STATEMENT ON THE LONG-TERM FISCAL POSITION 2021 — Report of the Finance and Expenditure Committee

I move, That the House take note of the report of the Finance and Expenditure Committee on the Statement on the Long-term Fiscal Position 2021.

It’s a real pleasure to stand here as the chair of the Finance and Expenditure to speak on our report on the Treasury’s report on New Zealand’s long-term fiscal position, He Tirohanga Mokopuna. This document is an important document. It provides insight into the long-term challenges that New Zealand will face, not just in the short term but the next 40 years. It’s a useful document to ensure that we do not ignore those challenges but, rather, put policies in place now to prepare for them.

The long-term fiscal statement has an important message in terms of the long-term pressures on Government spending. At the same time, it’s not a financial forecast. It can’t be said to be any kind of accurate prediction of the future but a series of illustrative scenarios, extrapolating out some assumptions over a long period of time, and there are plenty of tables and graphs in that document. The fact is that the compounding effects of fiscal and policy decisions now will have significant impacts in the future, now and through to 2060.

Past long-term fiscal statements have shown similar scenarios and assumptions and historical trends that are extrapolated out over 40 years. In fact, in 2016, the same document showed net core Crown debt reaching a higher level by 2060 compared with this report. It was 206 percent of GDP. This report projects or suggests 169 percent. I’d like to say that the Minister of Finance here, in front of me, reduced debt by 40 percent but that might be a bit of a stretch. But one of the major challenges that will face us, which I would like to identify, is that of climate change, and the report has a significant section on climate change. [Interruption] Don’t deny it, Mr Bennet; not again. It really identifies not only the fiscal impact but also the wellbeing impact on New Zealanders across New Zealand, across our coastal communities, across our rural communities, and, importantly, in Māori communities and the Māori economy.

So I think it’s really important that we identify that and we identify that in terms of our long-term challenge, this Government is working, has been working, and will continue to work on these challenges so that we don’t come down the track in 40 years’ time having done nothing, which is what happened in the past nine years. In fact, this Government’s having to play catch-up on nine years of inactivity on climate change.

The fact is—and the report makes it clear—that climate change will lead to extreme weather events, and as we stand here today, Mr Bennett, whilst you’re harping on over there, pretending that things aren’t happening, we have Cyclone Fili bearing down on the East Coast only weeks after another extreme event. The inaction of that Government has contributed to the problems that we are now facing in the fact that this Government is having to work at double speed to catch up. We’re playing catch-up on the inaction of the previous Government and we’ve done that from day one—from 2017.

Early on we stopped issuing exploration permits for offshore oil and gas. The emissions trading scheme had been left derelict in a corner by the National Party, eviscerated by the National Party. We reinvigorated it and it’s up and running again. The zero carbon Act, admittedly was a cross-party piece of legislation, and thank goodness for that, but the Labour Government of the past term along with the Greens passed the zero carbon Act. We now have an ecosystem of legislation that is finally working. And, of course, we’ve just had the release of the greenhouse gas inventory from the Ministry for the Environment, which underlines the need for accelerated action as we haven’t reduced carbon emissions enough.

This statement on the long-term financial position makes it very clear indeed that we need to act now because the longer we wait the more radical action will be needed, and the document sets out that these radical actions are more costly and more damaging both economically in terms of what the actual fiscal cost is but also in terms of the wellbeing of New Zealand. So we’ve got to act now. The window to tackle climate change and limit global warming is vanishing but it is still there. This is a Government that is committed to seizing that opportunity with bold and lasting action. With this Government, as we heard from our excellent Minister of Transport, every policy is a climate policy.

Our transport policy, which has shifted focus away from roads to rail, cycling, and indeed shipping, and public transport is about climate, which is quite the opposite to what the National Party want to do. Matt Doocey just the other day said, “Let’s make roads great again.”, a policy from the 1970s. It is outrageous. And Christopher Luxon would remove public transport subsidies on public buses, saying that public buses should be self-sufficient. That is the most retrograde, neo-liberal, anti-progressive idea so far, and that’s saying something.

