Appropriation (2012/13 Estimates) Bill

Budget 2012 is all about investing in our future. It is a very impressive Budget that Bill English has put together with four key priorities. No. 1 is something the Labour Party knows nothing about: responsibly managing the Government’s finances. No. 2 is building a more productive and competitive economy. No. 3 is delivering better public services within tight financial constraints, and No. 4 is rebuilding Christchurch. It is a responsible Budget that creates $4.4 billion in new initiatives, $3 billion in savings, and $1.4 billion in revenue initiatives—that is $4.4 billion in new initiatives, without increasing spending. And it is a surplus in 2014-15.

Contrast that firm, solid economic leadership with the rabble that is on the other side of the House, who have absolutely no economic direction whatsoever. All they have is the three denying Davids. The first denying David, who is not even in the House today, is David Parker.

💬 Grant Robertson: I raise a point of order, Mr Speaker. It is a longstanding convention in the House not to refer to the absence of members, which the member just did.

💬 Mr SPEAKER: That is absolutely correct. I ask the Minister to please not refer to any absence of a member.

Thank you for that, Mr Speaker. The first denying David is David Parker, Labour’s so-called finance spokesman, who starts from the position of being in denial about the world economy. He is an economist who wants to assume away the global financial crisis, who wants to pretend that the biggest world recession since the Great Depression did not happen, and who wants to pretend that the Christchurch earthquakes never happened. He tells this House he is sick of hearing about the global financial crisis and he is sick of hearing about Christchurch earthquakes. Well, so, frankly, are the people of Christchurch and the people of New Zealand, but they know that that is reality. He is Labour’s finance spokesperson. He is in denial, and being in denial is no place to start from in developing an economic policy.

Then there is denying David No. 2, also known as David Cunliffe, also known as Sonny Crockett to his mates—Dave, the ham actor. He stood up big and tall in front of the New Lynn ladies club—

💬 Hon Trevor Mallard: Point of order, Mr Speaker.

💬 Mr SPEAKER: I can predict what the member’s point of order will be. Members must not refer to members by other than their proper names, and even in the Budget debate they must still refer to members by their proper names. I call the Hon Steven Joyce.

💬 Hon Simon Bridges: They’re a bit sensitive, eh?

They are a little sensitive for that one. But anyway, he stood up tall and strong in front of the New Lynn ladies branch of the Labour Party and denied the last 30 years of economic policy in this country, his party’s role in it, and his own role in it. His economic policy is to fire-hose money around to any company or any person who walks in front of him. But it is not just money; he wants to fire-hose borrowed money around—borrowed money, borrowed internationally. He also wants to bet the New Zealand economy against the international money markets with the exchange rate. That gentleman is in economic denial. He is also in denial of what David Parker is in denial of, but God forbid he would ever be in charge of New Zealand economic policy.

Then you come to denying Dave No. 3, “David What’s-his-name”. He is in desperate denial that the other two Davids want his job. Plus there is his hungry-looking deputy, Grant Robertson, who is also seeking his job. So we have these three denying Davids, who have absolutely no coordinated approach to economic policy at all. They deny the global financial crisis, they say their economic plan is to want more jobs and growth, and then they whack increased taxes on growing businesses. That is what they want to do: they want to add a capital gains tax. The Labour Party also says it wants more growth. It says it wants more growth, and then it declares it will stop almost everything the Government is working on that would encourage growth. So whether it is convention centres, whether it is oil and gas, whether it is foreign investment, whether it is more intensive agriculture, whether it is ultra-fast broadband, or whether it is new roads—the list goes on and on of the things that Labour would not do.

Labour is also saying—and this is one that stretches credibility to the absolute maximum—that it wants to balance the books. It says that it wants to do that in the same time as the National Government, and then it opposes every piece of spending restraint in the last 4 years—every piece of spending restraint. Labour is saying that it wants growth, but then it wants to tax growth. It is saying it wants to stop everything that leads to growth, it is saying it wants to balance the books while not stopping any spending, and it says it wants to pretend the real world does not exist.

💬 Hon David Cunliffe: What a lot of rubbish.

That happens to be true. That is not an economic policy; that is a joke. That is actually snake oil salesman activity.

Then you have the friends, the Greens. Every opportunity the Greens get, they say they want to return to, basically, the horse and cart.

Finally, we have Labour’s other friend, Hone Harawira, who wants jobs in his electorate, but then wants to encourage people to march against mining in the far north. So we have the ridiculous situation in last weekend’s Weekend Herald where on page 9 we have protesters, including all of Hone’s mates, against mining in the far north, and then on page 3 we have the residents of Kaikohe saying that they will get up and go over to work in the mines in Australia. That is the trouble with that side of the House. It has absolutely no idea of cause and effect between what you say in this House and the impact it has on the economy.

That is in contrast with this Government and Bill English’s Budget, which is working hard to grow the New Zealand economy. The Budget addresses a number of things that will help develop the New Zealand economy. No. 1 is infrastructure. It will be one of the things that this country will look back on in terms of this Government, saying that it kept investing in infrastructure during tough economic times, and we are. We are investing billions to get the country moving more quickly. We are investing $12 billion in the high-use highways around New Zealand. That was opposed by Labour and opposed by the Greens. One thing we could be sure of is that if those parties ever got in, none of it would be happening.

We are also investing $1.35 billion to roll out ultra-fast broadband and an extra $300 million for the Rural Broadband Initiative. We are also investing $2 billion to upgrade the metro rail systems in Auckland and Wellington. Labour wants to spend more, of course. It wants a 35c return on every dollar spent; that is the quality of economic analysis in the Labour Party. We are also working hard on the capital markets by encouraging New Zealanders with their opportunities to invest in the mixed-ownership model companies. That will help kick-start New Zealand’s capital markets, and the Labour Party does not want any part of that either.

Another area where we are working to grow the economy is in skills. We have made some great progress there, and Labour hates it. We are funding the highest number of core tertiary places ever—13,000 more in 2012 than in 2008. We are also funding for performance, for completing qualifications and courses. “Bums on seats” is finished. That went out with Labour members, and the door kicked them in the bum on the way out.

We are also getting excellent results for priority learners like Māori. There are 5,500 more places at university for Māori than in 2008, and completion rates are up. Finally, we are getting great progress in literacy and numeracy. This year 122,000 people are taking embedded literacy and numeracy in higher-level education around New Zealand, which is up from 36,000 just 2 years ago.

Then we go on to what is in this Budget. There is $42 million worth of investment to increase engineering diplomas and graduates—

💬 Grant Robertson: Where does that money come from?

—over the next 5 years, building to 500 a year. Mr Robertson hates it. He does not like engineers. Labour never invested in engineers. We are also investing $100 million more for research at universities, we have 3,000 more Youth Guarantee places, and we are also putting $17 million into extra investment in science at universities. On top of that we are investing further in research and innovation across the New Zealand economy, from basic science to applied science and to firm-led innovation with the Advanced Technology Institute. It is a massive amount of money and it leaves those tired, old research and development tax credits in the shade. The spend on research and investment goes up from $1.16 billion to $1.24 billion this year, up from $1 billion in 2008-09. It is an increase of 17 percent in 4 years. I am proud of the Government, which invests in science and innovation. [Interruption] Those members wish they were us. They wish they were us.

This Budget is balanced and sensible. It is about investing in New Zealand’s future. It is about responsibly managing New Zealand’s finances while building an innovative, productive, and competitive economy that sells more to the world, supports more jobs, and delivers better public services in constrained times. It is about returning to surplus in 2014-15. It is about continuing to protect the most vulnerable New Zealanders with Working for Families and New Zealand superannuation, and encouraging and supporting beneficiaries into the workforce. It is about investing in the rebuild of Canterbury. The National-led Government is delivering on all the promises it made to New Zealanders at the 2011 election, and it is working hard to ensure a brighter future for all New Zealanders.

Is that as good as it gets from the National Government—

💬 Andrew Williams: I seek leave of the House to table a document prepared by the Parliamentary Library, The Government Operating Balance 2002-12, showing the true surpluses and deficits in the last 10-year period, which includes 4 years under the National—

💬 Mr SPEAKER: Order! Leave is sought to table this document. Is there any objection? There is objection.

💬 Andrew Williams: Not surprised.

💬 Mr SPEAKER: Order! The member will not comment like that again.

Is that still as good as it gets from the National Government’s presumed powerhouse that is Steven Joyce? The best we had from Mr Joyce was a few laminated, Durasealed PowerPoint cards of what the Budget has delivered to New Zealanders—some flash cards, if you will, to remind Mr Joyce of the supposed high points of the Budget that the Government has recently delivered to this nation.

As we all in this House know, a Budget is not just a statement of the Government’s accounts. It is setting out a direction—a plan, if you will—as to where this nation is going, not just next year but in the years to come. Under those terms this was not just a zero Budget; it exposed to New Zealand and New Zealanders that there is zero plan for New Zealand and, therefore, zero hope for those who need it. And who needs it? Who needed this Budget the most? Well, just today Unicef tabled its scorecard on child poverty, and in some respects it simply reminded us of our national shame. Between 170,000 and 270,000 New Zealand children live in poverty, and that is according to international measures, much as the Minister would choose to deny those clear statistics. We now rank 20th out of 35 OECD nations when it comes to child poverty. We sit alongside countries like Estonia and Slovakia when it comes to child poverty rates. Those nations too have experienced a recession and economic hard times, but those who sit above us in this league table have at least acknowledged that it comes down to priorities and it comes down to leadership with our most vulnerable. This Budget acknowledged neither of those things. In fact, for the next generation it has removed their future.

But this is not the first time that we have experienced this in a Budget. In fact, I felt a sense of déjà vu when I sat through the reading of Mr English’s Budget speech. I reflected on the last time that I had this sense of déjà vu. I was sitting in the House last term scanning through Bill English’s Budget speech when I stumbled across a paragraph that stood out more than all the other puffery, and that was about superannuation. For me that paragraph was emblematic of the failure of this Government and the whole point of our being here as politicians. Unlike the other side of the House, I do not see us as a group of ad hoc board members here to govern New Zealand as part of a career plan. I believe that we are guardians, and, by definition, it is incumbent on us to leave this place better than we found it, and that means making hard decisions. On that measure this Government has absolutely failed.

It has failed the next generation, and in what ways? Let us start with its supposed inheritance. Our country currently has a dividend-returning asset base in the form of power and energy companies. That is an asset base that gives us a steady flow of income that we are about to strip away from the next generation, which currently owns it. Not only do I find this deeply offensive, but I find it deeply personal. I remember the last time that this happened in our nation. I remember the last time that it happened, not because I was a mum and dad investor, but because I lived in a community that suffered deeply from a Government that forgot why it was there and what guardianship means.

So now that we are watching the next generation’s inheritance being stripped away, what more can it hope for? Social mobility, perhaps. There is an idea in New Zealand, at least, that if you can dream it, you can achieve it. After all, we pride ourselves on being the country where you can start life in a State house and become a Prime Minister. I am afraid that the very child who achieved that goal in life is now presiding over a Government that is willing to sit idly by while every indicator suggests that the fair and equal New Zealand that he grew up in no longer exists. This Budget did absolutely nothing to fix that and it did nothing to help our kids.

When this Budget was introduced, one in five kids was living in poverty, and nothing will change. Two out of five of the kids living in poverty are in the houses of the working poor, and after this Budget nothing will change. Notifications to Child, Youth and Family have increased to 150,000 a year. We know that when it comes to our most vulnerable kids, poverty is the cause of the causes, and today nothing will change. Preventable hospitalisations have increased due to cold, damp houses. Infectious skin diseases are up because families cannot afford hot water and washing machines, and today nothing will change. What about our brilliant education system? Sadly, 20 percent of kids in that system are failing, and the Government’s response to that was to increase class sizes and make it worse.

Let us be absolutely clear. This Government might think it is on track to reduce the deficit, but that is coming at a cost in ways we have not even seen yet. The Children’s Commissioner puts a number on it. He claims that for every child who has a poor start in life, it will come at a cost of $1 million per child later on in life. Unicef has added to that figure and that message today; its report stated that “failure to protect children from the impact of poverty … is one of the most costly mistakes a society can make.” We desperately needed things to change for our kids in this Budget, and they will not. Even if the Government wanted to ignore the morality issues around leaving a whole generation behind, there are, of course, the fiscal ones. Our population is ageing. We need an educated, healthy, thriving set of kids to be taxpayers in the future, and they need us to be their guardians and to make the right calls on their behalf.

So what are those hard calls? Well, first, there are our incoming bills. The Government has decided that the biggest one that we need to worry about happens to be tertiary education. Rather than seeing education as an investment, a public good, its policy will narrow the eligibility of young people for allowances. I know of a current graduate studying to be an educational psychologist to work with deaf students—an area of serious skills shortage in New Zealand—but she is being left with no choice but to end her studies, as a result of the Government’s policy.

And what reasoning have we seen for this policy change by the Government? It argues it is all about the sustainability of tertiary education. But why is it that if there are sacrifices to be made and questions about sustainability, it is young people that it lands on time and time again? If this Government was genuinely interested in issues of sustainability, it would look first at superannuation. In 3 years superannuation will cost more than the entire education budget. That includes primary, secondary, early childhood, and tertiary education put together. It will grow to 20 times the cost of unemployment benefits. We need to ask the question of whether the universal age of superannuation is set at the right place. But rather than tackle this big issue for the sake of future generations—future generations who want a secure home, a secure retirement, and a country with a sound savings plan—the Government has ignored it.

