Imprest Supply Debate

on behalf of the Minister of Finance: I move, That the Appropriation (2012/13 Estimates) Bill be now read a third time and the Imprest Supply (Second for 2012/13) Bill be now read a second time. Budget 2012 confirmed that the Government is on track towards achieving the top four priorities it set itself shortly after the 2011 election: responsibly managing the Government’s finances, building a more productive and competitive economy, delivering better public services within tight fiscal constraints, and rebuilding Christchurch. These priorities meet New Zealand’s current needs and ensure that we are well placed to seize future opportunities.

Getting the public accounts back into order quickly will let us lift the debt burden off future generations and free up resources for investment in productive infrastructure and public services. Budget 2012 demonstrated the Government’s commitment to this objective with an operating surplus in 2014-15 and net debt peaking at 28.7 percent of GDP in 2013-14. I would remind members that this is a dramatic improvement on the fiscal environment the Government faced when it first took office, where Treasury projected deficits continuing out into the 2020s and debt climbing rapidly. Although this build-up in Government debt was appropriate in the aftermath of a domestic recession and the Canterbury earthquakes, it cannot continue for ever. Instead of looking into the financial abyss, we are now within sight of surplus—a fact that is solely down to this Government’s prudent fiscal management.

A more competitive and productive economy is the key to achieving the living standard that New Zealanders aspire to. The weight of world economic power is shifting towards the Asia-Pacific region, and the growing Asian middle class is likely to be a willing buyer of New Zealand made goods and services. If we are to make the most of this development we will need to rely more on savings, investment, exports, and the tradable sector, and less on debt and consumption, and we will need to create a business environment that rewards effort and enterprise. Budget 2012 made a further contribution towards rebalancing the economy with significant new investments in skills and innovation, including the establishment of an Advanced Technology Institute to support our growing cohort of high tech services and manufacturing firms.

We believe strongly in having efficient, high-quality public services. Thirty-three percent of the economy goes towards public services, so it is essential that we get the best possible value from this money. The Government has a wide-ranging agenda focused on getting better outcomes from current services, seeking new and more efficient ways of delivering services, and making progress in areas that will make a real difference for New Zealand: reducing long-term welfare dependency, supporting vulnerable children, boosting skills and employment, reducing crime, and improving interaction with Government. Budget 2012 funded a number of initiatives that will further this agenda.

Finally, the Government is committed to rebuilding Christchurch, and the reconstruction process is gathering pace. The Christchurch Central Recovery Plan has laid out an exciting blueprint for our second-biggest city’s future, and the Government was pleased to endorse this. Budget 2012 provided additional support for the Canterbury Earthquake Recovery Authority to support Christchurch’s reconstruction.

For the previous 4 years there has been significant disruption to economies around the world. Growth prospects for these economies are uncertain. In contrast, New Zealanders have avoided substantial reductions in their living standards, and are on the doorstep of a rapidly growing Asia-Pacific region. The Government has a sound plan to grasp these opportunities. That plan is built around four clear, credible, and critical priorities that respond to New Zealanders’ needs and ambitions. These priorities drive the Government’s entire work programme and shape our Budget decisions. Budget 2012 is an excellent example of this, and I commend it to the House.

That is it from the Associate Minister of Finance. That is it in terms of a plan to grow the New Zealand economy—this coming from a Minister whose great achievement has been merging a department that had been merged only 18 months earlier into a big mega-ministry, for which he came up with the idea of giving away $1,000 of something called “thinking putty”. That is what this Minister did. That is what he did. The Ministry of Science and Innovation found its way into the new Ministry of Business, Innovation and Employment, and to help out the staff there Minister Steven Joyce came up with the idea that they should all get some “thinking putty”.

💬 Hon Annette King: Is that like play dough?

It is. On this side of the House, what we would ask the Government to find is some “doing putty”, to actually get on with doing the job of trying to improve our economy.

If this National Government’s election was a novel, it would be called Great Expectations. In 2008 John Key toured the country telling New Zealanders that they would get a brighter future and assuring New Zealanders that they would no longer have to wave goodbye to their loved ones at the airport. Well, if the novel was being rewritten today, it would be called A Tale of Two Cities. One of those cities is the city of New Plymouth, because that is the number of people who have left to go overseas, to Australia, in the last 12 months—53,873 New Zealanders have left New Zealand and headed to another city, perhaps Sydney or somewhere else in Australia. That is the legacy of this Government. John Key proudly stood in Westpac Stadium, brandished his arms around, and said that we could fill this stadium with the people who have gone to Australia in the last year. Well, today he could not fit them in. Today he would have to go to Eden Park, because that is the only ground in New Zealand that could fit the number of people who have left New Zealand in the last 12 months under this Government’s watch. What is worse is that 40 percent of those people are aged between 18 and 30. That is our future heading overseas, while this Government sits back and thinks that it can rely on a mythical market solution—not pulling the levers that are available to it, but simply sitting there, trying to put its spin out.

This Government has let New Zealanders down. The expectations that this Government built up coming into office in 2008 it has consistently failed to meet. The legacy of this Budget and the legacy of this Government so far is twofold: the sale of our future and the growing inequality in our country. That is the legacy that this Government is leaving New Zealand. It is selling our future, and it is selling our future on a basis of no economic sense whatsoever. Treasury has told this Government that at least $100 million of value will be lost to the New Zealand economy from the sale of State assets. That is $100 million net loss. There is no economic gain, let alone the transfer of wealth that comes from the sale of assets that are owned by all New Zealanders and are now being given away to those who can afford to buy them, and, to boot, the $120 million that is going into the pockets of consultants, lawyers, and accountants to manage that sale process.

But the sale process is falling apart. It has been marked by mismanagement, by insults, by poor calculations, and by the shifting sands of what this money is for. To call it a dog’s breakfast is an insult to a bowl of TUX. These people have got no idea what they are doing when it comes to selling these assets, or to the damage they do to the economy today, the damage they do to the future, the dishonour they do to the New Zealanders who have built up these assets over generations, and the dishonour they do to future generations—[Interruption]—who could be benefiting from these assets, Mr Goldsmith. The future is being sold off by this Government. That is it. There is nothing more to the Government’s economic plan.

A group of New Zealand business people, the Pure Advantage group, was motivated to come to the Government. Those business people said there is an opportunity for New Zealand to grow an innovative economy that is built off our natural environment, that does not see the economy and environment in some kind of battle to the death, like this Government does, but that actually sees the two together as being the future of sustainable economic growth and a fair society. They were dismissed—arrogantly dismissed—by Steven Joyce, who says he is not interested in that kind of approach. He dismisses them as being self-interested. These business people are trying to put up a better way for this economy, and on this side of the House the Labour Party says we want to work with those business people because they see the future the same way we do, with an economy and an environment working together to build better living standards in New Zealand, that also supports the beautiful natural environment that we live in, and where we can create—as Sir Paul Callaghan, who has, so sadly, left us, said—a place where talent wants to live. This Government is driving talent away from New Zealand every single day, and it is a shameful record for the Government.

So in the end the Government has reduced all the big ideas—New Zealand being a financial services hub, the cycleway, and the Job Summit, where there were more people there than jobs created by it—and in the end it comes back and circles its wagons around the asset sales and digging holes in the ground. It is not a strategy for future sustainable economic growth.

The other legacy of this Government is the growing inequality in this society—the growing gap between the rich and the poor. What did this Budget do to try to reduce inequality? Absolutely nothing. In fact, it increased it. Just look at some of the measures, which range from the bizarre to the plain mean. The paper boy tax—what was that about? The big plan in taxation from this Government is to try to take away the minimal tax credit that young people working, delivering papers and delivering pamphlets, actually get. The Budget is removing—actually abolishing—allowances for postgraduate study. How backward-looking is that from this Government? We want more people undertaking postgraduate study, we want more New Zealanders improving their skills and qualifications, and the rug is pulled out from under them by this Government taking away their allowances.

Let us not forget something that has not been talked about enough: prescription charges going up. It may be only a small amount of money to members on the other side of the House, but a visit to any pharmacy in New Zealand will show you the number of prescriptions not picked up, particularly in low socio-economic areas. And the pharmacists will tell you that that charge makes a difference. That is what this Government did: it put prescription charges up.

There is nothing around child poverty—no measures. The Minister for Social Development wants to deny child poverty. She wants to say that people come in and out of poverty every day. She does not want to measure it, because she does not want to have to face up to the damage that her Government is doing to New Zealand.

And the unfairness in New Zealand will grow. Yesterday we heard that chief executive officer wages in New Zealand rose by 9.9 percent in the last year—9.9 percent. New Zealanders understand that we are in tough economic times. They have accepted a lot from this Government in terms of belt tightening, but when it comes to the chief executive officers, they got nearly a 10 percent wage increase, compared with 1.6 percent for the average worker. This Government needs to face up to the fact that inequality is getting worse, and its legacy as a Government will be the selling off of our future and the loss of New Zealanders’ ideal of an egalitarian society.

The Labour Party has a different vision. It is a vision where we grow a sustainable economy and create a fairer society, where we actually allow people to achieve their potential, no matter where they are from, and where we harness that potential and that opportunity, and give New Zealanders a reason to stay in this country and grandparents the opportunity to see their grandchildren grow up. That is the vision that the Labour Party has. We want to focus on creating jobs, on having the Government play a role in pulling the levers—big and small—that help an economy grow, on making sure that we support New Zealand firms, but also on addressing the big issues that this Government keeps running away from: getting better monetary policy that supports exporters, making sure that we have proper savings to help businesses grow, making sure that we address the sustainability of a universal superannuation system, and making sure that we have a fair tax system that ensures we have the opportunity in New Zealand to grow.

The Labour Party has a plan to bring a fairer society. It is built around the creation of a world-class education system, bringing the economy and the environment together, and ensuring that all children in New Zealand have the best start in life. We can invest in our potential for the future. If we invest in our potential, if we create equality, that creates the obligations we have to one another in our society, a social contract where people know the Government is on their side. That is what the Labour Party will bring to Government. That is what is missing from this Government. This Government is now a tawdry Government with no plan for the future, and the Labour Party will hold it to account every single day in this House. But, moreover, we will bring to the country a plan for a fairer society, built off a strong, sustainable economy.

Tēnā koe, Mr Assistant Speaker. Kia ora. Ngā mihi nui ki a koutou. Kia ora. I rise to take a call on the third reading of the Appropriation (2012/13) Estimates Bill and the second reading of the Imprest Supply Bill—part of Budget 2012. When the Government was elected in 2008, it inherited a Budget and an economy that were seriously out of balance, a country that was living beyond its means, and a country that has been rocked by catastrophic earthquakes. Now, in its second term, we can measure how the Government has responded to these significant strategic challenges. This Government has had an opportunity to remake our economy, placing it on a more sustainable footing environmentally but also economically. It could have invested in an economy that was more productive, that invested in its people, and that invested in education. We could have had an economy that invested in the new economy, which is green energy and clean technology. This would have provided more lucrative jobs, which would have boosted our economy without trashing our environment. We could have rebuilt Christchurch smarter, and made it one of the most sustainable cities in the world.

The Government had an opportunity. It was inheriting an economy that was broken and it had a huge number of challenges. But now we can measure how it has responded to the challenges, and it is clear that it has failed. It is clear that what it has turned out to be is a poor economic manager. What we see from this Government is not embracing the opportunity of the new economy. Instead it is stuck looking towards the past, and, in fact, it has purposefully undertaken a series of measures that have hurt our economy.

One just needs to look at the statistics. We know that the Government deficit is over $8 billion. We know that gross Crown debt is in excess of $75 billion, around 38 percent of GDP. What is even worse is New Zealand’s total foreign debt, which is more like 75 percent of GDP. When it comes to growth—the main measure that this Government wants to measure itself on—we have seen the lowest growth in 50 years. We have seen the highest unemployment rates since 1994. We have seen inequality growing and a record number of Kiwis going overseas. Under the quantifiable measures of how this Government has responded to those challenges, it is clear that it is doing an abysmal job.

The fact is we have got opportunities and we have got options, but all this Government has embarked on is the path of cut it, sell it, mine it, drill it, and frack it. It is the only plan we are seeing from this Government. Grant Robertson quite rightly pointed out that the only measures to increase tax revenue in New Zealand were to focus on the paper boys and the paper girls, the changes around postgraduate allowances, and the increasing of prescription charges. We see it has cut it. Because of those unaffordable tax cuts a few Budgets ago, the Government has dug itself a gigantic fiscal hole. Those decisions, which led to the head of Westpac getting $5,000 extra a year, were fiscally unsustainable and fiscally reckless and demonstrate what a poor economic manager this Government is.

That tax cut hole has led to the Government now requiring the second leg of the plan, which is to sell it. It does not make sense to be selling off these assets, which were returning healthy dividends to the taxpayer. If you listen to the Government, on some days it is to pay down debt, on other days it is to invest in infrastructure, and on other days it is to do different things. But it is mad under all those terms to be selling these highly productive assets. Now what we are seeing is that other, mostly foreign, companies are trying to play us off. Because of the Government’s asset sale agenda, we see job losses, potentially, as a result of the Glenbrook steel mill’s decision. We are seeing Rio Tinto once again threaten to leave the country, trying to get lower electricity costs from Meridian. But what we are missing out on is these healthy dividend flows in the future.

What this Government is quite happy to do is spend taxpayer money to sell these assets. The public relations job this Government wants to do and the admin costs are around $120 million, but it will not tell the country, because it is officially secret. We know that the asset loyalty share offer could be in the order of $400 million—a $400 million wealth transfer from Kiwis who already own those assets to the richest New Zealanders, who can afford to purchase assets. This loyalty share is simply welfare for Kiwis who need it the least, and this is what we should be calling it—welfare for those Kiwis who can already afford to purchase these shares. We also know we are going to miss out on the dividends—up to $100 million a year.

There is a better way and it does not involve drilling, mining, and fracking our environment, which is the only plan this Government has got left. Even under the current economic conditions, this is not going to benefit us in a massive way economically. Everyone assumes that we are going to strike it rich if we find a large oilfield or gasfield, but it is simply that—an assumption, not grounded in reality. This Government has the fourth-lowest royalty and tax rate in the world. This Government has pages and pages of tax exemptions for the oil industry. This Government is quite happy to put oil workers—12 positions—on the skills shortages immigration list to facilitate and expedite getting foreign workers into New Zealand. What we know is there is going to be a huge environmental risk; unfortunately, the conservation Minister is not standing up for our marine and coastal environment. It will be a huge environmental risk and a huge economic risk, but for 100 percent of that risk, this Government is quite happy to sell us short with 5 percent royalty rates, when we are going to see hardly any jobs, hardly any taxes, and hardly any royalties, and we know the profit is going to flow offshore. So the only plan this Government has is not even going to boost our economy.

In fact, what we are going to see is that it comes with a massive opportunity cost. The opportunity cost is investing in the new economy, investing in the smart economy, and investing in the green economy. Internationally, this is where the lion’s share of international investment is going. In fact, in 2010, for the first time, investment in clean energy outstripped fossil fuels. Instead, this Government is looking to the 19th century for economic inspiration, not the 21st century, where we should be looking.

💬 Paul Goldsmith: Along with the trains! Along with the trains!

