Debate on Budget Policy Statement

I move, That the House take note of the report of the Finance and Expenditure Committee on the Budget Policy Statement 2017. What does this Budget Policy Statement, which was presented to the Finance and Expenditure Committee last year, show? It shows four very important things.

Firstly, it projects growth of 3.5 percent for the next 2 years, and 3 percent over the next 5 years. In the New Zealand context, this is extremely good—far ahead of the long-run rate of average growth in New Zealand. Economic growth provides more opportunities for the Crown accounts, it provides more opportunities for New Zealand families, and it gives us choices as a Government.

Secondly, it projects more jobs—150,000 more jobs by 2021. At the moment, our employment rate is the third-highest in the OECD. It shows our labour force participation rate as one of the highest in New Zealand history at over 70.5 percent. Those are some of the key metrics that determine the long-run future prosperity of a country.

Thirdly, it shows rising wages. It projects that the average annual wage will hit $66,000 per year by 2021. We had 1.6 percent wage growth in 2016—far ahead of inflation. It is these kinds of moderate, sustained increases in New Zealanders’ real take-home pay that drive higher living standards.

Fourthly—and I know members of New Zealand First really do not like this—the Budget Policy Statement shows that people want to live in New Zealand. It shows that New Zealanders do not want to leave New Zealand any more. It shows that New Zealanders overseas want to come home to New Zealand, and it shows that people around the world are choosing New Zealand as the destination of choice because our economic outlook is far superior than many countries opposite.

What the Budget Policy Statement shows is a set of numbers that are the envy of the developed world. They are a set of numbers that any developed economy would love to show. That is why people around the world look enviously at New Zealand.

What does the Budget Policy Statement show about superannuation? What it states is that the Government will resume contributions to the New Zealand Superannuation Fund when net debt starts to decline below 20 percent of GDP. We have had this debate in the last few days, since the Government’s announcement on Monday about the gradual progressive rise in the superannuation age from 2037 onwards. We have had this debate about whether or not this is appropriate.

The Government did stop borrowing to invest in the Superannuation Fund in 2009. We maintain that this was the right decision. Borrowing money to invest in global equities is like a household putting money on the credit card to invest in the global share market. We know that when the Cullen superannuation fund was set up in 2000 by Michael Cullen, it was set up to invest surpluses. Michael Cullen was extremely clear about this. He said Labour was setting up the fund to fund the long-term cost of superannuation by pre-investing surpluses—not borrowing money and whacking it on the credit card, but investing surpluses. As members opposite are so proud to proclaim very often, there have not been many surpluses in the last few years. Now we have got the books back into the black and we have got these choices.

The other thing that members forget is that the Labour Party and the Green Party have done a flip-flop on this issue as well. It was David Shearer, in 2013, who actually decided that the Labour Party was going to agree with the National Government and not start contributions to the Superannuation Fund while the Crown books were in deficit. I can quote no more learned commentator on this particular subject than the former Green Party finance spokesperson Russel Norman, who said in 2013 that he welcomed the Labour Party’s backtrack, that the National Government was right to stop contributing to the Superannuation Fund while it was running a deficit—“it was always very strange that [the Labour Party] wanted to borrow money to put it into the Cullen Fund, and I’m glad that they have seen common sense on it.”

So the now sadly lamented, departed leader and finance spokesperson of the Green Party actually agrees with exactly the position that the National Government has advanced consistently for 8 years, which is that it makes no sense to borrow money to chuck it into the Cullen fund—into the New Zealand Superannuation Fund. Members opposite often say “Oh, well, look at the returns; look at the returns.”, and the returns have been great, but it is very easy to look back in hindsight and say: “If only we had done this.” Of course, investing in global equities, and investing in the global sharemarket—just because you put money in it, there is no guarantee of future returns. These things do have risk. Members opposite have no concept, no understanding, of the concept of risk.

It is a bit of a thought experiment, but it does beg the question: if we had continued to borrow this money and put it into the Cullen fund, and we were sitting around today and the size of the fund had actually decreased by $15 billion, what would members opposite be saying now? Well, they would be standing up and they would be saying: “That was a crazy decision of the Government; you should never have borrowed money at a time that you were running fiscal deficits to invest in the global sharemarket, because look at the consequences. Look what has happened. You have destroyed New Zealand’s future. You have mortgaged young New Zealanders’ future.” That is exactly what they would be saying, and they would be right. We would have been doing that. We would have been doing that. So it is all very well to look back on the past and say we should have done that, but it ignores the concept of risk. It ignores the fact that the fund could have gone down.

The other thing about this argument about the Superannuation Fund, when it comes to raising the age of superannuation entitlement, is that it would have required the Government to borrow $13.5 billion more than we were already borrowing. Again, I point out that members opposite often like to stand up and talk about how the Government is borrowing too much money, the Government has borrowed more money than Rob Muldoon, and we cannot possibly borrow any more money—neglecting, of course, to mention their own profligate and extravagant spending plans. So I just point out the interesting contrast there. They often try to imply, when it comes to dealing with the long-term costs of superannuation, that if we just funded the Cullen fund, that would have dealt with it. Nothing could be further from the truth. By 2040 the Government’s plan, which the Prime Minister outlined on Monday, saves the Crown $4 billion a year. If we had borrowed all that money and put it into the Cullen fund, it would have probably saved the Crown about $1.4 billion a year by 2040. So the big question for Labour and the Greens is: where is the other $2.6 billion coming from?

What the Government announced on Monday is a sensible move. I am 33. I do not know anyone my age, or of my generation, who thinks that superannuation at the age of 65, with the generous system that we have, is sustainable in its current form. That is because, at the moment, there are four workers for everyone over the age of 65. By the time we hit 20 years’ time, there will be two workers for everyone aged over 65. The long-term costs of superannuation are going up. It is projected to treble in 20 years from $11 billion a year to $36 billion a year. This fiscal earthquake is not something that is unique to New Zealand—it is why Australia is doing what we are proposing; it is why Denmark and other countries are doing it as well. It is time that the Labour Party went back to its policy—its admirable policy—of the 2011 and 2014 elections and got on board with this, because there are a litany of quotes from senior Labour Party members about the long-term costs of superannuation.

Andrew Little said the one thing that scares the bejesus out of him—very old-fashioned word—is the long-term cost of superannuation. David Parker used to go up and down the country to business audiences talking about raising the superannuation age being the very epitome of fiscal responsibility. Well, we agree. The much-vaunted new deputy leader of the Labour Party, Jacinda Ardern, said we need to ask whether the universal age of superannuation is set at the right place, and there are a series of quotes from her about that. Well, she is right; Andrew Little in 2014 was right; David Shearer in 2013, when talking about the superannuation age, was right. Parties opposite are playing populist politics on this issue, and they need to get on board with what this very fine Budget Policy Statement laid out by the Government provides, which is a great set of numbers that sets New Zealand up for long-term prosperity.

I just want to end my speech by talking about that, because, actually, the hard work is just beginning. We have done a very good job of getting through the Christchurch earthquakes, we had the fiscal headroom to get through the Kaikōura and Wellington quakes, we have got the books back into the black after the profligate spending years of the last Labour Government, and now we have choices. I, for one, am looking forward to campaigning later in the year on the choices that the Budget Policy Statement provides.

I have a short phrase to respond to that speech from Chris Bishop: bring back David Bennett, because at least David Bennett would have tried to mount some kind of proactive support for the Budget Policy Statement. Instead, we have a range of Mr Bishop’s memories from 2011 and 2014. He managed to miss out a couple of them—in fact, I suspect he might have been responsible for the following quote from the then economic development Minister, Steven Joyce, who reacted to a statement from the Retirement Commissioner, saying that the nation’s superannuation system was affordable and no changes needed to be made. That is what Chris Bishop wrote for Steven Joyce. So if we are getting into the idea of who might have moved their position, Mr Bishop, the House is a very glass one.

When we look at the high-level numbers and indicators that are in the Budget Policy Statement, it would be easy to say the New Zealand economy is doing absolutely fine at that high level. I am reminded of what I did when I was a young university student and I managed to earn myself a little bit of money. I was very excited to buy a car—I wanted to buy my first car—and I went and bought a car from a very reputable used car sales yard. It was painted red, and that was the most important thing to me, even then, that the car was painted red.

💬 Kris Faafoi: What was it?

It was in fact a Nissan station wagon, Mr Faafoi, and it looked fantastic. It looked brilliant. I drove it home from the used car yard and I drove along and it was going fine, and then one or two rattles started to emerge. So when I got back home I lifted up the bonnet, and then I saw the real story. That is what is happening with the New Zealand economy.

💬 Tim Macindoe: Caveat emptor, Grant.

If we look under the bonnet, it is not quite so attractive, is it, Mr Macindoe? If we look under the bonnet, there are still 140,000 New Zealanders unemployed. If we look under the bonnet, there are 90,000 15- to 24-year-olds not in education, not in employment, and not in training, and, unlike the Prime Minister, we do not think they are drug-addled, hopeless people; we think they are New Zealand’s future, who deserve some support and some investment. But that is the statistic that is sitting in front of the National Party. Long-term unemployment has nearly tripled, to 44,000 under this Government.

Remember this every time the Government members get up to tell us something about unemployment statistics—remember this: in every region of New Zealand the unemployment rate is higher than it was when National came into office. It declared the global financial crisis over in 2012. Where are the benefits there? Under the bonnet of this economy, we have long-term problems going unaddressed. New Zealanders look at those high-level statistics and wonder “Where’s the benefit for me?”. Wage and salary earners who average ordinary-time wages are falling behind: 45 percent of Kiwis did not even get a pay rise last year; more than two-thirds of New Zealanders got a pay rise of less than 2 percent. At the same time, their housing costs were spiralling—on average an increase of 11 percent. Steven Joyce admitted in this House just a couple of weeks ago that the net effect of those low wage increases and those spiralling housing costs has been that for the average household last year, they were $1 a day better off—$1 a day.

That is the benefit of the so-called growing economy. That is what ordinary New Zealanders are experiencing, and that is why they are questioning whether or not these high-level statistics actually mean anything. Yes, GDP growth is at 3 percent; real GDP per capita is less than 1 percent. It is population growth that is driving GDP growth. We are not seeing the improvements in productivity that Bill English and Steven Joyce like to talk about. What we are seeing is New Zealanders working more and more hours and not getting ahead. That is what is happening in the real economy that the National Party members do not want to talk about.