This is not just a zero Budget, this is a Budget with zero hope, and it is also unfair. It has also come at a cost. We cannot burden future generations and not pay for it. That cost is young people lining up at our departure lounges—1,000 a week. Everyone in this House will know someone leaving these shores for a job and a better income. Why? Well, 52 percent is the increase we have seen in unemployment, and that has hit young people heavily. A lot of those are our graduates. They fulfilled their end of the deal. They went out, they got educated, and they took on debt to do it. The Government’s job was to make sure a job was there when they needed it. On that front, the Government is failing.

At the very least, those young people deserved a Budget that produced a plan: one that introduced pro-growth tax reforms so that income is fairly taxed, no matter how it is earned; one that tackled the hard issues, like superannuation and lack of savings; one that brought back research and development tax incentives to attract more investment into science and innovation; one that brought in new apprenticeships and closed our skills gap; and one that gave a fairer deal to our exporters. But this Budget did not present this plan, and it does not present any hope. The result is The GC.

This Budget fails our kids. It fails our young people. It is not just that they are being ignored; they are being pushed back and laden down with the cost of this Government’s political expediency. Intergenerational inequity has to stop.

I am just not sure whether I heard the last bit of the previous speech from Jacinda Ardern right. It was: “The Budget was impact and made the GFC.”, or something, I think. That was an appalling description of—I do not know what, really.

We started off, maybe, quite well. The member previously said a measure of a Government is for it to leave the country better off than it found it. Well, actually, I have higher aspirations than that, but I take that as an apology for the previous 9 lost years of a Labour Government, because Labour most certainly did not leave the country in a better state than it found it in in 1999. This Government is well on track to leave this country in a better state than the one we inherited, as we go through our various terms. For example, household incomes and after-tax incomes are up under this Government. It is giving families, New Zealanders, more choice in what they do with their spend, be it pay their mortgage off, look after their family, or do whatever else, rather than having the Crown, the Government, the State coming in and overtaxing them. We must recall when mentioning tax that half of New Zealanders fell in to and were fiscally dragged up to the highest tax bracket under the previous administration.

When the previous Government left office, crime was rising. Crime was higher than it was when that Government arrived. Crime is declining. The most violent crime is declining under the hard watch of this Government and under the hard choices this Government is making. It is easy to talk, as that member talked endlessly, but actions are where it counts. Crime in this country is declining to the point where we are saving about $1 billion because we do not have to build one additional prison, as a result of some of the decisions that this Government has made. We must remind ourselves that the policy of the previous regime for some time was to save on prison beds. I do recall that it was known as “catch and release”, to try to free up beds, as opposed to building the “Milton Hilton” down south.

If a Government is to leave New Zealand better off than it found it, well, I would take that as a measure of pouring resources and focusing them into the front end, to where it counts: in health, operations; in education, educational outcomes; in crime, more police. I could go on and on. In health, waiting lists. There is more elective surgery happening quicker than ever before, rather than the “secret squirrel” silly games of waiting lists, and there is upfront declaration, where the public can hold their district health boards to account. That is what we are doing to continue to leave New Zealand in a better place than when we inherited it.

I come to the Warm Up New Zealand campaign. The member started to go on about respiratory issues. Well, actually, in conjunction with the Green Party over there, the Warm Up New Zealand campaign has put in insulation and made many New Zealand families safer and healthier. Their homes are in a better state than the economy that we inherited.

I take great offence, because any child in this country should and could dream about being the Prime Minister, regardless of their background. The difference between this Government and the previous Government of the members over there is what we believe the potential of our people can be, rather than having them dependent upon an ever-growing State for ever after in that poor child’s life, which is exactly what we saw in the previous regime.

Budget 2012 continues the prudent, sensible management of the economy that we inherited. I would say the Budget is courageous. It is just as courageous as the zero Budget, or the flat new spending Budget, we had in election year last year, for the first time ever. I congratulate the Hon Bill English on once again delivering prudence, delivering savings, and, yes, making some tough choices. But in this world, tough choices are demanded. It takes courage and leadership to make those choices.

Europe is casting a shadow across the globe. Debtor nations such as New Zealand must keep their books in order. New Zealand owes the world $180 billion. The world is competing for capital. Capital is being written off in Europe. New Zealanders see what is going on in Greece on their TV screens every night, and New Zealanders are in tune, as this Government is in tune, with what they are doing in their households every single day: managing the money as tight as we can, pulling the discretionary spend down, paying off debt, being prudent, and reprioritising. We cannot live the lie that we are a creditor nation. This is not Switzerland, as some members opposite constantly seem to believe.

Mr Parker, in his various speeches, said that he is getting sick of hearing about the earthquake. As other members have noted as to that point about Christchurch, that is somewhat of an insult. But the Budget is actually an economic document, so I will talk about economics. Mr Parker is sick and tired of hearing that the impact of the Christchurch earthquake is 9 to 11 percent of our GDP. It is 9 to 11 percent of a $200 billion - odd economy, and he is sick and tired of hearing about it. Well, that speaks volumes about that member’s thinking about where everything is, and perhaps that is why Mr Cunliffe is constantly giving out finance spokesman - type press releases to the general public.

Europe is casting a shadow across the world, and yet members opposite are still going on about fixed exchange rates, for goodness’ sake! We are seeing what that means to a country such as Greece, which is unable to let go a steam valve for the various pressures it is under. Yet members opposite rave on about monetary policy, fixed exchange rates, etc., and about what happened 30 or 40 years ago. They are in constant denial.

I understand that the Labour Opposition at least, and maybe one or two of its partners, is voting against the Budget and the Budget speech as outlined by Mr English. Well, I would just like to remind the House of a couple of things that those parties are, therefore, voting against by doing that. They are voting against the Future Investment Fund. They are voting against $1 billion of investment in 21st century schools. They have the audacity to stand up and make complaints about our education system, yet they are, I believe, going to vote against $1 billion of investment in New Zealand’s 21st century schools. How on earth can they look their kids in the eye—excuse me, members; I did not mean to bring personal issues into it. How on earth can they look kids at school in the eye as they go around and discuss what is needed in education?

I am proud of what we are trying to achieve in education. Minister Parata has her finger right on the pulse. Yes, we have the most awesome education system in the world, but it is failing 20 percent of our populace. Our education system is failing 20 percent of our kids. If members opposite have a problem with that fact, I would like to point out that the same kids who are coming to the end of their secondary education were at school when some of the members opposite were in charge of that portfolio, and those same kids are unable to read and write. They are unable to pass level 2 National Certificate of Educational Achievement. They are our most vulnerable: our Māori and our Pacific Islanders. Members on the other side have the audacity to get up and say something in Samoan Language Week, and yet they do not really applaud and celebrate what we are trying to do to fix that cohort and to have better and brighter teachers so that every single one of those kids may one day aspire to be the Prime Minister of New Zealand.

We announced some KiwiSaver changes in the Budget. I believe that members opposite will also be voting against them. There are options for people to compare KiwiSaver accounts and performance. The public should know that the Labour Party is going to vote against the ability of New Zealanders to compare the performance of their KiwiSaver funds. That is what Labour is going to do.

💬 Hon Trevor Mallard: That’s not in the Budget.

That is what they are doing. It is announced in the Budget. You must read it. At least Jacinda Ardern said she had read it. That is what Labour is voting against.

💬 Grant Robertson: That’s not in the Budget.

Labour is voting against it. Those members could at least get up and say, perhaps, that that policy is not a bad thing but that they disagree with some other policies. That would be more respectful. I suggest that that would be somewhat more in tune with New Zealand, unlike the policies we are hearing now from Labour. By the way, most of them were put before the electorate last 26 November. We are hearing the same policies from the same members, although there are fewer of those members now, yet they are still in denial. They forget that in many of their own electorates, National won the party vote on the exact policies that we are implementing right now.

Every society around the world is facing challenges in its health services, because health services are some of those services that people look to their Governments to provide. They are one of the core things that Governments provide. Yet the capacity of technology to provide more and more health services greatly outstrips the ability to pay for those services. So every country is facing big challenges around how best to put up the money that is required for health services, how best to distribute that money, and how to decide what it is used for.

In this country there has been for some decades, actually, a consensus that investment in health services should be rebalanced towards public health services designed to keep people well in the first place, and primary-care services designed to deal with people’s health needs in the community, and as early as possible in their disease progression. This is for a variety of reasons. It is best for the individuals to not get sick in the first place or to be treated early, but it is also because all of the evidence from the health economists suggests that investment in that part of the spectrum of health services provides the best return in health gain on the dollar spent.

There has been a consensus to do that, and yet in this Government with this Minister of Health that consensus has been thrown out the window, because this Minister of Health is driving the investment in the other direction. Tony Ryall, Minister of Health, at the point that he leaves that job—I think that will be in 2014—might well be advised to seek a career on the stage as a magician. He accomplishes that magician’s trick of diverting attention away to this glittering prize over on his right-hand side, while at the same time with his other hand he is pulling away the nut below the cup that is left on the table—out of sight, out of mind. That is what he has done with health.

When Tony Ryall was the Opposition spokesperson on health—and as Chris Auchinvole, I think, was saying earlier in this debate—he made a great job of talking about elective services. He talked about waiting times for elective surgery and about the number of people waiting. He made it seem as if that was the main thing that health services provide. In fact, it is about 5 percent of what health services do. What he has done since he has become Minister is he has actually, and I agree with Craig Foss, seen more resource go into elective surgery. There has been more elective surgery done. People are waiting less time for elective surgery. In this Budget he has done the same thing again. In some places around the country, district health boards practically have to ambush people on the streets—to pull them in—to give them elective surgery! But certainly more people are getting it. Indeed, there is more money for cancer services and more money for cardiac services. But that is accomplished at the expense of everything else in the health sector. That is the cost. The cost is less service, and, in particular, less service in the areas that we know provide more health gain.

The broader context is that health services are faced not only with the Consumers Price Index but also with medical inflation, which tends to be somewhat higher. They face wage settlements that are higher than the average wage settlements, because of the workforce crisis that we are experiencing and the higher rates available overseas. They face one-off hits, like the unfunded changes to KiwiSaver that the Government made in its Budget last year. They face the costs associated with an ageing population, and we know that older people need more health services and we need to spend more money on providing services for that group. We face a growing population with all of the costs associated with that.

When we learn that Vote Health has increased by just 2 percent—in other words, basically the CPI—we know the subtext is that health services have been underfunded. The careful calculation of all of those factors that I have just listed suggested that for district health boards to tread water, to be able to provide essentially the same set of services at the same intensity as they have been doing, in this Budget they required another $465 million. That is an increase of about 4.4 percent. What the Government actually delivered in this Budget was an increase of $319 million, leaving district health boards basically $150 million shy of where they needed to be to retain the same level of service. The Government says that that will be met by increased efficiencies, trimming the fat, and increased productivity, but what everybody in the health sector knows is that that will be met by cuts to health services.

Every day we dig further into the individual budget lines in the health budget and we come up with new gems that illustrate some of the detail of that service erosion—for example, in the area of clinical training. I have already mentioned the workforce crisis that health services face, yet in that environment the only area in which training received a significant increase was midwifery training. Most other areas of clinical training essentially were unchanged. So medical training is essentially unchanged, which will be astonishing for those working in the medical profession. For those working in the nursing profession, the news is worse. The money for nursing training is actually decreased in this Budget—actually decreased. The money for Māori workforce development is actually decreased. Those are some of the ways that the Government is funding that increased elective surgery.

Some of the cuts are going to be the axing of whole programmes, and we have seen that in the past few years. That is one of the things the Government does. Whole organisations that have been providing services are no longer doing it. Their programmes are completely gone. But a lot more of it will be in the area of what we might call slow-burning cuts, where gradually the cost of providing services is transferred from the State to the people who need those services. In this House—I guess, technically, it was last Thursday—we were debating the Government’s unheralded change to the asset-testing threshold for aged residential care. That is one of the ways in which the Government is subtly and behind the scenes trying to transfer its responsibility on to private citizens.

Another example was the increase in the cost of medicines. It may seem like a small increase, but for the families that are really struggling and wait until lots of their kids actually need services before they go to the doctor, and who try to get multiple conditions for each of their kids dealt with, they will find that that prescription with multiple items—each of which is going to have the increased cost—will put them back into the situation where they have to decide which of the things on the prescription they get filled and which ones they decide to leave.

So this is a Budget that will see increased cancer services, but also a cut to the services designed to stop you getting cancer. It is a Budget that sees district health boards $150 million short, but $150 million being provided for the refurbishment of the high commission in London. It is a Budget that sees no action on the workforce crisis. It is a Budget that sees no action on the increasing rates of preventable hospital admissions, particularly for Māori and Pacific Island people. It is a Budget that actually locks in inequality and sows the seeds of poorer indicators of illness, of disability, and of death in generations to come. It is a failed Budget.

I intend to title my speech today “Contra vera nihil obstat”, which is Latin for “Against fact there is no argument.” Today I want to present just a few facts to the Labour Opposition that I think will fair and squarely contradict so much of the waffle and the debate that has gone on without actually allowing the facts to ever interfere with a good story. I was proud to sit in this House for my 25th Budget in the Parliament, and to listen to Bill English present a Budget in some of the most difficult economic times I have ever experienced in this country, and to still keep the ship well and truly afloat, with a good direction on it, and with a good forecast for the future. It is not a future like Greece has got, not a future like Portugal or others that are on the verge of straight collapse have got, but actually has things like growth rates. I want to remind members of them, because I was looking through the comparison of growth rates, and for those people out there who do not think economic growth matters, you are wrong. Economic growth is vital for a nation, or you will never be able to fund the services such as education and health that are required. So I had a look at the world’s economic forecasts for growth, and I think they are really important.