Currently, a multi-zone fare is Christchurch is $4.70. The Luxon reform would have it at $11.75. Luxon would overnight empty buses, force some into car travel and force others to stay at home. The result would be a less mobile, higher-carbon, higher-cost, and more congested city, and that’s the National vision for New Zealand. Of course, when Luxon was challenged on this, what was his response? It was, “I haven’t considered it that much.” Has anyone noticed the growth in electric and hybrid cars over the last months? Statistics show that electric cars are selling at a greater rate—

💬 Nicola Willis: Point of order, Mr Speaker. This is actually quite a serious debate.

💬 SPEAKER: Order! The point of order?

💬 Nicola Willis: Point of order—the member is far too wide of the issue that we’re meant to be discussing, which is the long-term fiscal position of New Zealand.

💬 SPEAKER: I’ve been listening very carefully to the member. I would’ve thought that spending on public transport subsidies would have quite a lot to do with the long-term fiscal position of New Zealand, especially if people who were commenting on that in the media had any thoughts of being responsible for it.

As I was saying, the long-term challenge—

💬 Hon David Bennett: Where’s the independence?

💬 SPEAKER: Order! The member will leave the Chamber—David Bennett.

Hon David Bennett withdrew from the Chamber.

As I was saying, this is about taking steps today which will address the challenges that will be with us for the next 40 years and beyond. The fact that our subsidies on electric cars are shifting the needle on carbon around transport is of critical importance today. It is of critical importance today because if we don’t do it now, we will have to make radical change, and the Treasury say that the cost economically and socially of radical change is much, much greater. So we need to take change when we can as much as we can, and it is a balance. We do need to strike a balance. We are making real progress, whereas the other side would abolish the clean car subsidy and see us go back by years and years.

And we have done a lot more—at the Finance and Expenditure Committee we looked at the Green Investment Fund, another initiative which is saying we need to partner with the private sector to innovate around decarbonising the economy, and of course, there’s the $4.5 climate response fund, the hypothecated fund which will be invested into decarbonising New Zealand, making sure that the funds from the emissions trading scheme are recycled back into a low-carbon economy. We have to address also the coastal problem—that our communities are at risk. From Granity on the West Coast one report said that the community is slipping into the sea. So we need to assist those communities in taking real steps so that they can be prepared for what is sea-level rise that we can see happening already. The West Coast is a great example.

The glaziers are retreating, the coast is eroding, and we need to take steps. So we now have introduced a national adaptation plan. We have taken a stocktake of those risks. This is about looking out to the future. We now will be having our first ever emissions reduction plan, to be released next month. It will provide a comprehensive list of actions to drive transformative change. It will set out how we meet our first emissions Budget, and more policy strategies to reduce our emissions. This will be in sectors like energy, waste, building and construction, agriculture, and forestry. And when we hear from the other side, they’ve got nothing to say on any of those things. We’re committed to taking a long-term approach, one that recognises the long-term fiscal challenges that not taking action today will result in.

I welcome this opportunity, so rare in this House, to talk about the long-term picture for New Zealand 40 years into the future, the fiscal position which we will have. We do so because of the Public Finance Act 1989, which in a very sensible move requires Governments every four years to have an appraisal of the long-term fiscal position, to consider the trends, the risks, the opportunities, the choices that we are making today, and the choices we are potentially taking away from future generations or adding for future generations. It is engaging in that big picture that we can have discussion about intergenerational equity, about demographic trends, and about the economic opportunities and threats that present themselves to New Zealand.

As we have that discussion, I am reminded of what greeted National when we took office in 2008—and that was the New Zealand Treasury forecasting a decade of deficits with net debt blowing out to 60 percent of GDP. I am reminded of the actions taken by successive Ministers to ensure that New Zealand could put itself in a much better position than that to allow us to be in a position such that when the global pandemic struck, the Government we have in front of us today was able to make choices about the way it used its fiscal position. That is why we have these discussions—because the choices that Governments make today about spending will impact the resilience and ability of future generations to cope with shocks and to have good options for the public services and amenity available to New Zealand families.