So where does that leave us as a country, looking at this Budget Policy Statement? We should be seeing in this Budget Policy Statement some kind of vision for growing the wealth of all New Zealanders, some kind of sense of shared prosperity, because there is no point in an economy that delivers growth rates of over 3 percent if more than 5 percent of New Zealanders are unemployed. There is no point in growth rates of over 3 percent if people are living in cars and garages, and 41,000 New Zealanders are homeless. The economy is not an end in itself; it is the means to creating the kind of society that all New Zealanders can enjoy the benefits of, and that is what this Budget should be focusing on.

It is a Budget that should be focusing on how we grow decent work opportunities all around New Zealand. I was really pleased when Andrew Little went to both Dunedin and Gisborne in the adjournment that we just had and came up with practical ideas to create jobs in those areas: a centre of digital excellence in Dunedin and another wood processing plant in Gisborne. That is what will grow decent jobs, that is what will spread the benefits of a growing economy around the population: practical partnerships from an active Government in the regions of New Zealand growing those decent work opportunities.

In Dunedin, my old home town, we look now—with the Cadbury’s factory closing, with Hillside having closed—at cities and regions that have been left behind by this Government. We can do practical things as a Government about that: a procurement policy that actually gives New Zealand firms a fair go at bidding for contracts. We have not seen that from this Government, and places like Hillside have lost out. We can do better than that, and the Labour Party will make sure that we do.

We need to look at the drivers of productivity. We need to get more capital to our small businesses to allow them to grow and develop. It is hard work out there running a small business in New Zealand at the moment. The Government can do all the roadshows it likes with Jacqui Dean in charge, but in reality what those firms want is some support to actually be able to grow themselves. We also need to invest in skills and training. This is the most important thing we can do for the future of New Zealand—not write off a whole cohort of young people but actually do active programmes like Ready for Work, which Andrew Little announced at the Labour Party conference; like revamping our careers advice and guidance service so every single school-leaver has a plan about what they will be doing; like Dole for Apprenticeships where we take that money paid in the dole to 18- and 19-year-olds and convert it into a subsidy for apprenticeships. These are practical policies that are about giving young New Zealanders the skills that they need.

Relying on anecdote, relying on saying that everyone who comes into a business is failing a drug test and that is the problem is absolute rubbish and it is defeatist nonsense from the Prime Minister, who does not want to face up to the fact that after 9 years in Government he has left 90,000 15- to 24-year-olds outside of any kind of training or work. That is the kind of issue that has to be addressed head on and it is certainly what the Labour Government will do after the next election.

Then we start to look at the issue of housing, and this remains one of the most critical things. When you take a look at the Budget Policy Statement, once again the Government has failed to tackle the housing crisis. It has failed to tackle the fundamental issue that gives New Zealanders security—owning your own home or, at the very least, having some security of tenure in your rental property. That is the issue that, time and again, Budget after Budget, the Government has thrown its hands up and said it is somebody else’s responsibility. Well, that has to change and that is why the Labour Party has proposed a suite of measures, from the KiwiBuild programme of building 100,000 affordable homes over 10 years, through to a proper social housing agency in Housing New Zealand responsible for actually creating security for people who are not able to house themselves, through to addressing homelessness. All of those issues have to be addressed because they are core economic issues. If we do not get housing right, if people do not feel secure, then they will not be able to get ahead.

What this Budget Policy Statement reveals is a series of deficits underneath the surplus: an infrastructure deficit. We have a massive shortfall in housing. We have transportation issues in Auckland that are clogging up the roads and destroying productivity in that centre. We have a deficit in infrastructure that this Government has let rise, and that will need to be addressed and will be a significant priority for a future Labour Government.

But we have also got a massive social deficit. The under-investment in health, in education, in housing, and in addressing child poverty has to be dealt with in a Budget. This Budget Policy Statement from the Government lacks vision, lacks courage, and lacks the kinds of investments that will allow all New Zealanders to succeed. Under a future Labour Government we will prioritise security and opportunity for all New Zealanders.

I am very pleased to take a call on the Budget Policy Statement (BPS) as we build up towards Budget 2017. I would start my contribution by noting that, in my view, the core job of a Government is to make sure its people are safe and to make sure they have the opportunities to get ahead. I think I can safely say that, certainly on this side of the House, the reason that we have come into Parliament is that we care deeply about providing those two things: making sure that our country is safe and that our people have every opportunity to get ahead. When you boil that right down to its most basic, the one thing that we need to have if we are going to give New Zealanders the chance to get ahead is a strong economy that provides those opportunities. If there is one thing we know, it is that it is businesses that provide jobs, it is businesses that create opportunities, and it is the men and women of New Zealand who go out and invest their own money in creating businesses, creating opportunities, and creating jobs—who create jobs for New Zealanders.

It is not—it is not—a contest of how much money one political party or the other can spend. If this is a spending contest—if we want to measure successive Governments around how much you spend—Labour is going to win that race every day. This side of the House knows that real success looks like an economy that is creating jobs and that is creating opportunities, a system that is educating our people, and a system that looks after our most vulnerable, and that is why this side of the House and this National-led Government talk consistently and unapologetically about the need to have a strong economy, to have a strong education system, to have a strong health system, to keep our people safe, and to get back to surplus.

Why do we talk about getting back to surplus? Why does this Budget Policy Statement repeatedly talk about the strong progress we have made to turn the books around from the never-ending deficits that Labour left us to, now, projections of strong, solid, building surpluses? Why does that matter? Very simply, because surpluses mean choices. We are a Government that understands that you have to earn money before you spend it, and once you have surpluses it means the Government is in a position to sustainably make choices about how we can invest to better New Zealand’s future. What we are not going to do—what we are not going to do—is borrow to speculate and spend, to buy the votes of New Zealanders in election years. We are going to make sure we have money in the tin to invest in New Zealanders, and that is why we have worked so hard over an incredibly difficult period to get us back to a situation of surplus.

Let us just reflect on that. Let us reflect on the last 8 years in which we have done that. It was not enough that we came in and Treasury was forecasting never-ending deficits after the end of the Labour Government. If that was not enough, we also took on, of course, the global financial crisis. Of course, I am not blaming the previous Labour Government for that, but that is why you need to be in surplus, because then you have the ability to get through global shocks like that. Again we are looking at a period of great international uncertainty, and New Zealand needs to be in a position of economic strength to weather that. We are a very small player in a large sea of international economies that are a bit wobbly, frankly, at the moment, and New Zealand has to outperform all of those to continue to do well—and we will.

The most exciting thing for me in this Budget Policy Statement is showing not only that we have delivered on our promise to New Zealand to manage the economy well, to manage the Government books, to bring down net Crown debt by 2020, to create jobs, and to build a strong economy, but that this is now an economy—and this is not just the Government talking, and not just Treasury; every international assessment of New Zealand says this—that is growing faster than almost every economy we would measure ourselves against, and it is forecast to have stable, predictable, year-on-year growth of an average of 3 percent per annum for the next 5 years. That may sound modest, but when you realise that is faster than the EU, it is faster than Australia, it is faster than the UK, it is faster than the US, it is faster than Japan, and it is faster than Canada, you realise that for all the Chicken Little talk we hear from the Opposition, this is a country, thanks to the management of Bill English and John Key and Steven Joyce and the whole team of Ministers, that is growing strongly.

It is growing in a stable way, and we are seeing the results of that every single day. We are seeing it through jobs. We are seeing our unemployment rate dropping and our employment growth stronger, almost, than we have ever seen—now the third-highest in the OECD, as we heard from Mr Bishop. The Budget Policy Statement forecasts unemployment to drop to around 4.3 percent, which is an incredibly strong result, and the household labour force survey in the last completed quarter reported 19,000 more people employed just in that quarter—in 3 months; 19,000 more people employed in just 3 months.

And it is not stopping. We also see 150,000 more jobs coming into the economy over the next few years, thanks to the policies of this Government. That does not happen just by getting up in the morning and wishing and hoping and spending money on Government services. That happens by building an economy that businesses have the confidence to invest in. That is mums and dads and families putting their capital on the line because they see positivity in New Zealand, and that is why we are seeing so many New Zealanders wanting to be here, wanting to come home. We are seeing wages going up faster than inflation. We see it in the BPS, and we see that it is forecast to continue to rise, up to $66,000 for the average wage, by 2021. That is very strong growth, and, importantly, faster than inflation.

We have got, now, the largest ever construction workforce, thanks to the rapid period of building construction we are seeing not just in Christchurch post-earthquake but in Auckland, in Queenstown, in Tauranga, and right across New Zealand. The other thing that I really want to highlight is that this is not just a story of a strong economy in Auckland or a strong economy on the farm. This Government has overseen the development, now, of six, I think it is, regional economic development plans, covering areas like Northland, like Gisborne, like Manawatū, and like Southland. We have just released the most recent one in Tai Rāwhiti, which has gone down incredibly well. Every part—

💬 Hon Maggie Barry: That’s good.

—West Coast, quite right—of the New Zealand economy has a positive future, and we are helping them to see, identify, and deliver the opportunities in their region.

What we do know, of course, is that that is very much underpinned by our strong commitment not only to educating our core workforce, which underpins all of New Zealand’s success and the fabulous work Hekia Parata has done in that area, but to building the physical infrastructure to support it. The ultra-fast broadband (UFB) programme and the Rural Broadband Initiative’s (RBI) $2 billion is making sure we are one of the best-connected countries in the world. I am incredibly proud of that, as I am of our investment in schooling, our properties and policing, and in roading projects to support it.

But I just want to end by going back to that comment I made before, which is that we do have a period where the international situation is uncertain, and we should not ignore that. We have to be mindful of it. But what it says to New Zealand is that it is even more important now that we stay on the track we are on, which is one of seeing our net Crown debt reducing to around 19 percent by 2020, having our strong economy growing, managing core Crown expenses, creating the environment for investment, and, most importantly, delivering strong, stable Government. That is what has got us through the global financial crisis, that is what has got us through the twin shocks of the Christchurch and Canterbury earthquakes and the Kaikōura earthquakes, and the other natural disasters, that is what is seeing New Zealand now being held up internationally as a leading light in what good fiscal management and good, stable Government can deliver.