In the Budget we are forecasting, even with a zero Budget and all the constraints that we face, around 3 percent economic growth per annum. You would have to say, if the others were doing 4, 5, or 6 percent, that New Zealand is a failure and we should be embarrassed. So I had a look. Let me have a look at the growth rates that are forecast. In Europe—and I am talking about Europe as a whole—the whole of Europe’s economic growth forecast is for around 0.5 percent. That is a sixth of what we are forecasting. The United Kingdom is doing a little bit better; it has about 1 percent economic growth—1 percent. Japan, that mighty economic powerhouse of the past, has 1.5 percent, and the United States and Canada, which again are countries we used to look to and go “Wow!”, are on just 2 percent. At a time when New Zealand has come through some of its worst economic conditions, when the global financial crisis has wiped out a whole lot of the financial institutions and others, to be forecasting 3 percent growth is outstanding.

I want to remind members what the four key priorities out of the Government’s policy and out of the Budget were, and then go through them. First of all was the responsibility for managing the Government’s finances. I think that some of the initiatives that Bill English has taken in recent years, such as the tax switch, have been fantastic for this nation, and I am really proud that we have done so. What I want to do is counteract a few of the absolute myths that lie out there about our tax system. You know what the one is that I bet you members on this side of the House hear almost daily? It is: “I reckon the rich should pay more—I reckon the rich should pay more.” Well, let me give you the numbers, and these are out of the fact sheet from the Budget, so that members can work out whether that is true or not. If we take the number of people in New Zealand who earn over $150,000—oh, and by the way, I had better make sure that these numbers do not include the Working for Families subsidies coming back, because they would make these numbers even worse, in terms of what I am about to tell the House. If we take those people who earn over $150,000 in this country, there are only 2 percent of income earners who do. Only 2 percent, and what do they pay of the income tax take? Nineteen percent of the income tax. If you want to take the cumulative effect—

💬 Michael Woodhouse: Well, fair enough.

Yes, it is fair enough, but do not argue that the rich do not pay their share—do not argue that the rich do not pay their share. Two percent of income earners pay 19 percent. Let us take the cumulative numbers for the $100,000 and above category; there is a bigger number in that category. About 6 percent of all New Zealanders earn over $100,000, and they pay 34 percent—6 percent pay 34 percent—of the tax. I am not saying that is wrong—

💬 Hon Annette King: Yes, you are.

No, I am not. I am not saying that is wrong. What I am saying is do not say that the rich do not pay their share, because 6 percent pay 34 percent, and that member had better get with the programme. Let me say again that if you put the corrections for the transfers back to the lower incomes of Working for Families, those numbers get even worse. Based on a calculation I saw from David Farrar last year, when he put those payments back into the schedule, it comes to something like the top 10 percent of income earners paying 90 percent of all net income tax.

I have to say that this Budget was a great Budget, but for a number of other reasons. For example, the Government has decided that there are areas where we could really put in some expenditure and get a fantastic return. One of those would be science and innovation. I was really, really delighted when I heard the finance Minister reading the Budget and putting $385 million over 4 years into science and innovation. That is more than $1.3 billion a year we will now be spending. That is a $385 million increase, so we will be spending about $1.3 billion a year by 2015-16 on science and innovation, developing products, developing services, and developing smart things we can sell to the world. There is not a member of this House who does not accept—actually, no, I exclude the Greens, because on “Planet Green” they do not accept even this—the idea that New Zealand can make its future only by selling at the high end of the value-added product line, and we will never make our existence or our survival by selling at the bottom end of the whatever.

If I talk about the parties and their views a bit, what I want to talk about now are those sorts of big headline issues. In the Budget and leading up to the Budget for the last few years the National Government has made some very strong calls about making the economy work. First of all is intensification and development of our agriculture sector—things like irrigation. If members do not understand the impact of irrigation, they need to just go out and start watering a bit of their grass for a few days, just in the same spot, and watch what happens to the productive nature of land if you can irrigate it. If you can irrigate huge tracts of the South Island, for example, using the water from the rivers and so on, guess what? That is where we would get our economic growth. That is where we would get our ability to pay for a whole lot of the services that members of this House want the country to have, yet the Labour Opposition and the Greens on “Planet Green” are all opposed to intensification and opposed to the irrigation schemes.

Now we come to one of the things that I think is a real cracker here. We, regularly as clockwork, get from the other side of the House the comparison with Australia, about how well Australia is doing and how hopeless we are getting—you know, that “Planet Australia” is just booming, and “Planet New Zealand” is failing. Well, guess what? Wayne Swan, Australia’s Treasurer, will tell you this if you ask him. He will tell you straight away that the biggest driver of the Australian economy is mining and mineral resources. In fact, they openly admit across the Tasman that they have got a dual economy. Their normal economy is pretty flat. It is pretty dull, there is unemployment, and it is struggling. But what is bringing them into the sunshine, what is keeping them going, is their minerals and their mining. Well, I agree with Wayne Swan. I cannot believe I am saying it, but I agree with a Labor Minister in the Australian Government. Wayne Swan was right. But what do we get here? We want to compare ourselves to Australia, we want to have the same levels of employment, and we want those young unskilled Māori and Pacific Islanders to have jobs, but, oh, we are not prepared to mine any of our minerals—no, no, no! We will let them do it. Well, guess what? Where will those young people go for a job? They will have to go there if we cannot do the mining and mineral exploration, and no wonder there is a drift because of that limitation.

And then we get members in this House saying how dreadful welfare reform is. I do not know how anybody can think that the social welfare system we have right now, which is paying hundreds of thousands of working-age people to do nothing, is acceptable. I agree with a welfare system being there to help the vulnerable. I agree with it being there to help those in need. I agree with it being a handout for only a short period, but it has to be a hand up over a longer period. I congratulate Paula Bennett, the Minister for Social Development, on the work she is doing, trying to get some real sanity into our welfare debate and trying to get some real outcomes so that those people on welfare are actually looked after. I think this is a great Budget. I am proud of it, and I am delighted.

I want to commend the member who has just resumed his seat, Maurice Williamson, for 10 minutes of serious repetition of the National Party line. That was extraordinarily well repeated, Mr Williamson. I know he is in the competition to replace the Rt Hon Lockwood Smith when he takes his vacation, when we are joined in the House by—I am sure he will soon be, after he returns—the “Hon” Aaron Gilmore, who is escalating rapidly in the stakes in the National Party. A lot of the time that the National members have been taking the calls, they have been crowing that Labour members are voting against the Budget, and that means we are voting against the asset sales programme. Well, I just want to confirm that. Labour is voting against the Budget, and we are voting against the asset sales programme. Just in case anyone in the country is in any doubt, Labour does not support National’s asset sales programme.

Tragically, that is about all that is in the Budget. That is why it is quite correctly being described as a zero Budget. At the end of last week this House went into urgency to discuss the critical measures that were contained within the Budget. So what did the House do? We passed three bits of legislation. The first one rattled, upside down, the poor young paper boys and paper girls of New Zealand. It turned them upside down, held them by their ankles, and shook them until their pocket money came out of their pockets and into Bill English’s hands. Mr Key described them as “small employees”. Those of us on this side of the House do not call them small employees; we call them children, actually. They are young people in New Zealand, and they earn a tiny little bit of money. Up until the Budget last week they could keep it all; now they have to pay tax.

That was the first big initiative in the Budget. What a great leap forward for New Zealand that was! What a vision from John Key and Bill English that we saw: “Let’s get the money out of the pockets of the paper boys and the paper girls.” It did not feel very visionary for me. It did not sound as if the National members who spoke during urgency supported it, or could feel a vision, either. But, nevertheless, that was the first big measure.

What was the second? Well, the second big initiative in the Budget—again, passed under urgency—was to reduce the support for tertiary students. That was the second big, bold initiative. It was no doubt rammed through Cabinet by Steven Joyce. I do not know whether he shared as much information with his Cabinet colleagues as the Hon Hekia Parata did, but if he did, he will be in bother later this week as well, because nobody in Cabinet knew the details of the education budget cuts. I am not sure the Hon Hekia Parata knew them, actually, until teachers and parents drew them to her attention. So that was the second big, bold initiative: “Let’s cut the support for tertiary students.” In bad times the most important investment that a Government can make is investing in the skills, the training, the education, and the employment of our citizens so that as we come out of the bad times we will be better off. But, instead, for 4 years in a row, this Government has cut back on that.

The third big, bold initiative in this zero Budget—what was it? I am sure that everyone in the House remembers the debate from last Friday. Certainly, every Grey Power member around the country remembers the debate and will be reminding National members of it. It was to freeze the asset threshold—not a little tinker, not a minor reduction—so that instead of the annual $10,000 a year increment in the amount of assets that could be retained by a person going into a rest home or a hospital-level care facility, that is now frozen at CPI. So out of the pockets of young people earning a little bit of pocket money, out of the pockets of tertiary students, and out of the dressing gown pockets of rest home residents, the Government shook a few miserable dollars and said: “That’s it; that’s our vision.” Well, no wonder hundreds and hundreds and hundreds of New Zealanders—good New Zealanders, people we want and need to stay here and contribute to our communities and our nation’s future—are saying: “Forget it. There is nothing here for us. This is a Government with no vision, giving us no hope for the future. We are on the next plane out of here.” Record numbers of people are leaving our shores permanently to go to Australia.

Mr Williamson said: “Judge us on our financial management.” Nothing would give us more pleasure, actually, Mr Williamson, than doing that, because every year the Prime Minister and the Minister of Finance have overpromised and then failed to deliver. You can get away with it once, but you cannot get away with it every year. You cannot promise more than you are able to deliver, be shown to have failed, and then try that same trick again. New Zealanders are not foolish. New Zealanders can read the record of this Government. Last year, for example, the Prime Minister said we would have 4 percent growth; 4 percent growth was what he promised New Zealanders. Now he is projecting just over 2.5 percent in this year’s Budget. That is quite a difference. The Hon Maurice Williamson can do the sums quite easily, I am sure. The difference between 2.6 percent and 4 percent, when you are talking about economic growth, is quite a lot. The difference between misleading and promising is very narrow in the way that the Prime Minister does it.

Last year the Prime Minister said we would have 170,000 additional jobs, and this year that has been cut in the Budget commitment by 16,000. They are not numbers, they are not figures, and they are not statistics; they are people. They are people who want and deserve a job. Maurice Williamson has got the audacity to say that people are being paid to do nothing. They do not want a benefit, Mr Williamson; they want a job. They want a job, and if there was a job on offer, they would take it, as they did in their thousands when we were in Government and supporting employers, supporting the export sector, and supporting innovation within our business community so that more jobs could be available for the people who currently are stuck on a benefit, with the only choice available to them being to stay on the benefit or leave our country. That is not a vision that I think is good enough for New Zealanders.

Last year the Prime Minister said real wages would grow. This year we see it peaking at 1.6 percent and then declining. So not only are people not able to get jobs—thousands more than previously—but when they do get a job their wages do not even keep up with the rate of inflation. New Zealanders and our nation deserve better than what we are being offered. We want leadership. We want leaders with the ability to look at the hard decisions that are confronting our country, to engage in a public debate, and to come up with real solutions—not re-pose questions or stick to tired old outdated arguments but come up with real solutions for the future.

A surplus in the Government accounts is important. Labour maintained it for a long time and was consistently attacked by the National Party for not spending more money. We said we wanted to maintain a surplus for that rainy day, and it came in buckets, and the National Government blew it all. It did not save any money to invest in New Zealanders. It blew it all on tax cuts for the highest-income earners—the people who did not need that additional money—and at the same time put GST up, which hurt the most vulnerable people in our community.

The Budget is about choices, it is about decisions, and it is about providing a vision. This Government has given us no vision. It has given us a zero Budget. The choice it has made is to rattle the money out of the lowest-income earners and make them pay tax, to stop additional support for tertiary students, and then at the other end of the age scale, it has rattled the dressing gowns of our most vulnerable senior citizens to get a few extra dollars out of them. The Government calls that a vision. It calls it leadership. It is neither. It is a zero Budget, and New Zealanders deserve better.

Talofa lava. Malo le soifua. I rise—and I am very happy to rise—to speak in support of Budget 2012. I represent the people of the North Shore, and my constituents like this Budget because they are an intelligent, aspirational community who understand only too well that when times are tough you have to cut your cloth accordingly. It is the right Budget for these difficult and tough economic times, and its measures are prudent and sensible and will result in the kind of moderate growth that this country needs as we move towards getting the books back into surplus.

Opposition members are, of course, and are, indeed, the no-hopers—the chattering classes. They have taken more than enough of our time with their foolish preoccupations with the minutiae, the pickpocketing, the paper boys, and tipping old people upside down in their dressing gowns. Many of them should just retire and do us all a great favour, actually. We are going to put aside that nonsense, because more than enough time has been spent on it already. Let us actually look at the facts of this Budget. I know that it is uncharted territory for the Opposition, but as we in this Government chart our course back to surplus we have indeed developed and delivered a zero Budget. We are sticking to our plan because it is working, and that does not mean for a moment that we are not investing in and growing our economy. We are saving and reprioritising where we can, and continuing to spend in the priority areas that are vitally important for New Zealanders and for this economy’s growth.

There are four main areas I want to talk about today. There are many winners in Budget 2012, and overall we have progressed our aim of funding front-line services. Let us start with health. Minister Tony Ryall, I believe, is to be congratulated not only on achieving milestones with immunisation targets, which are vitally important for our young people and for our future, but also because under his watch there have been 27,000 more elective operations. That is 500 extra a week, compared with what we were able to do in 2008, after 9 years of a Labour Government. We have, as a result of some slight increases in prescription charges and from savings in health and across all of our Government accounts, made an extra $1.5 billion available to go into health services. This is an excellent achievement for Budget 2012. It means, in fact, that there are more funds going into district health boards, there is more elective surgery, and there is better cancer treatment. For anyone who has been through the health system in New Zealand, I think they would fully approve of the move to put the extra $33 million into faster services, and particularly for dedicated nurses who can coordinate care for patients. This is a vital need that has long been required, and now we are delivering on it.