We are today in a situation where there are different ways that debt can be managed. One way—and this is the way that the current Minister of Finance has chosen—is to rely on tax revenue windfalls helped by massive inflation. That is an option that this Minister of Finance has taken and we on this side of the House are concerned about the implications that has. The balance we would like to see the Government opposite strike is a better one that says not only how can New Zealand households take some of the pain of inflation and a rising cost of living but what it is that every Minister sitting around that Cabinet table will do to ensure better value out of the expenditure that New Zealand is already doing. What is it that every Minister sitting around the Cabinet table will do to ensure that they are getting maximum bang for the taxpayer dollars they are using on New Zealanders’ behalf?

This 40-year appraisal reminds us of what it is that that money should be being spent on, because, actually, when we look at the demographic challenges we face—the rising cost of superannuation, the rising cost of healthcare, the challenges that we will face with climate change—it becomes abundantly clear that the only way New Zealand will be able to face these challenges well while taking people with us will be if we have a growing, more productive, wealthier, more prosperous economy. That is why we have a solemn obligation to ensure we are investing in the things today that will allow us to be a wealthier country in the future.

Do you know the first place we should start when we are thinking about what we should be investing in today? It is our people. And what is the major tool the State has for investing in the capability of its people? It’s our education system. So we should all be very concerned that in New Zealand today, not only relative to the countries we like to compare ourselves with but also relative to our historic performance, the achievement of New Zealand school students is slipping. It is slipping across those core measures of ability: literacy, numeracy skills—reading, writing, and maths.

So when I look ahead 40 years, it makes me gravely concerned that there are still thousands of New Zealand schoolchildren who, despite being in an education system which has had billions of dollars poured into it, are less likely today to get the skills they need to succeed than they were a decade ago. That is the sort of issue that a Minister of Finance who really cares about future generational equity will be focused on. We simply must lift the capability of New Zealand students, and that requires a different approach to education policies in our schools.

I’m reminded of what the long-term drivers of big spending are. What are the areas that we’re going to be spending a lot on as a country into the future? When we look at the bill for welfare, we look at the bill for social services and the bill for our justice system, then surely we must do more than simply say, “Oh, well, we are kind over here on the Government side. We’re going to spend a lot more money into that in the future.” Because what we say on this side of the House is: what is kind about saying that the State will continue to service the misery of those who are dependent on the State, who find themselves in prison, who have their human potential cut short? Actually, what we should be doing is taking a social investment approach, which says, “What are the targeted investments and interventions the State can make today to reduce the dependence of people into the future?”

That is the kind of thinking that a Minister of Finance who is genuinely concerned about the next 40 years of New Zealand’s fiscal position would be thinking about, because, as the Treasury point out in their report, we must consider the cumulative impact of better spending. We must consider not only what it is that we spend more on in the next Budget but what it is we are spending money on today. I would implore of members opposite that they should treat New Zealanders with more respect than saying that anyone who says they think they can get better quality spending is talking about cuts, because, actually, what we are talking about is getting better results and better value. As the Treasury point out in the statement, what that requires is a rigour, is accountability, is a set of performance measures, is an ability to drive into the detail of delivery and implementation to ensure that when more money is appropriated from New Zealanders it is actually getting results. Sadly, we are not seeing that from this Government.

I’m reminded that when National was confronted with that decade of deficits, there were choices that needed to be made. One of the choices that could have been made was to allow, as I said, these windfall tax revenue gains. And when I look at the situation New Zealand faces today, I think one of the biggest challenges we have to intergenerational equity is the cost of living crisis that is facing our young people, because not only are they now in an environment that the Minister of Finance admitted in question time today where costs are outpacing wages, they are also in an environment where house prices have exploded up 40 percent since this Government came in, when rents have increased massively, and where their choices for their futures are more diminished than generations before.