I cannot count the number of times I have been told by international counterparts “Why can’t we do as well as New Zealand’s doing? What is your secret?”, and I can tell you it is very simple. The secret of this Government is the strong, stable, consistent leadership of the John Key and now the Bill English - led Government.

Look, we did not think we would see it here. We read about the phenomena in the United States. You have just heard a post-truth speech from that Minister, Amy Adams. The Minister stood up and said that “Unlike Labour, we have produced all these surpluses.” Well, if the Minister knew her history, she would know that every single Budget that Michael Cullen delivered delivered a surplus. The first seven Budgets that that Government delivered had a deficit. How can you say that we did not deliver surpluses? That is simply not true.

The Minister stood up and said that there are two things that her Government is working hard to deliver: safer communities, where people can get ahead. Well, between 2016 and 2015, there were 11,000 more victimisations—11,000 more. The Police are woefully underfunded. They admit it themselves. In fact, both Police Ministers we have had in the last couple of years have admitted it. Ninety percent of burglaries go unsolved, and that Minister says we are creating a safe environment for Kiwis! How can she stand up there and actually say it when the facts simply do not bear that out? She said: “We wanted to create an environment where New Zealanders can get ahead.” We now have 140,000 unemployed New Zealanders. We have 90,000 New Zealanders between the ages of 15 and 24 who are not in employment. I believe that they have been let down by an education system that is not catering to 21st century learning. When you have 90,000 unemployed young people, you have got to have a look at what the Minister has done to the system and say that it is simply not working for young people in the 21st century.

Minister Amy Adams talked about the average wage increasing in 2021. Really? Do New Zealanders really care about what will happen to the average wage in 2021 when, at this point in time, they are struggling to put food on the table and petrol in the car, pay the power bill, pay the mortgage, and, if they are lucky, find a house so that they can pay the rent? They do not want to know about the average wage in 2021; they want to know what the Government is doing for them now. It was astounding—oh, I was shaking my head.

And we had Mr Bishop before that Minister, and Mr Bishop talked about hypothetical scenarios that simply have not existed. But Mr Bishop’s speech was actually quite revealing, because what Mr Bishop talked about was what the Government wants to do in the next year or two. I think there are fundamentally two major differences between Labour and National. The first is that Labour is not looking to where New Zealand will be in 2017, 2018, or 2019. We want to know—we have got a vision—where we want New Zealand to be in 2040. What we are doing is we are looking out to the future and saying we have got a vision.

We want to create a New Zealand that our grandchildren and great-grandchildren can inherit. We want to create an environment that is really good for them and an education system that is world class to make sure they have the training, to make sure there are the jobs available, and, when these young children now are adults, to make sure they have the ability and the skills and the competencies to take on tomorrow’s jobs. That is why Grant Robertson undertook the Future of Work project, and it was enlightening. Amy Adams said that people are looking at New Zealand and saying: “Why can’t we be as good as you?”. That is because Grant Robertson was the one who painted the future for where we need to be. We have a vision.

The other thing was Mr Bishop and Amy Adams kept talking about fiscal risk, but that is another one of the differences. For us, it is not just about the dollars and cents. For Labour, it is about the people. For Labour, it is looking and saying: “What do we need to do to that will serve all New Zealanders? What do we need to do that will create sustainable economic development—that will create jobs and wealth and will put more money in the back pocket of good, hard-working Kiwis—but will create jobs? We will look after our children and our elderly.” The Minister Amy Adams talked about our magnificent health system. It has been underfunded by $1.7 billion. Labour is looking at this and saying: “What do we need to do to make sure all Kiwis have the health system they deserve?”. That is the difference between Labour and National.

For us, it is about creating a vision. For us, it is about making sure that New Zealanders have a role to play and can buy into that vision. For those members, it is about dollars and cents, and it is coming to the fore now—there is no doubt about that.

But the other thing that Mr Bishop said that did make me smile was he said—and I quote—“The hard work is just beginning.”, and I think that was a very salient admission that for the last 8 years, this Government has not been doing much at all. Mr Bridges has—there is no doubt about that—but he is probably the only Minister on that side who has been working very hard. None of the other Ministers have. Oh no, no—Judith Collins has done quite a lot of work, as well. But, by and large, the hard work should have started the week after the election. That is why Labour has a plan for what we want to do in the first 100 days, not the first 2,000 days. We are going to start working hard the day that our feet hit the floor on that side, because we know what we want to do to create the vision that New Zealanders will buy into.

But another one of the major differences between Labour and National is that National believes that the market can control the outcomes—the market has got all the answers, so if you leave it to the market, everything will be OK. Labour believes that, in fact, in a country the size of New Zealand, with 5 million people, the Government actually has a very important role to play in economic development.

Again, if you look at the statistics, you know, they speak for themselves. Investment in research and development has dropped from 0.54 percent of GDP in 2012, to 0.52 percent of GDP in 2014. At 0.54 percent or 0.52 percent, it is still incredibly low, and I believe one of the reasons why it is so low is that the Government has not created the sort of environment that encourages small businesses, medium businesses, or large businesses to invest in research and development. Although the small business roadshow will go ahead, and they will sit down and they will drink some wine and they may have a couple of hors d’oeuvres, my experience is that what people in small businesses actually want is not a glass of wine. What they want is to know that the Government has a plan in place to allow them and to encourage them to invest in research and development, because that is what is going to drive jobs.

I do remember that the Prime Minister, when he was the Minister of Finance, actually came out and said something along the line of one of New Zealand’s competitive advantages is we have such a low wage rate. He said that—we have such a low wage rate. Our minimum wage is so low, it is cheap to employ workers. One of the major problems we have in this country is our low productivity. It really is dreadful. We need to create an environment that encourages business to invest in capital. That will grow capital. That will grow jobs. That will grow productivity. Mr Scott knows this because he is a businessman. He must look around and go “What do we need to do to actually grow jobs?”, and it is not about talking about them. It is not about roadshows. It is about creating the sort of fiscal business environment that encourages business to invest in research and development.

I remember when the Mosgiel plant for Fisher & Paykel closed down, with the loss of about 400 jobs, I think. At the time, the first reaction was “Goodness me! Four hundred jobs? That’s really going to gut a community like Mosgiel.” The next question was: why have we got an assembly plant with 400 people? Why is that plant not employing 100 people, working 24/7, and is a lot more efficient than the most efficient plants around the world? We are a country with low productivity.

Let me sum up. I want to start by saying that Labour has a vision for New Zealand. Labour has a vision for New Zealand that includes all New Zealanders. Labour has a vision for New Zealand that includes the education system, that includes the health system, and that includes funding the health system in a way that meets the expectations of all Kiwis. Labour has a vision for New Zealand where the tax system enables businesses and works with businesses to grow, as well as not disadvantage Kiwis.

We know that we have not got an education system fit for the 21st century. That is why we have come out and promised 3 free years of post - secondary school education. Unless we start treating New Zealanders, unless we start training them, and unless we start investing in their future, we are never going to reach our potential. I do not want to benchmark New Zealand against other countries. What I want to do is be part of a Government that always says: “How can we do better?”. Labour has a plan for that. Thank you very much.

It is fantastic to speak in this Budget Policy Statement debate. That is because there are so many good things to talk about at the moment. We are in such a purple patch as a country, and I am looking forward to talking all about that.

Can I firstly just refer to the last speaker, Stuart Nash. He is all right, actually, Stuart Nash. He is all right. I welcome him to the economic development role in the Opposition. I am highly confident that he is not going to be ducking and diving down the irrelevancies and the rabbit holes that the “Red Rev.”, David Clark, used to, every few weeks. He is going to be a much better Opposition spokesperson—of that I am confident—and so, as I say, I welcome him to the role. I like the nice words he said about me, actually. It was very good. That is not why we are delivering so much investment into Napier at the moment—but we are. There is $25 million in roading investment, and I look forward to being back there later this year and being involved in the progress of some of that, because we are investing in an increasingly confident part of New Zealand, just as all of New Zealand has momentum.

Actually, while I am talking about Napier, can I also say it was great to be in Hawke’s Bay just, I think it was, last week for the Taniwha Dragon Economic Summit. It was remarkable what iwi had done there, getting in, and involving themselves with some significant Chinese interests. There was $100 million of investment into New Zealand done in the Hawke’s Bay over that summit, and it just shows you, I think, that really it is a metaphor, if you like, for what is happening in New Zealand at the moment.

I believe that when it comes to this Budget Policy Statement, when it comes to the Government’s books, when it comes to New Zealand, we are in a period of real momentum. I remember our former Prime Minister John Key talking about us being on the cusp of something great. The other side scoffed; they laughed. Well, actually, we are in it. I cannot tell you whether we are at the start of it or in the middle of it, but I can tell you we are in it. We are in a really exciting period in New Zealand.

Actually, it is funny, whenever they start scoffing, the good stuff happens. They declare a manufacturing crisis, and we see the manufacturing numbers go up. They talk about unemployment, and it goes down. We are not just talking about being on the cusp of something great; actually, we are in a very exciting period of time in New Zealand, economically speaking.

I am really excited to be a new Associate Minister of Finance, with Amy Adams, who has spoken in this debate. It is an incredibly rewarding job and a great time to be in the role, with Steven Joyce, who of course had a very long apprenticeship in the role. He has built up a huge experience as an Associate Minister of Finance to our Prime Minister, Bill English, when he was finance Minister. I am really enjoying the role, given the state of the country that we are dealing with at the moment. It is one of momentum, one of confidence, and one of optimism.

After all the doom and gloom from the other side, let us just think about the numbers that we see in that blue book that James Shaw is putting up. What it tells us is that, actually, following the plan that the Government has had for the last 9 years, through a global financial crisis, through a period when the developed world has found it incredibly difficult, has led us into a period when we have got an incredibly positive outlook for New Zealand.