The trains? The member Goldsmith, from an inner-city Auckland seat, is arguing against the trains. What we see is that this Government is quite happy to borrow billions to throw at motorways with poor economic returns. Half of them have low benefit-cost ratios. That member is quite happy to keep a third-rate rail system in his electorate, in his city, because he would rather encourage urban sprawl, increased oil demand, and an increased cost to council for his motorways—his motorways to nowhere, which this Government is quite happy to borrow billions for. It is economically risky, is economically reckless, and shows that this Government is a terrible economic manager.

What we should be embracing is the new economy: clean technology and green energy. The home insulation scheme, which we are quite proud to be working with the Government on, is a great example of that. We have worked with the Government, despite disagreeing with a whole host of its plans. The Government says it is because we are against everything. We are only against stupid ideas; it just happens that most of them come out of the National Government. But one good idea, where we were able to persuade it, was the home insulation scheme. Now we have 230,000 Kiwi homes that are warmer, drier, and healthier because of the Greens. We have seen 4,000 people directly employed. We have seen 10,400 people indirectly employed and downstream economic benefit because of that scheme. We have seen, if you laid the pink batts or other batts end on end, an amount that would stretch from Auckland to Invercargill and back again because of this Green scheme. It is a great project, having real, good economic returns, really helping Kiwis, and it is a shame the Government is not extending it and not providing more jobs, considering we have got the highest unemployment rates since 1994.

As we saw in the Pure Advantage report, we are missing out on the race to be the ones who are embracing clean technologies and being at the forefront of the 21st century economy. It is a $6 trillion industry, they predict, but this Government, as Grant Robertson pointed out, rubbished it. In an absolutely rude manner, the Government rubbished the Kiwis behind that report, who I think have the country’s best interests at heart. Sadly, we have got this Government picking winners. It is quite happy to help out its mates at Skycity and to gamble on extra casinos, and quite happy to help out its mates at MediaWorks and do whatever it can for the international foreign oil drillers.

What we should be doing is extending the insulation scheme. We need a capital gains tax to rebalance our economy and put capital investment towards more productive enterprises, not more housing bubbles. We should be investing in greater research and development. We should be increasing the minimum wage to $15, helping those Kiwis growing up in poverty—those 200,000 Kiwi kids growing up in poverty. We should be putting a real price on carbon, not subsidising by more than $1 billion the greenhouse gas polluters in New Zealand, sending the wrong signal to keep investing in the 19th century economy, not in the 21st century economy. And we need to reprioritise our transport. We need to invest in safer roads. We need to invest in better public transport with real economic benefits. This is how we are going to boost jobs and boost the economy, but, most important, take the opportunity with the new economy, not throw it away. Kia ora.

Before I call the next member, I advise the House that the next call is a split call between two members from New Zealand First. They are two 5-minute calls. What I will do for the members is with 1 minute remaining, the bell will go.

Quality, not quantity, as we always say in New Zealand First. I rise to take a call on the Appropriation (2012/13 Estimates) Bill and the Imprest Supply (Second for 2012/13) Bill, which we have described in the past as being the bills that represent the “Fagin Budget” of this National Government. It is the “got to pick a pocket or two Budget” of 2012-13, which basically saw the poor paper boys and paper girls of New Zealand being ripped off for $14 million—a miserable $14 million from the paper girls and paper boys of this country—for this Government to try to help balance the books.

This will be looked back on a bit like the Ruth Richardson Budget of the early 1990s, as a most miserable and miserly Budget, where we will see zero growth in many sectors, where Government departments are basically on their knees, where the likes of the Ministry of Foreign Affairs and Trade is trying to save $24 million from our front-line people around the world who are negotiating our access to foreign markets, and our access and diplomatic ties with many important trade partners and international countries that we so dearly depend on, and where the Government is spending $9 million in this Budget to basically save $24 million, and where much of that saving will be lost anyway, going out to consultants and being farmed out for a net nil result.

This is a Budget where we will see the likes of the police and the armed forces getting zero increases in their budgets, so as a result the morale in the likes of the police force and much of our armed forces is not great, because they really are not being acknowledged and rewarded for their efforts in terms of our New Zealand law and order and our defence.

This is also a Budget where there is an attack on our students, our future and the brightest young people of this nation, whom we keep referring to as being the ones who will come through and help grow this nation, and our postgraduates, who will basically struggle to be able to afford to stay with their courses, with their postgraduate studies, under this particular Budget of this Government. It is a message from this Budget that our brightest and our youngest should head off to Australia and further afield for the brighter future that our Prime Minister, John Key, keeps talking about. Unfortunately, the brighter future at the moment for many of those younger people, under this Budget, is not here in New Zealand; it is on foreign soils.

This is also the Budget that will be remembered as the “sale of State assets Budget”. It is where my family’s heritage, your family’s heritage, Mr Speaker, and the heritage of many in this House whose families and loved ones have helped build up this country over many, many decades, and, in fact, centuries is being sold down the river—literally down the river—with the sale of, firstly, our power stations and State-owned enterprises, and our power-generating companies. It is where the likes of Mighty River Power will be first on the block to help balance this Government’s future Budgets, and where the likes of those important places such as those great dams in the South Island, the wonderful thermal power stations in the Taupō area, and so many of our wonderful resources are already on the chopping block under this Budget and future Budgets of this Government to help balance the books. As a result, many of the reasonably well-off mates of the Government will do well out of the sale of those companies, while good, average, everyday Kiwi families and good, average, everyday mums and dads in this country will simply lose their national right to those shares in those companies while they are privatised.

Our veterans are also left wanting, with only 10 out of 170 recommendations of a report from 2 years ago being enacted. At the same time, the Government is saying that it is going to put money into education, but basically the money that it takes will be going into fixing leaky schools, leaky buildings, leaky Government buildings—billions of dollars worth of them—when, again, this National Government, back in the 1990s, was the cause of so many of our leaky problems around this country. This is a Fagin-like, miserable Budget. It is a Budget that will always be looked back on by the people of New Zealand as being a no-growth Budget with no vision, and basically the people of New Zealand will be very disappointed in this.

On behalf of New Zealand First, I rise to speak to the Imprest Supply (Second for 2012/13) Bill. The economy requires serious attention, particularly now that we are in the reprioritisation phase that the Government seems to be going through. The Government is not looking at growing the economy, but, rather, it is looking at growing the discrepancies. One of those groups where the discrepancy is growing is with our senior citizens. In New Zealand First, we always maintain that how we treat our senior citizens sends a very clear signal of our status as a developed nation. It is really concerning to see that this vote is decreasing year upon year upon year. It is not clear as to when we are ever going to see an increase in this particular vote.

In New Zealand we know that we have got a Positive Ageing Strategy. One of those goals is around income: that it must be secure, that there must be adequate income for older people, and that health care is timely, affordable, and accessible. These goals are becoming an absolute dream for many of our people. Many of our seniors are finding it increasingly difficult to make ends meet. They are struggling. There is only so much that they can tighten their belts. When it comes to saying that they may be able to find a part-time job to help out, that is absolutely impossible. There are no jobs for anybody out there—young people, people looking to start a career, school-leavers—and nothing for senior citizens, or for anyone over the age of about 45.

We know that their living standards are dropping, as our seniors are paying higher prices for electricity, for basic groceries, for prescriptions, for petrol, for rates, and the list just goes on and on. Many of our seniors are now at the stage where they cannot afford to insure their homes. Some of them insure the exterior of their homes, but not the interior. They just cannot afford it. I was talking to one elderly lady who said: “Well, if anything happens to the interior of my home, I am just going to have to make do. The furniture is getting on anyway.”

The latest rates rounds are making many wonder whether or not the councils are actually trying to force people out of their homes, because there is only so far that money can go. I know of one case where three home units are on a section, and they pay the same rates as a house does. They downsized because they thought it actually would be cheaper. That is not logical.

When it comes to the SuperGold card, we were quite pleased to see that some increases had been made in the number of people who actually follow through with discounts for seniors. Private businesses are participating at a greater rate than they ever have before, ensuring that our seniors have access to products and services. We can only thank those businesses like TelstraClear, which has even offered telephone discounts and mobile discounts for many of our seniors.

But the bottom line is that it is time for the Government to come to the party. We know in New Zealand First that we have got two bills in the ballot to help with this. One is advocating for an electricity discount for senior citizens over the winter months, and we would like to see this go through. Cold homes are not the best place for our seniors to be in, and, of course, once they are hospitalised it costs far more than a 10 percent discount on electricity over the winter months. I have got a bill in the ballot that is advocating for three free doctors’ visits each year. We know that if we can actually pick up on small ailments before they become serious, it will save money in the long run because our seniors will not be hospitalised.

We need to address these issues. We need to address the growing discrepancies that are happening in our country. We know that seniors are suffering. We need to invest in our society. People do matter, and it is time for the Government to take a strong point on this matter.

It is a pleasure to rise and speak in the third reading of the Appropriation (2012/13 Estimates) Bill. What a long time ago it seems since we had that fantastic Budget read out in this House by the Hon Bill English, directed by our extremely hard-working, intelligent Prime Minister—a man of the people he was, and still is.

As we have followed this debate over the months and here today, one thing has become clear to almost every New Zealander who has tuned in. On this side of the House we are focused on the job at hand and on what matters. On the opposite side of the House, at least with the main Opposition party, the Labour Party, and the Green Party, its close, close ally—I find it hard to tell them apart, not from a philosophical point of view, but in terms of who actually is the Leader of the Opposition, and which is the No. 1 Opposition party. The reason that it is hard to tell is that there is a bit of intermingling of policy here. The things that Labour used to be so proud of, now the Green Party is spouting as its own policy, and the things that the Green Party used to talk about, when it was dishevelled in all sorts of different directions and not sure of its leadership or the direction it should head in, what it stood for, and what it did not stand for, the Labour Party has adopted all of that. We see it every week in this Chamber and in our media.

What have we delivered as a Government in this Budget? Responsible management of Government finances—

💬 Gareth Hughes: Lowest growth in 50 years. Record unemployment.

—building a more competitive and productive economy, delivering better public services, and, of course, rebuilding Christchurch, which is so very important. I want to touch briefly on each of these. But to my colleague from the Green Party who spoke earlier and is now interjecting from afar, I want to—[Interruption] No, I am not pointing at Mr Goldsmith. Nobody would ever accuse him of being from the Green Party.

What I wanted to say is that we hear from the Greens all the time that the Government has ruined the economy. The Greens are saying that we are doing things we did not tell New Zealanders about. Well, last year in November there was an election. Every New Zealander who was eligible to vote had an opportunity to vote. Over the course of the 3 years that we were in our first Government and during 2011, we made a case to New Zealand on a number of issues to achieve what is in this Budget: responsible management of Government finances, building a more competitive and productive economy, delivering better public services, and, of course, towards the end, rebuilding Christchurch.

The Greens have said that that is not the case, that we did not make that case to New Zealanders, and that we have pointed New Zealanders in a different direction. But I can say that in my electorate in Rotorua, where I was re-elected, and in many other electorates around the country Green Party activists—sanctioned by the Green Party leadership or not, we are not sure—walked, got out in their electric cars, or got out on their pushbikes, because they care about the environment, got big hoardings and stickers, and stuck them all over our signs and defaced them. They defaced them all over the country. What they were doing when they were doing that was saying to New Zealanders: “If you vote for these people, this is what they are going to do.” What I say to the Green Party is that you can campaign as hard as you want at elections, you can have your activists—sanctioned or otherwise, we are not quite sure—go and deface all of our hoardings and vandalise our property, telling people what will happen if they vote for us, but then when we are re-elected you cannot turn round and say that people did not know, that nobody knew about this, and that we have misled New Zealanders. We have not. We are focused on the job at hand. We told New Zealanders what we would do. New Zealanders accepted that, and they voted for us in the largest vote any party has received under MMP ever.

I also, before I get into the detail of this, want to say to some of our friends in New Zealand First that we too share your concerns around seniors in New Zealand, and I commend you for the work that you do in this area. I am very proud to be able to stand here and say that over the first 3 years we were in Government we increased superannuation payments to people on superannuation in New Zealand in pretty tough times. It was a very difficult time for New Zealand, for our economy, and, certainly, great pressure was on the Government books. But what I do want to say is that we did that. I am proud to be able to say that we increased support for senior New Zealanders, and I hope that as our economy improves and the Government books get into better shape, with other parties in the House we can find ways to do much more for our seniors. We owe them a lot.

Responsibly managing Government finances—what does this mean? It does not mean spending more money on hopeless projects that the Greens and Labour are forever talking about in this House and in the media: spend, spend, spend, borrow, borrow, borrow, and put off the pain until the future. That is what we are hearing from the Green-Labour coalition. I am going to call it the Green-Labour coalition from now on. It is no longer a Labour-Green coalition; it is a Green-Labour coalition of Opposition parties.

We have said that we are going to work as hard as we can to get the Government books back to surplus by 2014-15. It is going to take a lot of discipline. It is not going to be easy, because we are a trading nation and we know that many of the countries we trade with have themselves gone through difficult issues with their economies. One needs only to cast one’s eye across the seas to Europe to see the great difficulties that they have over there.

💬 Hon David Cunliffe: Oh, reread the notes again. Go back to the start and read them again.

Thank goodness we are not Greece. Our freshly shaven friend on the other side is back from Europe. I am waiting for his speech to tell us about all the doom and gloom he saw over there. Some of the countries I saw, which not Goliath but one of the Davids on the other side of the House visited—one or two of those countries—have quite some problems with economic policy. I am sure that he and Labour will adopt those soon—not Greece, I am not going that far, but certainly some of the other countries he went to.

Getting back to surplus by 2014-15 is important for us. It is important, and the way that we will do this is by focusing on what we spend taxpayers’ resources and taxpayers’ money on, by not being frivolous, by making sure that there is a return for the taxpayer—better health care for the money that is being spent—by making sure that our borrowing is reducing, and that we are focused on the job at hand. That is the job that New Zealanders have elected us, and given us a second term, to do.

Budget 2012 forecast economic growth to average 3 percent a year over the next 4 years, with 154,000 jobs to be created, on top of the 60,000 new jobs that were created over the last 3 years of an extremely difficult time with our economy—the global financial crisis of the world.

We have increased annual spending on science and innovation, a very important part of our economy, by $385 million, as opposed to the hollow promises we hear from members opposite on a regular occasion. That means that by 2015-16 under this National-led Government, spending on science and innovation will have increased to $1.3 billion a year. That is $1.3 billion a year that is not being just thrown around, as the previous Labour Government did with some of its hare-brained schemes, but focused specifically on things that are important for our economy, on areas of the economy where we have an advantage, where we must do much more in science, and where, in years to come, great dividends will be paid to this country through this new innovation.

You see, New Zealanders are innovative if you get out of their lives, leave them alone, and allow them to get on. It is a shame that in the 9 years of a Labour Government it spent all its time trying to get into their lives, and trying to be in the house with them. Do you remember how it tried to be in the bathroom—the bathroom on the side of the bedroom—and decide how much hot water they should have? Well, those were policies of the past. They are polices that we are certainly glad are gone. Again, I am reminding members opposite that, although as list MPs they may not want to remember, there was an election in November of last year, New Zealanders had their opportunity to cast their vote, to have their say, and we got a larger vote than any party ever had before under MMP—

💬 Michael Woodhouse: Under almost any system, actually.