So, faced with that, the Minister of Finance has different approaches he can take to reducing our debt. He can allow higher inflation to increase the tax revenues to reduce the real value of debt and he can keep on spending into the future. What we on this side of the House say is in a time when people are facing a cost of living that is actively daily, weekly, diminishing the choices they can make for themselves and their families in the future, the Government has a solemn responsibility to do better with the spending it’s doing and to ensure that New Zealanders can have more of their own money back.

The point of this fiscal debate we are having today is to think about the choices that we make today and the impacts they will have for future generations. Here on this side of the House, we are prepared to forecast a couple of things. First of all, for New Zealand’s superannuation system to be affordable, we will have to raise the age of eligibility. We’re prepared to forecast that if we want the children of the members opposite to have the choices that they had growing up, then they’ll need a Minister of Finance that can spend money better. We are prepared to forecast that if we want this country to grow and be more economically prosperous we will have to invest a lot smarter in our education capability, in technology, and in meeting the challenges of our times. That is what a National Government will do.

The Hon Grant Robertson. [Interruption]

💬 Hon Grant Robertson: I don’t know what that was about.

That was Mr Bayly—

💬 Hon Grant Robertson: Oh, right.

—but I gave the call to Mr Robertson.

Oh, very good—thank you, Mr Speaker. I think it’s instructive that in a debate about the 40 years ahead for the New Zealand economy and New Zealand society, the Opposition finance spokesperson couldn’t utter the words “climate change”—could not utter the words “climate change”—didn’t devote anything in her speech to the biggest challenge facing the New Zealand economy for 40 years ahead.

And there’s a reason for that; it’s because the National Party doesn’t have a plan around climate change. They are completely out of touch with the biggest issue that will face New Zealanders across the next 40 years. And that was really brought into sharp focus over the last 24 hours, when the Leader of the Opposition decided to tell New Zealanders that public transport needed to look after itself—it needed to be able to make sure it paid its own way, somewhat undermined by the fact that each year the Government puts aside more than $2 billion—probably more than $2.5 billion—a year to actually support public transport.

All around the world, public transport systems are supported and subsidised by Governments and local government because of the value that they provide. They provide that value for low and middle income people especially, but, nowadays, we also recognise the value that that has for addressing climate change issues. Mode shift, as the Leader of the Opposition has picked up, is an important matter. It would seem he thinks mode shift is moving from corporate cabs to black Mercedes, and then back again. On this side of the House, we know that mode shift is actually about making sure that New Zealanders have the ability to make good transport choices and that they have good public transport options in front of them. So for the long-term fiscal statement debate, it is worth putting on the record that in that report, the Treasury highlighted the importance of climate change. The Treasury highlighted the importance of different policy approaches to make sure that New Zealanders are prepared to make sure that we reach our zero carbon targets.

And the issue we have is that I heard the Leader of the Opposition this morning say, “No, no, no—totally committed; totally committed to the 2050 targets.” That commitment’s hollow. It means nothing if there is no policy prescription to back that up. And I am extremely proud of the work of this Labour Government to develop the emissions reduction plan that will mean we can reach that zero carbon goal. It means that we will make sure that our transport fleet is cleaner. It will make sure that the way we eat, our industries in New Zealand is cleaner. It will make sure that the way our homes are designed in the future means that they are more energy efficient.

I want to thank the cooperation of James Shaw and the Green Party on the work in the emissions reduction plan. And when we announce the Budget in May, we have the first steps with the Climate Emergency Response Fund, taking all of that money from the emissions trading scheme and putting it into emissions reduction initiatives, starting to take the steps that are asked for in this report to truly address one of the biggest issues that New Zealand will face over the next 40 years. But, yet, the Opposition’s finance spokesperson decided it wasn’t important enough to talk about in her speech today. That shows just how out of touch the National Party is.