When we look at welfare, we all know that too many New Zealanders are welfare dependent—families trapped in poverty—which is costing us all far too much. Something like 12 percent of our working-age population is on a benefit. Unlike the Opposition, we believe that those who can work should work. We want to support them off welfare and into jobs. So in the past 3 years we have created an extra 60,000 jobs, against a backdrop of the global financial crisis, the Canterbury earthquake, and, of course, the complete mess that Labour left our books in after its profligate spending over nearly a decade. Minister Paula Bennett has ushered in Future Focus, which has saved around $17 million. She has introduced payment cards for teenage beneficiaries, to help them make better choices about their budgeting and not blow their money on booze and cigarettes instead of the rent. For welfare, we are investing in this Budget over the next 4 years $287.5 million to support those on welfare going into work, and that is going to save the taxpayer $1 billion in benefit payouts. There is $80 million being ploughed into early childhood education childcare places, because we believe that investing in our very young is vital for the future of this country. There is a further $55 million for dedicated staff who can support job seekers and sole parents back into work, because they need help. It is not going to happen by itself. It is vitally important that the front-line services are improved, but they need to be targeted. We are also spending in the welfare area $148 million on better youth services so that they can work with the young unemployed. These people need hope, and they need a future.

Education—there has been a lot said about it in the last few days. It is another winner in Budget 2012, with an extra $512 million. We have continued our firm focus on raising student achievement and teaching excellence. I believe that Hekia Parata is doing an outstanding job. We do have a world-class education system and a very dedicated, talented, and hard-working teaching workforce. There is so much to be proud of. But—and there is a but—not all of our children are succeeding and realising their potential. Something like one in five is not getting the qualifications they need, and we believe that that is not good enough. That needs to change.

Let us look at what has happened in the last 10 years. We have in the public gallery a big group of schoolchildren who are here. I think you will appreciate this more than perhaps the chattering classes on the other side of the Chamber, who—

The ASSISTANT SPEAKER (H V Ross Robertson): Order! The member cannot bring the gallery into the debate. She is addressing the Speaker, and through the Speaker the House.

Thank you for that clarification, Mr Speaker. In the National Party we believe that our young people deserve a lot more, and we want all our children to leave school—that is five out of five of them—with the qualifications they need to make a good life for themselves. So we have targeted specifically 85 percent of all 18-year-olds to achieve a minimum of a level 2 National Certificate of Educational Achievement or equal qualification. We are also starting to increase participation in early childhood education. We want a target of 98 percent there in the next 5 years.

Budget 2012, crucially and specifically, invests in improving the quality of our teaching. The biggest change is an explicit trade-off of quantity for quality. We are not ashamed of that, and we are not resiling from it. Part of the way we are funding this is to make a small adjustment to the teacher-student ratio funding in schools from years 2 to 10. These are funding ratios, and we as the Government fund them. As Minister Parata has been at pains to point out on several occasions, it is the schools that set their own class sizes. What is going to be the impact on schools? Let us put aside the scaremongering and the misinformation that is being peddled by the Opposition, and actually address the facts. Ninety percent of our schools, as the Prime Minister said in this very Chamber a couple of hours ago, will either gain or have a net loss of less than one full-time teacher equivalent as a result of the combined effect of the ratio changes and the projected roll growth. Moreover, there will be 10 percent of schools that will have a difference, and there are a few sharp edges on that. We want to look at the people who are catering specifically for technology classes at years 7 to 8, and that is effectively the intermediate schools.

On Monday in my electorate I met with a group of nine school principals from intermediate schools. They told me their concerns. In a 2-hour meeting we discussed their concerns in some detail. I agreed with them that their issues were real ones. We took the message back to caucus, we discussed it robustly, and there were clarifications that emerged from that. The Ministry of Education, along with the Minister, who announced it but who directed the ministry, announced that there is now going to be a guarantee that the staffing entitlement in all schools in New Zealand will not be reduced by more than two full-time teacher equivalents over the next 3 years as a result of the policy changes. There is also going to be a working party that is going to get together, and there is a contingency fund so that that management, that transition to the new ratios, will be achieved.

That is an important issue, as is the issue with seniors. I do not want to digress into a rebuttal of what the Opposition is saying. I want to concentrate on what people really care about. In my area the seniors are worried. They are very worried about the level of services for dementia care. I share those concerns. New Zealanders are going to be getting something like $10 million over the next 4 years for community-based dementia services. This is a very important area. We are also increasing funding for aged residential care beds by $82.4 million over the next 4 years. We understand that New Zealanders want to stay in their homes for as long as is possible, so we are increasing funding to raise an extra $57 million compared with what was spent back in 2008.

The asset test—let us look at it briefly. Labour is complaining that the threshold has been altered. Labour forgets, of course, that when times were good in the early 2000s, it was looking for ways to spend money, so it introduced a flat $10,000 annual increase. We are actually slowing that rate of increase, in recognition of the tight times and the ageing population. We are going to be using the Consumers Price Index to set the threshold, just as we do to increase national superannuation every year. New Zealand superannuation, like the asset testing, will be geared to the Consumers Price Index, and that is a very important point.

I would like to make one last point. I personally would like to celebrate the other measure, which is the encouraging news that we are increasing the funding for environmental schools—Enviroschools—by $7.6 million. It is yet another fine measure. Thank you.

Tēnā koe, Mr Speaker. Talofa lava. Kia ora tātou katoa. It is my great pleasure to stand and join in this debate on Budget 2012 with my Labour colleagues in opposition to this atrocious, awful Budget—the zero Budget, the “nothing Budget”, the “kore Budget”. It delivers nothing and we oppose it. It is a failed Budget from this failing Government, and it has delivered zero for New Zealand. We have got zero hope, zero ideas, and zero opportunities flowing from it.

There is a new word that has come out of our Māori whānau around the motu. They have heard about the zero Budget, and the austerity Budget, and the cuts. You say “austerity”, but Māori whānau are now saying “Oz territory”—Oz territory. What we are seeing is our whānau in their droves boarding the planes and heading over to The GC across the Tasman. They are going to Oz territory because of the austerity that this appalling National Government has been imposing in this dreadful Budget.

We have got a lot of poroporoaki going on, up and down the country, from Auckland, Wellington International Airport, and right the way through the country. Every day our whānau are going to the departure lounges, having a tangitangi poroporoaki, and saying goodbye to their loved ones. All of our whānau are affected. Everyone is affected: friends, families, aunties, and uncles—[Interruption]

The ASSISTANT SPEAKER (H V Ross Robertson): Order!

Friends, aunties, and uncles—they are all being tearfully farewelled as they cross the Tasman to a better life. It is appalling that they are forced to make that very, very sad decision to leave our great country, because of the no-hope and failed Budgets of this Government, and the fact that there are no jobs being created out in the regions.

If we look at the actual record of this National Government, we see the worst growth record in 50 years—the worst growth record in 50 years. It is a party that talks about economic growth and free enterprise and business, but we have had the worst growth in 50 years. We have 50,000 of our whānau members up and down the length and breadth of this country—over 50,000—leaving for Australia every year. We have had a 52 percent increase in unemployment, and nearly 50,000 more of our people are on benefits. So this Government has overhyped the talk, but it has failed to deliver.

We do face serious issues as a country—in fact, globally. We acknowledge that. We know that the EU is on the brink. Greece is in serious trouble. Spain is in trouble. The term “bank runs” is a highly searched Google term these days. So there are going to be some serious things happening up in Europe over the next few weeks, depending on the outcome of elections that may be taking place. We know that things are really tough, in terms of what effects that could have on the banking system and the ripple effect that that will have right throughout the whole world. We are not immune to that, obviously. We are well aware of that.

But what is this National Government doing in response, with this Budget 2012? What is the big idea that it has come up with? Well, it is squeezing an extra $14 million from our tamariki—from our paper boys and paper girls. That is the National Government’s big idea to turn our country round, to protect us, to get us on to a sustained growth path so we can actually deal with all the headwinds that we will be facing in terms of what is going on overseas. The Government wants to squeeze. That is the big idea. It wants to squeeze some coins from those paper delivery boys and girls. So we have got the penny-pinching, which is the great idea this Government has come up with.

We have got the attacks on our schools. Now it is attacking our teachers and it wants to cram more kids into the classroom, put more pressure on our schools, and cut out the teacher numbers. What else is the Government going to do? What else are its big ideas? It wants to asset-test out the elderly now, and penny-pinch from our elderly, from our kaumātua, from our kuia.

Oh, and we cannot forget the great plan that it has. We are facing a very tough global economic crisis situation, potentially, and what does the Government want to do in this environment? It wants to sell off four of our major State-owned enterprise assets in such a depressed international market, and it says that mum and dad investors want to buy them. I know what it is like when those State-owned enterprises are up for sale. I know who are rubbing their hands right now, in terms of all of the money that they want to make from the floats of those initial public offerings on those asset sales. It is the corporate lawyers who will be charging in the millions for doing all their transactional work and providing all their advice. It is the corporate advisers, it is the investment banks, and it is the people who will be leading the public offerings who will be making a mighty lot of money from the public offer. It will not be the mums and dads. It will be the advertising agencies that will wheel out, probably, an ex - All Black captain or some other celebrity to front the TV campaigns that they will be beaming across our television screens, telling us how great these investment opportunities are. The mums and dads who will be watching that TV screen already own those assets. They do not have the money, in this depressed environment, to even get in the queue to try to secure some shares.

That is the Government’s great plan. It wants to sell off Air New Zealand, Solid Energy, and our electricity generation companies in the worst of times to try to raise a bit of cash, when what it did in its first 4 years, now, was totally irresponsible, such as implementing tax cuts that benefited only the rich. That was irresponsible and it sucked out desperately needed revenue for our country and put it into the pockets of the wealthiest. The Government increased GST to 15 percent, which disproportionately impacted on everyone, all of the whānau particularly, who struggled to pay for their shopping, to pay the grocery bill, and to pay the bills every week. They are going to the grocery store and struggling to pay the bills. Those are the big ideas.

I could go on about how child poverty has increased in our country. Only today Unicef has come out with its report on measuring child poverty internationally, and New Zealand is ranked in the bottom half of the countries in terms of measuring child poverty. That is a disgrace. That is a national disgrace. But what is this Government doing about it? It wants to just sell off assets and pick the pockets of our paper boys and paper girls.

I want to just touch briefly on what is in this Budget for Māori. I know that the Māori Party members stand up and talk about the fact that we have a bit of money for this and a bit of money for that. But, basically, this is a zero Budget. The money is just getting shuffled around. Some will go up, some will go down, but at the end of the day everything equals out and there is no extra money that is actually going to be going into helping our people. In fact, based on the total policy initiatives that this National Government is persisting with, even though it can see that there are big, big challenges on the horizon, this Budget will actually have no positive benefit for Māori. So this is a non-Budget for Māori.

It is going to be interesting when it comes time for us to vote on this particular bill, and when we do the party vote count as it goes around the House. Of course, the Māori Party is never here. Those seats are always empty when it comes down to this business.

💬 Louise Upston: I raise a point of order, Mr Speaker. It is a well-known tradition that you do not talk about members’ absence from the House.

💬 Hon Trevor Mallard: The member is right, as far as the convention, about individual members. But there is no convention that says that one cannot refer to the absence of an entire party on a regular basis.

The ASSISTANT SPEAKER (H V Ross Robertson): Although I understand where the member is coming from, one can extrapolate, and we all know that every person at one stage or another is absent from the House, for whatever reason. I would ask the member to desist.

💬 Hon Tau Henare: Mr Speaker.

The ASSISTANT SPEAKER (H V Ross Robertson): No, no, the member has not finished yet.

Oh, sorry.

💬 Hon Tau Henare: I raise a point of order, Mr Speaker. The member sat down. I sought the call. I sought the call—

The ASSISTANT SPEAKER (H V Ross Robertson): Order! I have to say the member is perfectly correct, but the member did not understand. He thought his time had expired. He has about 8 seconds left, so I am asking the member to complete his speech.

This is a failed Budget from a failing Government. More of our people are going to go to Oz territory as a result. We need a change, and Labour can deliver that. Kia ora tātou.

Kia ora to you too, brother. What that was was atrocious. That was appalling. I expected more from Rino Tirakatene. You know why? Because up and down the north there is Hone Harawira, there is Shane Jones, there is Parekura Horomia, and there is Rino Tirakatene, and they all march up and down the streets of their electorates saying that we should not mine. But they are the first ones at the departure lounge waving goodbye to their relations, whom they will not give jobs to in the north, who are going to places like Pilbara in Western Australia, or going to mine in other parts of Australia where they mine.

Every one of those members has relations—brothers, sisters, you name it—who are on the bus to the mines, where they are allowed to mine. Those members get up in this House and they ask where the jobs for our people are. I tell you where the jobs are: in the north and on the East Coast. You know, it is the same people who jump in their four-wheel drives and drive out to a protest against drilling for oil—oil that makes the diesel that they put in their four-wheel drives. There is a word for that sort of person. Yes, there is a word—[Interruption] Well, I was going to say the other word—

The ASSISTANT SPEAKER (H V Ross Robertson): No.