Under almost any system, our chief whip says to me. I have not checked that, but he is an intelligent man, and I accept fully what he would say in that.

What do I want to say? Delivering better public services. That is in health, in education, and in policing. I am going to touch briefly on health for a moment. Tony Ryall is an outstanding Minister of Health. On Friday of last week I had the great pleasure of going along and visiting the Lakes District Health Board in Rotorua, a district health board I have visited on many occasions, and standing there and presenting it with a certificate of gratitude on behalf of my community for the fantastic work it has done in all areas, but particularly around elective surgeries over the last couple of years. What Tony Ryall has said is important to him and to this Government is not letters to people telling them they have to go back to their general practitioner at the back of a waiting list before they can be treated; he said it is important that we back doctors and nurses to treat these people, and he has done an outstanding job. We have delivered more money in that area.

I want to touch on policing, because it is very, very important. I have a bill before this Parliament that is halfway through its first reading at the moment and that we will get to focus on in a week or two. It focuses purely on law and order, about holding to account those who seek to harm others and to intimidate others, giving our community some powers to take back those parts of the communities they think are important to them, but giving extra power and authority to our police to get amongst people—

💬 Hon Craig Foss: Labour caucus.

No, no, I am not talking about the Labour caucus; I am talking about others who cause great grief and harm in our community. But putting aside some of the things that have been in the newspaper of late, what I would say is I hope the House can come together and have an adult, reasonable, and sensible debate on this. This was a fantastic Budget that I commend to the House. Thank you.

One of the best things about having spent a couple of weeks in Europe is that I come back and I can actually understand the accent of the member who has just resumed his seat, the member, apparently, for Rotorua. He said he has visited Rotorua recently, so we can only take him at his word. He has made two points. The first was to try to demonise our colleagues the Greens and to panic New Zealanders into not supporting the Opposition because of the way he has mis-painted their policies. I think people can see right through that. The second and very telling comment that he made was to say that National’s idea was to leave New Zealanders alone and get out of the road. That is, in fact, the best that National members can do. The member is nodding. The best that they can do in a historic economic crisis is to leave it alone and get out of the road.

For the record number of New Zealanders who left permanently for Australia, sadly, this month—the all-time record for a July—that is not enough. That is not enough. Colin James in today’s Otago Daily Times referred to the battle lines being drawn on the economic debate by saying “Voodoo or orthodox—take your pick”. He pointed out that it was actually Mr Joyce who shot himself in the foot by calling others’ policies voodoo economics, when actually National members are so fossilised that they do not realise the economic debate has moved on so far past them that they are left looking like relics. It has moved on, because New Zealanders have accepted that although we have been through tough times and they have patiently been willing to draw in their belts, it is not enough. It is not good enough. It is not enough to provide for their futures, to provide hope for their children, and to provide good jobs and the security of a roof over their heads. For too many New Zealanders, the loss of that hope has meant a queue at the departure gate, like this “departure gate Budget”, hoping against hope that there would be a way forward.

There is a mood change on, and National knows it. It polls every day. It knows what the numbers are saying. There is a mood change in the wind. New Zealanders are desperately looking for answers. Now National is trying to rush out a series of wafer-thin, glossy brochures, pretending that they are doing something. Last week, there was the export strategy. You know, it mentioned science just once, and competitive advantage just once. It mentioned branding 21 times, and telling stories 25 times. Does that not just say everything? Of the 55 new initiatives, 47 of them were already announced. Only eight were new, and more than half of those were public relations fluff. That is not what New Zealanders expect, it is not what they deserve, and it is not what they are going to vote for in 2014.

So distressed was National at the flop of its export glossy that it rushed out its buff new innovation pamphlet this morning. So desperate was National that it sent out the invitations only on Friday, to a captive audience, and Business New Zealand jumped the gun by putting its draft on the Business New Zealand website before the Government even released it. Whose document was it? It looks like Phil O’Reilly wrote it, and well he might have, because the document—the so-called strategy—leaves it largely to the private sector to do all the heavy lifting at a time of national crisis. That is not leadership. That is not vision for the future. That is not even a substantive game plan. Where does that leave New Zealanders who just want a good job and a safe roof over their heads, and hope that their kids can still do better than they did—hope that their kids can still do better than they did?

Well, at least they can now see, laid bare, the two competing views of the economy across the two sides of this House—and I use the phrase a little liberally, because I see the Minister of Māori Affairs sagely sitting there, wondering which side he and his party are on. They will figure it out before 2014, when the bids are clear. On that side, there is an extractive view of the economy. If they cannot cut it and sell it, they will mine it or flog it. But it is an extractive view of primary agriculture and mining that they mistakenly believe is going to lift incomes. Well, it will not, because it is not possible to milk enough cows, sell enough raw logs, or export enough unprocessed fish from the seas around Nelson. That is nobody’s idea of a smart way to live. The Global Competitiveness Report by the World Economic Forum canes New Zealand, not because we have got a high cost structure, but because—just like the rating agencies said—we have under-diversified exports and insufficient knowledge and value content.

So what is the answer to that? To build that content with a strong economic development and innovation plan. And what did we get? This wafer-thin glossy. It is not worth the glossy little paper it is written on. It is an embarrassment, and the Government should put it back in the bottom drawer until it has done some work and it has something worth releasing that Phil O’Reilly did not write.

Our vision is different. Our vision—I might say, quite similar to the Greens’ vision—is a high-value, sustainable, socially just vision where New Zealanders get good jobs from high-value manufacturing, advanced technology, high-value services, and the primary sector, but where we do not just milk it, we think it. We add value to the bucket of milk with science, nutraceuticals, advanced foods, and good branding. That is how you make a buck in this world. Labour has the economic policies that will deliver that outcome at the macro level, as we have made clear to the public, with tax policies that will encourage capital to flow where it does the most good—not to the slick-shoed property developer mates of that Government, and not to the slimy bond-traders who are ripping everybody else off and holding the country to account, but to real business people building real businesses, exporting products, and employing New Zealanders. We have a strong universal savings plan that will create the pools of capital for investment while providing the nest eggs New Zealanders need.

We have a cradle-to-grave view of education, being led in the post-school area by my colleague Jacinda Ardern, which means that no New Zealander out of school is going to be left on the scrap heap. They will be earning or learning—all of them. We are going to use the unemployment benefit for apprenticeships, and get employers employing our young people, to give them hope and a real start in the job market.

💬 Jonathan Young: Good idea. Let’s call it Youth Guarantee.

Mr Young, we are not going to forget them when they get to your age. We are going to make sure that there are lifelong learning opportunities, and I wish you well for your next job. I wish the member well, because no New Zealander at that certain age should be left on the scrap heap. There is still life in the old dog, as they say. He deserves another chance. When the good people of New Plymouth come to their senses and send him down the road, we hope there will be a Labour Government that can help him retrain for something more useful, and something more useful than his current employment of propping up this good-for-nothing Government with its vacuous glossies—vacuous glossies. All joking aside—

💬 Jonathan Young: Yeah, it is a joke. It’s a joke.

It would be funny, Mr Young—Rev. Young—if it were not for the fact that last month a record number of New Zealanders gave up on their country, gave up on their future, and left for good.

We owe them better than that. We owe the guys who earned these wooden plaques around this building and who fought for our country better than that, and we remember some tragically today. We owe them all better than that. We owe them every bit of brain power, every bit of hard graft, every bit of international research, every bit of worthwhile investment, and every bit of lining up the ducks for a better future. What we do not want is wafer-thin, glossy little brochures that talk about branding and spin, while New Zealanders are dying on the dole queue or leaving for Australia.

The next call will be a 5-minute call with a 1-minute bell.

Tēnā koe, Mr Speaker. I am happy to take a call on this legislation, even though it is a short one. In terms of our relationship accord and confidence and supply agreement but also because of the economic gains that Māori have made in our relationship with the Government, we certainly support this legislation. In particular, I would like to talk about the Māori economy and its emergence into the wider New Zealand economy as a dynamic and growing force.

If I could just go back a couple of years to 2009 when we had our Māori economic summit, Māori decided that there should be a task force to look at our economy and evaluate its progress, size, shape, and so on. So that was set up. One of the things that happened under that was a review of the Māori economy, how to emerge from the recession—and we are just about in that process now, emerging. If we look at primary industries, Māori own a third of all forests and fishing. If we look at local infrastructure building, at collaborating between the small to medium sized enterprises amongst Māori, and at Māori branding for export, these are some of the actual things that we took up—in particular, how Māori could make use of the free-trade agreement with China and go forward from there.

These are the things we did. One of the things that happened was that we commissioned Business and Economic Research Ltd to do a review on the state of the Māori economy. Instead of $16.4 billion, which was touted as the value of the Māori economy 2 years ago, it turned out to be $37.9 billion. So it is double what it was before. This put a new light on things and gave Māori an economic arm, if you like, in order not only to get into coalitions but also to do partnerships with other industries, and so on. Interestingly enough—$37.9 billion—everyone thought this was iwi money. In fact, $20 billion was small businesses—that is, either a small group or a single self-employed person, and so on, made up a whole $20 billion. That was a wake-up call, showing there is plenty of entrepreneurship amongst Māori to increase their business and grow. You will remember that 3 years ago Māori women were third in the OECD countries for entrepreneurship in terms of starting up new businesses.

On top of that $37.9 billion, Business and Economic Research Ltd forecast an extra $12 billion in GDP per annum—an increase—plus 150,000 new jobs by 2060, but there was a proviso, and the proviso was that it would be only if Māori asset holders invest successfully in science and innovation. Science and innovation have been realised by all industry in New Zealand now as being absolutely essential to value-add to our products before exporting and selling.

At another conference Ganesh Nana of Business and Economic Research Ltd also said that for Māori the key is “export or die”. We have chosen not to die, so we are exporting big-time to China. We have had two expeditions there, taking a number of Māori businessmen and businesswomen across to China. On the last one 30 of us went across, and business was struck. The thing is that we use what I call a Māori edge—[Bell rung]; oh, already—Māori techniques: going first of all to Beijing, talking with the Ministers, Premiers, and Vice-Premiers and getting kanohi ki te kanohi trust, and then going out into the community and establishing business in mānuka honey, wines, pasture techniques, education exchange, and food and gourmet dishes.

China has got a new middle class growing rapidly. They want our foods. In New Zealand we are a food basket for China, and we have got to make sure that we capitalise on it. Seafood, crayfish, fish, pāua, timber—to value-add our timber instead of just sending logs, we should be processing them here and getting the value-add plus the jobs that it creates as well to go over. We have got the China Development Bank looking at possibilities of helping us do that. That is only part of my talk, so that is enough for now.

Technically this is a 5-minute call going to Opposition members. In their absence I will accept a 10-minute call, because I think you are next on the schedule after that.

It is my pleasure to take a call on the Appropriation (2012/13 Estimates) Bill and the Imprest Supply Bill. It has been a very interesting debate we have had in the House. Mr Cunliffe gave what sounded like a leadership qualification speech. He reminded me of Huey Long, the great American politician of the 1930s, whose motto was to suck up the fat and spread it thin. That seems to be Mr Cunliffe’s new approach to politics. His speech was all about demagoguery, getting out there and trying to buy votes all around the country.

Members will by now be very familiar with National’s plan to build a brighter future for all New Zealanders, which underpinned the Budget. The priorities are, firstly, responsibly managing the Government’s finances; secondly, building a more competitive and productive economy; thirdly, delivering better public services; and, fourthly, rebuilding Christchurch. We know these themes so well because there has been a measure of consistency in what this Government has done, and that is never more valuable than today in these difficult international times.

The headline measure of our financial management in this Budget has been the fact that we are on track to post an operating surplus in 2014-15. It is not the world’s largest surplus, we concede, but it is a very important milestone for this country. It will be the first time in a number of years that the Government will be raising enough revenue to pay its way without having to increase debt. We will have the opportunity then to start repaying some of the debt we have accumulated during this recession, as we should be during good times when the economy is growing. That represents a huge turn-round, given the impact of the 2008 recession.

It has not been a miserly or mean Budget, as some have alleged. There is nothing generous about spending other people’s money. There is nothing generous about spending money you do not have. That is what many of the promises that have been made from the other side are about. The focus of the Budget has been on returning to surplus, and at bottom that has been about strengthening New Zealand’s resilience in uncertain times. It is about maintaining New Zealand’s international credibility, a status that is hard-won but easily lost. It is about helping to keep interest rates low, which has been underpinning the ability of many households around New Zealand to pay back mortgages and increase their savings. It is worth noting that although most sides of this House nod and say that, yes, we have to get back to surplus, they have opposed every single restraint that we have brought to this House in order to get this economy back to surplus. So it is one thing to say it; it is another thing to do it.

We are very conscious at the moment that New Zealand’s high level of private sector debt is an issue for the country. There has been some natural correction going on as households have been saving in a positive manner for the first time since 2000, and household debt has, indeed, fallen. But, as I indicated at the start, returning the Government’s books to surplus and increasing household savings is only part of the solution.

Another important aspect is that our prosperity depends on building a more productive and competitive economy based on savings and less debt. The Labour Party, I accept and agree, says it agrees with National on that basic message that we do need to grow our economy—at least that is what David Parker has been saying in recent speeches. I am not sure about the rest. I am certainly not sure about the Greens. I do not think they do want to see growth. But most people are concerned about retaining our people in New Zealand and not losing so many New Zealanders to Australia, and that, at the end of the day, comes down to growth, generating jobs, and generating products that the rest of the world wants to buy.

So let us run through just some of the things that the Government has been doing, which this Budget has referred to. It is about the tax changes that we made initially in 2009-10, realigning the tax system away from taxing income and on to taxing spending. Labour and the Greens both oppose that. It is about boosting capital markets through the Mixed Ownership Model Bill. That has been opposed. We have been investing much, much more in innovation and science. Labour probably says it supports that, but when it came to the point, it did not. Labour did not do much when it was in power—

💬 Moana Mackey: The R and D tax credit.

I will come to that in due course. Labour did not do much when it was in power for 10 years. When we talked about getting people off benefits and back into work, that has been opposed. When we talked about the focus on primary resources and encouraging the use of our resources around the country—our mining resources—and investing in infrastructure, that has been opposed. It has certainly been opposed in the exclusive economic zone bill. And when we talked about investment, trade policy, and encouraging new free-trade agreements, that has been opposed. Labour used to support free trade, but it does not seem to any more. When we talked about the 90-day probation period, that was also opposed. Labour talks about wanting to grow the economy, but when it comes to the crunch, it opposes it.

In recent times we have seen, under the guidance of Bill English and Steven Joyce, two eminently capable Ministers, the Government taking further steps and crystallising its thinking around the Business Growth Agenda. We have two wonderful reports that have been produced recently. The House does need to resist the siren calls of the Labour Party, which has gone back to the same old song of the 1960s and 1970s. We have seen some ideas floated from Mr Parker in recent times about forcing Government departments to buy locally made goods, even if somebody else can produce them more efficiently and cheaper overseas. I do not see how that has had a good track record for many years.