There are two or three other areas—it’s as much as I can fit in in this contribution—in this report that I think are worthy of note. The first of those is around COVID-19, because the Treasury did take the time to address the impact of COVID-19 on New Zealand’s long-term fiscal position. I think it is worth noting that they said—the report of the committee tells us—that the financial implications of the Government’s response to COVID-19 are largely temporary and will not affect the Government’s financial position long term. That is a very important thing to note, because the significance of what we did day to day for New Zealanders should not be understated. We worked alongside New Zealanders to make sure that unemployment didn’t get out of control and that we have 3.2 percent unemployment, and we were able to do that on the basis of a strong fiscal position.

I acknowledge what the Opposition finance spokesperson said about that. She did actually leave out just a little bit at the end, which was that we, the Labour Government, brought net debt down to 19.5 percent of GDP. That left us in a strong position to respond. But there is no point in saving for the rainy day if when it comes along, you don’t use the savings that have been put in place. I stand by those decisions that we made that allowed New Zealanders to come through COVID-19 not only with one of the best health responses in the world but also with what has been recognised by the likes of Standard & Poor’s and the IMF and others as one of the strongest economic responses as well, all done in such a way that the long-term fiscal position of New Zealand will not be undermined.

Today, the Reserve Bank, when they put forward their monetary policy statement, made the point that the underlying fundamentals of the New Zealand economy are strong, and that is actually what this financial statement says. Yes, there are challenges. Yes, there are areas that we need to step up to and make big decisions about. But the underlying fundamentals are strong, and day in, day out in this House, I hear the Opposition telling us that there is in New Zealand a cost of living crisis. We accept that for many New Zealanders that’s true, but to then take from that that somehow the New Zealand economy is going to hell in a handbasket actually undermines the hard work of New Zealand businesses and workers who have got us to the point that we are today, and that is clear in this particular report.

It also notes the importance of the targeted support that has been provided through COVID-19 and will be provided out into the future. There is no doubt that the kind of economic shock we’ve seen in COVID-19 will affect different parts of our community differently, and that’s why we’ve continued to provide greater support, for example, to Māori and Pacific communities, to make sure that we’ve looked after those on low incomes as well. And that’s why when we did the 1 April package, our focus was there, because as we bring New Zealanders through these tough times, some sectors have benefited enormously through COVID-19. Our export sector has been strong and we’ve been able to build off that. But we also have to look after those in our society and in our economy who haven’t done so well, and targeted support is important. Untargeted support, tax cuts that are targeted at people who earn more than $180,000, is simply an out of touch policy that shows that the National Party do not understand not only today’s economy but where the economy should be in the future.

The other area I do want to talk about, and it’s highlighted in the report, is the importance of what we do with health expenditure, because a lot of the focus we often have in this debate—and the Treasury has been consistent about this when they’ve been writing these reports over the years—is around the cost of superannuation, and they do indicate that that would rise from about 5 percent of GDP, where it is now, to about 7.7 percent of GDP by the end of the period that they cover in this report. That is an increase. It is a significant increase. I want to put on the record that for the Labour Party, we continue to believe that dignity in retirement is worth it and that we will keep investing in that.

But the bit that doesn’t get talked about as much is what happens in health spending, because with an aging population, there is no doubt that health spending will need to increase. Yes, we can be more effective. Yes, we can be more efficient—new technologies come along. They help us; we must do that. But, ultimately, a Government must invest in its health system. But, over and over again, I hear from the National Party’s health spokesperson that the reforms that we’re making to make the health system more effective, to make the health system more efficient, to make it more equitable are the wrong thing to do. So, once again, there’s an out-of-touch response from the National Party, whereas the Labour Government is making sure we make the changes to our health system that mean we can meet the challenges that are outlined in this report. And that means, yes, the creation of the Māori Health Authority, because we need to acknowledge that what we have done to this point has not worked for Māori.

The health outcomes for Māori are disproportionately poor compared to the rest of the population. So the answer is not to do exactly the same thing as the National Party would propose, but rather change it—make sure that we provide more by Māori for Māori services, make sure we have a greater focus on those health outcomes and improve them. I know that those on the other side of the House don’t like to admit that, actually, sometimes things do need to change. Sometimes things do need to improve, and in the health sector that is certainly where we are focused.

