Clark David: Appropriation (2014/15 Supplementary Estimates) Bill Imprest Supply (First for 2015/16) Bill — Second ReadingsText is incorporated into the Bound VolumeClark David: Appropriation (2014/15 Supplementary Estimates) Bill Imprest Supply (First for 2015/16) Bill — Second Readings[Sitting date: 17 June 2015. Volume:706;Page:4508. Text is incorporated into the Bound Volume.]Dr DAVID CLARK (Labour—Dunedin North): Well there was one thing that member David Bennett got right in his speech.Hon Clayton Cosgrove: Oh really?Dr DAVID CLARK: I spotted it. He said that this bill relates to the Budget. For anyone at home looking for a factoid in that speech he suggested that this bill relates to the Budget. I cannot fault him on that. It may not be exactly about the Budget but it does relate to the Budget. The member is quite right technically. I look across the House to catch his eye but I cannot catch it any more. He must be hiding under his desk and I might have been doing the same thing in his position.In the imprest supply bill we do have some money set aside for capital injections which is a standard thing that Governments do and so I wish to talk about some of those. I also wish to talk about the mental health spending that is related in the supplementary estimates and also about the alterations in revenue relating to KiwiSaver all of which are related to the Government’s attempt to get into surplus. As my colleague Grant Robertson—not yet “the Hon Grant Robertson”—noted in his contribution this desperate attempt to get to surplus and the failure again—for the seventh time in a row—for this Government to get to surplus was in fact the central plank of its election campaign.Hon Clayton Cosgrove: No. 1 promise.Dr DAVID CLARK: It was its No. 1 promise as my colleague the Hon Clayton Cosgrove points out in the last election campaign. Therefore this issue cuts to the heart of National’s credibility as a Government. It failed to get there despite—despite—making a number of changes. In fact if we look closely at the changes to KiwiSaver the amount saved in the first year is roughly what brings the Government’s projections into line to finally—finally—achieve surplus in the next round. We will see whether that really happens because it does not have a plan for the economy. That is what is clear in these supplementary estimates. It is jiggering things around. It is trying to make things fit together with a tactical plan without any kind of strategy over the top of it other than to get re-elected. That is what we have seen in this Budget of broken promises that it brought to the electorate.We have seen of course the promises broken around the number of jobs created. National has pushed that promise out by 3 years in the Budget. We have seen the wage rises get pushed out by 3 years in the Budget. There is $7000—it said every New Zealander would be better off. It had promised that previously by the end of next year. Well it has pushed that out another 3 years. This is becoming a pattern. It is always jam tomorrow with this Government—unless of course it is a television screen for a Government department in which case $140000 is no problem at all. That is chump change when it comes to this Government. It has got its eye off the ball. It is out of ideas and so we see in these documents the moving around of small bits of expenditure here and there.But the really big thing in this Budget and the big broken promise is the KiwiSaver change. It does however fit a pattern. It is the eighth change this Government has made to KiwiSaver. It has never liked savings. It has never liked savings although New Zealand has an acknowledged problem with capital debt. Businesses struggle to get the money and capital they need to get off the ground as compared with Australia where it has had much more proactive savings policies. Of course Labour introduced them in the 1970s and Muldoon with his propensity for debt—similar to this Government’s—got rid of them. There would have been many hundreds of billions of dollars in savings in this country were it not for that Muldoonian movement back to cancel that savings regime. Australia—noting by the by—has $1.3 trillion in its retirement savings as a result of adopting a similar scheme after us. But this Government is the Government of record debt—more debt than Muldoon. In its attempt to get to this wafer-thin surplus that it failed for the seventh time to get to it cut KiwiSaver again. The first cut it made if members cast their minds back was to reduce the member contribution rate from 4 percent to 2 percent in 2008. It—The ASSISTANT SPEAKER (Hon Trevor Mallard): Order! The member is not being quite as blatant as the member preceding him but I am going to attempt to get him to talk to either the supplementary estimates or the imprest supply. The member might be getting to it but it would be good if he got to it promptly.Dr DAVID CLARK: I will leap ahead and point to page 25 of the supplementary estimates bill where the KiwiSaver changes and these supplementary estimates are recorded because that is where I am coming to. I am wishing to point out that there is a pattern to this changing behaviour and this whittling away of KiwiSaver.The changes noted in the Budget—and if any member wishes to correct me I would be interested—relate to the Government’s refusal to allow new members to sign up with any notice period. In the Budget the Government cut off the $1000 kick-start contribution on Budget day and that is why we have had an alteration to the kick-start payments recorded in the supplementary estimates. As I said that does fit the pattern of this Government which reduced the member contribution rate from 4 percent to 2 percent then reduced the member fee subsidy of $40 per annum—it discontinued that completely. Then it capped compulsory employer contributions at 2 percent then it discontinued the employer tax credit and then it halved the maximum member tax credit to just $521 a year. Employer contributions were subject to additional tax under this Government and then the minimum employee rate was reversed. It had reduced it from 4 percent to 2 percent then it put it back up to 3 percent—it does not know quite where it is on this particular thing.Then in this estimates document we see that it has removed the kick-start payment and that has had an effect on this Budget. It has removed that first $1000 that incentivised kids to start saving and incentivised first-time workers to start saving. It has removed that and with it the incentive for people to save despite the acknowledged savings challenge that New Zealand faces. It really is short-sighted. It is indicative of a Government without a plan; it is indicative of a Government that is willing to break promises at a drop of a hat. I bet that just about every member over on that other side had that $1000 payment before they stopped this scheme and before they stopped future generations—in fact before they stopped 500000 New Zealanders in the next 4 years—receiving that $1000 KiwiSaver kick-start. It is a tragedy. It was a sad sad day when the Government broke that promise to future New Zealanders’ earnings.This Government also broke the promise around the surplus—we have noted that. It broke the promise in terms of not introducing new taxes. In this Budget we had three new taxes: a tax of capital gains on property investors an airport tax that was introduced and a broadband tax. The Government’s own department said that these were taxes while the Minister stood up and tried to deny it. This is a Government in disarray. It snatched at a grab bag of window dressing opportunities. There is the housing agenda that is falling apart at the seams as we see Nick Smith’s—Hon Clayton Cosgrove: Debacle.Dr DAVID CLARK: —debacle or fiasco. The superlatives fail us as Aucklanders struggle to find affordable homes. The Government is saying that they will be affordable to someone—they will be affordable to someone—but most hard-working Kiwis in Auckland certainly in the younger generation can no longer see themselves owning a home. That is because this Government has sat on its hands for 7 years delivering seven failures to get to surplus running for two elections on the promise of surplus breaking promises left right and centre without a vision and failing to reach its own export target of lifting exports as a percentage of GDP to 40 percent. It is a Government out of ideas that is failing New Zealanders.I am running out of time so I will not be able to mention in too much detail the changes to mental health funding but I will note that the mental health cuts in Dunedin that are being faced by NGO providers are going to result in a reduction in the volume of services—that is what the providers say. This Budget is cutting health services. It is cutting future savings. It is window dressing to do a little bit for really hard-up people. Good on those members for taking some steps to alleviate the suffering of some of the most hard-up beneficiaries although it goes only a small way towards the damage that they did in the 1990s to that very same group of people.