We have heard him talking vaguely about controlling the currency. I would love to know how Mr Parker is going to do that. It is a very difficult area. Is he proposing that we should start watering the milk like other countries, or printing money? Is he proposing that we should wind back the clock to the 1930s and exchange-rate controls? I am very much looking forward to seeing what Mr Parker is going to do to control that problem. Or is it a return to the research and development tax credits that Labour tried? Well, the Labour Party does not seem to have learnt anything from history. Taxes should be low rate and broad-based. Mr Parker’s path of research and development tax credits, which were tried, is a path back to the shambles of the 1980s, when New Zealand—

💬 Moana Mackey: It was only there for a year. You got rid of it before people had even been able to apply for it.

We had them for decades. They had them for decades in the 1970s and the 1980s. They did not work then, and they will not work now. In the meantime, although Mr Parker is wanting to take some money off exporters, he is wanting to increase taxes on exporters at the same time, because export companies all have capital gains. He wants to increase taxes at the same time, with a new capital gains tax, and also take research and development taxes off them. It does not make any sense to me. It seems very short-sighted, and it also implies that local businesses are somehow less worthy. Why should local power, telecommunications, or infrastructure businesses, for example, which are every bit as important to New Zealand’s economy, its growth, and its international competitiveness, not have tax credits along the lines that Mr Parker suggests?

The idea of research and development tax credits is an idea that has passed. It never worked in the past, and it will not be working again. The best thing for New Zealand businesses—

💬 Hon Lianne Dalziel: Nonsense! They were only in place for 12 months and then you got rid of them.

You had them for 20 years in the 1970s and 1980s, and they did not work very effectively. These ideas look superficially attractive, but history has shown that over the long term such breaks rarely succeed in boosting home-grown businesses. The best thing for a New Zealand business is to compete openly in the world on its own merits. There is no magic for this other than producing goods and services that the rest of the world wants to buy for the best price, and that is what this Government is keen on supporting. So we have put a lot of thought into what things businesses need in New Zealand. The six areas that come to mind are the ones that are universal. They are not unique to New Zealand. Businesses need access to ideas and innovation to create an opportunity, they need money to build businesses, they need access to the necessary raw materials, they need skilled people to work in businesses, they need customers who want to buy their products, and access to export markets is implied in that, and they need the infrastructure that the businesses depend on, such as electricity, broadband, and transport.

This Government has gone through in a systematic fashion, looking at what those basic requirements are for successful businesses, asking that question, and producing very detailed and logical plans as to how the Government can ensure that businesses have access to those six essential areas. That is what these Business Growth Agenda progress reports are all about. We have seen the first two come out in recent days on export markets and innovation. These documents here fill me with great hope for the future of New Zealand, given the guidance we have from this Government.

So, all in all, it gives me pleasure to speak in favour of the Government’s Budget this time around, as relayed through this legislation. Thank you very much.

Let us restate for the record why I am here. I am back in this Parliament so that those people in Opposition are over there. I am here so that they are there. We do not want these people in charge of the levers of power and we certainly do not want these rabbits in the lettuce patch of Treasury. So the people of Epsom have put me here so these roosters can stay over there. Is that not good? And they are going to stay over there for a long, long time. And because they cannot get over here on policy, on performance, on leadership, or on values, they want to gerrymander the electoral system to try to get themselves over here. But I have got bad news for those over there. The people of New Zealand are glad that those roosters are over there and we are here. So I rise to support this legislation today.

By the way, the Opposition members would give us an accountants’ paradise if they were in charge here this afternoon—an accountants’ paradise. They would want to mess with GST, they would want to take income tax off the first $5,000, and they would add a capital gains tax. There is no political party in the Western World that has promised at the polls an additional extra tax on the hapless populace and been elected. So I want these people over there to continue to propose a capital gains tax, continue to propose GST, and continue to take income tax off the first $5,000, because that means in 2014 they will stay over there.

Every time I walk through Broadway in Newmarket people stop me and say: “Hey, Banksie, we’re glad you’re there, Banksie, and those people are over there.” That is what they say to me. They jump out of taxis, out of police cars, off the buses and they say: “Banksie, we did the right thing. We’ve got you here so that those people, those rabbits, don’t get in charge of the Treasury lettuce patches.”

There are interest write-offs from the student loans of our most able learners. We think they should go. Clearly there are major chunks in this Budget that we in the ACT Party would like to remove. There is the pension age that stays the same while life expectancy continues to rise. We would like to see the pension age rise. That would save $1.7 billion a year. If we put a small interest rate on student loans it would give us $800 million a year. And then there is Working for Families, the Labour Party bribe that continues to give handouts to families earning over a hundred grand. They are prepared to give bribes to families who earn over $100,000 a year, because they are so desperate to get across to this side of the House.

Then there are doctors’ visits subsidised by hard-working people at Countdown supermarket in South Auckland so that I can have a subsidised visit to my general practitioner. How bad is that! It is called middle-class welfare. It does not work. It is too expensive. It is wrong. We cannot afford it. It belongs to those people on that side of the House, but it does not belong in sensible fiscal prudence. Then there are the transfer expenditures comprising Labour’s great spending spree that outlived the Labour Government. In a perfect world we would be taking a harder focus on Government expenditure, and reducing expenditure that does little good to anyone in the race for votes. These people spend all of their time on their real job: getting themselves re-elected into Opposition.

What a fine contribution the fine member of Parliament who spoke before me, my biographer Paul Goldsmith, made to Parliament this afternoon. Well, this Budget has maintained a tax system that rates in simplicity and compares favourably with nearly every other system in the world. It is not a time for big spending. It is not a time for big noting. It is not a time for big promises, and it is not a time for these people to get themselves from that side of Parliament to this side of Parliament. So I finish as I began. The people of Epsom are eternally grateful for their own inherent common sense when they put “Banksie” here so that John Key and this Government could be on this side of Parliament and these roosters could be over on that side of Parliament. I have not heard one constructive contribution from anyone on that side of Parliament on how we are going to build investment and growth in jobs, and start paying our way. This bill, the Appropriation (2012/13 Estimates) Bill, is a good beginning.

💬 Mr DEPUTY SPEAKER: There is a further 5-minute call.

I am very pleased to be able to stand in this third reading of the Appropriation (2012/13 Estimates) Bill, and I just want to address a couple of remarks that the Hon David Cunliffe made just recently. It is hard to think that that is Labour’s best contribution that it can make to this country, as he simply said that we are a nation that is focusing only on extractive industries such as dairying and oil and gas. Well, I come from the province that has the lowest unemployment rate in this nation because of those two industries—dairying and also oil and gas. We have around about 3.6 percent unemployed, which is not good enough. We want to get more people into jobs. But we are seeing that those two industries have undergirded a remarkable GDP in our province.

It is not only those two industries but also the industries that they support, whether it be financial services or engineering, even to the extent that there has been diversification of manufacturing and engineering. We now have a company called Fitzroy Yachts Ltd, which is reputedly the best luxury yacht builder in the world. Last year at Monaco it won a tremendous award for building the best yacht in 2011. We see in this great province of Taranaki very low unemployment because of these industries. Let us not take them for granted. Let us not minimise them.

These are industries that also have a very good reputation for their concern and care for the environment. The Taranaki Regional Council is famous in this nation for its riparian planting programme. There are 17,000 kilometres of streams in the province of Taranaki, and a vast majority of them are being planted out with shrubs on the shorelines of these streams in order to capture and filter away nitrates and keep our waterways pure. We also know that there is a very high environmental safety record regarding those industries that are involved in the oil and gas sector. We also know that these industries are great contributors to the way of life of people in Taranaki and also in New Zealand. So we are very proud that we do support and encourage these industries in our province and in our country.

Really, when you look at Taranaki and what it has to offer, the lifestyle, and all the opportunities in terms of employment that give people international qualifications and international ability to work anywhere in the world in these industries, and when you look at what these opportunities offer New Zealanders, you can see what can happen to this country when it comes to economic transformation. We know that there is one particular field that is 50 kilometres offshore; it is called the Tūī Area field. It used to be that oil and gas extraction was the fourth-biggest export earner in this country. Yet when the Tūī field came on stream, it immediately jumped to No. 3. It surpassed our timber products and our export markets, which tells us that just one significant find has the ability to bring a big kick into our economy.

When we look at what we want to do in terms of our schooling and our modern learning places, when we see what we want to do in terms of our hospitals, and when we see what we want to spend in cities like Christchurch and its rebuild, it is very important that we have some game-changing industries in our country. I think it is very important to acknowledge the Business Growth Agenda, which our Government is rolling out, and how we are turning not just Government policy but also Government departments round to be far more integrated with business. Indeed, it is private enterprise that is the substantial tax base for this nation, and we want to encourage that. We want to see innovation. We want to see an increase in our export markets and in our selling to the world so that we can continue to see this great nation of New Zealand prosper and make great progress. Thank you.

💬 Mr DEPUTY SPEAKER: We are back to 10-minute calls.

Yesterday I spent the day in my electorate with Russia’s David Frost, Sergey Brilev, and a television crew, visiting all manner of productive primary sector activity in the Wairarapa in preparation for a television film that will be shown in Russia around the Prime Minister’s visit when he goes to Vladivostok in the middle of next month. I have got to say that we were on a dairy farm, talking to the cocky, and I said: “Well, how do you think things are going?”. The cocky said: “Really well.” He said that he had great confidence in John Key, and his exact words to me were: “Because John Key knows what he’s doing, and I’ve got to tell you”—he said to me—“the other people don’t.” He said: “I will be supporting National at the next election, because National knows what it’s doing.” There was one farmer who knows what is very sensible and what is good for this country. He knows that we have to invest in the primary sector because that is where this country has a competitive advantage, and doing that will stimulate new jobs. He knows that in the Wairarapa, for example, we have got to save our winter water and feed it out in the summer when it is dry, and we do not want to take 6 years or longer going through the resource management complications that the previous Government, the Labour Government, left us with. Every day we wait, we are locking up jobs and we are stopping people being employed. We need to build a more competitive and productive economy.

The Budget that we have just passed this year forecasts economic growth to average about 3 percent a year over the next 4 years. That means 154,000 jobs created on top of the 60,000 new jobs created in the past 2 years. And if Mr Groser is successful in getting free-trade agreements with India, with Korea, with Japan, and with Russia, then we will continue to expand the opportunities for employing people, because—

💬 Hon Clayton Cosgrove: How many has he signed in 4 years? One.

Let me explain to that member that once we signed the New Zealand - China Free Trade Agreement, in the first year we sold an additional $850 million of product—in the first year. In this year under review we have sold an additional $3.35 billion worth of produce to China. Think about how many jobs exist because of that new level of export. Groser is doing a great job, and I commend him for it.

The Government’s responsible fiscal management, in particular our discipline around spending—no new expenditure, no new borrowing—and our capital management, is strengthening New Zealand’s resilience in what I think are still very difficult times. We do not know whether Spain is going to fall over, and, if it does, whether Italy will follow. There is still uncertainty out there. What we have to be careful to do—and this is what John Key is doing—is maintain New Zealand’s international credibility, a status that is very hard-won but very easily lost, as a number of countries around the world are finding out. He is helping every one of my constituents through his astute fiscal management, because we are keeping interest rates low, and mortgage rates have never been lower—not in my lifetime. They have never been lower. They have gone from 21 percent, as I recall, under Prime Minister Lange down to 5.7 percent now.

We are also getting growth in New Zealand that is forecast to be higher than that of many other nations. New Zealand is only a quarter of 1 percent of the world economy, so we are affected by what goes on in the rest of the world. The good news is, I think, that if we continue to do things right under John Key’s leadership, we can stand out from a large pack, and we already do. Growth in New Zealand over the next 3 years is forecast to be higher than in Europe by half a percent, higher than in the UK by just over 1 percent, higher than in Japan by 1.5 percent, and higher than in the US and Canada by 2 percent. New Zealand is expected to have around the same growth rates as Australia—around about 3 percent. That is because growth in New Zealand would be based on strong fundamentals, as I was told by a dairy farmer in Masterton yesterday.

We have strong fundamentals. We have sound economic and financial institutions. We are producing the sorts of goods and products and providing the sorts of services that will be in demand over the coming decades. This is why companies like Xero are doing so well on the stock exchange. Xero, partly invented in Greytown in the Wairarapa, has done extremely well on the stock market this year, going from about $2 a share to about $5.50. Why is that happening? Because it is a company that is based on the internet. How is it doing well? Because we have spent $1.5 billion out across New Zealand building a decent internet. These are the sorts of things and the sorts of services that are going to be in demand over coming decades.

Sixty percent of our exports now go to Australia or to South-east Asia in particular, the most vibrant and thriving regions of the world. We are moving our resources from Europe, where we have traditionally spent effort promoting our exports, and now we are spending much more effort trying to grow our export drive in Asia, because that is where the economies are growing quickly in the global market place.

The fact that we are also managing the economy and the Government’s finances, providing stable Government in tough economic times, and building a more competitive and productive economy based on savings and productive investment is being monitored by agencies external to New Zealand. If you have a look at Standard and Poor’s you will see that it is affirming an AA rating with a stable outlook for New Zealand. That is really welcome news, and I think it confirms independently that we are headed in the right direction and are better placed than many other countries. Affirming New Zealand’s long-term foreign currency rating, on 3 August Standard and Poor’s noted that this country’s fiscal flexibility, resilient economy, and strong political and economic institutions would stand it in very good stead. New Zealand is one of only nine countries with the highest possible AA rating and a stable outlook with Moody’s, and it has an AA rating with Fitch Ratings. Standard and Poor’s notes that New Zealand has favourable prospects for sustained growth while there remains strong demand for agricultural exports. The Government is making progress in getting its own deficits and debt under control, and it is on track for a fiscal surplus in 2014. But New Zealand’s high level of private sector debt is its biggest vulnerability, according to the external agents.

We have got a very resilient economy. This country has got extremely competent Government management in the form of John Key and Bill English. This is recognised—

💬 Andrew Williams: Ha, ha!

You might laugh, Mr Williams, but I can tell you that it is strongly recognised in the Wairarapa, and that is why you are sitting here leaderless—because your leader is not being sensible. Where is your leader, Mr Williams? On “Planet Labour” you can impose all the economic development you like and then pretend you can have more jobs. Well, that is fairy tale stuff—it does not exist. Labour wants to slow down New Zealand’s development for its own political reasons. The simple reality is that my constituents are telling me in the Wairarapa that we need more higher-paying jobs in this country, because they want to support families and they want decent public services that are world class. Tony Ryall is delivering that, and it helps people make their future in this country, not abroad. Thank you very much, Mr Speaker, for the opportunity to support this legislation.

Well, I would like to thank “Dr Dolittle” for that wonderful presentation. It was incredibly enthusiastic—Maurice Williamson almost fell asleep. They are so proud of their programme that the best they can do is the man in the bow tie. What a cracker! The spirit, the esprit de corps, and the enthusiasm of John Hayes were bar none. John Hayes made a very interesting point. He said that this Prime Minister, John Key, and the National Government know what they are doing. Well, I can do no better than quote one of their mates, Rob Cameron, the head of the Capital Market Development Taskforce, a Government appointment. Presumably he is a mate of John Key, “Dr Dolittle”, and the others over there. Rob Cameron said that he backed the sale of State-owned enterprises—

💬 Louise Upston: I raise a point of order, Mr Speaker. It is a longstanding rule that members are addressed by their correct names in this House.