I said I was going to say the other word, but the new word is “Labour MP”. Yes, that is that what they are. They will walk up and down the streets of Whangarei—and there is another one; we will get to him in a minute—and they will walk up and down the streets of Moerewa talking to the poor people. All the poor people want is a job. But then those members say: “Good on you. Here is 10 bucks for your kitty to go to Australia to get a job.”—the job they will not allow you to have in New Zealand. That is the atrocious thing about the Labour Party. I can handle it from the Greens, because that is their kaupapa. That is their kaupapa. If they want to do that on “Planet Green”, that is fine. But I expect more from my relations across the way, and I am not talking about Trevor Mallard.

This Budget is about being responsible with New Zealand’s finances. That is what it is all about. It is actually about nothing more than being responsible in hard economic times. If Labour wants us to go down the road of Greece, Spain, Italy, and so on and so on, then that is fine. Go to the election and get elected.

But here is the thing. Last year National went out to the people of this country and put forward a plan. That plan included some things like the 49 percent sale of State assets. The atrocious thing is that we get the opposition from the Labour Party, which introduced not a 49 percent sale of State assets but a 100 percent sale of State assets. I can tell this House, with my hand on my heart, that if, back in those days, we had taken the road that we are taking now—a 49 percent sale and we keep the majority share—things may have been a wee bit different. So I applaud John Key, Steven Joyce, and Cabinet for making that decision and allowing us to go out and campaign for it. What happened during the November election? We put it out there. People voted for us. We are the Government. No amount of getting up on the hind legs is going to sway us from our path.

💬 Todd McClay: He was on his front legs.

He was on his front legs—well, that is nice. Our plan is about being responsible. It is about making sure that our finances are in good shape, because who knows what is going to happen tomorrow? Who knows what is going to happen next week in Europe? I tell you what, I hope that China does not go belly up, and I hope that Australia does not go belly up, and all of our trading partners, because we need them as much as they need us.

The young people in this country are getting a raw deal from those members opposite, who will stop them getting the jobs and education that they so deserve. And while I am on education let me mention a 2 percent rise in the roll, and a 12.5 percent rise in the number of teachers. Over the last—how long was it—10 years have we seen a discernible increase in the quality and the results? We have not.

💬 Hon Member: We have.

We have not.

💬 Hon Member: Read the NCEA results.

No, we have not. Anybody who stands up in this House and says the results are going that way is talking porkies. I did not accuse them of talking porkies, but they will if they do. It is a shocking indictment that Māori are still at the bottom of nearly every indicator. It is a shocking state of affairs.

💬 Hon Trevor Mallard: He used to be Raymond before he was a bottler.

We have been here, what, 3½ years—and see the personal attacks by “Mr Quackmaster”—the “Quackmaster”. The personal attacks do not even worry me. Oh, no. I tell you what, that sort of public attack is like water off a duck’s back. It is an indictment that they for 9 years oversaw the crumbling of Māori statistics. They are the ones, and they get up in this House and tell our people that they cannot get jobs in the mining industry in their own areas. But they will wave them goodbye at the departure lounge. That is a horrible indictment on those people across the way.

I hate it when those members get up and say how they feel for the poor old Māori boy who has not got a job up in the north, or the poor old Māori guy who has not got a job down on the East Coast. But if we allowed mining in this country, we could be like the Gold Coast, and we could be like Western Australia. We could be as wealthy and as educated as our mates across the Ditch. It is an indictment that they sit there and blame National for what is happening around the world. I tell you what, some of the members from Christchurch from the Labour Party need their heads read as well. The Christchurch earthquake is something that could have happened to anybody, in good times or bad, and we just have to bite the bullet and fix Christchurch. At least this side is doing the job. We do not talk about it; we get in there and do it. [Interruption] That is right, New Zealand First.

💬 Phil Twyford: That member doesn’t even get up off the couch.

Now we hear Mr Twyford, the new MP for Te Atatū. He has already said that he will spend a billion dollars—a billion dollars—on a busway. Mr Twyford has already promised the people of west Auckland a billion-dollar busway. He has been in the electorate only 6 months, and he wants to tax and increase the rates in our area. Not once did Mr Twyford front Len Brown and back the people of west Auckland. He did not. He went around the back and he patted Len Brown on the back and said: “Good on you, Len. Spend all the money. These fellas out in west Auckland don’t give a hoot.” It is a great Budget, and I will tell you what, it is a great day to be a member of the National Party.

Talofa lava. Tēnā koe, Mr Speaker. The Government made it very clear that last Thursday’s Budget was a zero Budget. It had zero ambition for making our clean, green image and brand a reality. The Minister of Finance did not even mention the natural environment in his Budget speech. The Budget has zero ambition to safeguard the health of our oceans or to significantly improve the survival chances for kiwi, mohua, whio, and other species at risk of extinction. This is despite the fact that we have a billion-dollar tourism industry, and the Department of Conservation, with its management of national parks and conservation lands, is one of the biggest providers for tourism in New Zealand.

The National Government does not seem to realise that the economy depends upon planet Earth. No environment; no economy. No wild landscapes; no tourists. No water; no milk. This report, Beyond Rio: New Zealand’s Environmental Record Since the Original Earth Summit, should be a wake-up call for Government because it shows how much more we need to invest in environment and conservation, except that this Government, as the last speaker, Tau Henare, demonstrated, has blocked its ears. Its plan for the economy is firmly based around resource extraction: drilling for oil, mining for coal, damming or diverting rivers for irrigation, and encouraging further growth in dairying regardless of the pollution load and the environmental damage and harm that that does. For the members opposite, they do not seem to realise that the climate in New Zealand and the geology in New Zealand are very different from those of Australia. With our higher rainfall, there is much more risk of tailings dams leaking and of toxic chemicals leaking into our waterways; it is completely different from the dryland environments of Australia.

New Zealand was one of the first countries to ratify the Convention on Biological Diversity in 1993. That was followed in 2000 by the adoption of the Biodiversity Strategy, and one of the strategy’s primary objectives is to halt the decline in biodiversity. At the Rio Plus Ten Earth Summit, in Johannesburg in 2002, the Government committed to strengthening national, regional, and international efforts to control invasive alien species, which we know are one of the major causes of biodiversity loss. Our 2004 state of the environment report identified biodiversity loss as our most pervasive environmental issue. We have a global and a national biodiversity crisis, yet this Budget cuts funding for our main biodiversity manager, the Department of Conservation. The department’s allocation of $335 million is equivalent to the budget of the Hamilton City Council, yet the department manages a third of our land area. The Budget means an $11.6 million cut in departmental spending in the current year, and an $8.7 million cut from 2013-14 onwards. It means that in the next year the department has to raid its land acquisition fund of $8.2 million. That means there is no money to purchase coastal forest and other lowland areas that are not well represented in the conservation estate. And it will mean more loss of conservation expertise and skill as departmental staff are forced to leave in the next round of restructuring.

So, despite the evidence of the biodiversity crisis, this Budget offers no hope, no vision, and no indication that the Government wants to achieve the goal in the Biodiversity Strategy of halting the decline in biodiversity. As the Royal Forest and Bird Protection Society has said, it is “galling” when you look at Vote Conservation to see that the department will spend just $156 million on the protection of our wild places and wildlife in these islands of Aotearoa. The Government’s priorities are wrong. It gave tax cuts to the well-off so had $1 billion less to spend elsewhere. It expects to spend $100 million in investment bank fees to sell off our energy companies and get a one-off windfall, yet it refuses to invest even $10 million more in conservation. It subsidises the mining industry to the tune of $24 million for its seismic surveys, yet it cannot properly fund conservation. This is despite the fact that the department has world-leading expertise in conservation. It achieved a world first in eradicating rats from Campbell Island. And as Associate Professor Dianne Brunton of Massey University said in response to the Beyond Rio report, “DOC are very good at controlling predators and pests when [they] have sufficient resources to do so …”. Yet this Budget means that in the next financial year the department will be able to undertake sustained possum control on only 1.2 million hectares of the 8.5 million hectares it manages. It will be able to do sustained weed control on only 1.8 million hectares. A Green Budget would invest in conservation instead of the short-term thinking and the callous cuts to environment and conservation spending, to our native plants and wildlife, that are in this Budget, which sees the department’s funding slashed by $54 million over 4 years.

The Department of Conservation has a statutory responsibility to advocate for conservation beyond the conservation estate, but one of the main consequences of the funding cuts and the associated restructuring and loss of 150 staff—planners, lawyers, ecologists, and others with technical expertise—is that increasingly the department is absent from major resource consent applications. It was not there on the plan change for Crystal Valley, which takes some of the Craigieburn Range and turns it into an alpine village and subdivision. It has not been involved in TrustPower’s application to change the Rākaia water conservation order. The water conservation order exists to protect the outstanding habitat values of the Rākaia catchment for birdlife, yet the Department of Conservation has not been involved. Nor is the department involved in Solid Energy’s application to mine at Mount William, despite the outstanding biodiversity of the coal plateau. So the fact that the Department of Conservation is not involved because of these funding cuts puts the burden on NGOs and the community. It means that there is less information presented to decision makers, and that, of course, tilts the playing field in favour of resource exploitation and environmental harm. And yet the Government plans to tilt the playing field even further with its plans to allow the Minister of Energy and Resources joint decision-making power with the Minister of Conservation when there are applications to mine on conservation land. It will tilt it further with the EEZ legislation, which will make it “eee-zee” to drill for oil offshore.

We certainly live in austere financial times, but the Green Party would make very different choices. A Green Budget would increase conservation funding, because we recognise the intrinsic values of the species that live on our protected lands. We recognise the added value that investment in conservation provides to making our clean, green image real, to assisting the tourism industry, to promoting our quality of life, and to providing for ecosystem services, because it is often these protected uplands that provide the water that irrigators and others use downstream. A Green-led Government would promote a much more strategic approach to energy generation and energy planning—one that emphasised renewables, solar and wind, and the gains from energy efficiency. It would keep our energy companies in public ownership, because sound energy planning demands that.

A much more strategic approach would provide certainty to generators, energy users, and the wider public. It could involve using a national policy statement to provide guidance on where wind turbines go, and it could mean that we would not then have the conflict that we have seen about sites like the Lammermoor Range and like Mount Cass. A more strategic approach would also be more collaborative. It would mobilise the expertise, the skills, and the resources that we have seen spent in classic conflicts between the environment and the economy in the Mōkihinui River. It would ensure that rivers like the Mōkihinui were given proper protection. A Green Budget would be about ensuring that we have a smart economy that protects our natural assets, that shares prosperity fairly, and that ensures we have a good quality of life.

Talofa lava, Mr Speaker. I am very pleased to stand today and support the Appropriation (2012/13 Estimates) Bill. I want to support it because I want to celebrate what Budget 2012 has done for Canterbury and the people of Christchurch. As the MP for Christchurch Central I really appreciate the commitment by this Government to the Christchurch rebuild. It is very appropriate, I believe, that the rebuild is one of the Government’s four priorities, and hearing the Prime Minister say that his Government is 100 percent committed to rebuilding a strong and vibrant city is music to our ears.

The Budget commitments of 2011 and 2012 give Christchurch certainty. They give us certainty because they are important for us as the second-largest city in New Zealand, as the gateway to the South Island, as the gateway to our tourist destinations, and as an export centre for our agricultural production. It gives us the certainty that we can, and we will, rebuild. It gives us the certainty that we can rebuild knowing that the Government is standing right beside us and right behind us. It is very interesting to note that the Opposition MPs from Christchurch have spoken about everything in the Budget, but none of them has talked about the fantastic support for Christchurch and Canterbury. Perhaps that is too positive a story.

On top of the $5.5 billion that was specifically allocated for the rebuild in last year’s Budget—and about $2.4 billion has already been spent—Budget 2012 has increased the funding. It increased the funding, particularly for the Canterbury Earthquake Recovery Authority, by $115 million to make sure that it can oversee that reconstruction and to make sure that that money is spent well. The Budget also added another $13 million for the community, for NGOs to lead initiatives to support Cantabrians. There is a debate about what the total cost of damage in Christchurch and Canterbury will be. It is estimated at somewhere between $20 billion and $30 billion. So whatever you think, there is absolutely no doubt that it is the largest, the most complex, and the most difficult project in New Zealand’s history. But we are making real progress. It is our job to fix and to repair the destroyed homes, the damaged businesses, the public buildings, and the infrastructure, and that job is well on the way.

Of course, earthquakes damage land and destroy buildings, and so the most difficult job we have had to start with is to understand the geotechnical processes under the city of Christchurch and Canterbury. It is to look at the zoning for the very worst damaged lands. That has been a particularly difficult time for residents whose land is damaged, trying to figure out where their future lies. There are still nearly 2,000 people on the Port Hills, in the white zone, who do not know what their zoning will be. However, all the zoning on the residential flat land of Christchurch is complete, so everyone, except those in the white zone, is able to think about moving on and think about creating a new future for themselves, and many have. Owners of 7,256 properties with the worst damage are eligible for Crown purchase offers, and to date 6,162 owners have been sent offers. About half those owners have settled, and that has allowed them to move on and to restart. Every day I talk to people who have found new homes, who have moved into new communities, and many of them are very happy. In fact, some of them are ecstatic. We have paid out about $600 million pre-insurance to those red zone residents and expect to do that again in the next few months.

💬 Hon Trevor Mallard: Who’s “we”?

The Government has spent out.

💬 Hon Trevor Mallard: The insurance companies.

No, the Government has spent $600 million pre - insurance repayments, and then $600 million will come again in the next few months.