So I thank the Treasury for this report. It is once again a useful contribution to New Zealand’s economic debate. It does show to us that as a country we are well-positioned but facing challenging times, that we do need to make big calls and difficult calls, that we do need to get on top of things like our infrastructure deficit, the spending that we do in the health sector, the way in which we support low and middle income families. Those things take time and they take serious investment, but they also take a plan that is in touch with the future needs of New Zealanders. When we come to do the Budget in a little over a month’s time, I am sure that New Zealanders will see that the Labour Government has its focus not just on the short term in supporting people but also on the long term, and making sure that we make the decisions and we have the policies that give New Zealanders prosperity but also show that we continue to care for one another.

Thank you, Mr Speaker. Yes, it is a pleasure to be talking on this document, which is an important perspective on where New Zealand is heading with debt. It’s interesting; the Minister of Finance just sat down and I listened carefully to his speech and, of course, he was accusing the deputy leader of not talking about climate change—I seem to recall that she did. But the one thing that I would acknowledge around climate change: it’s interesting that emissions have actually increased under this Government over the last three years so, obviously, the Government is making a lot of progress with regard to that and, of course, the Minister seemed to focus almost exclusively on climate change.

The one thing he did not talk about, which was clearly identified in the Treasury’s report, was superannuation because superannuation, for the Labour Party, is one of those issues that they want to ignore and just hope it goes away. And, of course, as the Treasury says, it is one of the huge factors that will have an impact on future debt levels and, as the Treasury has highlighted, current debt projections—under the current arrangements—will see that debt getting to unsustainable levels in New Zealand, and unless there are decisions made around superannuation—health is related to that, of course, particularly with older people and their health needs—and climate change, of course, then we will be on an unsustainable track, and we are already on an unsustainable track.

It’s interesting; the Minister loves to crow about debt and how we’re low and that means that we don’t need to basically worry about it. But it’s interesting; when you look at the actual figures in the document, debt has gone from roughly $60 billion, 24 months ago, to about $124 billion today. Under this Minister, we have doubled our debt in 24 months—almost a record. I suggest, it is a record doubling of debt. That has occurred at a time when New Zealand is the country that has spent more on COVID response than any other country apart from the US. We’ve spent more on COVID response than any other country, other than the US. Whilst we support the $24 billion that has been paid towards supporting businesses through this difficult time, and their employees—that is something we have absolutely no truck with—the bit that we find absolutely concerning is the other $36 billion that has been blown by this Labour Government on so many issues, so much wasteful spending—dumb spending—that has got us to a point where we are today.

Of course, New Zealand will not pay down debt under Grant Robertson. Under the Treasury projections, the debt will go up to $182 billion in 2022-2023, and will stay at roughly at that level—$189 billion, $175 billion. New Zealand, under Labour, will not be paying off any debt. The reason why the percentages decrease as a percentage of gross domestic product (GDP) is that the Government and Treasury is hoping that we will continue to grow the economy and, if you grow the economy and you still have the same quantum of debt, you get a decreased debt to GDP ratio. So one thing we should be mindful of is that in four years’ time the country will still have elevated levels of debt of about $175 billion. That is a staggeringly high figure, considering we were at $60 billion only 24 months ago.

The issue about this document is that debt is an important way of managing the economy, but it does have trade-offs. When you take on and double the debt, as Grant Robertson has over the last 24 months, it’s fundamentally a trade-off between current wellbeing and the wellbeing of future generations. It does impose a real cost; debt has a real cost. It has a real cost in terms of interest rates that the Government has to devote to paying back that debt, and the interest as well. And the principal needs to be paid back. We’ve already seen the cost of buying back the Treasury bonds that the Reserve Bank’s doing. The out of market cost at the moment is about $6 billion and rising. So it’s a cost imposition on all New Zealanders when a Government decides to take on a massive amount of debt.