That is not to say there are not issues. There are always issues with growth. There are always issues that keep politicians relevant. But we are in a strong phase domestically, where business is growing, jobs are growing, and wages are growing—actually, much faster than inflation. At the moment, over the next couple of years, there will be 3.5 percent growth, which is the fourth-highest growth rate in the OECD. It is one of the strongest growth rates in the developed world. Actually, 3 percent—we are a bit over, I think—over the next 5-year period. It is an incredibly strong period, and we are one of the strongest developed economies in the world. That is because great individuals, great families, and great businesses, in all manner of areas—because we are seeing an increasingly diversified economy—are getting in. They have the confidence to get in, to invest, to work, to be creative, and to have entrepreneurialism, and that is doing the business, literally, for New Zealand. Of course, we can take some satisfaction on this side—not enough; we have got more work to do. But our plan, as I say, has been working, and we continue to have new, fresher ideas to take the country forward.

We are, I think, ultimately, as a result of those numbers and the growth that we are seeing, a more confident country. We are a creative country, an entrepreneurial country, a diversified country, and a hard, smart-working country. I think, increasingly, whether it is Hawke’s Bay, which Stuart Nash represents, whether it is Tauranga, or whether it is Canterbury, we know the benefits of being outward looking, having a positive outward focus that is pro-globalisation and pro - free trade with the rest of the world.

All of that success to date does not mean there are not potential dark clouds, and I will come to those, in terms of protectionism and some of the things going on. But it does give us options as a Government about how we can do an even better job for New Zealanders, with the growth that we have.

We are clearly going to want to deliver better public services. We have done a fantastic job, with the likes of Hekia Parata in education, Jonathan Coleman, and Tony Ryall before him, in health, and many other social sector Ministers. We have ensured, every year, that those areas receive more funding. But, more than that, we have not been lazy with that funding. We have ensured that it is better spent, and that through social investment it is being spent in a way that gets results. So Better Public Services is a big part of our budgetary process to date, and will certainly be, in this next upcoming Budget.

Delivering infrastructure for a growing modern economy will continue to be, and will have to be, a real focus—again, whether it is Napier, whether it is New Plymouth, whether it is Auckland, whether it is Canterbury, or whether it is Southland, that will be a focus. I am really proud to play a role in that as transport Minister and communications Minister. In Kaikōura, because of the good choices we have made, because of the plan we have followed when very significant earthquakes have come, we have been able to back that area, to reinvest $1 billion to $2 billion in a new corridor, both highway and rail, in that area. The work goes on at pace, and we will be continuing to work hard on that.

Auckland—we continue to invest, at the moment, more than ever before in our biggest city. These are the biggest projects that New Zealand has ever seen. Regionally, in Taranaki—I talked about that in question time today. Earlier—a week or so ago—in Gisborne there has been significant investment going in there. In Northland—half a billion dollars, and a four-lane highway to the port, to back the success that is happening there. Paying down debt will continue to be a real focus for this Government, to around 20 percent of GDP by 2020, which, again, will allow us options and gives us an intergenerational equity with others. And, fourthly, as we can, we will be reducing the tax burden when we have room to do so.

I am really proud that we, as a country, under Bill English—who has shown a new, fresh, and dynamic style of leadership—are able to make a difference. We are able take a long-term view, whether it is on the superannuation issue, where moderate, sensible decisions over time continue to safeguard our finances and give us options in areas like health and education, over time, as people like me, frankly, live longer and healthier lives—touch wood—and as we bring ourselves into line with other countries.

We are also able to move really nimbly and adeptly with new trade policies and strategies in what is a fragile and uncertain world. I think that gives New Zealanders a confidence that this side of the House in Government is able to have the answers that keep us moving forward and keep us confident even in the very uncertain time that we are in. In contrast to the doom and gloom on that side, on this side we are excited about where we are. We are not just on the cusp of something great; we are in a fantastic time to live in New Zealand.

It is a great pleasure to have the opportunity to speak in the Budget Policy Statement debate. It is particularly a great pleasure to follow Simon Bridges, who has talked a great deal about growth and about the Government’s enormous investment in growing investment in transport—for example, the blowout in the costs for the Warkworth to Wellsford motorway, estimated to cost between $1.4 and $1.9 billion, with a—oh, he has left; how about that—

💬 Mr SPEAKER: Order!

—I beg your pardon, Mr Speaker; I withdraw—with a cost-benefit ratio of 0.25. And that cost-benefit ratio was estimated when the cost was due to be $494 million, as opposed to—oh, look at that—$2 billion. So, yes, growth, and increasing investment in things that were supposed to cost roughly a quarter of what they are now going to cost, at a time when, even then, they had a pretty weak business cost ratio.

So the kind of growth that this Government’s members have been talking about in this debate—they have gone on a lot about growth, so I will just sort of say a few things about the kind of growth we are experiencing. We are having growing numbers of polluted rivers; growing numbers of endangered species; growing numbers of people living in cars and garages; growing numbers of young families who cannot buy their way into their first home; a growing cost of living for the elderly, who are increasingly hit by accommodation costs; growing costs of living for the bottom 30 percent of income earners, whose cost of living is growing extensively, and far faster than their wages are growing; and growing greenhouse gas emissions. Since this Government came into office we have had 19 percent growth in greenhouse gas emissions.

We have had growing numbers of communities that are on water restrictions and boil notices at the same time as we have had growing exploitation of underground aquifers by large-scale irrigation projects and water-bottling plants. They take that water out of the ground for free, while those same communities are on those boil restrictions.

We have had growing congestion in Auckland. The average Aucklander now spends 12 business days a year stuck in traffic, and that congestion is only getting worse. And that is at the same time that Mr Bridges has been growing the so-called investment—funnelling good money after bad into roading projects, which does not solve the problem, and, in fact, expands the problem.

We have had growing oil and gas exploration at the same time as we are pretending to put in place some kind of climate plan. We have had growing unemployment. There was growing unemployment in the last quarter. Cadbury’s, of course, is the latest manufacturing plant in New Zealand to hit the wall.

So this is the kind of growth that we are seeing in this country. It is the kind of growth that if it was growing on your body, your doctor would send you off to see a specialist.

When I hear members on the Government side talking about GDP as this Holy Grail, you have got to remember that all that GDP is is an estimate of economic activity. It is just activity. It does not say what kind of activity. It does not say whether that activity is any good, whether it is useful, or anything like that. You have an earthquake and you have GDP growth—right? So let us have more earthquakes, because that grows GDP. If GDP is the be-all and end-all, then going to war tends to increase GDP, so let us go to war because that is great for GDP growth, and we should be all for it.

We have got the kind of growth, but we do not have prosperity. What good is growth without prosperity? That is my challenge to the Government.

I think I heard Amy Adams saying that our growth was growing faster than other countries’ growth. When you consider the kind of growth that we are having, it is kind of like boasting that “My melanoma is growing faster than yours.” That, to me, is an entirely unhealthy way of looking at the economy, or the kind of useful activity that we could be seeing here.

💬 Hon Hekia Parata: It’s ridiculous.

I would like to respond—it is ridiculous, is it not, that you have got this kind of growth in this country? It is ridiculous that we are having such appalling results for our environment and for our people, even while all this so-called activity is going on.

I do want to respond to one of the points that the new chair of the Finance and Expenditure Committee, Chris Bishop, raised before. He was talking about what a bad idea it is to borrow to invest—it is somehow a bad idea to borrow to invest. Well, I tell you what, I have worked in a number of businesses that grew because they borrowed to invest. That is actually what you do. Actually, for anybody who can afford a house, what do you do? You borrow money—it is called a mortgage—and you invest it, in a house, and that has actually been a runaway activity in this economy over the last few years, Mr Bishop.

People borrow to invest all the time, and Mr Bishop was saying: “Let’s not borrow from the credit card.” Well, credit cards are running at 15 to 20 percent interest, but in this country you can get long-term bonds at 2 percent for 30 years. That is not credit card rates of interest. So if you want to borrow to invest, now is as good a time as any in recent history for a Government to borrow to invest in the things that it needs, whether it needs transport and infrastructure—we have got a huge deficit in our water infrastructure that needs looking after. It is a good time to borrow to invest in the things that all of our people can use to grow their businesses, to support their families, and so on.

Mr Bishop also said that the Cullen fund was set up as a place to invest the surpluses that the Labour Government consistently ran in every single Budget that it ran, and he is absolutely right. In every single Budget, it ran a surplus, and then it invested those surpluses in the Cullen fund. He said: “We’re not going to borrow to put money into the Cullen fund because we’re not running surpluses yet.” Well, here is the thing: if you keep cutting taxes, you stop running surpluses. The thing that staggers me is that the Government keeps saying: “Oh, look, we’re not going to save for the future. We can’t run these surpluses. But, by the way, tax cuts, everybody.”, and that, to me—if you want ridiculous, that is ridiculous. If you cut your revenue lower than your expenses, then obviously you are not going to run surpluses, and if you do not run surpluses, you have got nothing to spend on the Cullen fund. So that is why you are in trouble on the superannuation, Mr Bishop.

So it comes down to: what are your priorities? What are the priorities in Government here? We have seen this Government cut core public services—some to the bone. In health, Annette King has done a superb job of unveiling the real-terms cuts to the health budget over the course of this Government. In education, how many schools still have the same swimming pools that they had when any people in this Chamber learnt how to swim? How many of those schools are still completely free to attend? I venture it is very, very few indeed.

And here is a question: how many of those schools still have kids from all walks of life? Have we stratified to the point now, as a result of this Government—it has cut, in real terms, funding to State schools while expanding it to private schools, so that it is able to say that the quantum of money that is going to schools has increased.

In the Department of Conservation, it has a $424 million, real-terms, lower spend now than it had in the last year of the Labour Government. In real terms, we are $53 million a year worse off in the conservation budget than in the last year of the Labour Government.

💬 Hon Maggie Barry: Over and over you repeat the nonsense.

We do say it over and over again because it is true. In addition, a huge imbalance in the economy—

💬 Hon Maggie Barry: Every time you say it, it’s wrong.

Well, forgive me for doing the job of Her Majesty’s loyal Opposition. In addition—[Interruption]

💬 Mr SPEAKER: Order!

—we have the ongoing imbalance in the economy—[Interruption]

💬 Mr SPEAKER: Order!

—thank you, Mr Speaker—which is that in this country, because the Government continues to refuse to deal with the enormous imbalance of the tax advantage that property has over other asset classes, not only does that mean that the Government misses out on a source of revenue but it also means that we have runaway house price inflation and huge accommodation costs, which contribute to massive blowouts in the cost of living, especially for the elderly and for people on low incomes.