There is lots of work happening in Christchurch. In fact, that has been a silver lining for many families. Engineers, workmen, and tradespeople are everywhere. The Earthquake Commission has repaired over 15,500 homes, and another 35,000 homes are in the process. The Stronger Christchurch Infrastructure Rebuild Team has completed $165 million worth of infrastructure repairs, and it is completing about $40 million worth every month going forward, which will finally end up with about $820 million. Right now it has been working on the pipes and the drains under the city. It has examined, assessed, and cleaned over 1,000 kilometres of pipes, and it has repaired 20 kilometres of them.

Of course, buildings have to come down before we can rebuild, and we are getting very good at demolition in Christchurch. There are about 1,000 buildings in the central city that have to come down. Close to 800 have been demolished, with another 200 on the way. I actually live in the centre of the city. I go to bed hearing the demolition and I wake up in the morning hearing the demolition, but I have to say it is a good feeling to see those broken buildings gone and to realise that we are beginning to rebuild. Things are popping up all over the city. I have got a new house over the road from where I live. My office was a rebuild since September. There are new shopping centres, there is a new supermarket about to open, Briscoes has got a new centre, and there is a new hotel. There are about 26 major buildings being built in Christchurch at the moment.

However, there is no doubt it has been an extremely tough time, both physically and mentally, for the people of Christchurch, so the health and well-being of Cantabrians has been a really important part of the Government’s earthquake response. Extra funding and resources for the Ministry of Health and the Ministry of Social Development made sure that we could have a rapid response going right back to September and right through 2011, and the extra money for health in this Budget will also help. Although the health facilities in Christchurch are working amazingly well, it has been really difficult for everyone. I would like to pay tribute to the doctors and the nurses and the health professionals who are working under very difficult circumstances to keep our system running, and it is still fragile. In fact, I think most of the people in Christchurch are a little bit fragile at the moment, so Budget 2012 has confirmed an excess of $2.8 million for the Canterbury Earthquake Recovery Authority’s community well-being team.

In education we have an opportunity to look at new ways to deliver to our young people, and it is good to see the increase in Vote Education and our commitment to getting a great education to five out of five young New Zealanders. It was an absolute credit to our schools, to our teachers, and to our parents that Christchurch students improved their response in the National Certificate of Educational Achievement last year despite all the disruption of the earthquake. Christchurch’s results were 6 percent higher than the national average and its students did better in 2011 than in 2010. So it just goes to show that when you focus on education, and you have a quality input, you can get a quality output.

One of the silver linings of the earthquake is that young people can see many good jobs ahead of them in the rebuild. We have created 4,500 new training positions in construction, but all types of skilled workers are in demand. We need accountants, we need lawyers and managers, and we need everybody who can support the rebuild and our communities.

The productivity of Christchurch is essential to the long-term economic health of our country, and our future is looking good. Our economy is operating well, record amounts of exports are going through our port, unemployment is down, and many businesses are not only recovering but flourishing. I would like to thank the Government for its support of my city in this Budget, and I believe that Christchurch is looking forward to a very bright future. Thank you.

The Government presents the Christchurch earthquakes as both a problem and a solution in the Budget. It is one of the three excuses given for its failure to manage the New Zealand economy adequately, listed along with the global financial crisis and the New Zealand recession from 2008—both of which have been with us, of course, for some years. At the same time the Budget presents the earthquake recovery as a solution generating most of the projected growth that the Government has put in this Budget, and also as the biggest factor in new job creation.

The growth overall has struggled in recent years to reach 1 percent, and this makes, I think, the Government’s projections in this Budget for 3 percent growth in the future years pretty unrealistic. However, according to the Government’s own projections the earthquake recovery will make the major contribution, through residential and infrastructure rebuilds in the coming 3 years, to the growth projected in that Budget. That growth resulting from earthquake recovery does not arise from Government policy; it is consequential growth from disaster recovery, and it is funded more from insurance and investment from the private sector than from Government investment as a result of its two Budgets—the previous one and this one.

The earthquake recovery is stated to be one of the Government’s priorities. But when you look at this Budget, little or nothing more is added by it over and above the allocation made in the previous Budget. The Government measures offer nothing new to Christchurch people suffering the effects of the earthquakes. All we get are statistics on the numbers who accepted the red zone offers, and they are not very revealing in themselves. The fact is that too many people were losers from that process. Too many people cannot, in fact, afford to buy the new sections—those of them that are on offer, and there are far too few of those. Homes are effectively confiscated by the Government under the red zone regime, with inadequate compensation for far too many people. Yes, there have been some winners, but there have been far, far too many losers. People are expected to move on without fair compensation, and that is not the way New Zealanders do things.

I suggested to the Minister for Canterbury Earthquake Recovery concessionary bridging finance as a way of helping people move on: for example, a facility up to $100,000, repayable on the sale of the property or the death of the borrower, with no interest or perhaps, at most, a modest concessionary interest rate. That would have been possible with very modest expense to the Government, and it would have helped a lot of people to move on. There has been no reply to that, no action on that or on any other provision of that kind that would actually make a difference to Christchurch people who are struggling to move out of the red zone and to buy another property. That is just not good enough. This Budget is silent about that.

Another fact is that some insurers are getting away with blue murder: deliberate delays, bullying of claimants, and other problems. We see, again, absolutely no action by this Government whatsoever, and that is not good enough, either.

Another fact is that the Earthquake Commission has been much, much too slow in reinstating damaged land and homes in Christchurch. I believe that the reason for that is the Fletcher’s monopoly. It is a monopoly of inaction. Qualified Christchurch tradespeople are available who are not employed by Fletcher’s, and they are available to assist in the rebuild. They are being shut out by the policies of this Government, and that is poor use of available resources, and contributes further to the very slow progress of reinstatement of damaged houses in Christchurch.

Another fact is that there is a severe housing shortage in Christchurch. It is chronic and it is getting worse. No significant action has been taken by this Government on that, nor on the rent increase explosions. No action has been taken on that, either. People have asked for months for action on that and they get silence from this Government. So if the Christchurch earthquake is such a high priority for this Government, why has there been so little action on these important issues?

I believe that Christchurch people have gone through three stages in their reaction to what has happened since the earthquake. The first one was a reaction of gratefulness that the Government was in there and helping out. And we all felt that. That was fine, and I suppose that it assisted the Government in the election. But since then what has happened is more and more protests—protests on top of protests about problems on top of problems. Now we have got over that to an extent, because people are now just resigned to the situation that nothing better is going to be offered to them, and, of course, that results in a lot of people simply leaving the city or giving up hope. In fact, in a recent survey 68 percent of Christchurch people said that they were unhappy with the Government and the earthquake policy.

So I simply do not understand how Nicky Wagner can get up in this House and tell us all how wonderful it all is in Christchurch, when everybody who lives in the affected areas of that city knows that that is not true, and it should never be projected as such. But there is more. The rebuilding of Christchurch central—and Nicky Wagner, as she says, lives there—needs funding. It needs funding so that the rebuild can happen with insurance money and with Government money, and happen promptly, and basic infrastructure gets attention with a combination of Government money, council money, and insurance money.

But there is not enough money to fund the aspirations of Christchurch people for their city for these three things. First of all, there is the new central city rebuild. There is a good plan that has been produced, and the Christchurch Central Development Unit has been established, and we hope that that will be effective in pursuing that plan. But what funding has been allocated to it? We do not see that in this Budget, and we should. Secondly, in respect of the repair of heritage buildings, which are dear to so many people in Christchurch, there has been nothing but a huge, deafening silence from the Government. There should be a special provision in the Budget for the preservation of heritage buildings in Christchurch, as required by the people who live there. And, thirdly, there needs to be direct support for economic recovery in Christchurch, such as special economic zones to stimulate economic recovery and to ensure that it happens in a structured way.

So what we get from this Government is yet another aspect of its dull, lifeless Budget from “Asteroid National” for Christchurch. There is no provision for those needs that I have spoken of. So much for the Christchurch earthquake recovery commitment from this Government! Many are now saying that the earthquake disaster was one thing, but it has been matched by Government policy as well.

The Minister of Finance, in his Budget speech, said this: “The rebuilding of Christchurch will be a key driver of overall domestic activity and is expected to contribute around one percentage point to annual growth in each calendar year from 2012 to 2016.” So the rebuild will save the New Zealand economy to this very considerable extent, but given the pathetic record of growth under the Government of only about 1 percent in recent times, the Christchurch rebuild will apparently be a very big part—and perhaps all—of that future growth. And none of it is actually this National Government’s doing.

The Government’s reliance on a natural disaster to produce the growth that it claims credit for is not—is not—a credit to it. Growth needs to be achieved well over and above that.

It is a pleasure to take a call in the debate on the 2012 Budget, which is a forward-looking Budget in times of very challenging economic circumstances. I know that it is lost on our opponents on the other side of the House that there is a major meltdown taking place in Europe as we speak. It has absolutely escaped Labour’s attention that in the US what is being described as a second recession is potentially going to take place. Listening to our opponents on the other side, the rest of the world is flat, and the only place where there is an economic plan is back here in New Zealand, and it is contained within the Labour Party.

Let us have a look at what Labour has been saying. It has been saying that the way to prosperity in New Zealand is to tax the industries that are prosperous, which means the agricultural sector, with a capital gains tax on farming. A capital gains tax; that is the answer! If something is moving too quickly, you tax it. If it keeps moving, you tax it some more. If it stops moving, you subsidise it to get it moving again. That has always been the Labour plan. It has been tried and it has failed around the world. If you look at the excesses of some of the spending in Europe, and look at the type of Government policies there over recent years, you can sheet some of that same philosophy right back here to New Zealand.

Let us have a look at what this Government is doing. It is responsibly managing the Government’s finances, building a more competitive and productive economy, delivering better public services, and, of course, rebuilding Christchurch. The Government has in mind a 3 percent growth rate within a short period of time. This is a very aspirational goal in the circumstances that we find ourselves in. If you look at what our opponents are offering us, this level of growth is certainly a brighter, much more focused direction. Growth in New Zealand over the next 3 years is forecast to be higher than Europe’s rate of 0.5 percent, and the United Kingdom’s of just over 1 percent. So what you are looking at is an economy in New Zealand based on the agricultural sector, which is dependent on exporting in the wider economic climate, and which has a set of rules around it that will deliver those results.

It was interesting to read in the Dominion Post today—not usually somewhere where you would go to find a friend of the agricultural sector—where it said: “Agriculture is the sensible choice to base such a vision on.” The writer was talking about a vision for how to grow the New Zealand economy. KPMG’s latest Agenda magazine said: “Now is the time for the diverse companies that produce New Zealand’s food, fibre and timber products to explore how they can work together—with the government—to make the primary sector New Zealand’s pathway to prosperity.” This comes directly from today’s Dominion Post. I could not agree more, and I congratulate the Dominion Post on having the good sense to pick up on and write something like that, because what do we hear from our Green opponents and our Labour opponents? The way to grow New Zealand, apparently, is to place so many restrictions on our agricultural sector that there is no way that it could grow.

💬 Hon Trevor Mallard: Tell us about DIRA.

Well, I would love to tell the member about the Dairy Industry Restructuring Act, but, you know, I probably would not be able to give him the intelligence to understand it. I understood that it was duck shooting season, and obviously one or two have escaped the maimai. The reality is that this economy is an agricultural-based economy. It will be interesting to see how that member responds to the dairy industry restructuring legislation over the next few days, because he is going to be given a chance to have a view on that. It will be interesting to hear what the member’s view is.

This economy must grow, and has always grown, through the prosperity of the agricultural sector. What is it that we need to do in times of hard economic circumstances? One of the things we need to do is have a look at what will actually make the economy grow. When we look at what our opponents have done, we ask whether they support further infrastructure and development in our agriculture sector. No. Will they support the bill that the member interjected about, the dairy industry restructuring legislation? Well, we are yet to find out. It would probably be without precedent if they do not support it, because when it comes to issues of such economic importance they always have done. So I look forward to their support there.

They want to put out business by producing a tax system that incentivises a whole lot of non-productive activity and puts a penalty on those businesses that produce. Do they support the 90-day probation period for new employees, for example? No, they do not, and they never have. Do they support any labour-market reforms? No, they do not. Do they support the $1.5 billion put into ultra-fast broadband, which is hugely important to the agricultural sector? Do they understand that when you are an export country, you need to be able to export from the areas where you produce the products, like rural New Zealand? Do they support the $30 million investment in rural broadband? No. Do they support the 3,000 jobs that came in through the Hobbit movies? No.

What do they support? What will they support? Will they support the irrigation proposals in the South Island? No. What will they support? Do they support the $5 billion to $7 billion in the mixed-ownership model, which potentially could be invested in high tech education? No. So what we are hearing from our opponents is a whole lot of hot air. In fact, when you listen to the Green Party members you do really wonder—and I seriously do wonder—whether they could carry out some of their policies if they were ever in a position of power. Would they be mad enough to do it? It is a real test. Would they actually be mad enough to do what they say they would do? Because if they did, they would bring the economy—

💬 Hon Trevor Mallard: I raise a point of order, Mr Speaker. I think there are probably two grounds on which you could rule that comment out of order. One is the blatantly sexist language that has been used. Second is the implication of a lack of courage, which I definitely object to.

The ASSISTANT SPEAKER (Lindsay Tisch): The member cannot say that someone is mad, so he should be careful how he expresses himself.

I do not intend to challenge your ruling, Mr Speaker, in any way at all. Would Green Party members carry out what they say they will carry out? Would they? Could they? And what would happen to the New Zealand economy if they did? That is a very good question. What would happen to the New Zealand economy? If they were to place the restrictions on agriculture that they say they would place on agriculture, what would happen to the New Zealand economy?

Let us go back and have a look at some of the rhetoric around some of the recent things that have been said. I see Mr Hughes in the House. I notice that he recently found out where Taranaki is. There must be something up there for which he could get his name in the newspaper. He was found to be wanting in terms of his facts over that debate, as well.