I apologise, Mr Speaker.

The ASSISTANT SPEAKER (Lindsay Tisch): Yes, I think the member knows, so apology accepted.

I am speaking, of course, of John Hayes, in case there is any confusion for those listening out there. Thank you to the junior Government whip. Rob Cameron said he backed the sale of State-owned assets. He said that the management of the scheme has been “a disaster”. So that is what Rob Cameron, a mate and an appointee of the National Government, said about John Key’s management and the Government’s management of the sale of State-owned enterprises—and, as we know, 80 percent of New Zealanders do not want their assets, which they already own, sold. It has been an utter disaster from start to finish. I have never seen an attempted initial public offering—and I have worked for a number of companies that have been engaged in initial public offerings—so botched by an entity in history in this country.

In respect of Mighty River Power, this is the worst time to sell it. We have the worst economic conditions, the worst market conditions, and a tribunal hearing hanging over the Government’s head. Why? Because of the incompetence of the Prime Minister, because of the incompetence of the finance Minister, the State-owned enterprises Minister, and the Treaty negotiations Minister, aided and abetted by those geniuses in the Māori Party—the weekend warriors—who went around the marae and said they would fix the Māori ownership issues and the property issues. They would fix it. The deal has been done with their paymasters in the National Party, and it was done so well, of course, that the tribunal now is considering the matter, and we know from listening to the Iwi Leaders Group and the Māori Council that if the Government does not listen, they will be off to court. The sales process has been totally, 100 percent, botched, and now we know that the Prime Minister has talked about delaying the sales. I think that is a good thing, colleagues. Anything that delays these sales and gives the people of New Zealand the opportunity, with those of us who are on the right side of this argument in Parliament, to stop these asset sales is a good thing. We should have a referendum where people will have a direct say—and then there will be no more talk about mandates from this crew over here.

So this, as John Hayes described it—alias “Sir Les”; oh no, sorry, John Hayes—the Prime Minister and the National Government know what they are doing. Well, not in the eyes of 80 percent of New Zealanders, and not in the eyes of Rob Cameron. It has been a botched, mismanaged initial public offering, from start to finish.

Then, what do we hear today? Well, Solid Energy, another one that is on the block with this crew. Oh, hang on, Solid Energy’s books are not that good. Why? I do not vent any fault of its own on that, but there are international ramifications in terms of China, with natural resources and the orders they are putting in for things like coal and other natural resources. Ah, the books are not really that good. So the Government has suddenly decided that maybe this might not be the best time to sell—likewise with Air New Zealand. If you actually look at the litany of problems some of these State-owned enterprises have, you will see Meridian Energy being put over a barrel in respect of negotiations with its biggest customer, the Bluff aluminium smelter. Is this a really good time to get Meridian Energy up and sell it? I would not have thought so, given the leverage that is being put over it by some of its clients. So, this from a Prime Minister—to quote John Hayes, the man in the bow tie, in case you missed him: the Prime Minister and the National Government know what they are doing. Well, even their own mates say they do not know what they are doing in respect of State-owned enterprises, and it is a disaster.

If you look at some of the record of the National Government, it knew what it was doing, it said, in tourism, did it not? I note the big silver bullet for the economy, where we now have 50,000 more people unemployed, and about 80,000 or 90,000 young people are not in work, not in training. We have the biggest training opportunity in New Zealand’s history, called the Christchurch earthquake, but how many apprentices have we had in 23 months, out of that? Zip. But the big hit was going to be the cycleway. We had the Associate Minister of Tourism, I think—

💬 Hon Member: Who’s that?

I am trying to remember. It is the chap from Napier—help me—Mr Tremain. He came to the select committee, and we said: “OK, well, if this was going to be the big hit, how many permanent jobs has it created?”. He could not name one. How many businesses have been created. He named two—one, I think, was a fish and chip shop in Napier. As people got an appetite up as they cycled around, they whipped into the old double beef burger and chips. They might have bumped into Gerry. Second was a bicycle shop. Well, you would naturally think that might pick up the pace, if you had a cycleway running down the side of the shop. So the stone-cold end of that were two businesses. We do not know how many permanent jobs, but two businesses are going gangbusters and I congratulate those two solitary businesses somewhere in Napier.

The other achievement, of course—remember the financial hub? New Zealand was going to be an international financial hub. Where has that gone? Zip, gone, gone by lunchtime. Then there was mining in national parks—another “you beaut”, Gerry Brownlee, bulldozer, D9 special; gone, botched. And this from a Government, to quote John Hayes, that apparently knows what it is doing. It knows what it is doing, to the extent that 1,000 Kiwis, talented Kiwis, young and old, are leaving our shores every week for places like Australia—every week. These guys, of course, were going to fix all that. They had the ideas, they had the brighter future—gone are 50,000 Kiwis a year leaving to go to Australia. John Hayes is the big hitter, the impact player from the National Party. He is the man National puts up when it really is in trouble, I am told, to make the case that this is a solid Government that has a growth strategy. What is it? A 120-point plan. There are so many plans, so many points, so many reviews that they are running out of ink and xerox paper in the Government departments, and yet we still have its legacy of 50,000 more people unemployed than when it came to office. There are 50,000 people a year leaving New Zealand. The 120-point plan—if there is a plan, perhaps, to get people on the end of the xerox machine, copying and typing all these plans, then maybe that might be a full employment strategy.

But the truth is as Mr Hayes knows it, and as he expressed with such enthusiasm, did he not? He sort of eased and oozed enthusiasm. It sort of dripped from every pore. He was so enthusiastic about his Government’s programme. As he knows, it is off course. I just say to Mr Hayes, amongst all the hyperbole and all the clichés, out of all the sorts of Crosby/Textor spin briefings that he has read, can he give us some facts? Why is it, I say to Mr Hayes, that there are 50,000 more people unemployed than when he came to office? Why is it that 50,000 Kiwis a year, under his Government’s regime, are leaving for Australia? Why is it that his Government has botched the asset sales? [Interruption] Hang on. We have got Rumpelstiltskin in the corner there, having a go. Give us one example where the initial public offering of State assets has not been botched. Give us an example where New Zealand people have got behind this asset sales programme. We know they have not, because 80 percent of the polls say the people are against it. Give us an example where progress is being made.

How many apprentices are we getting out of Christchurch? Look at the Christchurch rebuild—tragic, slow. What is the Government’s response? We know one of the big blockages down there is insurance, so after 23 months the big fella, Gerry Brownlee, gets up, jumps up and down, stamps his feet, and says to the New Zealand people: “I am brassed off with insurance companies.” We applaud. We were brassed off 22 months ago. That was, I think, 3 or 4 weeks ago, and what has been the physical or practical action to back up these fine words?

💬 Hon Lianne Dalziel: A big fat zero.

Zero—absolutely nothing. And this Government knows what it is doing! Well, the people of Christchurch know what has to be done down there, but the problem is they just cannot get any action. Clichés and fine words and Ministers being brassed off and stamping their fist occasionally, to be followed by zero, is not a plan, is not a Government in charge, and is not a Government showing leadership, whether it be in training, whether it be in health. Then we look at some of the myopic things they are getting sucked into. Hekia Parata apparently knew what she was doing over the teacher-student ratios. What a botch-up. I could use more colourful language, but this is a sacred place.

Then we have Mr Banks, whose greatest contribution is to put a bill into Parliament to get rid of 31 Acts that do not exist. We will not mention envelopes. We will not mention Dotcom. What an absolute botch-up that has been. And this is from a Government, to quote Mr Hayes, that knows what it is doing. Accident compensation—Nick Smith went troppo, really troppo. He checked out in more ways than one. I say to Mr Hayes to show us a Government that knows what it is doing, and show us a Prime Minister who knows what they are doing, because I am sure that outside this Chamber the people of New Zealand would love to see one as well.

This is a Budget that does not just entrench our current account deficit but would create an asset deficit and entrench a skills deficit, an environmental deficit, and, potentially, also a democracy deficit in Christchurch. Asset sales are a cornerstone of this Budget, and that is looking about as derelict and crumbly as some of the buildings in Christchurch. The asset sales programme is in disarray. This John Key - John Banks Government should just admit that asset sales are poorly conceived, poorly timed, and unlikely to yield the revenue that the Government had claimed, and call them all off.

When asked about how he saw the Government’s sales plans for Solid Energy, given the plunging international prices for coal and coke, Solid Energy Chief Executive Officer Don Elder was reported in Saturday’s Press as saying: “in the current world there aren’t too many normal investors looking to buy coal companies [but] the people who invest in coal companies are saying there are bargains left, right and centre.” So why give away shares in Solid Energy at bargain-basement prices, when that company could be repositioned with a much more progressive research and development and investment strategy to increase its investment in biomass and biofuels, instead of speculating on a climate-destroying lignite conversion plant in Southland? Why give away shares in Solid Energy and our other energy companies, when they could be repositioned to get a slice of the trillion-dollar renewable energy market internationally? Solid Energy is looking to cut $120 million off its operating costs because of those falling coke and coal prices. A good place to start would be to stop preparing for asset sales. The company has wasted $130,000 on that, but we have hundreds of thousands of people signing up to our petition to seek a referendum on asset sales. Asset sales are opposed by the public. We will get that referendum.

If the Government goes ahead with asset sales in the current recessionary climate, it will be selling at the worst possible time assets that have been built up over generations. It will be taking the wrecking ball to the dividend stream that we receive from Meridian Energy, Mighty River Power, Genesis, and Solid Energy. There is huge uncertainty, with the Waitangi Tribunal yet to report. The whole issue of Treaty rights over water is nowhere near close to being resolved. So that means that potential bidders for Mighty River Power will downsize their bids to take account of this uncertainty—similarly with Meridian Energy and the Tīwai Point contract being renegotiated.

Asset sales would be a disaster—the same disaster that this Government has overseen in terms of failing to create jobs and failing to create hope. There are 65,000 more people out of work today than when National came into power. With its Budget and with its whole economic direction, this Government is failing to give hope to young people. There has been a failure to stop the flood of New Zealanders across the Tasman. More than 1,000 New Zealanders a week are going across the Tasman because they have given up on John Key’s brighter future, and they are seeking their future in Australia instead. That is creating a skills deficit and a human deficit.

We are getting a democracy deficit in Christchurch because of the Draconian powers of the Canterbury Earthquake Recovery Authority in planning and facilitating the city’s post-quake rebuild—[Interruption]

The ASSISTANT SPEAKER (Lindsay Tisch): Order! I am sorry to interrupt the member. The member cannot interject: “Tell the truth.” I ask the member to withdraw that comment. I ask the member to withdraw that comment.

💬 David Bennett: I withdraw.

It is a democracy deficit because we have not seen the information about key decisions. We are not getting enough transparency around those decisions. We do not know who is going to be making the decisions, the Canterbury Earthquake Recovery Authority or the Christchurch City Council, on some of the key civic assets that Christchurch residents will be funding through their rates as well as their taxes. Will it be elected councillors on the Christchurch City Council, representing Christchurch citizens, or the Canterbury Earthquake Recovery Authority making decisions on things like the future of the Centennial Pool? In June, as part of its long-term plan, the council passed a unanimous resolution asking staff to report back on the feasibility and cost of repairing the Centennial Pool in central Christchurch, so that people in the central city and in Christchurch East would have somewhere to recreate and somewhere to swim. The council’s own engineering reports show that the pool could be repaired for a cost of around $1.8 million to $2.3 million, and the council had earmarked money in its own annual plan for operating costs for the pool. Yet the Canterbury Earthquake Recovery Authority’s blueprint for the central city shows a playground where the pool is. This Thursday the city council will further consider the issue, and there will be a major democracy deficit if the Canterbury Earthquake Recovery Authority, through its compulsory land purchases, overrides the decision of the city council to investigate the repair and restoration of the pool facility. The pool was used prior to the quakes by around 1,000 people daily.

We need to tackle the fundamental problems in our economy with a smart Green economic plan. If we had had a Green Budget, that would have been about ensuring that we protect our natural assets, that we share our prosperity fairly, and that we have a good quality of life. That Green Budget would have involved retaining our State-owned energy companies in public ownership and refocusing them towards exporting their renewable energy expertise. A Green Budget would have extended the Warm Up New Zealand: Heat Smart programme to another 200,000 homes over the next 3 years. That would create jobs for another 4,000 people directly, and another 10,000 people if you include the indirect effects. A Green Budget would have moved to a fairer tax system and enhanced our fiscal resilience by introducing a capital gains tax, excluding the family home. That would enhance the revenue stream for the Government, and it would help shift capital away from the largely unproductive property sector into much more productive uses, including the clean-technology sector. A Green Budget would have reprioritised our transport spending away from billion-dollar motorways that we cannot afford and towards sustainable investment in better bus and rail systems, taking account of peak oil. A Green Budget would have put a price on the commercial use of water—again, to provide a tax on resource use, rather than just relying on taxes on income. It would have put a real price on carbon. And it would have supported a living wage by raising the minimum wage to $15 an hour.

A Green Budget would recognise that “Planet Economy” lives on and relies on planet Earth. It is not somewhere else. The exploitation agenda of this current Government means that even its rhetoric has moved away from balancing the environment against the economy to just getting on with it and to hell with the environment—full steam ahead with the use and abuse of natural resources. That is why we have seen, at the weekend, the Minister for Economic Development, Steven Joyce, commenting that the Government will be sitting on the shoulder of local government, whipping it along. The Government is proposing amendments to the Resource Management Act that would gut the sustainable management purpose of the Act. It would speed applications through. That is why Ministers like Steven Joyce want the Bathurst Resources—an Australian mining company—proposal on the Denniston Plateau to go ahead, regardless of the fact that there are virtually no coal measure ecosystems protected on Department of Conservation land other than on the Denniston Plateau. That mine would totally destroy a lot of the biodiversity and the distinctive species there. This Government’s agenda is about resource exploitation, and to hell with the environment. A Green Budget would involve a much more sustainable footing for our economy that puts the respect and protection of nature as the centrepiece of sustainable economic use. Thank you.

Following on from that rubbish, really, from the Green Party, I think we need to look at the practicalities of the real world we live in. Often we hear about reports of what the world will look like in 2050, and often you see some of those reports. I was just reading one from PricewaterhouseCoopers about the shift of global economic power in 2050. It makes for very interesting reading. Basically, when you look at those reports, they have one common feature, and that is that the world is a numbers game. It is a numbers game in the sense of number of people. World economic power—the ability for countries, therefore, to deliver to their people the services and the rights that people expect—will be determined by the size of the population. It will be determined not by its geographical footprint nor by its resource footprint but by its human footprint. That is a completely different approach from what we have had in the history of the world for the last couple of hundred years, where it has been about the space that someone conquered or the area that was under control. Now it is about the number of people who work in your economy.

What we have seen in the last few years with the world economic recession is part of that. It shows that there were some dynamics in the world economies that were not structured the right way, and that there was an emphasis on borrowing at the wrong time for the wrong things. Essentially, it was a wake-up call for the West that the Western economies were not performing any more. Those economies had got out of sync with what it actually takes to make money and to deliver for your people, going forward. The Eastern economies have delivered over that period of time and continue to deliver now, because their economic fundamentals are much closer to what is required to deliver for an economy. That is the big wake-up call that is happening to the world at the moment. New Zealand is in a bit of a precarious position in that situation, because we are not in the heart of that wake-up call in Europe, so we are not feeling the pain that many European countries are feeling. We live in an environment that is distinctly Asian. We trade with Asian countries, and so we have been insulated a little bit from what is going on. Australia is in the same position. It has been insulated. We live in a Western economy but we have been insulated from the effects of what is happening to those economies, because of our position in the world.