So the National Government has got its priorities all wrong. It has restricted its own revenue at the same time as pretending that that somehow means that it cannot invest in the future of Government superannuation.

It was St Augustine who said “God, make me chaste, but not yet”. This Government makes announcement after announcement to make it look like it is doing something, without actually solving the problem. In superannuation, electric vehicles, clean rivers, becoming predator-free—all of these are huge announcements, but they are devoid of results. When the Green Party gets into Government, we will be measured not on announcements and activity, but on results. Thank you.

Thank you for the opportunity to speak in this Budget Policy Statement debate. I could literally give the same speech as I did this time last year, and in fact—

💬 Chris Bishop: Oh, please don’t.

—I note that Mr Bishop actually did. It was like listening to a broken record from Mr Bishop over there. The reason why I cannot give quite literally the same speech is that things have got so much worse—so much worse. It has got to that critical point that any action now from this Government is too late. Any action that it takes now will be too late, and Government members have just spent the last hour telling us how good they are at not doing anything at all.

I want to just start my contribution by addressing some of the points made by Mr Bishop. I did want to add to the chorus of calls of “Bring back Mr Bennett” but that would be far too painful, so instead I will wish the new chair good luck in his role. But I note—oh, no, I do not think I am allowed to say that. Mr Bishop spoke about—and these were his words—“extremely good GDP”. It was an eloquent contribution, and when you look at that nominal value, that face value, of that number, 3.2 percent, it looks good. There is absolutely no doubt about it. But the reality is that GDP per capita paints a completely different picture of the economy as we move forward, and I will go into that in far more detail.

He spoke about how well things were going for New Zealand families, but we have literally 140,000 unemployed people in New Zealand as of today. We have 90,000 young people between the ages of 19 and 24 not engaged in employment or training or education. That is the reality of the figures that Mr Bishop gave us. He spoke also about average wage growth, but whose growth is increasing by that average figure? It is not the low-income earner. It is those already making so much money that the increase in their wages and salaries has skewed the average figure. We are being sold a set of numbers that on the surface do look good, but any kind of superficial digging shows them up for the ridiculous sales pitch that they are and which they are being used for by the members opposite.

Mr Bishop spoke about contributions to the Superannuation Fund, and he spoke about—I think, Mr Joyce earlier today also spoke about the surpluses that would be used. But let us get something straight in everybody’s mind right now. The Budget surpluses that this Government is claiming we will obtain in the near future will not be enough to pay off the interest on the Government’s debt that this country owes as a total. It is just absolutely—well, I cannot say what I want to say. What I will say, though, is that he did go off message. He did go off the script because he actually spoke about how the National Government could not actually achieve surpluses for the last 7 years. He actually admitted it in the House. It was rather refreshing to see. Year after year the Government has not, and was not able—

💬 Chris Bishop: It’s a fact!

Yes, I know it is a fact, but you guys seem to struggle to tell the people in the House what the real numbers are and what the real situation is. So it was really refreshing, Mr Bishop, when you used facts to tell the truth of the situation. Brilliant! I really respect you for that.

All I can say to the new chair, actually, is that he spoke about the—what was it—prudent and wonderful ideas around superannuation and contributions to superannuation. No, it was changing the superannuation age—that is right—about how sensible it was and fiscally prudent going forward. Leave it alone, Mr Bishop. Leave it alone, National Party. You came in and campaigned on not touching New Zealand superannuation. You told New Zealand that it would not be changed. So, Mr Bishop, leave it alone.

In the past year, I touched on earlier in reply to Mr Bishop, the fact that GDP per capita has—well, some pundits say about half a percent growth and others say it is literally flat at zero, that the economy is truly stagnant if you measure it with just a little bit more accuracy rather than talk about GDP in and of itself. Just dig a little deeper, and the economy is standing still.

How about debt? I think the sales pitch from that side of the House was to talk about prudent management and safe hands moving forward. Well, what have those safe hands achieved for New Zealand? They have achieved one of the greatest debts in this country’s history—the greatest debt in this country’s history. That is what those prudent experienced hands have achieved for the people of New Zealand, and that is the Government’s sales pitch to New Zealanders. It has gone over $100 million. Minister Joyce talks about the ability to pay down debt but, as I said earlier, those numbers just do not add up. The interest on the debt alone is billions and billions of dollars and our surpluses are not there yet.

I think what we are really missing from the Budget Policy Statement in this half-year period is a vision or a direction. We are like a country that is kind of broken up in parts—

💬 David Seymour: It’s a chain of islands—so, yes.

—and the first and foremost example that comes to mind—apart from being broken and in parts in the ACT Party—is the Electricity Authority, which has skewed its thinking and reinforces the Government’s attitude to a broken plan going forward; region fighting region, cities fighting against other cities and not working together, and the Government does nothing about it. What will happen, probably, if the National Government remains in power—and I dare not think about it—is we will move forward as regions fight against one another, and the Government will argue it is economic efficiency as industries die in towns and cities potentially fade from view. That is National’s economic plan.

What this Budget Policy Statement is really about is a Government that is stuck, that does not have any new ideas and cannot even seem to manage what it has got already. Government members talk about diversifying and growing a new economy. They cannot even get it right for the industries, our primary industries, that are here now. Our manufacturing statistics and our export numbers are going backwards as of today. In the most recent report out this morning, the numbers are going backwards.

Minister Joyce came into the Finance and Expenditure Committee to give us his vision of the future, and all he could talk about was how he was going to manage the housing crisis, but he dare not describe it as a housing crisis. It was just unbelievable. I have got so much more to say. I am frustrated at the moment with the amount of things to talk about—

💬 Chris Bishop: Away you go.

—and yet, well, is Mr Bishop going to offer me more time from his party? Is anyone over there offering another 10-minute slot? I am happy to take it. Come on, Mr Macindoe.

💬 Tim Macindoe: So much time to say so little.

Ha, ha! So I had better get to the conclusion and make the final point, because Mr Macindoe is chaffing in his seat. I have not spoken about the depth of the very real housing crisis that New Zealand is experiencing right now. People in New Zealand know the truth; they know about it. They know what the situation is and they know that the Government is not prepared to act and will not act. Those members over there must first acknowledge that they have a problem. They must face their reality, but they refuse to do so.

Auckland is clogged. The rest of the country is struggling as people on low wages are trying to find real hours of work, not the employed statistics we get where it is 1 hour a week—that is how they spin the data. Household debt grows as people borrow from week to week just to get through the day. These people now know that the Government making its rich mates richer is not helping anyone.

Well, where do we start? It is so depressing listening to Fletcher Tabuteau for 10 full minutes. There is nothing refreshing. There is no oomphy, punchy policy that they espouse or they pretend they think they have. There is nothing to Mr Tabuteau’s speech at all that was constructive. I would like to comment, firstly, on a couple of things that the lone member on the Labour benches, Stuart Nash—because he must feel pretty lonely. He is the only one who suggested that Labour has foresight. He talked about foresight, but, believe me, he is on his own. He is on his own. There are no new ideas. There is only ad hoc, expensive policy coming from the Labour benches. So, unfortunately, Mr Nash, you are a party of one on the Labour side.

Where do we start? Well, we have got a whole lot of good news. Unfortunately for the Opposition, there is a lot of good news to talk about. It has already been mentioned that there is a greater than 3 percent growth in GDP, low unemployment, more jobs—more jobs than ever before—and one of the highest labour participation rates on the planet, and, of course, there are more apprentices in the economy than ever before. It is not, as Minister Adams said, just in the cities; it is in the regions. I can say that in my own electorate of Wairarapa there is building framing going up wherever you might be.

There are more consents—in fact, in the last 12 months, in dollar terms, there are more consents than in the last 10 years from the Wairarapa electorate. There are people moving into the Wairarapa electorate from Auckland, from Wellington, and from the South Island. Why are they moving? Well, for a start it is a great place; it is a great climate. But they are moving because it is connected. There is ultra-fast broadband being rolled out into the regions. There is connectivity. There are better roads. The railway system has a new operator. Things are working very well for the Wairarapa electorate.

The question is: how are we getting there? How do we get to 3 percent growth? How are we getting these people employed in jobs? Why is it that we are cutting the Labour Party’s lunch when we continue to look after those who are most in need? Well, I will tell you what it is. It is because we support free-trade agreements, for a start—that is one of the things. We are an open, small market. We must continue to trade with the world to survive, to prosper, and to get ahead. So any party that does not support free-trade agreements is working against small businesses. It is working against small operators, exporters, and the agricultural sector. All these people rely on trading with the rest of the world. So that is the challenge to the Opposition, and particularly the Labour members who are there or thereabouts but unfortunately—and I will talk a little bit more—have lost a lot of credibility because they have tied themselves to the Greens. They have tied themselves to the Greens, and, unfortunately for them, that really reduces their mana, their credibility to the general electorate.

This side of the House is full of new ideas. It does have step-change improvements, and I will give you just one. I will just give you one example of where we are eating the Greens’ lunch, and that is the recently announced freshwater policy. They hate it. They hate it because they know it is a huge improvement on what has been and what was from the previous Labour Government, where there were no standards—no standards whatsoever. They did not give a toss about the environment. Nothing was done.

In the last 8 years we have had Minister Adams bring in freshwater standards. We have had Minister Smith continue to develop and set the aspirational goal of 90 percent of waterways being swimmable by 2040. We are not talking about the 540 parts per million; we are talking about the median of less than 130 parts of E. coli per million. That is a standard. That is a tough standard, but we aspire, we are ambitious, and we aim to have 90 percent of swimmable waterways by 2040. At the moment that number is about 70 percent, so we have got a long way to go. But the Greens just hate it. I will tell you that they also hate the hugely aspirational goals set by Minister Barry to be pest-free by 2050. Again, we are eating the Greens’ lunch. We are eating the Greens’ lunch, and they do not like it.

There are a whole lot of new ideas coming from this side of the House, such as raising the age of superannuitants’ entitlement. This is sensible and pragmatic. We are living longer—why would we not raise it? Twenty years is a long time for people to adjust. I am—how old am I now? I am 52, and I never thought, when it was discussed in the 1990s, that I would ever receive superannuation, but I will do. We continue to grow older and live for longer and 67 is a very reasonable and fair age and, quite frankly, it is just the right thing to do.