What have we heard from the Labour-Green Opposition? We have heard a speech from the new incoming Labour leader, David Shearer. He said that we needed to create an economy similar to Norway. He said we needed to have a Nokia in this country, and we needed to move into the high tech end of the economy.

💬 Hon Trevor Mallard: Norway?

What I want to say to the member opposite who constantly interjects—

💬 Hon Trevor Mallard: Wrong country. You don’t say Taranaki and Hawke’s Bay are the same things.

The member constantly interjects, but what does he think Fonterra is, if it is not the New Zealand equivalent of Nokia. What does he think turning milk products into an asthma inhaler substance is, if it is not high tech? What does he think developing very sophisticated nutraceuticals, which help that member ride his bike, is, if not a high tech industry? What does he think developing very sophisticated food products and ingredients is, if not high tech? I know that it is lost on the member. I know we could talk about it for some time, but he would not want to listen to or hear that view.

What is the biggest threat to the New Zealand economy? It is the Labour Party and the Green Party. What is the biggest threat to the environment? It is the continual bashing of agriculture, despite what the agricultural sector is doing to turn that round. If you actually look at where the best opportunity for future development for New Zealand, and further enhancement for the environment, will come from, it will not come from within our cities. I would like the Green Party to apply the same standard to outfalls from cities as it applies to the agricultural sector. When those members go out and start campaigning up and down New Zealand about clean streams, and when they are blaming the dairy industry for pollution, they should at least take a photograph of a dairy cow and not a beef cow standing in the streams. At least that would be a start. That would show they are genuine, at least. But they cannot find a dairy cow standing in a stream.

Talofa lava.

E mihi kau ana ki a rātou i roto i te Rōpū Māori, e tautokotia atu te mahi o te Whānau Ora, te mahi o te kāmura, mīhini me ngā cadetships. E tautokotia atu tērā engari, he itiiti atu te nui o ngā take e pā ana ki te pai o tātou a ngāi Māori.

[I really acknowledge those in the Māori Party and endorse the work of Whānau Ora, and carpentry, engineering, and cadetship initiatives. But in terms of how well off we Māori are as a whole, there is really very little there.]

I just want to recognise a couple of the decent things that have happened in the Budget, but overall for Māori and, most of all, for all New Zealanders, this is a shocking Budget. The member Shane Ardern, who has just sat down, talked about madness. Madness is infused in one person’s progress through a jumbled mind, and that is what has happened to a whole lot of the people in this country because he drove Myrtle up the parliamentary steps. He believed that that would be the correction for the economic panacea that he has huffed and puffed about, but it made no common sense, whatsoever.

Over the last four Budgets a fascinating thing has happened pre-Budget. There have been these great statements, statements of grandiose, promising everything—milk and honey. You see, there has been a lot of fibbing in this. That member said that lycra is made out of milk. That is a whole lot of rubbish.

💬 Shane Ardern: I never said lycra is made out of milk.

So he did not even know what he was saying.

In the first Budget from National, this is what the Prime Minister said: “I think by the end of 2009”—blah-blah-blah—“we’ll … come out of [recession] and I think actually starting to come out of it reasonably aggressively”. In the next Budget he said the Government would “start making the long-term changes that National promised … and needed to lift New Zealand’s long-term economic performance”. In the next one he said: “This Budget is about growth. It is not about looking back, and there will be jobs developed and you will see that grow in the economy.” In 2011 he said: “The Budget is likely to see very strong growth in real wages … very strong job growth”—blah-blah-blah—and this year we had a zero Budget. So growth has been on the Government’s mind.

Mr Speaker, you and I worked together in entrepreneurship and all of that stuff in the past, and it was wonderful. We were innovators of the modern time. I certainly recall those things like starting the Art Deco event, the World of Wearable Arts, and all of that stuff that has become so fashionable now that people make out it is some corporate plan. This Budget is all of that. It mirrors the corporate plans that finance bluffers—people who bluff in the finance world—use. We certainly know what happened to that big company—what was its name?

💬 Hon Trevor Mallard: Merrill Lynch.

Oh, Merrill Lynch. We know what happened to that.

💬 Hon Trevor Mallard: The Bank of America had to buy it up.

The Bank of America. This Government has the worst growth record in the last 50 years—the worst growth record. We have 1,000 New Zealanders going to Australia every week, like my great colleague Rino Tirikatene said. That is a disgrace. Why would they want to go over there? And I will tell you what—

💬 Shane Ardern: How Labour would keep them in New Zealand? Tell us how Labour would keep them here.

We kept them here in the 9 years we were in Government. We had the lowest unemployment rate for 32 years. People going into employment were four times better off then than they are now, and that National Government has added 52 percent to the unemployment number. For every two who were unemployed when it came into power, it put another one on to the number. That is where the growth is. The growth is all negative indices. That is where the growth is, and National makes all these excuses, huffing and puffing about everything else. Of the fact that there are nearly 35,000 kids living in poverty, you should be ashamed. It is shameful. It really is shameful.

Then the member dared to mention the labour market. I will tell you what is driving the labour market at the moment. It about sitting down and listening to families in Wairoa, where the parents say they are having only one meal so their kids can eat. What a shameful thing for any Government to enact on people. It is because of National’s labour market nuances and its crazy ideology, which is about kicking the workers out, making them suffer, and putting the minimum wage up by 50c—

💬 Nicky Wagner: You know better than that.

—no, no, no, Nicky—then the tax has increased, so the minimum wage has gone up by 20c. Mr Tremain can snigger, because he is on “cosy seat”. He knows that in Wairoa, where he used to turn up with me, they were unemployed and those members have done nothing. He is sitting there doing nothing, and we put them into the jobs. Well, I will tell the Government what happens in the labour market. You invented the 90-day bill. You invented the 90-day bill, and it is very interesting how you have calculated—

The ASSISTANT SPEAKER (Lindsay Tisch): Order! Do not bring me into the debate.

That lot over there, Mr Speaker, which I am sorry you are part of because they work with you, invented the 90-day bill. This is what the 90-day bill does. It shortens work opportunities, it becomes an added single figure on the labour force numbers and percentages, and the Government makes believe it has invented all these jobs. It has invented so many jobs that it is saying that the number went up by 9,000—that 9,000 dropped off the unemployment. But what it has not added to that number is the 18,000 people who came into the labour market. So it invented the 90-day bill, the poor old meatworkers get stung, and then there is the big game of the nasty companies—

💬 Shane Ardern: Where are there meatworkers in this country being stung?

—that that joker defends over there. There are some good companies, but the nasty ones are trying to corral everybody into a 3-month employment package. That is low-down cunning. That is low-down dishonesty.

Talking about this international economic downturn, the Government knows every reason why it is happening wrong in Alaska or over in Norway, or anywhere else, but it will not fess up to what it is doing here. There are some very interesting things that Mr Ardern, who is a farmer, talked about. He talked about the commodity export prices. This is what is happening. On average around the world the dip in the percentages is 4.5 percent in the sense of moving towards negative pricing. This country is consistently down at 13 percent. How can you explain that when we are getting the best prices we have ever got for cattle, sheep, beef, and crops? We are failing miserably. That means that those members are not running the books straight enough and they are not getting enough innovation to make things move.

We have heard all this business about the rheumatic fever. The reason you get rheumatic fever and you start heading towards having a Third World country ideology is where you put the families. That is why the Government has slammed the money in for rheumatic fever. Its members should hang their heads in shame for the last 4 years of letting rheumatic fever grow in this country. It is happening in the families where there are poor kids and in the families who are on benefits, and those members think it is really great.

As for the Families Commission, you know, Mr Speaker, this slashing and burning is not good, and I find it hard to believe that you are part of it.

The ASSISTANT SPEAKER (Lindsay Tisch): Uh-uh.

Sorry. Well, anyway, the Families Commission. The Government has cut seven commissioners off and left one, and it has knocked its budget out—nearly 90 percent worth. That is how much it cares about families—that is how much it cares about families.

💬 Hon Nathan Guy: How long has he been here?

You think about the shearers and the rousies, though, mister, and make sure that they get helped out, because you ain’t doing it. It really is a disgrace.

As for KiwiRail, the Government is putting more money into that road north of Auckland. Everything is about that damned road up there near Ōmaha, or Ōmahu, or whatever you call it. I wonder who has got their holiday baches there. Never mind the Gisborne to Napier railway line. The Government wants to close down the KiwiRail thing, and stop it from stopping at 12 small towns—going to be a lot of exiting over there. Why do those members want to do that? It is because they are out of control. They think they have unbridled power, and they certainly are not giving the people a fair go.

You know, with the research and development thing that they are huffing and puffing about, when they came in they removed the total tax credits. They removed the research and development tax credits, and the money that they have injected back in they are saying is a huge amount, but it is still only 32 percent of what they took away. You know, it is like the great magician: give with this hand; take away with the other. I see you frowning, Mr Speaker, and I will sit down on that note. Thank you very much.

Talofa lava, Mr Speaker. It is a pleasure to speak in the Budget debate this afternoon. Budget 2012 was a Budget for our times, our uncertain times, and the Minister of Finance, Bill English, has made sure that we will be on track to surplus by 2014-15. That has been the theme for the last 4 years. It has been a sustainable Budget, and it is one that ensures we can actually make our way in the world. We have to pay our debts, and we have to make every dollar count, and this is a Budget that will do exactly that, so I say congratulations to our Minister of Finance.

Obviously, having been a health practitioner, I focused on the health part of the Budget, and I am delighted about Budget 2012 in respect of the health budget. It has been a challenging time for the health Minister, but he has managed to put more money into certain areas, and this made me reflect on how far we have come. In the lead up to the 2008 election the mantra going in was that it was harder to see a hospital specialist; in fact, we had tens of thousands of people culled from waiting lists. The emergency departments were gridlocked. We had stories of patients on gurneys in the corridors of emergency departments and under bright lights. We had workforce shortages, morale was extraordinarily low in the health workforce, we had ballooning health administration, and health professionals were basically seen as part of the problem, not the solution.

Well, our health Minister, Tony Ryall, has carefully managed his way through that with careful leadership through successive Budgets, and he has turned that round. He has got to be congratulated on the work he has done in the health sector. I am certainly proud of our successes in the health sector.

Basically, key to all of this, and to turning it round, is making clinicians part of the decision making. That has been quite crucial, also, in implementing health targets. The targets have been advertised quarterly; they are a way for district health boards and the public to benchmark their local hospitals. This has been welcomed by clinicians. It has not been seen as a threatening move. Basically, district health boards have stepped up. Even this morning at the Health Committee hearing the Waitematā District Health Board, which had had a bad patch only a few years ago and had gone through a rough time, reported that it was leading in most of those six targets for the district health boards. So congratulations to the Waitematā District Health Board. I think that Lester Levy has been an inspired choice as chair of both the Auckland and Waitematā district health boards.

I want to look at some specifics in the health budget. Basically, at over $14 billion, it is the biggest investment so far in health. There is $68 million for more operations, scans, and tests, and that will also ensure we maintain our excellent levels of elective surgery. Compared with 2008, 27,000 more elective operations are performed per year, more than 500 extra operations per week, and under this Budget we are still going to be investing $48 million in elective surgery so that we can have a further increase of 4,000 operations in elective surgery. That is an astonishing, astonishing result and target. In my first term of Parliament, as I said, we had patients being culled from waiting lists. Tens of thousands went back to their general practitioners, from the waiting lists, and I recall many harrowing letters from patients and families about their relatives being culled off the lists—unacceptable. I am so delighted that we have increased elective surgery and will continue to do so.

Also, an area of quite some importance is diagnostic tests, such as magnetic resonance imaging scans, CT scans, colonoscopies, and angiograms. These are important tools in the diagnosis of disease and also in how we plan treatment. Minister Ryall has recognised that we need to speed up timely access to these important tests and tools. Therefore, $16 million has been allocated for new IT systems, which will create faster access to those tests. There will be $4 million for a national register for patients who have heart conditions.

Importantly for me, given where I used to work in the health sector, $33 million has been invested in better, faster services for cancer patients. Importantly, and it has been alluded to by a previous speaker, there has been more money to go to dedicated nurses, to help patients and their families navigate their way through the health sector when they are diagnosed with a serious cancer diagnosis. You can appreciate that with a cancer diagnosis that is very serious, it is confusing, it is frightening, and a navigator—a personalised service using a dedicated nurse—is a fantastic initiative. Also from July we are going to be able to collect key data on those points in that patient’s journey, so that we can get a picture of a patient’s journey, and it will also help when looking at coordinating services and improving services.

I can only go back to 2007-08, when cancer waiting times were absolutely appalling. We had radiation waiting times, and instead of what we have now as the gold standard of 4 weeks, it was up to 16 weeks - plus, which was dangerous. We had women going to Australia for radiotherapy, having to leave their families and their jobs, and their whole lives were being absolutely turned upside down. We will soon be having targets on chemotherapy waiting times, and I am pleased to see that.

The whole thing, I think, with health targets is that they do actually focus the mind and get people talking about how we can achieve that target, and that is key to it all. I mean, emergency department waiting times have been a fantastic success. Emergency departments do represent the barometer of how a hospital is functioning. If there is gridlock, it represents systemic issues going on within that district health board, such as poor patient discharge planning, maybe poor design of the accident and emergency department, and just general patient flows. The fact that 50 percent of our district health boards are now achieving the target of 95 percent of patients being processed within 6 hours is fantastic. You just cannot achieve that out of thin air. It takes planning, it takes collaboration, and it takes communication.