And that positioning means we have to be very careful in the decisions we make in the next few years, because it would be very easy for New Zealanders and Australians together to think that they are comfortable and successful and can carry on the mantras and policies of the past. Those Western policies will not serve those countries that well, going forward. Those countries, New Zealand and Australia, need to go back to the economic basics and make sure we pay our way in the world. That is what the New Zealand National Government, with our coalition partners, has been doing for the last 3 or 4 years, and will continue to do, because the people of New Zealand understand that need. They understand that the world has changed. The ordinary New Zealander out there has probably lost money on their biggest investment, their house, and they realise that they could lose their job in the business they work in if that company is not competitive in the world market. They know that economic reality. They do not have the luxury to sit in places like this and spout off some great ideas about some green economy that does not actually exist, or spout off some Labour mantra about trying to make everybody equal, when that does not exist either. They live in the real world, and in the real world you have to compete, you have to get training, you have to get education, and you have to work hard. These are fundamental things that the Labour and Green parties would never accept, but they are core National Party beliefs, and they are represented in this Budget and continuing Budgets, because the public understands what they need and what needs to happen.

Just going back to that report—if you go back to those 2050 reports, look at some of these dates. In 2013, Brazil is to overtake the UK—the UK, the great empire. In 2016, India, a former colony, takes over the UK in size. In 2021, Indonesia beats Spain. In 2025, Brazil beats Germany. In 2031, Mexico beats the UK. And in 2045, India beats the USA. That is the real world, and those countries are big populations and they are young populations.

💬 Dr David Clark: In 2012, New Zealand moves to Australia.

Our friend over there says what happens to Australia? Australia is a very interesting point. Australia moves out of the top 20. Australia loses its position in the top 20, because it has not got population. We have a distinct relationship with Australia, and that is an important part of what we have to do to be competitive. When you look at the facts about Australia, there are New Zealanders going to Australia at the moment because of the mining boom and the job opportunities there through the mining boom. But that is not sustainable for the long term compared with our agricultural and primary-based industries that rely on water, which is a much more renewable resource going forward than the mining boom that Australia now faces. I think, and this Government thinks, that we are in a better position.

So when we look at those statistics, and when we look at the need for New Zealand to develop its economy, we have to look at what we have to do to make that happen. New Zealand will never compete with Indonesia or China on a population basis; we just have not got 200 million people. But we can and we need to trade with those countries. That is our success. We are building the tradable sector of the New Zealand economy so that we can trade. On the other side of this House we hear rhetoric of things like capital gains taxes and increased income taxes, trying to do all those things that will hurt the tradable sector of New Zealand. What has the Government delivered? It has delivered low interest rates. It has delivered the right economic infrastructure for New Zealanders to grow their businesses. That is how we will grow and trade with those other countries.

We also need to make our economy competitive in the way we deal with some big issues. That is around things like education to make sure that all our young people have a start in the modern world, and we do not accept the failures of the past and say that a group of people cannot succeed. The world order will mean that you will not have that privilege. The privilege of feeling that we can say no to a group of our people, and that they are not able to play the game, is not going to be enough going forward. That is an old Western ideology that is not going to last in the modern way. We need to encourage education and the delivery of education, and the Government has made big strides in that area. Some of those things are not popular, but they are important in achieving our end goal.

So, in essence, the world has changed. It has changed very quickly in the last few years, and it will change immensely in the next decade or so going out to 2050, as those reports indicated. But what is essential in that change is that the Government delivers the right infrastructure for New Zealanders to take advantage of that world order. That is what this Budget does. It focuses on what is required and needed for New Zealand going forward. The rhetoric on the other side of the House is dreamland rhetoric. It is not practical and it is not endorsed by the New Zealand people, because the New Zealand people see through it. They know that the plan on this side is the practical plan that will work. The plan on the other side—if they have a plan—is something that is completely impractical, has no chance of working, and that is why the New Zealand public supports this Government in this very good Budget. Thank you.

I rise to speak in this debate on the Appropriation (2012/13 Estimates) Bill, on that part of the Budget that takes some 19 percent of Government expenditure, and that is health. The total health budget is something in the order of $14.1 billion, so nearly 20 percent—19 percent—of the total Government appropriation. If one were to believe Tony Ryall, one would think that all health services are performing better than ever before: there are no difficulties here, move right along, there is nothing to see except those occasional statistics that the Minister wishes to shine a very fine spotlight upon. Those are the things where targets have been met because of the blood, sweat, and tears of our professional health staff working in district health boards, who, because they have been funded to do so, but sometimes not, have worked extremely hard to meet the targets—the short-term measurable targets—that the Minister has set them.

The truth, however, of the health landscape out there is one of cost cuts, of chaos, and of impending chaos. The expression “death by a thousand cuts” takes on a new meaning under this Minister of Health. There is a whole new meaning to that expression when we realise that the funding in the health sector is $230 million down on what is needed simply to keep up with cost pressure, never mind catering for a larger, ageing population or an impending diabetes epidemic. Never mind those things—simply looking at cost increases, the Government is $230 million down on what is necessary in that area. So the district health boards are not even being funded to break even. They cannot cover their costs. They cannot meet the increasing demand of an increased population and an ageing population.

In the health budget, only $358 million was new money. The district health boards in particular are being asked to do more with less. They are being asked, for example, to absorb all of the KiwiSaver liability that they have not been previously asked to cover. There was no additional appropriation for the covering of the KiwiSaver liability. That used to be taken care of centrally by Government, which is no longer to be the case. So what we have now is some of our district health boards spending huge proportions of their new funding in covering new liabilities—not funding that was given to them or tagged for that purpose, but funding that they have to give out because the Government has withdrawn from liabilities it covered previously.

Let us take, for example, Canterbury—our most smitten of district health boards, our most desperate district health board, trying to recover from its devastating earthquakes and, at the same time, meet the Minister’s short-term measurable targets. Canterbury District Health Board has a projected liability for KiwiSaver of $8.6 million. That is about 42 percent of the new funding it has been given. So nearly half of its new funding, which is meant to be delivering all these things the Minister requires, is having to be spent on KiwiSaver contributions. There is no recognition of that. The KiwiSaver contributions are critically important to the economic welfare and future of this country. If we are ever going to deepen our domestic capital markets, KiwiSaver and New Zealand superannuation are the mechanisms to do it for us. However, the Government is not taking any responsibility for that, and so Canterbury District Health Board is having to take up 42 percent of its new funding to cover that liability. Even a little wee district health board like the West Coast District Health Board is having to spend 34 percent—one-third—of its new funding on its KiwiSaver liability.

Listening to the Minister of Health, as I say, one would think that all was well in the health garden. Well, it is not rosy in that health garden. I would like to stress, for just a moment, a number of the things that have been cut by this Government. Let us take just a few down-to-earth, practical examples. The Dannevirke out-patients clinic was cut. Counties Manukau District Health Board has had to cut funding, which included two Māori health programmes and Auckland University’s evaluations of the board’s 5-year $10 million scheme to reduce the incidence of type 2 diabetes. These efforts out in the community are being cut because the Minister is requiring district health boards to turn on more elective surgery procedures so he can go and award certificates to those poor district health boards that have tried desperately hard, without the funding, to do what the Minister requires.

As an example of this, I would like to quote from the Nelson Mail. Just recently the Nelson Marlborough District Health Board showed that it had performed 6,209 operations—150 more than during the last financial year. Yet the district health board’s surgical services manager, Dorothy McKeown, said that its elective teams had done a terrific job to surpass the elective target—which they have, and I take my hat off to them—while at the same time ensuring that no one was waiting longer than 6 months, but she said: “We were required to support this with extra resources that were not budgeted for.”

So what gets cut? What gets cut? Well, the Government has cut numbers of things. It does not matter whether we look back a couple of years or we concentrate on today. The abandoned school food guidelines, for example, were an absolutely no-cost item that this Government chose to cut when it came in, because it was something that the Labour Government had put in place. They were food nutrition guidelines to secondary schools, to school tuck shops, encouraging them to sell only healthy food. What has that done? Well, quite frankly, it has done nothing to improve our obesity problem, and the tendency towards type 2 diabetes that that problem will produce over time.

The Government has cut front-line public health programmes: some $12 million from tobacco control, $8 million from sexual health promotion and prevention programmes, $1 million from public health alcohol and drug services, $4 million from mental health workforce development, and on it goes. This Government is cutting health at every turn, and, in fact, replacing what should be long-term health goals with short-term measurable outputs that the Minister can then trumpet. Those are the things that he is funding, and he is not acknowledging what the experts are saying, which is that in order to reduce our health liabilities and the cost of health in the future, we need to be putting more into prevention.

There is a report that has gone to the Ministry of Health because it wanted to find out how to deal with diabetes care and management, given that the Government has cut the “Get Checked” Diabetes Aotearoa programme. When we have this epidemic coming down the tracks at us, why would a Government stop the “Get Checked” Diabetes Aotearoa programme? The report says that there was a recurring theme amongst those who were consulted that prevention and early intervention were not being funded as a priority by this Government, or even included as a specific target. For all that the Minister trumpets successes in the health portfolio, he is really jeopardising the future health of New Zealanders.

It is my pleasure to take a call on the Appropriation (2012/13 Estimates) Bill this evening. Obviously this Budget is part of a wider Government plan—a plan to get New Zealand back on track. One part of that plan is to get economic growth and grow our businesses in New Zealand. I was privileged enough last night to go and talk to the Hutt Valley Chamber of Commerce. What I was speaking to those people about was what the Government is doing around business growth, and what the Government can do to ensure that they have got confidence so they can invest in their companies. That is the one thing that the Government can do well: give businesses confidence so they back themselves, so they grow their businesses, so they take some risks, and so they invest when times are tough. They grow, they employ more people, and they grow our economies, because the only way that New Zealand is going to grow its economy is by trading—trading its way to success.

The Hutt, I have got to say, must be the most underestimated area for business in New Zealand. It has got some of the most incredibly innovative and inspiring businesses in New Zealand. If I was to pick just one of the tens, twenties, or dozens of businesses I can think of, one would be Fraser Engineering. This business is in the Hutt. What it does is it manufactures fire engines. But it manufactures them not only for New Zealand now; in these tough times it has found new markets as well. Now it is going into Australia, and it has got some significant contracts in Australia making its fire engines as well. It employs 100-odd people. I went around its factory the other day, and it is impeccable. You could eat your lunch off the floor. It is beautifully tidy. It is progressive. It is inspiring. The staff obviously love the organisation and love working there. It has got some very long-term staff there, it is progressive, and it is backing itself. It is backing itself in these tough economic times to go into emerging markets and grow.

I was lucky enough also the other day to be part of the Business and Parliament Trust; I went to Coca-Cola Amatil. It is investing in New Zealand as well. It has just opened a new bottling factory. Wandering around and talking to the staff there, they love Coca-Cola Amatil. They are well looked after. They are well looked after, and they have got a sense of pride in their product and what they produce. This is an example of a company that is growing and investing in New Zealand as well, and employing more people because of that. So as a Government we have got to ensure that we can give them the confidence that they need to grow their businesses in New Zealand.

We have identified six key drivers for business growth in New Zealand. The first one is skilled workplaces, because we know that when our trainees go out into these businesses, they need to have the skills to be able to match what the industry needs for its business. There has got to be a direct match from the industry training organisations and what they are producing to what the businesses need and where they are going in the future. So what we are doing is we have looked at the industry training organisations and we have made some changes. We are out talking to them at the moment, consulting with them at the moment about how we can get that stronger, and how industries can have a real voice about what they need in their trainees coming out, so that their skills are well matched with the businesses, and the businesses can grow in the future and have a constant, good, highly skilled stream of workers coming through.

Another area is innovation and research. Obviously, we have just put out a progress report called Building Innovation, and here it is. We put one out last week or the week before on exporting. I recommend anybody to go and pick them up. The Ministry of Business, Innovation and Employment have done them. They are really, really informative about what we are trying to do in these sectors for economic growth. The good thing about these is that you can actually hold the Government to account on the progress we are trying to make with our economic drivers for business. I think it is really important that there is accountability back with the initiatives that we have got in place to ensure that we can be held accountable for what we are doing as well.

It is interesting, because when you go around, talk to the businesses, and talk to them about what they are doing, it is all about innovation, it is all about research, and it is all about making their products better and better and better so that they can stay competitive in these global markets that they are entering.

What we have done is put in place a new ministry, which is known as the superministry, the Ministry of Business, Innovation and Employment. It has brought together science and innovation, economic development, employment, and housing and building. The important thing about putting these four ex-ministries under the same umbrella is that they will be talking to each other a lot more. They will not be working in silos, as has happened in the past. When you think about it, it makes sense. Science and innovation, economic development, employment—they should all be talking to each other, interacting with each other, and ensuring that each lines up with the others, so that they are all going in the right direction, and they are not working against each other.

I suppose the other big initiative we announced in the Budget—$166 million over 4 years—was the advanced technology institutes. If we are serious about growing businesses, helping them to grow in New Zealand, and staying cutting edge, we have to invest in their technology and their ability to access research and access researchers more easily to grow their business and stay competitive. One of the ideas around the advanced technology institutes is that the researchers can go into businesses and work directly with them. What we have heard from businesses is that they have got these great ideas and they can commercialise them, which is fantastic, but they really struggle to take them to the next level, because they cannot get the researchers in their businesses. They do not need them full-time. They want them for only 6 months, to come in and give them a bit of a help to get their research moving along, and to come and go out of their business. What we are trying to do is facilitate research with businesses to make it much easier.

We also know that we have got some great innovators in our Crown research institutes as well, and what we are trying to do is allow them to get their great ideas and commercialise them to be able to take them to the market much quicker. So we are looking at it from both sides, to actually try to make the most of the great ideas that we have got, and also help the businesses to access researchers so that they can actually grow their businesses as well.

The other area we are looking at is capital markets. Obviously, if a business wants to grow, it needs to be able to access capital markets, and there are many ways you can do that—many vehicles you can use to grow your capital markets. Obviously, one of them is through the banks, through other investors, through foreign debt, and through foreign investment. There are many, many vehicles you can use to grow your business, and we have got to ensure, as the Government, that we have got capital markets strong enough so that businesses have a range of capital that they can access. We did significant reform in the last Government, with the Hon Simon Power doing a lot of work around our capital markets and ensuring that they are a lot stronger.

The other area that we need as one of our key business growth areas is, obviously, infrastructure. In Wellington, in particular, we have just got Transmission Gully out of the starting blocks. It has taken about 30 years, but it has just started going through that process now, and that will be great for New Zealand and for businesses in Wellington, which will be able to get their goods and services up and down and out of Wellington in a much more efficient and effective way. Not only that, we have also invested heavily in our rail to ensure that our freight can move around New Zealand much more quickly. Not only that, we also have the roll-out of ultra-fast broadband. Ultra-fast broadband is very important to New Zealand business to ensure that we stay connected with the world.