I would like to talk a little bit more about why I think the Labour Party is losing credibility. There was a lot of discussion today, and in the last couple of days, around contributions to the Cullen fund, the Superannuation Fund and the disingenuous idea from Mr Robertson that we should have, could have, would have invested in the Cullen fund over the last 8 years. Well, I ask that member how much he borrowed to invest in the sharemarket on his own account—on his own personal account. How much did any of the Opposition members borrow to invest, on their own account, into the sharemarket if it was such a no-brainer thing to do and if it was so obvious that these contributions should be made by borrowing money?

And then the second question is: if he did not do any of that over the last 9 years, how about today? How about today? How much money has Mr Robertson borrowed today or how much is he planning to borrow for the next 12 months to invest in the New Zealand equity market or the Australian equity market or, in fact, any equity market on the planet? How much is he willing to borrow and how much is he planning to borrow for the next 12 months—just the next 12 months—on his own personal account because it is apparently such a no-brainer? It is such an easy way to make money—there is a free lunch and that is the way to do it! Well, I am sorry, Mr Robertson, but that is totally disingenuous and that sort of comment is why the Labour Party lacks credibility.

The people of New Zealand understand that that is a “Harry Hindsight” perfectly 100 percent global—what am I trying to talk about—crystal ball. It is a crystal ball and it is just a wish list. It is just Pixieland. He is a dreamer. It is like saying: “Oh, I should’ve put 10 bob on Donald Trump in 2008. It was so obvious that he was gonna win. I should’ve put 10 bucks on Donald Trump.” Well, that is why the Labour Party lacks credibility.

The Greens even talked about borrowing to invest in the equity market. The analogy was that lots of people borrow to invest in a house. Well, that is a completely different class of asset. It is a completely different leverage amount. What you are doing when you invest in a sharemarket is you are investing into instruments that are already leveraged. Companies already borrow on behalf of their shareholders. So for someone to borrow to invest in something that is already leveraged is just dangerous. It is just ludicrous that a Government would encourage that and borrow to do that.

So those two guys—the Greens and Labour; Huey and Dewey—investing and managing on the taxpayer’s behalf is just a scary thought, and that is why they cannot, and should not, be on the Treasury benches, and they will not be, post the September election. As I say, the people of New Zealand understand what is right, they understand what is fair—and I am talking about superannuation—and they also understand what is a reality. That argument that both those parties have put forward vis-à-vis the Superannuation Fund is a nonsense.

This side of the House is working every day for the benefit of all New Zealanders. We set aspirational goals for New Zealanders. We trust New Zealanders with their own money, and that is why the Minister of Finance today talked about tax cuts rather than doing other things—because we know that people can do the right thing for themselves, for their families, and for their communities if they are given a chance. And that is what Kiwis love—just to be given a chance. Thank you.

The next call is a split call. Julie Anne Genter—5 minutes.

Tēnā koe, Mr Assistant Speaker. What kind of society do we want? That should be the question that we ask before we debate Budget policy. Do we want an Aotearoa where rivers are clean and safe enough for our kids to swim in them? Do we want an Aotearoa where every child has a warm, dry home, the ability to walk and cycle safely to school, and nourishing food that enables them to grow and learn? Do we want an Aotearoa where everyone has the basics that they need to live a good life and an opportunity for meaningful work with fair pay? Do we want a world with a stable climate? And do we want important contributions like looking after children or looking after the elderly, teaching, cleaning up pollution in our natural environment, cleaning up our offices after we work in them—do we want the people who do those jobs to be able to do that work at their best and to have the resources they need to live good lives? I think the answer to all those questions is, obviously, yes.

When it comes to the Budget, this National Government is continually claiming that we cannot afford to do the things that matter most. It frames the questions in such a way that we are always asked to make impossible trade-offs. So we are asked to give up the idea of protecting our pristine natural environment—the place that is most precious to us—for some jobs. We are asked over and over again to give up critical Government services that help make our society fairer so that the most well-off people can pay much less tax. And we are told we cannot make long-term investments into clean infrastructure that would benefit the whole country in the long term—like keeping and extending the use of our electric freight trains, or investing more rapidly in affordable rail and light rail public transport in our towns and cities—because it would cost billions and billions of dollars. Well, the Government is already spending billions and billions of dollars on infrastructure; it is just not clean and it is not going to help us in the long term.

We have an unfair system of allocating resources at the moment, and it results in the concentration of wealth, which means that some people will never have the equal opportunities to live a good life. And National is actively choosing to allow that unfairness to persist by prioritising tax cuts over critical public services or prioritising asset sales over critical public services. We want people to have access to the public services they need to be able to have meaningful work and to have equal opportunities, and we can do that if we have a Government that shows leadership.

National’s refusal to do anything to truly protect and clean up our waterways, to incentivise sustainable, diverse agriculture, is quickly eroding the things that we love most about Aotearoa so some vested interests can continue making some short-term profits without having to do the hard work of protecting our waterways. We want to protect our natural environment; most New Zealanders want to protect our natural environment. They know it is a birthright for our kids to be able to swim in our rivers and lakes. We can create jobs by doing so if we have a Government that is willing to show leadership.

Budgets are all about priorities, and the people of Aotearoa do not have a difficult choice to make. Vote with your values. Vote for the things that matter most to you. Do not let anyone tell you that we cannot afford clean water, that we cannot afford fair pay, that we cannot afford ending child poverty, and that we cannot afford to invest in the long term for a clean, stable climate and the infrastructure that is going to enable us to create the jobs that will not rely on increasing fossil fuel pollution. We can do all of these things. We have the opportunity to make those choices.

The Green Party is not afraid to say that we will show leadership. We have the policies that will prioritise the things that matter most to New Zealanders, that will protect the things that New Zealanders care about for the long term. Kia ora.

I call Jami-Lee Ross—5 minutes.

It is pleasing to speak on this Budget Policy Statement. We miss Julie Anne Genter on the Finance and Expenditure Committee. I am sorry that she got bumped off, for James Shaw. She was pretty good on that committee.

She talked a lot about leadership. I want to say I am proud of the National Government and the leadership that we have been showing—the leadership that we have been showing to see more kids being educated in this country, to see more New Zealanders are healthy, and to see more elective surgeries in this country, to see 1,100 more police officers going on to the streets of New Zealand, to see literally—listen to this, Julie Anne Genter—hundreds of millions of dollars committed to cleaning up waterways in New Zealand. We are showing leadership, and the Budget Policy Statement that Bill English, as finance Minister, put together and now Steven Joyce is presenting as finance Minister shows the leadership that we are showing.

We are also showing leadership on responsibly managing the economy and not spending up large trying to buy elections, like we have seen in the past. I love this graph. I love this graph in the Budget Policy Statement. It shows red lines, which was Labour’s additional spending, and it shows blue lines showing National’s additional spending. We have committed to another $1.5 billion in operating expenditure over and above the previous year, through this Budget Policy Statement.

There is a huge line in 2008 showing Labour’s $7 billion spend-up to throw at the 2008 election. Labour can never stand in this House and say it was responsible with the Budget, when it threw literally billions of dollars trying to win an election. We are responsible, we are doing things properly, and we are delivering for New Zealand as well.

Leadership, Julie Anne Genter, is seeing 130,000 people gaining jobs in the past year. Leadership is seeing the average wage going up at a much faster rate than the rate of inflation. Leadership is seeing more children succeeding and fewer children living in benefit-dependent homes. Leadership is showing that there is an opportunity for people out there and that welfare dependency is not the future. Lowering the long-term welfare costs to the Crown by $10 billion, because we are getting people off welfare, getting them into work—that is leadership.

When the Minister of Finance appeared before the Finance and Expenditure Committee we focused quite a bit on migration during the interaction with the Minister as we examined the Budget Policy Statement. One of the brilliant things about the past 8 years is we are seeing New Zealanders returning home. We are seeing New Zealanders vote with their feet, decide that they want to back New Zealand again, and come home to live here. They have decided that the golden days that they saw in Australia and other parts of the world are no longer golden days compared with New Zealand, and they are deciding to vote with their feet. We are seeing literally tens of thousands of people, who previously were leaving our country every year, now deciding to come home.

If the Labour Party and the Green Party want to ask themselves “Do New Zealanders decide that the National-led Government is showing leadership?”, the answer is “Yes.”, because tens of thousands of them are returning home. That has its challenges on infrastructure, it has its challenges on housing, and it has its challenges on Government services, but the bottom line is that we are doing better for New Zealanders and we are showing people there is a brighter future here in New Zealand.

Housing is, of course, a challenging area that we must maintain. I was pleased to see that the Minister of Finance has not ruled out debt-to-income ratios but he has also not said yes to the Reserve Bank on that. I highlight that in my speech here in the House today because it was an area I took a lot of interest in when the Finance and Expenditure Committee was examining the Budget Policy Statement.

We need to ensure that there is more supply of housing for New Zealanders so we can buy houses. We need to ensure that there is assistance for first-home buyers, and we are doing that as well. Allowing the Reserve Bank too much rope, which it may use in a way that may be detrimental to New Zealanders’ ability to buy houses, we need to be cautious on. I was pleased that the Minister of Finance did not jump at the debt-to-income ratio scenario that the Reserve Bank was putting in front of him.

The bottom line is that New Zealand is achieving more and more every single year under Budgets put together, firstly, by Bill English—now he is Prime Minister—and that will continue under Steven Joyce. I am proud to be part of a Government that is showing leadership. I am proud to be part of a Government that is investing appropriately in New Zealand. We will continue to see tens of thousands of New Zealanders voting with their feet into the future as well, coming home to their home country.

It is a pleasure to speak in this honourable House on behalf of the ACT Party in this Budget Policy Statement debate. I mean that quite sincerely, because to have a Budget Policy Statement published by the Government, required by statute, to actually set out what the Government’s intentions are, how much money it intends to take out of the private sector as a percentage of GDP, how much it expects to spend, what it expects its net position to be in terms of debt and liabilities—to have those transparently displayed for all to see, months before the Budget is actually brought down, makes us a sophisticated country with transparent and open Government that is accountable to the people. I think we should never forget to pay tribute to those of us who went before us in this House, such as Ruth Richardson, who put in place the public finance frameworks that we have today that make us a well-governed country. I think we should all agree on that, no matter which side of the House we are from.