I recall that in the last term of Parliament I went to the Counties Manukau District Health Board when it was celebrating achieving that emergency department target of 95 percent. It had taken 2 years to get to that point. It did not happen overnight. There were conversations about everyone’s role, from the orderly to the personnel and so forth, and that is what—

💬 Hon Trevor Mallard: OK, that’s enough.

But, no, actually it is quite key. It is actually the care pathways that are key. The Canterbury District Health Board, which is a hugely innovative district health board, is doing care pathways. Basically, it is getting people round a table and talking about what their roles are, and how a disease or process needs to be managed. It is as simple as that. Communication is key, and that was lacking before Tony Ryall took over his portfolio in health. It was lacking, the morale was absolutely down low, and clinicians were not feeling empowered. I tell you: to turn that round is all about communication. It is as simple as that, and this Minister has done it.

Immunisation is a hugely successful target—95 percent of 2-year-olds to be immunised. Well, we have almost achieved that. We currently have 92 percent coverage, compared with back in 2007 when only 67 percent of 2-year-olds were immunised on time. That was a shocking statistic, and we have done extraordinarily well. There is no doubt that health targets focus the mind, and it is all about communication and achieving those targets.

Getting smokers to quit is another target. I am really pleased with the Budget announcement of increasing the tobacco excise, as that will mean we will have more and more people giving up tobacco and cigarettes, in droves. We know that costing hikes make a difference in people not wanting to smoke in the first place, or in people just making that decision to stop smoking. We know that it is an addiction, so access to smoking cessation products and Quitline are so important. I see that the initiative in Budget 2012, with the increase in tobacco excise, along with the health target, will make sure that that statistic keeps improving, and we will, and I am sure we can, be smoke-free by 2025. All of this is quite achievable. Smoking causes so much harm in our society, and I am delighted to see that initiative. I commend this Budget. Thank you.

We have heard a lot in this Budget debate about the lack of vision in this Budget. I agree with that entirely. It is a zero Budget delivering zero hope, zero vision, zero excitement, and zero initiative for anybody to advance their business and make sure they are keeping up with developments in their industries, promoting and developing new products, and getting our exports to market. The lack of those things is apparent and has been covered by my colleagues contributing to this debate already. But I want to talk about the lack of truth in the Budget. I want to talk about the lack of whole truth in the Budget, and I particularly want to talk about health. We hear repeatedly from the “Sunshine Minister”, Tony Ryall, about the wonderful work that is being done in the health portfolio. I want just to elaborate on some of the implications for the health portfolio that are apparent in the Budget—or are apparent when you look closely, because the thing that is missing in the figures in the health budget is the whole truth. Of course, the Minister could add one more dollar to the health vote and put his hand on his heart and say: “Never in the lifetime of any human being has more money been paid into the health budget.”

💬 Hon Trevor Mallard: He wouldn’t do that, though, would he?

He has been doing that, on repeated occasions—“Never has there been such money invested in the health portfolio.” He could put one dollar in and that would be true, but it is not the whole truth. I want to focus particularly on some of the implications for district health boards, because the Minister says an extra $350 million has gone into the district health boards. Well, I would like to put that in context. Although it might be true—and I am not absolutely persuaded yet that $350 million of new money has gone into the district health boards—I want to talk about the things that the Minister is not talking about that he is requiring the district health boards to absorb this time around. It does not matter how much he says is being given to the district health boards; what he is failing to tell the public is how much they are being required to absorb out of their new reprioritised and existing baseline funding.

For example, look at the obligations that the district health boards now have to take up—the KiwiSaver payments previously paid by the Government out of central Crown accounts. The Minister gave district health boards notice a while ago that it would be their obligation to pick up these KiwiSaver employer contributions, and that the Government was not having a bar of it any longer. This has been notified to the district health boards, and, because it has been notified, the Minister, of course, does not feel any obligation to point out the whole truth of the Budget. For example, let us have a look at the funding increase to Auckland District Health Board, which has been $30.5 million. That is the funding increase above its baseline, apparently. Its liability for KiwiSaver in the next year, 2012-13, is, by its own calculation, $4.8 million. So, already, 16 percent of the new money is to go on to a liability that the Minister is not talking about.

It gets worse. If we get to Canterbury District Health Board, its KiwiSaver liability is $8.6 million. It has been given $20.5 million of additional funding. Forty-two percent, then, of its funding increase will have to go on the KiwiSaver contribution—42 percent. Here is the Minister saying that more money is being given to the district health boards than ever before, that it is going to go on these services, and that money is being transferred to provide all sorts of costs, but nearly half of that new money at Canterbury District Health Board is going on KiwiSaver alone.

Worse than that, if we have a look at the increase of funding to each of the district health boards, we see that the percentage increase across all of the district health boards ranges from a low of 1.33 percent at West Coast District Health Board, to a high of 4.5 percent at Counties Manukau District Health Board. The 1.33 percent funding increase at West Coast District Health Board, I suggest, not only does not keep up with ordinary cost of living adjustments and predictable cost increases but also is going backwards. The district health boards are not better off for this funding. If we have a look at the high one, there is a 4.5 percent increase in funding to Counties Manukau District Health Board—one of our largest district health boards. Again, even at 4.5 percent it is unlikely to cover predictable cost increases. This is meant to cover the increase in the nurses’ collective agreement. Their collective agreement was modest by any negotiating standards. They negotiated a collective agreement that ran across 41 months, effectively, because they gave up 5 months’ worth of back-pay. In the first year it is 2.5 percent, in the second year it is 2 percent, and in the third year it is 1 percent. These are not extravagant numbers, yet there is not enough in these percentage increases across the district health boards for them to meet current liabilities, let alone do the new things that the Minister is requiring of them.

So what does this mean? It means that the district health boards are going to have to cut services. They are going to have to cut services, and where will they cut? Well, they will not be allowed to cut in the hospitals, because that, for the Minister, is too politically sensitive and too obvious, so money has to go into funding more elective surgical procedures. For the cost of more elective surgical procedures, the district health boards, if they are to manage these additional liabilities, are going to have to cut services elsewhere. And where will they cut them? They will cut them in the community. They will cut the delivery of services in the primary sector, because those services on the ground and in the communities go to the little people who do not squawk loudly. They go to the little people in little bunches of money to provide really essential primary intervention in the communities where there is the best return for the health dollar, quite frankly. Those services will go, and there will not be the kinds of squawks and loud noises that there would be if there were to be cuts in the secondary sector in hospitals.

So there are two levels of damage that are happening here. There are two levels of damage. First of all, in not telling the whole truth the Minister of Health is disguising the amount of the benefit to district health boards from the funding increases. In fact, my figures would suggest that there is not $350 million worth of new money, but in fact $276 million worth of funding increase—let us not call it new money, because much of it is reprioritised; stolen from elsewhere—going into the district health boards. The second layer of subterfuge is just where the cuts are going to land. They are going to land in the community, they are going to land in the primary sector, and ironically they are going to land in the area where there is the best cost-effective return for the health dollar. This is less than the truth from the Minister.

I seek the leave of the House for members taking part in the delegation to Samoa to commemorate the 50th anniversary of Samoan independence to be regarded as present for the purposes of party votes, in accordance with Standing Order 140(1)(c).

The ASSISTANT SPEAKER (Lindsay Tisch): Just a clarification: this is so long as the delegation is overseas? This is for today and tomorrow?

Yes.

Leave is sought for that purpose. Is there any objection? There is no objection.

It is a great pleasure to rise and make a contribution on the Appropriation (2012/13 Estimates) Bill. I would like to make just a small comment. My esteemed colleague Maryan Street was concerned about the health budget. I have to say that I was hugely impressed with the financial reviews that we looked at—the Canterbury District Health Board and the West Coast District Health Board and also, more recently, the Waitematā District Health Board and the Auckland District Health Board. I heard about some excellent work being done by those district health boards. In particular, I want to commend the Waitematā District Health Board, which has actually turned round a very, very difficult situation. It is now the nationwide leader in emergency department waiting-times, cancer treatment waiting-times, anti-smoking initiatives, elective surgery, immunisation, and programmes to assess cardiovascular and diabetes risks. So there is a lot of good news in the health budget. There is a lot of good news in this Budget.

I am proud to be a member of the Government that has presented this Budget. This is a strong Budget. It has been called a simple Budget, but it is a strong Budget, it is a disciplined Budget, and it is a prudent Budget. This Budget reassures all New Zealanders that this National-led Government is a safe pair of hands. This Government assures the international credit agencies that New Zealand is governed by a team that realises that ever-increasing debt is unsustainable. The financial markets are intolerant of poor fiscal policy, and any hint of profligacy would lead to higher interest rates and increased debt-servicing costs. It is pertinent to note that we on this side of the House have suffered a litany of opposition to any cuts that we have proposed, such as targeted cuts in Government spending and retargeting in other areas where there can be more efficient use of the money. Any scheme to grow our economy has equally been stridently opposed by the Opposition.

This is a responsible Government that is investing in New Zealand’s future. If we want to see an example of a lack of fiscal discipline, we need only look at Europe. Weeks after an election there, weeks after the first election led to no result and questions about Greece’s commitment to the eurozone fiscal compact, these questions remain unresolved. The European Union and the European Central Bank, as well as the IMF, are holding their breath to see whether common sense, rationality, and a commitment to the eurozone will be affirmed at the next round of elections in Greece. As David Cameron observed on the deepening eurozone crisis, either Europe has a committed, stable, successful eurozone with an effective firewall, well-capitalised and regulated banks, a system of fiscal burden-sharing, and supportive monetary policy across the eurozone or we are in uncharted territory, which carries huge risks for everybody.

This Government’s responsible Budget means we are on track to return to surplus by 2014-15. It thereby reduces our exposure to the capital markets and helps us to be insulated from the ongoing European turmoil and global uncertainty. This is a Budget that invests in New Zealand’s future. This is a Budget that is looking to New Zealand’s future. We have, in this Budget, $4.4 billion of new initiatives. These initiatives will stimulate jobs, deliver better services for families, invest heavily in science and innovation, and make our economy more productive and competitive. We have said—we have nailed our colours to the mast—we want to derive 40 percent of our GDP from export markets, and this Budget will help us do that. It will also give New Zealanders the security they require in health and education, whilst also allowing them to live in a state of security.

The priorities in this Budget are simple. The priorities of this Government are simple. There are four of them: responsibly managing the Government’s finances—and we have talked about that a little bit already—building a more productive economy, delivering better public services, and rebuilding Christchurch. We have made much—much—of the fact that this Budget, and our prudent financial management, means we are on track to return to surplus by 2014-15. The Budget surplus forecast is not a huge surplus, but it is a huge turn-round. It means that for the first time in a number of years the Government will be raising enough revenue to meet its commitments without having to increase debt. I will say that again because it seems to be something of anathema to the Opposition. The Government will be raising enough revenue to meet its commitments without having to increase debt. From that time on, we can get our existing stock of debt down, and further reduce our exposure to the ongoing turmoil in the global financial system. It is exposure that when you hear some of the contributions from the Opposition benches you would believe had never occurred. The global financial crisis—what is that? The eurozone problems—what are they? The earthquakes in Christchurch—merely a small diversion, if you believe some of the Opposition contributions.

Given the impact of the 2008 recession, which we accept, and acknowledging the ongoing global financial uncertainty, which we on this side of the House understand is a problem, and the Canterbury earthquakes, our getting back to surplus by 2014-15 will be an astounding result. New Zealanders have appreciated our management of the economy in our first term in Government. They can see and understand that our responsible fiscal management—in particular, our discipline around spending and capital management—is essential to strengthen our country’s resilience in these continuing times of uncertainty.

As I mentioned before, this Budget is crucial to maintaining New Zealand’s international credibility for economic management—a status that, like a reputation, is hard won and easily lost, as many countries around the world can attest. We are a small country. Our economy is dwarfed by that of some large corporations. We are only 0.25 percent of the world’s economy, so, financially, you can look at us like a small coracle bobbing up and down in the Caspian Sea. However, despite our small size, if we do it right and we do it well, such is the state of global financial—

The ASSISTANT SPEAKER (Lindsay Tisch): I am sorry to interrupt the honourable member, but the time has come for me to leave the Chair.

Sitting suspended from 6 p.m. to 7.30 p.m.

Malo lava le soifua, Mr Speaker. Despite our small size, if we do it right—

💬 Hon Hekia Parata: I raise a point of order, Mr Speaker. I seek leave to make a personal explanation.

💬 Mr DEPUTY SPEAKER: I would prefer if the member did it in 2 minutes, after this speech, rather than interrupt the member’s speech. Can the member wait that long? Thank you. I will hear the member, then I will take the point of order, if you do not mind.

Despite our small size, if we do it right and we do it well, such is the state of global financial mayhem that we will distinguish ourselves from the herd—and we already are. Growth in New Zealand over the next 3 years is forecast to be higher than in Europe, the UK, Japan, the US, and Canada. We are expected to have a similar growth rate to our nearest neighbour and greatest trading partner, Australia. Our growth in New Zealand is based on strong fundamentals, and we are producing the sorts of products and types of services that will be increasing demand across the world over the coming decades. Fortuitously, we are now ideally placed so that 60 percent of our exports now go to Australia and East and South-east Asia, which are some of the most vibrant and thriving nations in the world.

This Budget provides a sound economic base upon which to go forward. In this Budget we are investing in research and innovation to help our exporters stay ahead of the competition. Over the next 4 years we will invest $166 million in the Advanced Technology Institute, helping high tech firms improve their productivity. There is $60 million for the National Science Challenges, solving fundamental issues that New Zealand faces. There is $100 million for increasing performance-based research. There is $59 million for more science and engineering tertiary courses. I commend this fundamentally sound, disciplined Budget.

Debate interrupted.