Key John: Supplementary Estimates — Imprest Supply Debate 
Key John: Supplementary Estimates — Imprest Supply Debate 
[Volume:626;Page:21263] 
JOHN KEY (National—Helensville) 
: 
 What a revealing speech that was from the Minister of Finance in the House this afternoon. The entire Cabinet was whipped to come to the House to listen to his speech on the Appropriation Bill. Government members were desperate to try to give their Minister of Finance some encouragement because they know a Minister of Finance on the rack when they see one. They were so desperate that they forced the entire Cabinet to come to the House to listen to his speech. About the best thing we can say is that they looked slightly more enthused with that speech than they did with his Budget speech. When Dr Cullen rose on 19 May and read the Budget the entire Cabinet looked bored. Darren Hughes was out in the lobby giving No-Doz tablets to back-bench members. It was a disgrace. It was nothing short of a public relations disaster—a public relations disaster that will cause the end of a number of casualties. Mike Munro was not happy that he was not told of this strategy. He was not told what was going on. He was unhappy. 
Darren Hughes 
: I raise a point of order Madam Speaker. I want to make it clear that the Government is happy for a 5-minute suspension in the debate to allow there to be more than one National Party MP in the House listening to Mr Key. It is very unfair of his colleagues. 
Madam DEPUTY SPEAKER 
: The member will please be seated. He knows that is not a point of order on which to interrupt a member’s speech. 
JOHN KEY 
: The truth is that I do not need a whole lot of people to try to prop me up and tell me that I delivered a good Budget when I know it was a bad one. I do not need my mates around me. I am quite confident in what I am doing. I am not the one who is lying in bed at night wondering how I could have got an available cash surplus of about $4 billion—and we will work our way through those numbers in a moment—and how I could have been so out of touch with the people of New Zealand. 
Mark my words this Government is on the way out because it has become arrogant and it is not listening. I was on Newstalk ZB the day after the Budget was delivered with Michael Cullen. He was asked the hard question. He was asked why there were no tax cuts in the Budget and he gave this answer: “According to our polling people don’t want them.” That is what happens when a Government is run on the basis of looking backwards at the polls. It forgets what the average battling mainstream New Zealander cares about. It is not about a bunch of flaky policies and programmes that the Government is dreaming up with thousands of bureaucrats left right and centre; it is about real New Zealanders not being forced to line up in queues at Work and Income to be turned into beneficiaries. When Michael Cullen can come to the House and tell New Zealand families why they have to pay the top personal rate of taxation at 39c in the dollar and at the same time ask them to line up at Work and Income then he will be able to answer a question that at the moment they are scratching their heads over. 
The Budget was an absolute disaster. The “deep dark secret” that Mike Williams went out and told New Zealanders about was meant to be some great tax cut. Mike Williams knows that. He has tried to argue through his Minister of Finance that it was the KiwiSaver. Last time I looked I do not think the Labour Government would like to hear what Mike Williams thinks the KiwiSaver scheme is. He thinks it is a dirty dark Tory secret. Mike Williams was trying to do one thing and that was to pump up this Budget—to pump up the fact that there was some sort of tax cut. The truth of it is that there was no tax cut. The people of New Zealand know what the “deep dark secret” is; they absolutely know. It is that under this Labour Government for as long as Labour is in office there will never be a tax cut. That is why the people are rejecting Labour and that is why they will reject it come election day. It does not matter whether the election is in July or August or September. This lot will be gone because the people of New Zealand are sick and tired of a bunch of bureaucrats being employed while their families’ belts are being tightened because the Government wants to go out and spend their money thinking it can do so on their behalf. That is the truth of it. 
The “deep dark secret” is that there will never be a tax cut under Labour. If it cannot afford a cut when there is an available cash surplus of around $4 billion when there is an operating balance excluding revaluations and accounting changes of $7.4 billion for the second year in a row just tell me the conditions under which we can have a tax cut. There never ever will be one. 
This is a Government that is out of control. Every time I get up and talk about the number of bureaucrats who have been hired in Wellington the Minister of State Services wants to stand up and say that I am somehow deluded that I must be wrong and that no extra bureaucrats have been hired. Answer me this question: if they are all the same people who are being transferred in from other Government departments if they are already on the payroll then why has the amount of commercial real estate that the Government has taken here in Wellington gone from 360000 square metres to over 500000 square metres in the last 5 years? Tell me why the core State sector has gone up from 30000 to at least 38000 if not more. Tell me why Treasury is writing to the Government to tell it that its policies are out of control that 80 percent of Government departments have been hiring recklessly that there is no increase in productivity and that there will have to be cuts. 
Last Friday Treasury put on its website the Budget discussion document. I urge people to read that document. It states quite clearly that Labour’s policies are not working that reprioritisation has to take place and that cuts have to happen. That is the advice coming from Treasury not just once to the State sector but also in the Budget advice document. Mark my words there was a reason for a lot of people coming down to the Chamber to listen to Michael Cullen this afternoon and it had nothing to do with the quality of his speech or of the outcome; it had to do with the fact that this Government has got it so horribly wrong and the polls it is seeing internally are telling it that it is the end. 
Government members shake their heads. That is exactly why they are in trouble. They are in denial. We know that the NBR poll has been done by UMR pollsters. We know that UMR has been on the phone to the Prime Minister and to Michael Cullen. We know that in today’s  
New Zealand Herald 
 there was just a hint that maybe Dr Michael Cullen might be forced to bring forward those indexation changes. We know when the Minister of Finance is in serious trouble. We know that this is not the confident Michael Cullen who ruled the Chamber that this is a Michael Cullen who is under pressure. I have said many times before that when Michael Cullen was given the portfolio of Attorney-General it was the straw that broke the camel’s back—and boy did we not see that on Budget day when he made such a hash! He has argued that the available cash is $2.4 billion. Well what does he argue is the $700 million in cash that he is giving to the Reserve Bank? Is that a consumption item? Why does he include $723 million of student loans that have been repaid at over the Government bond rate? There are billions and billions of dollars of cash. 
The Minister came into the House and told us that New Zealanders should feel good because they pay less tax than Australians. He does not understand—and he should because he is the Minister of Revenue—that New Zealand has a broad-base low rate of taxation. That means that people in New Zealand can deduct virtually nothing from their income whereas for people in Australia there are many many deductions before they get there. A few weeks before the Budget I asked Michael Cullen in this House what he thought of the Australian Budget from Peter Costello and what he would do to match a situation where Australia will attract bright young hard-working entrepreneurial people. He stood in the House and answered that we should be happy because in Australia 80 percent of people will face a top personal rate of 30c in the dollar and somehow in New Zealand it is a great thing that 75 percent of people will face a top personal rate of 21c in the dollars. That tells us just how out of touch Michael Cullen is. What he has just told the people of New Zealand is that it is a good thing that 80 percent of Australians earn $70000 or less and a good thing that 75 percent of New Zealanders earn $38000 or less. 
National does not believe that earning $38000 or less is as good as it gets. We do believe in increasing the pie. We do not believe in redistribution. We do believe in those good old-fashioned principles that have made New Zealand go forward—in taking the opportunity to tell New Zealanders that they can keep more of what they earn and that we will join with them as a Government and share the upside and the good times. Michael Cullen is a finance manager and a Minister of Finance who has proved he wants to balance the books on the revenue side. There will be more Labour speeches and more Labour cronies sitting in those seats—and boy will Labour need them when it is under so much pressure!