Putting that aside, I think it is worth actually looking at what those numbers tell us. One of the things they tell us, which runs counter to the narrative that we hear so often from the Opposition and out in public, is that this Government has very, very low net public debt. At around 23 percent of GDP, it is among the lowest net public debt figures in the world. This Government has more room on its balance sheet than just about any other developed country, and far more room than the really troublesome countries such as Greece and Portugal, which have around 180 percent of GDP—almost nine times more debt on their Governments’ books than we do.

What is interesting, and is not included in the Budget Policy Statement but perhaps should be, is the level of private debt—that is, household debt held by people other than the Government who live in New Zealand and have borrowed. That figure is truly alarming. Although we have some of the lowest public debt in the developed world, we also have some of the highest private debt—that is, people borrowing on their mortgages, borrowing on their credit cards, borrowing through their banks to do a variety of things, and borrowing through finance companies. We are among the most indebted countries on the planet. That lends you to ask: what should we be doing when the public sector balance sheet is in fantastic shape and the private sector balance sheets are looking a bit edgy?

Also in this Budget Policy Statement is the observation that the Government is about to go into surplus, not just little surpluses but huge surpluses—$20 billion of surplus, nearly 10 percent of GDP over the coming few years. I just have to laugh when Fletcher Tabuteau gets up and says that the surpluses will not cover the interest on the Government’s debt. Well, if Government debt is 23 percent and the Government’s cost of borrowing is 4 percent, that means that the interest repayments are about 1 percent of GDP, and the surplus is coming down the line at 2 or 3 percent of GDP. Clearly, the surpluses are going to be far greater than the interest on public debt. If Mr Tabuteau wondered about that, he might have asked himself a simpler question, which is: why is the forecast for debt as a percentage of GDP to go down by about a percentage point a year for the next 4 years? Well, it is either because the economy is going to grow very, very fast or because the overall amount of debt is going to reduce. But I digress.

If we have got a public sector with a very strong balance sheet and a private sector with a little bit of a stressed balance sheet, then there is a very clear thing that should happen when those big surpluses start coming down the line, and that is that it is time for tax relief. When Michael Cullen introduced the top tax rate of 39 percent, it was for only so-called “rich pricks”. Only 5 percent of taxpayers were to pay it. Coming into this year, we are going to see half of all taxpayers earning over $70,000 and paying the top tax rate. The Government’s refusal to adjust those tax brackets for inflation has meant more and more hard-working Kiwis drifting into the top tax bracket, with someone on $71,000 paying the same top tax rate as a billionaire in New Zealand. That is wrong. The ACT Party says that nobody on a five-figure salary should be paying the top rate of tax. We need to move those brackets and give people tax relief. Not only is it right to reward people for their effort by letting them keep more of the money that was theirs in the first place, but it is also the sensible thing to do given the high levels of private debt and low levels of public debt that we currently have.

You have to pay tribute to Bill English for that scenario, because we have actually had a period of fiscal restraint and relatively smart investment in public services over the past 8 years with Bill English as the finance Minister and now as the Prime Minister. That is why when the parties line up in this House, I am very proud to be leading an ACT Party that keeps those people over there and these people over here. I am very pleased to see Bill English, and now Steven Joyce, as finance Minister because I know from the Finance and Expenditure Committee how hard Grant Robertson works and how strong his grasp of the detail is. That is why we have got to keep him over there, so he never becomes the Minister of Finance.

That does not mean that everything is rosy under the current Government. One thing that is not in the Budget Policy Statement but perhaps should be is superannuation. It has been a big topic this week. The Budget Policy Statement says that when public debt returns to 20 percent of GDP or below, we will resume contributions to the Cullen fund, or the New Zealand Superannuation Fund. That is nutty economics. Nobody in this House, if they have got a brain, would borrow money against their mortgage or forgo mortgage repayments in order to trade in the global sharemarket. As Chris Bishop made the point perfectly adequately earlier, it is always easy to have 20/20 hindsight in markets. If anybody in this House knew what the sharemarket was going to do in the next 10 years, they would not have to fundraise for their political party ever again. If they are not prepared to do it with their own money, they should not be investing taxpayers’ money in the global sharemarket.

Whatever happens with the New Zealand Superannuation Fund, we still have a serious problem with the long-term affordability and sustainability of NZ superannuation, and particularly with the fairness. People can always say: “Oh, well, you can afford anything if you make it a priority.” That is true—that is true. We could put the age of entitlement for superannuation back to 60 years, and people in my generation could pay the taxes to fund that for the rest of their lives. Technically true—that is possible, but it is not fair. That is why it was a fantastic revelation this week that the National Government does understand that the scheme requires adjustment, but, sadly, yet again it has missed the point of intergenerational fairness. By ensuring that there will be no change for the next 20 years, we are going to see younger generations paying $58 billion of extra tax to maintain superannuation at 65 for the baby boomers. As soon as they have all retired, the adjustment will be made.

New Zealanders under 45 are spewing, not just at the money and the mathematics of this but at the injustice and the snubbery that they have experienced at the hands of the Government with this proposal. If they had the guts, if they had the leadership that we heard about from the previous speaker, they would do it fairly; they would start gradually, incrementally increasing the age of entitlement to New Zealand superannuation, and they would do it starting as early as 2020. That would bring us into line with Canada, the UK, the US, Belgium, the Netherlands, Australia—all of the countries listed in the National Government’s own puff piece on its policy, all of whom are adjusting their ages of superannuation entitlement in the 2020s. It is not because they cannot afford to do it later, but because they have regard to fairness between generations and they want to make the adjustment now rather than waiting until all baby boomers have retired.

In conclusion, we are fortunate in New Zealand to have a Budget Policy Statement, to have the level of transparency we have, and we are very fortunate about the figures that it shows. We are in a good space publicly, but we need to have tax relief for our private sector, and we need a little bit more gumption when it comes to confronting our long-term challenges, such as those we regard in superannuation.

It is a pleasure to speak on the Budget Policy Statement. There are two things that I want to focus on in my statement, and the first is quite a unique one, given some of the speeches we have heard from the Government benches, and that is to actually talk about the Budget Policy Statement, which is this document here. The second one that I want to bring to the House’s attention is one that we have not heard much of from the Government benches either, and that is a little trip I want to take outside the comfort of this Chamber, out into the real world, a little bit later in my comments, to talk about what people out there actually living real lives in New Zealand might have wanted to see in this Budget Policy Statement.

I sat through the first couple of speeches from the Government benches. I heard from Mr Chris Bishop and the Hon Amy Adams before premature rigor mortis set in. I managed to hear their comments, and I just want to reflect on some of the comments that they put forward there.

The first came from Mr Bishop, and it was like trying to grasp at a pillar of smoke over in the corner there, because as I looked towards him, I wanted to grab on to something to respond to in respect of this debate, but there was precious little in terms of the Budget Policy Statement. In fact, I timed it. I timed it, and we got to 9 minutes and 33 seconds until Mr Bishop actually mentioned something substantive about the Budget Policy Statement. The first 9 minutes and 33 seconds were all about the Labour Party and, of all people, Russel Norman. I know Russel Norman has grown a spectacular and luscious beard, which Mr Bishop may well be very interested in, but it was not really that relevant in respect of the Budget Policy Statement debate.

What he did get on to talking to was another matter that is of substance but, of course, it does not actually relate to the Budget Policy Statement, and that was the Government’s lack of contributions to the Cullen superannuation fund here. Even though that matter does not relate directly to the Budget Policy Statement because the Government is not contributing, the sheer intellectual dexterity and gymnastics that Mr Bishop put into constructing his argument do warrant some form of response. What Mr Bishop put up was this contention—he put up this contention. In justifying the Government’s lack of contributions over the last 8 years, he argued that if the markets had not gone up and if we had not received consistent returns, then that lack of investment was justified.

So what he was actually doing was constructing a parallel universe argument, because the fact is that we have had consistent returns of 8 percent every year, compounding, over the last 8 years. It is not a matter of hindsight; it is a fact that that was the case. If the Government had had the foresight to put that investment in instead of blowing it away in a smoke of tax cuts in the 2010-11 Budget, we would be significantly better off in terms of meeting our future obligations to future superannuitants. We know that out there somewhere in the universe, in a parallel universe, there is “Planet Key”, and now there is a small satellite circling it called “Bishop 33”, in which the Cullen superannuation fund did not earn compounding returns of 8 percent per year over the last 8 years, like it actually did here in the real world.

To give her her due, the Hon Amy Adams did engage in the substance of the Budget Policy Statement, and I think—like the Government in many respects—what she put forward were some words that sounded good. I believe that she is a well-intentioned Minister, as are many of the Ministers and members opposite. But what you get when you actually delve into those words is a significant gap between the rhetoric, which sounds good, and the actual delivery for real people on the ground.

So let us take some of the statements that she made. The first one she said—and we can all agree with this; every member from every party in this House—was that one of the jobs of the Government is to keep New Zealanders safe and to help them get ahead. Of course we would want to see that, but what do we actually see on the streets of my electorate and of many electorates around the country? Record numbers of burglaries in our community, a 94 percent rate of burglars getting away with it, police foot patrols that have been reduced over the last 5 years, and in Auckland—our biggest city, our growing city—about 10 new cops, net, over the last 8 years, and it was only after wrestling between Judith Collins and the Prime Minister over the last year that we finally got some action on that. So, fine rhetoric there, but no action.

What about people getting ahead? Well, again, we would all agree with that. We all agree with the notion of opportunity so that New Zealanders can reach their full potential in life and contribute to society. That is what everyone wants. But what does it actually mean when we have got 90,000 young people not in education, not in work, and not in training? That is 90,000 young people full of potential, full of ideas, and with the ability to do good things, if only they had the support of a Government that would actually back them and put the resources in to make a difference in their lives.

We also heard from the Hon Amy Adams that we want a system that creates opportunities and looks after our most vulnerable. Well, tell that to the Māngere budgeting centre. Its people are actually out there in the community doing the mahi, looking after our most vulnerable, and helping low-income people do what this Government tells them they are supposed to do—getting their financial affairs in order. What does the Māngere budgeting centre have to do under this Government to keep itself going? It has got to run sausage sizzles at the weekend because this Government fails to provide the support to those essential community services, and there are many groups like this in my community, as well, that are struggling under the fiscal constraints of this Government.

