Yates you could conclude nothing more than that that question was wide of the mark. 
Mr SPEAKER 
: No I can conclude something more than that. The original question was to do with the 1990s as was the supplementary question. [ 
Interruption 
] Please be seated while I am on my feet. I am not going to have my ruling disputed. This question addressed the primary question and the supplementary questions. I invite the Minister to reply. 
Gerry Brownlee 
: I raise a point of order Mr Speaker. 
Mr SPEAKER 
: It had better not dispute my ruling. 
Gerry Brownlee 
: I am simply going to ask you to extend that ruling and tell us whether we can now ask Dr Cullen about fashion in the 1990s or perhaps fuel prices or car prices or something else from the 1990s. 
Mr SPEAKER 
: If it was in relation to the original question yes members could. 
Hon Dr MICHAEL CULLEN 
: The claim that we lagged so far behind Australia during the 1990s and fell so far behind in those 9 years was made by Dr Don Brash in his speech to the Knowledge Wave Conference as an indictment on the effectiveness of the 1990s reforms. The Government has already halted and is now starting to reverse that relative decline. 
Dr Muriel Newman 
: How does the Minister reconcile his answer with the fact that official Statistics New Zealand figures show that the average worker enjoyed an increase in gross pay of 9.8 percent in real terms over the 1990s and should he not be more concerned about the fact that New Zealanders’ real average net wages have fallen by 2.4 percent over the 3 years he has been Minister of Finance? 
Hon Dr MICHAEL CULLEN 
: Indeed the member is now compounding the previous error because she again is confusing household incomes with wage rates and benefits rates. Benefit rates were cut in 1991 by up to 25 percent. Household incomes have risen very strongly over the last 2 or 3 years. 
Hon Matt Robson 
: What has this Government done to improve the lot of vulnerable groups in New Zealand in consideration of what happened in the 1990s? 
Hon Dr MICHAEL CULLEN 
: The policy of market rents has been reversed and we have reintroduced income-related rents for low-income State house tenants. We reversed the previous cut to the married rate for New Zealand superannuation and boosted it so that it has been increased by more than $20 a week. We have raised the minimum wage introduced paid parental leave eased the cost of student loans and created 138000 new jobs 80 percent of which are full-time. 
Sue Bradford 
: Is the Minister concerned that those worst off in this country as a result of the 1990 reforms such as the benefit cuts and the introduction of the Employment Contracts Act tend on the whole to be families on benefits and will he remove the current discrimination that sees the family tax credit available only to those in paid work? 
Hon Dr MICHAEL CULLEN 
: As both myself and Mr Maharey have indicated we are looking at major restructuring in the context of next year’s Budget assuming that the existing surpluses prove to be structural rather than cyclical. That will include a restructuring of the whole family support system whilst ensuring that there are sufficient incentives to move from a benefit into paid employment. 
Dr Don Brash 
: Is the Minister saying that Statistics New Zealand data is incorrect and that the Prime Minister is right when she says that the income of the poorest New Zealanders went down during the 1990s—something not confirmed by Statistics New Zealand? 
Hon Dr MICHAEL CULLEN 
: The member must not confuse wage rates and household incomes with benefit rates. Benefit rates were cut in 1991. Unemployment peaked in 1991 at 11 percent then fell thereafter. 
Dr Don Brash 
: I raise a point of order Mr Speaker. The question related to the Prime Minister’s speech which talked about the poorest New Zealanders being an estimated 20 to 25 percent worse off. There was no reference to benefits or household rents or whatever else. She said that the poorest New Zealanders were 20 to 25 percent worse off because of the policies of the 1990s. There is no evidence of that from Statistics New Zealand. 
Hon Dr MICHAEL CULLEN 
: Speaking to the point of order I say to the member that this is debating material. He must learn that this is a debating chamber. A person who was on a benefit in 1990 and on a benefit in 1991 had suffered a cut in real terms of over 20 percent in his or her income in many instances. 
Mr SPEAKER 
: The member asked an appropriate question. The Minister addressed the question.