The last area I want to touch on is our exports. Once again, we put out a couple of weeks ago a similar progress report on exports, and I recommend that you go and pick it up and see what we are doing in this area. We have done significant work on our free-trade agreements, and in 2008 one of the most famous free-trade agreements for us has been that one with China, which people talk about. Since we have had that free-trade agreement, our exports to China have increased by 160 percent. That is fairly significant. The one thing that businesses do say to us is that we need to get channels open to get into these new markets so that we can access them. Free-trade agreements are one vehicle. The other one we are looking at is working with Australia much more closely to use joint channels to open up some of these new sectors, these new markets for our businesses to work with Australian businesses as well.

We have got a strong growth agenda for our businesses, and I am sure that over time we will get this brighter future, because our exports will be the way that we trade out of this recession that we have gone through, and we get the growth that we are looking for.

Back on 24 May I listened to the Prime Minister say this in the Budget debate: “In the end,” he said, “when you spend more money than you earn, it is called Greece and you go broke.” Since then we have had a number of statements in this House by National Government Ministers who have used the example of Greece. They have basically said that if we do not sell the assets, we are going to end up like Greece, and if we do not follow the National Party’s economic prescription, we are going to end up like Greece.

This got me thinking, because I have been wondering in recent months what economic model the Government is following with regard to transport, where it has proceeded to spend billions and billions of dollars of New Zealand’s taxes on a series of white elephant motorway projects, without providing a shred of evidence that they will promote economic growth. So I went back and did some reading about Greece and the countries of southern Europe that have been so badly affected by the global financial crisis. I found some really interesting information, which I want to share with the House. What I learnt about Greece was that in the years leading up to the Greek financial meltdown, Greece invested €20 billion on motorways between 1994 and 2004. Greece unleashed the biggest motorway building programme that Europe has ever seen—€20 billion. Unbelievable. What is more—and this is really interesting for the members on the National side of the House, in light of the fact that this Government wants to start borrowing to fund the roads of national significance—what is really interesting is that between 1991 and 2005 Greece borrowed €4.7 billion to fund this extraordinary motorway building binge up and down Greece. It is incredible. It is amazing.

I also found, when I began to look into the Greek model of economic development, that it had a 10-point plan—

💬 Dr David Clark: Oh, a 10-point plan—sounds familiar.

That rings bells. That rings bells. Greece was cutting Public Service jobs, it privatised the national railway, and it established a superministry. It is becoming very clear. The more we look into the Greek economic model, the more—

💬 Moana Mackey: Uncanny.

—it bears an uncanny resemblance to the economic development model that we have seen coming from this National Government. It has all become clear. I bring this information to the House tonight in the interests of illuminating the debate and explaining to New Zealanders that there is, in fact, method to Steven Joyce, Bill English, and John Key’s madness. It is not just a random collection of 10-point plans and glossy booklets; there is actually a plan, and it is the Greek economic model. We can see it coming through most clearly with regard to this Government’s transport policy. I have to ask whether or not it is any coincidence that the former Minister of Transport, Steven Joyce, was known in this House as the “Colossus of Roads”.

💬 Moana Mackey: OK, now it’s just spooky.

It is very spooky. It is deeply unnerving and deeply unsettling. We know that this Government is not following the Finnish model. It has made it very clear that it does not like the Finnish model. It does not believe in it. I have been wondering in recent days whether, in fact, it has been following the Muldoon model with the roads of national significance, because this group of mega-projects costing billions and billions of dollars has been hand-picked by the National Government. It has thrown billions and billions of dollars of taxes behind these projects. The projects have very dubious economic significance, and now we find out that this National Government wants to borrow to fund these projects.

💬 Clare Curran: It’s all Greek to me.

Well, this is very reminiscent of the Think Big projects of the 1980s. The Government wants to saddle future generations of New Zealanders with the costs of these ill-advised, hand-picked infrastructure projects. It is absolute madness. But the Government says that, no, it is not Muldoonist, and it is not Think Big. What we can say today, based on my extensive research, is that it is the Greek economic model that underlies this Government’s transport policy. Borrowing billions and billions of dollars and pouring them into these white elephant motorway projects—

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

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

Before I was so rudely interrupted by the dinner break, I was explaining to the House that extensive research has revealed that the National Government’s transport policy has, in fact, been inspired by the Greek economic model. Greece is the gold medal motorway builder of Europe. It has blown tens of billions of euros, much of it borrowed, on a massive motorway building binge in the decade leading up to its financial meltdown. And its policy bears an uncanny resemblance to the roads of national significance policy.

💬 Moana Mackey: Do they employ Crosby/Textor?

I think the Greeks do employ Crosby/Textor as their contract propagandists. What are the distinguishing features of this Government’s transport policy? Undoubtedly, the roads of national significance are the defining feature of this Government’s policy. By the time this Government leaves office at the end of 2014 it will leave our country a legacy of a number of giant, concrete, white elephant projects that are of very low economic value, by the Government’s own figures. Some of these projects, these seven roads of national significance, were given the green light by the then Minister of Transport, Steven Joyce, before the most rudimentary economic assessment had been done of their worth as major infrastructure projects.

The roads of national significance have become a synonym for wasteful spending and out-of-control, unaccountable transport spending. Last week it was revealed by Radio New Zealand that this Government has spent, in the last couple of years, $8 million on public relations consultants—

💬 Moana Mackey: How much?

—$8 million—to try to sell the roads of national significance to an increasingly sceptical public. On top of that, it was also recently revealed that $216 million was spent on investigation and design for five of the seven motorway projects. Some of these projects will not be built for years—for decades, probably.

💬 Moana Mackey: They can’t pay for our rail line.

Yes, that is right. The Government is closing down parts of the railway network. It is cutting spending on new public transport projects. It is flatlining the spending on the maintenance of local roads. Every member in this House, particularly the member for Invercargill, will know that the neglect of local roads is a major issue that has made provincial New Zealand very angry and very resentful about this Government’s policy.

If it was not bad enough that the roads of national significance are simply, in many cases, a waste of money—these projects do not stack up—they have also had the effect of squeezing out most other categories of transport spending, such as, as I have said, local roads. The New Zealand Transport Agency said last week that it is facing a $160 million shortfall for the maintenance of State highways. That is new information that has just come to light. It has a $160 million shortfall for looking after, maintaining, and renewing our State highways. That is another consequence of this Government’s policy of putting all of the transport eggs into the basket of the roads of national significance.

At the same time, we are seeing KiwiRail being set up to fail. There is an unrealistic KiwiRail Turnaround Plan, which, bizarrely, requires KiwiRail to find $3.8 billion from its own balance sheet to invest in capital expenditure. That is totally unrealistic, and that is what is driving a series of almost inexplicable decisions by KiwiRail, the most recent of which is laying off 181 track workers. They are the very people who are needed to improve the state of KiwiRail’s network, so that KiwiRail can compete with long-haul trucking. The worse the state the tracks are in, the slower the trains go, and the less KiwiRail can compete. What is this Government doing? It is forcing KiwiRail to lay off 181 workers who maintain the track. It is ridiculous.

We recently found out that KiwiRail purchased 7,000 Peruvian rail sleepers, which are rotting on the tracks. That is an example of poor, el cheapo procurement policies. Again, we lay that at the door of this Government’s unrealistic KiwiRail Turnaround Plan. Following the Greek model has not served this Government’s transport policy well, at all. It is unbalanced, it is all about roads, and it is time for a change.

It is with great pleasure that I rise for this, the third reading of the Appropriation (2012/13 Estimates) Bill. This is a Government that I am very proud to be a part of. It believes that building a more competitive and productive economy is so important, it is one of National’s four main priorities this term and a big part of Budget 2012.

Post-Budget, I surveyed my electorate on the North Shore. I asked them about the issues that concern them the most—the local issues and the national issues. I received hundreds of responses, the majority of which emphasised the need to get the books back into balance by 2014-15. That is a message that is very clear to the people of the North Shore and to most of us who have electorates. It is something that is totally lost on the Opposition, of course. My North Shore constituents were very worried about law and order, as well, and about benefit reform. They wanted there to be more emphasis on getting people off welfare and into work.

The majority of the North Shore people whom I surveyed and who responded believe that jobs are vital. It is important to emphasise at this time that we in this Government have created 60,000 new jobs, and we need to keep to that plan and we need to focus on what is important, and on what is planned and sustainable economic growth that will create permanent and worthwhile jobs. One of the best ways to achieve growth is by building a very competitive economy. We understand that very well. It is that competitive economy that allows our businesses to trade successfully with the rest of the world. Our Business Growth Agenda is a key element in building that competitive and productive economy.

The braying from the Opposition—it is a kind of a little yappy murmur at the moment, which will, no doubt, build up if some of the key players come on in—does highlight its inability, and longstanding ignorance, to understand exactly what it is that New Zealanders want. They want better and higher-paid jobs. For the benefit of Opposition members—and in the faint hope they just might listen and learn something, because they really do need to learn—let us spell it out very, very slowly for them. Why is it important to have jobs? Why is it important to have more and better-paid jobs? Jobs give people income to support families, instead of the cradle-to-grave mentality that the losers on the other side promote. Jobs also pay taxes to pay for public services. We understand that really well. Of course, we need more and higher-paying jobs so that people will choose to live here and choose to stay here. Jobs depend on businesses that are competitive. These are businesses that sell something that people value.

Of course, businesses, in turn, look at six key things: ideas and innovation, and that is an opportunity, and we need to create that opportunity; capital to build businesses; resources, and that is access to necessary raw materials, which are very important for business; skilled people, of course, to work in those businesses; customers who want to buy the products, and that leads to export markets; and, of course, infrastructure. Businesses depend on electricity, broadband, and internet. They are all initiatives and all goals that this Government is focusing on. It all makes sense to us, because it is common sense. Again, it is pretty much unknown and uncharted territory on the other side. If we want more and better jobs for Kiwis, we need to encourage more businesses to be based here. That is why the National-led Government is spending a lot of time focused on those six key areas.

We ask ourselves constantly, and we measure it as well, whether we are making access to those six key areas any easier. Our Business Growth Agenda will ensure that Ministers and departments are focused on these six very important areas. The finance Minister, Bill English, and the economic development Minister, Steven Joyce, are all progressing progress reports on each of the six areas in order to give greater visibility to the Government’s actions and progress. In the past fortnight the Government has released the first two progress reports on our Business Growth Agenda. So we have the Building Export Markets progress report, and Building Innovation hot off the press, just released today.

I will come to the innovation initiatives in just a moment, but I will start with our plan to help build our export markets, because it is a particularly important one for my North Shore electorate. At a business breakfast in Takapuna on Friday morning my local exporting companies urged the National Government to keep up the good work. They applauded our commitment to increasing the contribution that exports make to our economy from 30 percent to 40 percent of GDP by 2025. These are targets. They are measurable, and we will get through them.

People on the North Shore, exporters who are trying to make a living, know that this target is an important part of our plan to build a more competitive and more productive economy. That goal of increasing the ratio of GDP to 40 percent is ambitious and it is difficult. That is probably why the losers on the other side could not even give it a shot, because they did not know too much about stuff that is hard and stuff that is ambitious. What is required for that to occur is to have a shift away from producing goods and services for the domestic economy, and to move towards our international markets—in particular, those fast-growing Asian markets.

A local Takapuna frozen-fish exporter is a pioneer in the field, and has been building markets in China since the late 1980s. Here is Dr Jian Yang coming in to join us. He is somebody who is very, very focused on helping this Government achieve the markets that it needs and to develop the markets it needs. The Takapuna exporter whom I am referring to has put in a lot of years of hard graft, which is, again, an unknown to the people who are on the benefit on the other side of the House—that is, before they got into Parliament, of course. Now they have got a bit of a meal ticket, and the older ones just will not let go. They have got no retirement plan, of course.

Our free-trade agreement with China is helping this exporter to actually attract much-needed investment, because he wants to expand his business—because guess what? That is good for him, and it is good for our economy.

Another National-led Government agreement we signed on to and joined that makes a huge difference, and which was highlighted by my local exporters last Friday, was the World Trade Organization Government procurement agreement. This Government procurement agreement means, effectively, that Kiwi businesses are going to get much better access to an estimated $1.6 trillion worth of overseas Government contracts. It is a lot of money, and a big opportunity for us. Under this agreement, which is a very worthwhile one—Tim Groser is a very hard-working Minister; he is the kind of guy who gets things done, unlike the predecessors on the other side of the fence—countries cannot discriminate against any businesses from another country in their Government procurement processes. It means that our businesses are going to be able to export more products and services to more destinations, which is another welcome and very practical development, and one that we applaud.

Frankly, the people on the North Shore are much more in touch with the sort of reality that we all live in, and as other people who have spoken in this estimates debate have referred to, there is a lack of reality on “Planet Labour” and among the other Opposition people. North Shore and Kiwi exporters are helped by other Government initiatives that have been announced, as well. New Zealand Trade and Enterprise, Tourism New Zealand, and Education New Zealand, those three important agencies, are now being encouraged to work with both the public sector and the private sector to develop a New Zealand story. That is going to help our stakeholders. I have heard from my North Shore electorate just how hard it is for smaller exporters as they struggle to get brand recognition. It is difficult for an individual with a product or a service to break into a market like China. Our reputation as a country is an entry point, and the New Zealand story is going to help them.

Building innovation to get higher economic growth and greater prosperity—New Zealand as a whole just has to keep investing in innovation. It is as simple as that. This is a report that gives a very clear picture—

💬 Kris Faafoi: A very long script.

—of the more than 50 policy initiatives that the Government has under way. The concentration span of the people on the other side of the House is not all that it could be, but fortunately, you know, there are more intelligent people on this side, who are paying attention, because they know only too well that our aim is clear: to improve innovation, to improve competition, and to improve the commercialisation of smart ideas into research of new products. One of those targets—and I think this where this Government varies from its predecessors—is that we are almost doubling the amount of money businesses spend on research and development, from 0.5 percent of GDP to more than 1 percent. The co-funding tools we are doing are excellent as well. It is a lot of money, and we are doing the primary-growth partnership—endless initiatives. I would suggest, perhaps, we should hand this report over. Perhaps I should table this report so that Opposition members will have something to read that they can learn from.

What would Labour do? It would put costs on business, a capital gains tax on all businesses. Well, that is going to be great for growth, is it not? It will more than double employer KiwiSaver costs—hello? Irrigation taxes—they will knock the farmers. That is a particular sport of the Opposition, of course. A minimum wage increase that would cost thousands of jobs, an accelerated emissions trading scheme tax on the farming sector—this is all the sort of stuff that is going to stifle growth and stifle business. The cancellation of the 90-day trial period. It has been an enormously successful initiative—

💬 Hon Kate Wilkinson: 13,000.

—13,000 jobs. Thank you, Minister. Absolutely. Again, all they want to do is rip it down and return us back to the 1970s industrial relations policies because of their union backing. They would wind back National’s ACC changes, as well. That would result in higher levies. The losers on the other side of the House will never get it, but fortunately this Government does. We have targets and goals, and we will work towards them. Thank you.

Moana Mackey, 5 minutes.