We heard that this Government supports wages rising. Well, what about the 45 percent of New Zealanders who, in amongst that fog of the average statistic, did not get any wage increase last year? And you can bet your bottom dollar that most of those people were people on relatively low incomes.

We heard from Minister Bridges, as well. He is a fellow Gen Xer—a bit like me, I think. We grew up through the 1990s, and for that reason I give him the Seinfeld award for irony for describing the new Prime Minister, Bill English, as “new, fresh, dynamic leadership”. Then Minister Bridges, in 10 minutes, and this is the finance Minister—sorry, maybe he wants to be the finance Minister. The Minister of Transport, in his 10-minute speech on the Budget Policy Statement, at the same time as Auckland faces a transport crisis and is grinding to a halt, did not say one thing about investing in public transport in our biggest city—not one thing.

So it is on that note that I want to take members in this Chamber on a little bit of journey through the real world of my constituency in Mt Roskill, where many ordinary, decent people live who want all of those things that we have just talked about. My day in Mt Roskill might start with a morning trip down Dominion Road, where thousands of people—thousands of people—are stuck in congestion. They are annoyed, frustrated, and are having their time and their economic energies wasted, just like people on major arterial roads across Auckland.

All the members in this Chamber who live in Auckland know about that, and they know that it is not good enough, but what do we get from this Government? Do we get a transformative vision, a transformative plan, to actually invest in modern public transport like every other smart city around the world? No, we get more roads. We have just heard, of course, about the big investment in the road heading up to Northland. What is the cost-benefit ratio coming from this Government, which boasts about its fiscal responsibility? It is 0.25. For every dollar we invest in it, we get 25c back, but no investment in public transport.

After my journey down Dominion Road, I will get to my office, and I guarantee you this, because every day I get into my electorate office there are cases waiting. Cases are waiting. People in desperate housing need, usually young families with children, are often living in overcrowded conditions with relatives, with their kids getting sick. Can they find the social housing place that they need? No, they cannot. There are 4,000 families in Auckland—4,000 low-income families who cannot get the social housing places that they need.

On that note, when we heard the Budget Policy Statement submissions in the Finance and Expenditure Committee, we had a very good submission from Caritas, and it noted this about the social housing places offered by this Government. In 2013-14, there were 69,000 of them. Today, in 2016, although we all know that the housing crisis mounts and mounts every day, there are now 61,000 places—a reduction of 8,000.

The Minister for Social Housing will stand here and tell us about the Government’s great plans to invest in 6,000 more income-related rent subsidy (IRRS) places. Well, let us take her at her word. If this Government puts its money into 6,000 more IRRS places by 2020, we will still have 2,000 fewer social housing places in 2020 than we had in 2013-14, and that is the measure of this Government’s commitment in that area.

A man whom I admire very much, an American theologian called Jim Wallis, said that Budgets are moral documents, and that is because they have a very real role in shaping the lives and the aspirations of the people of our country. What New Zealanders deserved to see, and needed to see, in this Budget Policy Statement was some vision, some idea of transformation, and a plan for tackling the housing crisis so that young New Zealanders who work hard can actually have some hope and can have some belief that they can get a house and make a start in their lives. Aucklanders need to see a transformative vision around transport so that we truly can become the first city of the Pacific, as we should be, and small-business owners deserve to see investment so that they can get into housing and so that they feel safe in their small businesses instead of being plagued by crime.

We did not get that. We deserved better. But I hope to come back to this House next year and hear Andrew Little presenting a Budget Policy Statement that delivers just that. Thank you.

That hope expressed by Michael Wood will be a forlorn hope. It is a pleasure to be talking on the Budget Policy Statement but, before I do so, I just want to turn my attention to the events that are unfolding in my electorate of Hunua. They are also happening in Coromandel and Waiheke, and that is the extent of the flooding that is occurring in my electorate, which covers the areas of Hunua, Clevedon, Beachlands, Maraetai, Kawakawa Bay and Ōrere Point.

There is significant damage, but I have spent the afternoon talking to the fire chiefs and the police. They are doing a fantastic job in terms of helping those communities. Luckily, the 350 children who were at two camps have been rescued safely and no one has been injured, with the help of not only the fire brigades and the police but also the army. We have also had a number of vehicles recovered, including the police vehicle that was reported on by the media. That has now been recovered by the Clevedon Fire Brigade. But the hard work that all those five fire brigades have been doing has been fantastic. Since midnight last night they have been out helping everyone, and I just want to pay my tribute to all their hard work.

There are still a number of road closures, although I have just been made aware in the last few minutes that the road from Kawakawa Bay to Clevedon has now been opened. But the area of Ōrere Point south to Kaiaua is still closed and we have got the closure of a road around the Maraetai coastal route. The extent of the stock damage and loss of property is terribly significant. Luckily, everyone is in good order but we do have more rain forecast and we are all hoping that everything will be OK. My only words of wisdom and guidance are: “Make sure you look after your neighbours. Check them tonight. Don’t use the roads unless you have to. Keep safe, and we will all get through this together.”

I now want to turn to the Budget Policy Statement. I have got to say this is a great statement at any point in time. If we were in any country everyone would be holding up this statement saying: “These are great results.” When you look at the average GDP growth rate for the next 4 years—well over 3 percent—that is fantastic, given the international context that all countries are currently operating under, and we are well aware of those pressures that we are seeing across whole swathes of countries overseas. We have got an unemployment rate of 5.2 percent, but Treasury is now predicting that is going to reduce to about 4.5 percent over the next few years. We are generating surpluses, and it is interesting that the financial statements of the Government just released—just released—show that for the 7 months to the end of January we reported a surplus of $1.14 billion, which is miles ahead of the budget that Treasury forecast, which was close to about $440 million.

That is a significant advancement, and a lot of that is coming through higher taxation revenues and prudent management—and of course we do have to acknowledge the fantastic work that our Prime Minister did as the finance Minister but it will continue under the new finance Minister, the Hon Steven Joyce. I think this is all about managing an economy appropriately and with fiscal responsibility. So our debt level is below what we anticipated. It is 24.1 percent. And, as everyone knows, I believe—hopefully, across the House—we are trying to get to 20 percent by 2020, which is very low by comparative standards.

So why does all of this matter in terms of economic outcomes? Well, what it provides is money for investment, and I just want to look at three areas. The first one is around infrastructure. It is interesting that if you look back over the last 5 years, this Government has invested $18 billion into infrastructure projects. That includes things like modernising our hospitals all around the country. It is about upgrading our broadband—and only in February we announced another major initiative so that we are seeking to get 85 percent of all New Zealanders connected to ultra-fast broadband by 2024. That is a fantastic achievement when again you compare that with other countries around the world.

We have got schools. What the Hon Nikki Kaye is doing in building new schools is phenomenal. I have got one just announced this week, Flat Bush South, and I have also been and visited a brand new school that opened in Ormiston just in early February, and it is a fantastic building.

And, of course, roads, and I heard the previous speaker talk about roads. Well, actually the plan for the next 10 years is $43 billion to be spent on roads. Although that sounds a lot of money—it is—it does not always deal with all the pressures that we are experiencing. But in Auckland we have still got the Waterview tunnel coming on stream, in operation, in the next couple of months. We have got the commitment to the Pūhoi to Wellsford road, we have got the Government taking over the Onehunga road—about a $700 million road—triple laning down to Papakura, and the electrification of the rail line down to my electorate in Pukekohe. This is all good stuff, but we also are seeing massive investment in roading all around the country. The Hon Simon Bridges seems to be constantly out there opening new roads, which is great, and that is what New Zealanders demand and want.

The other thing is that there is a significant investment in social infrastructure. There is the work that the Hon Paula Bennett and the Hon Anne Tolley are doing around this, and obviously now, with the changes we are making, the work is about changing the culture around vulnerable children and putting the child at the centre of how we organise ourselves. That is a courageous move, it is a tough move, it will be hard to achieve, but I am glad that people like Anne Tolley are doing that.

There is also the $350 million that we put up for social housing initiatives to help vulnerable people, particularly women with young children. It is appropriate that we put money up, and a substantial amount of money, to look after them and keep them in safe places until we can find them proper homes. There is also the $2 billion that we spend every year—$2 billion that we spend every year—supporting people to rent properties all around the country. The $2 billion is so that they can have good houses and look after themselves and their families.

The other thing that we have heard reference to is the $500 million that has just been announced into policing, and that was a great announcement in January. There will be 880 new sworn officers all around the country. Also, on top of that, there will be all the people who will be hired to help with forensic scientific investigation around crime—all that good stuff. That is phenomenal, and of course all of us would like to see it happen earlier but we do have to go and recruit 220 new officers every year to achieve that outcome. Of course, what we are trying to achieve is to make sure that every New Zealander lives within 25 kilometres of a manned police station in New Zealand. That is a great thing and makes our communities feel much safer.

I have got to say that yesterday we witnessed a dismal display. In fact, I was quite shocked. One of the important roles of the Finance and Expenditure Committee is to deal with tax matters, and we had a whole lot of proposals we were working our way through with regard to closing tax loops: stopping foreigners using certain vehicles, stopping base erosion profit shifting, and interest rate charges and use of branches—a whole raft of things. Also more recently we have discussed the changes to the way that small companies can pay their tax as they go.

What we heard from members of the Labour Party was, in fact, the complaint that we were doing too much—the complaint that we were doing too much. I could not believe it. I was absolutely appalled. I listened to the Opposition spokesman on finance as he sort of robotically rode his way through a debate speech that seemed to be of interminable inconsequence. I was horrified. Where is the Labour Party of old? Those members are the ones who should be holding a Government to account in terms of making the tax system fairer, but no.

And then we turn our mind to some members of New Zealand First. Mr Fletcher Tabuteau has been a good member at times, but you know that when we came to this issue and working through the detail, where the real work takes place—who did the heavy lifting? Who? It was the National Party members on that Finance and Expenditure Committee, and it was dreadful to hear the Opposition members talking about too much, too fast. Well, what I say is: bring on the hard work, because we want to achieve great outcomes for New Zealand. Bring it on.