5. Question No. 5—FinanceNICOLA WILLIS (Deputy Leader—National) to the Minister of FinanceQuestion No. 5—FinanceNICOLA WILLIS (Deputy Leader—National): My question is to the Minister of Finance and asks: does he agree with Westpac Senior Economist Satish Ranchhod who said this week that over the coming year household spending levels will come under pressure from continued increases in the cost of living"; and if so why won't he provide New Zealanders with income tax relief to help them get through this cost of living crisis?Hon Grant Robertson: A point of order Mr Speaker. That's not the question on the sheet. SPEAKER: OK let's have a go at the question on the sheet shall we?5. NICOLA WILLIS (Deputy Leader—National) to the Minister of Finance: Does he agree with Westpac Senior Economist Satish Ranchhod who said this week that "over the coming year household spending levels will come under pressure from continued increases in the cost of living"; if so why won't he provide New Zealanders with income tax relief?Hon GRANT ROBERTSON (Minister of Finance): In answer to the first part of the question I've acknowledged many times in this House and elsewhere that New Zealanders are doing it tough amid a global energy crisis and ongoing supply chain constraints that are increasing the cost of living pressures. That's why the Government's acted moving quickly to reduce fuel excise and halve public transport fares to help Kiwis facing the pain of higher pump prices partly due to the war in the Ukraine. We're also supporting New Zealanders by delivering income increases for low and middle income earners which kicked in from 1 April and we also have the winter energy payment that has come in from 1 May. A strong health-led response has meant New Zealand does find itself in a strong position to respond further to support New Zealanders and we will always continue to look at ways of improving resilience of New Zealanders to absorb these types of global shocks. As to the second part of the member's question while her party's preference is for untargeted tax cuts that would give her and her leader thousands of dollars while giving low and middle income earners just $2 a week we will not be doing that. As the International Monetary Fund noted in its recent assessment of the New Zealand economy now is not the time for major tax changes as we emerge from a one-in-100-year economic shock. Nicola Willis: Why is he persisting with the biggest Budget spend-up in New Zealand history when Kiwis desperately need income relief and when in ANZ's words "[there are] significant limitations on how much additional government spending can achieve in real terms given the degree of capacity stretch in the economy right now"? SPEAKER: Order! I'm going to let the Minister answer it but I am going to warn that that supplementary was too long and contained two assertions. Hon Grant Robertson: When we look at the Government's spending as a percentage of GDP which is the consistent measure that we use the Government is spending just a little above what the former National Government did as New Zealand emerged from the global financial crisis (GFC). The member will also know when she looks at the Half Yearly Economic and Fiscal Update numbers that that percentage continues to come down and obviously that number will be updated at the Budget next week. Nicola Willis: Well does he believe there are limitations on how much additional Government spending can achieve? Hon GRANT ROBERTSON: Good Government spending—targeted Government spending—will achieve good outcomes for New Zealanders. On this side of the House we have adopted a balanced approach throughout all of the time that we've been in office. In every single Budget—including Budgets under the previous Government—Ministers come forward with more Budget bids than there is money available and prioritisation decisions had to be made; difficult prioritisation decisions. I'd also note that it is the National Party's policy to spend exactly the same amount as the Government would in this Budget. Nicola Willis: What is his explanation for delaying the return to surplus given the tax take is growing and the assessment by BNZ that "all else equal a fiscal surplus should have been coming into view earlier not later"? Hon GRANT ROBERTSON: As we traversed in the House last week this Government will get us back into surplus five years after the beginning of this economic crisis as compared with the National Party that took six years to get back into surplus after the GFC. I'm surprised the member is trashing Bill English's legacy. Nicola Willis: Does he agree with BNZ's assessment that the Government's tax take from individual taxpayers is up 16 percent year on year and why is the Minister still unable to balance the books even while he's taking more tax from Kiwis than ever before? Hon GRANT ROBERTSON: Two parts to the question: the first is that once again the member is against more New Zealanders being in work more New Zealanders getting higher wages more New Zealand businesses making profits and on this side of the House we know that a balance in the Budget is important. We've kept net debt to some of the lowest levels in the world. We took it lower than where the National Party had it. The member will know when she sees the Budget next week that a careful balance has been struck to make sure we invest in public services and keep a lid on debt. Nicola Willis: Does he agree with his Tax Working Group that "bracket creep reduces the progressivity of our tax system as average tax rates for low income households increase over time." and why won't he just let Kiwis keep more of what they earn?Hon GRANT ROBERTSON: As we discussed in the House yesterday bracket creep issues have confronted all Governments in the past. What the Government has to do is assess the balance in making sure that we invest properly in public services. We're also coming out of a one-in-100-year economic shock. As the IMF indicated now is not the time for major tax changes; now is the time to keep supporting New Zealanders invest in public services and look to the long term.Nicola Willis: Why is the finance Minister taking more tax from Kiwis when they need that cash more than ever and can he explain to this House why in the middle of a cost of living crisis he intends to bake in more future Government spending than at any time in New Zealand's history?Hon GRANT ROBERTSON: As we have discussed in this House putting a Budget together requires prioritisation; it requires difficult choices. On this side of the House we've prioritised supporting low and middle income New Zealanders through this crisis by making—Nicola Willis: Your choice is a spend-up.SPEAKER: Order!Hon GRANT ROBERTSON: —sure that we lift benefits by making sure that we increase the family tax credit by making sure that we lifted student allowances. All of those initiatives to support people through a cost of living crisis have been opposed by the National Party. So the reality is actually we have got the balance right over here; the member and her party would rather see that those on the highest incomes receive thousands of dollars a year while they would give those on low and middle incomes $2 a week while opposing all of the initiatives to actually lift New Zealanders' incomes."