The amazing thing about that speech with all the nasty and, frankly, unnecessary comments towards members on this side of the House was that Maggie Barry had them written down. Sometimes members come into the House and they say things in the heat of the moment, and sometimes you go back and you get an email from people saying: “You know, it wasn’t very becoming of our representatives to behave like that.”, and you say: “Fair enough.” You know, you get wrapped up in the heat of the moment, you forget that people are watching, and it might not seem appropriate. But she had them written down. She sat in her office and wrote all those nasty, vitriolic statements about the Opposition. She wrote them down. That is extraordinary. Apart from the fact we are not meant to read speeches in this House, to read a speech out like that, and for someone who is in only her first year in Parliament to already be that nasty, is, frankly, very, very disappointing.

One of the comments she made that I found interesting was that she said everyone on this side of the House was on a benefit before they came in to Parliament. That is what Maggie Barry said. Well, I was not. I was a scientist before I came into Parliament, and I can tell that member that everything that is laid out in that science and innovation plan is not good enough—not good enough. National has gone backwards in terms of assisting science and innovation, and then, lo and behold, we found out over the weekend that now in charter schools we are going to be teaching creationism instead of evolution. How is that pro-science, and boosting science? How is that going to enhance the reputation of science in New Zealand? We are now going to be teaching not evolution but creationism in charter schools, with unqualified teachers. So I say to that member—with her 10-point plan, 60-point action plan, summit this, summit that, pamphlet, glossy booklet—how about less hooey, more “do-ey” from the National Government? Less hooey, more “do-ey”, because I am sick and tired of all the action plans and the glossy pamphlets.

The only jobs that have been created under this National Government have been people who produce pamphlets and glossy little publications that are outlining the Government’s next great big idea for the economy because all the others have failed, going right back to the Job Summit. Remember the Job Summit? When the National Government first came in, it was going to create thousands and thousands of jobs. It created practically none, apart from in the pamphlet-producing sector of the economy, which is a very important sector of the economy, but there is so much more that the Government could be doing.

Maggie Barry talked about the importance of getting into China. Let us take that example, because I agree. One of our best assets in New Zealand for getting into a lot of these international markets, particularly China, is our mayors, because mayors are very, very highly regarded in China. The Mayor of Ōpōtiki has gained enormous access to China. He is working on a project that will create jobs. He has been able to do that because of his status as a mayor when he takes delegations there to forge those relationships, and to do it in a way so that local government is not doing all the heavy lifting when it comes to the relationships that we are developing with these important overseas markets. Well, we have a bill at the Local Government and Environment Committee at the moment, the Local Government Act 2002 Amendment Bill—Maggie Barry is a member of that committee—which seeks to do away in some cases with the roles of provincial mayors. They will no longer be responsible for the economic, environmental, social, and cultural well-being of their communities. The bill will limit their ability to do these things, and if it forces amalgamations, it will actually take those mayors out of the picture entirely.

Just about everything Maggie Barry said in that speech is contradicted by what the National Government is actually doing, and that is a frustrating thing. It keeps talking about jobs. Well, where are the jobs? We have been sitting here for 4 years waiting to see when all these promised jobs are going to eventuate, and nothing in Budget 2012 is going to do that. Do you know what the big, king-hit economic plan of Budget 2012 was? Taxing kids on their paper routes. Taxing kids on their paper routes was the big, surprise economic plan of the National Government in Budget 2012. How mean is that? How mean is that, that at the time when you are giving tax cuts to the wealthiest New Zealanders and taking assistance away from those who need it the most, you tax kids on their paper routes. And what the National Party said about that was: “You know, it’s not that much money anyway. It’s only a few hundred dollars.” Well, when you are a child and you are saving, and when, like most of us on this side of the House did, you are saving to go to university and pay the fees, all that adds up. It might not be a lot of money to people on that side of the House but we know that for the people we represent in this Parliament it is a lot of money and it was appreciated. Taking that away to pay for unaffordable tax cuts that overwhelmingly went to those who needed it the least is not what a Government’s priority should be in the tough times.

There was nothing in Budget 2012 that is going to grow the economy. There was nothing that is going to bridge that gap between the jobs that are starting to come out now, the jobs that are out there, and the people who are unemployed who need the skills to do those jobs. That is where the Government focus should be and the Government dropped the ball in 2012 Budget again.

We are coming soon to the end of a long journey that began on 24 May, and this debate, when wound up, is going to be something of a vote of confidence in the Budget and in the Government’s agenda. So it is opportune, I think, to reflect on what we have heard in this House and what the public of New Zealand have been listening to over the last few months, and also on the alternatives that have been put by the Opposition parties. I just want to do a bit of a summary of this contest of ideas, if you like. The Government has laid out four main pillars to its Budget this year. They are responsibly managing the Government’s finances, building a more productive economy, better public services, and rebuilding Christchurch. I just want to go through them one at a time.

It is true that when we inherited the Treasury benches the one thing that the Labour Government did leave us was low net debt. That was a good legacy. The other legacies, of course, were 10 years of deficits, an unemployment rate forecast to reach nearly 9 percent, and a debt to GDP ratio forecast to get up to nearly 70 percent. There is no one big lever to pull. This is about many, many policy initiatives: fiscal policy, welfare reform, Resource Management Act reform, and building infrastructure—roads, rail, and information and communications technology. So how many of these little levers have Labour supported? None. Labour has said no to absolutely every single growth agenda this Government has had. It would be nice if there was just one—just one—that we could point to and we could at least say: “Well, at least it has got the right idea.” But it has said no to further intensification of the agricultural sector, no to more mining or oil and gas exploration, no to making welfare work for our most vulnerable, no to public sector reform—the list goes on.

So what is Labour good at? Tax and spend—tax and spend. It would put back a punitive top tax rate. It would put a capital gains tax on business. It would double KiwiSaver costs on business. It would put in place irrigation taxes and minimum wage increases, cancel the 90-day trial period, go back to the 1970s industrial relations framework, put in place extra transport charges, and wind back the ACC reforms that have just put half a billion dollars back in the pockets of hard-working levy payers in this country. It would cancel the mixed-ownership model. So there is another $5 billion to $7 billion that it would need to find to fund just our promises, not its promises, which include universal student allowances and investing billions more in public services for no output—none whatsoever. It would go back to the high interest rates that that debt would lead to, with no output whatsoever.

Do you know what? For all of that, Labour is still not as bad as the Greens. It is absolutely not as bad as the Greens, and at least it is up front about what it would do. But the Greens want to de-intensify farming in this country by 20 percent by smacking all businesses with punitive emissions trading scheme charges, and they oppose every single free-trade agreement. Where was Metiria Turei this week? She was in Canada supporting Canadian farmers, who are given 300 percent subsidies, and opposing our farmers competing on a level playing field with the Canadians. Well, I find that just outrageous, but it is absolutely consistent with the Greens’ agenda, which is anti-business, anti - foreign investment, and xenophobic.

I want to go on to that more productive economy, and I will start with the Greens. It is really hard in straitened times to find that extra investment to boost the economy through innovation, through the Performance-based Research Fund, through the new Advanced Training Institute, and through the many other initiatives we have to improve science and innovation in this country, but we have done it. What did that icon of science in this country—that is, the late Sir Paul Callaghan—say about the Greens’ policies? He did not beat around the bush. He thought that the Greens’ policies were quite crazy: “There is absolutely no reason why we can expect to be best in the world at Clean Technology. … It is absurd, in particular, because we have proven particularly dreadful at developing advanced knowledge-based industries or leading technologies in any of those areas …” What he thought our brilliance was in was the weird stuff, the good stuff—the little niche markets that those big economies will not invest in. We are good at agricultural science. We are very good at agricultural science, which is why the Government is investing in those things.

Even Labour, in terms of innovation—just today when we issued our progress report on innovation, Labour’s David Shearer said: “Where are the bold, innovative ideas we desperately need?”. He said there was not one single new idea. Well, guess what? The report was not about new ideas. The report was a progress report on the plethora of good ideas that are being focused on now. I would accept that if there was one, just one, idea from Labour—one new idea that was not a rehashing of that tired old innovation strategy, the research and development tax credit. My tax accounting mates would just love that to come back, because all it would do is give them incentives to manage accounting—not to manage innovation, but to manage accounting. So I am looking for just one idea from Labour.

I want to move on now to better public services. It is true that it is really tough in straitened times to build more productivity in public services, but I am absolutely amazed and grateful for the effort that is being put in by our hospitals, our schools, our police, our prisons, and our defence forces—bless them, in the tough time that they are having this week—and the productivity gains that are being made. With virtually no new money, there are 27,000 more elective surgeries a year. Nobody is flying across the Tasman for cancer treatment now, and nobody is waiting in the middle of the night on gurneys in emergency department waiting rooms. We have set some challenging targets, have we not? We have actually said that we are going to set goals for those public services and we are going to stand or fall by them, and I think that is very, very bold. There has not been not a Government in this country that has done that much.

Lastly, there is rebuilding Canterbury. I think everybody across this House will accept that that is one of the single largest challenges the Government and this country face, and will do over many decades. It is encouraging to know that all parties support those efforts, although I would note that the Greens want to tax some more. After Earthquake Commission levies have gone up, and the probably $15 billion that by the end of this will have been funded by the Government through the taxpayer, what do the Greens want to do? Hit the taxpayer again. So I wish those people in Canterbury all the best for that rebuild.

In summary, this is a contest of ideas. It is a contest of ideas in this Budget put up by a Government with prudent fiscal policy and spending restraint, led by an outstanding leadership team—not just the Prime Minister—and a disciplined caucus, and, as senior whip, I can speak from experience on that. Contrast that with a Labour Opposition, pseudo-led by three Davids and a Goliath, that is racked by infighting, with no policies and no ideas—an angry, angry Opposition—and the Green Party, which is the worst anti-business, anti - foreign investment party in this Parliament bar none. Well, I know who the public have confidence in, because they put them on the Treasury benches in 2008 and returned them there in 2011.

Paula Bennett, you have just over 6 minutes.

Mr Speaker, 6 minutes is long enough to actually extol the virtues of this Budget, of the future of this country and just where it is heading under this Government. This is a good, pragmatic, responsible Budget, which is taking us forward in, I think, some still quite difficult times.

I want to stand up first of all, though, and congratulate Bill English, and say thank you to him on behalf of all those teenagers who are out there and who are struggling, for the $148 million extra that you put into this Budget on behalf of this country for those young people who actually need it the most. And they do need it. At the moment we have young people who are floundering, who are lost in this country. This Government has actually decided that it is going to stand up for them and put the kind of support around them that they actually need. In this Budget alone we saw $80 million going into extra childcare and support for those most vulnerable mums and dads in this country—teen parents.

💬 Hon Member: Labour don’t like that.

No, no, that is right. Labour members did not vote for that. They did not vote for an extra $80 million in childcare going to teen parents so that they have got options and opportunities to get an education and to get the kind of training that they need.

You know, we have the debate too often in this House about how we are dividing up that pie of money, instead of how we are growing it. This Budget is about growing it. It is about giving businesses the opportunities so that they can take on those young people and have those kinds of jobs. We hear often in this House “Where are the jobs?” and “Where is it happening?”. Well, let us tell that to the 88,000 beneficiaries who went off welfare last year and into work—88,000 beneficiaries went off welfare and into work. Those are not the ones who went off welfare to go on to superannuation, not the ones who went off it to go into a relationship, and, no, not those few who went off it to go overseas—those 88,000 beneficiaries went off welfare to go into work. Let us include, because some of these will be included, those who got job opportunities because of the 90-day trial period policy that this Government put in place. So those are the kinds of developments and kinds of opportunities that actually meant more for those very people who needed it more.

Actually, benefits at the moment are 4,000 below forecast. We have 4,000 fewer people on welfare than has been forecast. In fact, that has been the way the whole way through. I see, actually, the honourable member Clayton Cosgrove was here at one stage saying there would be 24,000 more people on benefits in the Christchurch area—24,000 more on benefits. Well, actually, in total it went up by about 500 and, of course, now it is 46 percent less than it was a year ago for young people, and 39 percent fewer on benefits in Christchurch alone overall for the unemployment benefit.

Let us not forget, though, that these members opposite are the members who will not vote for welfare reform, and will not vote for a future for those young people and for those on benefits. They would rather have them sit there, lost of hope, lost of opportunity, not having the chances to actually move forward. It was quite an extraordinary week last week, and I am sure colleagues will agree, when we actually heard the Labour Party and their friends standing up and saying we should not drug test those who are on the unemployment benefit and they should not be made to take opportunities to get into jobs. It is—[Interruption] No, no—we saw, we heard. We heard Helen Kelly on Close Up, I think it was, where she did sort of try to sell the virtues of people being able to sit on benefits for long periods of time, not actually having obligations to be drug-free and in a position where they can take jobs.

💬 Andrew Little: No she didn’t. The Minister’s making it up. What a disgraceful Minister.

Well, actually, it is true. So we were kind of thrilled—kind of thrilled. It was quite helpful seeing her there, but it was also quite—[Interruption]

💬 Mr DEPUTY SPEAKER: Order! Order!

I do not think we should forget, though, how much this Budget actually did help those most vulnerable. We have seen 96 more front-line workers for Child, Youth and Family. We have seen more than 149 social workers put into schools to support those children and their families who need it most.

I do not think we can go past a programme and initiative as big as the Prime Minister’s mental health initiatives. They cross over from education to social development to health. The depth of them, quite frankly, is kind of staggering, and has certainly increased my workload dramatically—and I am sure that many fellow Ministers would agree—but for all of the right reasons. Let us not go past health care, which is actually there for those vulnerable people who need it most. This is a chance to talk about our under-sixes, who are getting 24/7 health care now under this Government—under the Budget—which is stepping up.

But none of those changes makes a bigger difference than a job does. What the Opposition does not get, and what this side does, is that it is businesses that will employ the people who need the jobs. It is businesses that create jobs. No job will be given to any person in Waitakere tomorrow unless an employer says they can take someone on, and for them to do that, they need the confidence of a stable and responsible Government that is going forward for them. No job will happen for anyone in this country unless a business stands up, or a person has the right kind of backing with the skills and initiatives to stand up and take the courage to move forward themselves. Past Governments can wring hands, but this is about action that makes a real difference for them. We see those jobs being created in the worst of times, and in some of our hardest times. We will see them go forward. We will see people moving forward and getting the kinds of opportunities that they want.

💬 Sue Moroney: Go to Australia.

Well, those 88,000 people who went off benefits last year and into jobs did not go to Australia. I am sure that we could do a whip around now and get a ticket for that member if she would like one, because that we would see, I am sure, as an investment. There is not an electorate in the country that would miss her, and, actually, there are not many others who would as well, which is the truth of it.

The reality is that these are times when we need to be looking at the future. It is something to stand up here and talk about the future for our kids, but we need to think about the future for those who are in it and those who need it now, and that means actually getting back into surplus. It means being responsible about what we are spending and whom we are spending it on. I am proud that we have looked after the most vulnerable. This has always been a National Government that would do that. We need to actually have more of it. We need to see this country move forward. This is a Budget that I am really proud to support on behalf of this Parliament.

The time for this debate has expired. I shall put the question. The question is that the motion be agreed to. Those of that opinion will say Aye, to the contrary, No. The Ayes have it. Party vote? The Clerk—[Interruption] It is timely to remind the House that party votes will be taken in silence.