The issue we have with this is that the Government has been able to go and borrow this huge amount of debt—an additional $60 billion—because, after the Canterbury earthquakes and the global financial crisis, we—through prudent management, both Labour and National—got our debt back to 19 percent of GDP. Also, the reason why we’ve been able to go out and borrow lots of money in the market, offshore, is that we have a history of responsible fiscal management and sticking to it. That is why New Zealand is in a good situation and had an ability to take on this massive amount of debt over the last 24 months, but we’re at the risk of squandering that huge advantage and reputation we’ve built up.

The long-term requirements of the fiscal responsibility Act that was set up in 1989 is that the Government must run prudent debt levels so as to provide a buffer against factors that may impact adversely on the total debt in the future, by ensuring that we’ve got prudent debt levels. Once you’ve got prudent debt levels, the Act also requires that you maintain, over a reasonable period of time, that total operating expenses do not exceed revenue—Government revenue. Guess what! When you look at what’s gone on over the last few years, and what is forecast in the Treasury projections, we will continue to run operating deficits at a Government level. We will continue to lose money at a Government level. I think, from memory, we’re going to rack up about $36 billion of operating losses by Labour since it’s come to office, and over the next two years, as a result of running high operating budgets—by basically spending too much money.

As I said before, this is the trade-off. We need to be much more careful about how we manage it and, of course, Grant Robertson loves to talk about the paradox of not being able to either spend more on good stuff or reduce debt. Actually, there are three choices in terms of managing the economy, and to reduce debt to prudent levels. The first choice is you can increase taxes and, gee, don’t we know the Labour Government’s good at that. You can increase taxes—that’s one way of dealing with debt. The second way you can deal with debt is to make sure you don’t do dumb spending and, unfortunately, the Government is great at dumb spending. I’ll give you some examples: $280-per passenger subsidy on the Te Huia Hamilton to Auckland train service; $15 million on the road to zero advertising campaign; $20 million on the unnecessary Radio New Zealand / TVNZ merger; $51 million on the bike bridge. I can just go on. I have a list, Mr Speaker, of wasteful spending projects. I don’t intend to go through that. But if the Government stopped doing dumb spending—that’s how you reduce your operating losses at a Government level.

But the third way—and this is the issue that I never hear the Minister of Finance talking about—of dealing with debt in the long term is to grow the economy, and that’s one thing that the Government, this Government, does not know how to go about doing. It is about supporting businesses to grow aggressively, to employ more people—not to sock ’em with $3.5 billion of additional costs as the Labour Government has done over the past four years. We want a Government that supports them because when business is successful, they hire lots more people, they can afford to pay people more money in wages, and provide better working conditions, to enable people to get ahead in life, to be able to buy a house, to be able to raise a family, to be able to get the best education for their children—that’s how you run an economy. You don’t tax the hell out of people, and you don’t do dumb spending. What you do is you do things in moderation and you support the economy to grow, and that’s what National will do when we get back—

💬 SPEAKER: Order! Order!

Mr Speaker, it’s a genuinely welcome opportunity to speak on this long-term fiscal report, because it’s one of the few times when the House can look a long way down the track and engage in debate seriously about the choices Government should be making. But it’s worth remembering that this particular long-term fiscal report from Treasury was prepared against the background of the greatest crisis we have faced—perhaps for a generation—in terms of the global pandemic. And it is an ongoing crisis; COVID is not over, and we need to reshape our new normal to fit this ongoing crisis of COVID. So it’s an extraordinary challenge for the Government of the day.

I wish to address in particular the issue that was raised by the previous speaker, Andrew Bayly, about the levels of debt that are prudent. Now, as it turned out, before going into the COVID crisis, through all sorts of reasons this Labour Government had reduced our debt to around about 19 percent of GDP—the lowest it had been in a very long time indeed. Along came the crisis, and at that stage the necessity was to keep the economy going, so we adopted the best health response, and we adopted the response that kept people in jobs, kept businesses going, and sustained our economy. And the way we did that—in common with countries around the world—was we adopted the strategy of borrowing to meet this crisis. So our debt has increased. But the issue is not whether or not debt has increased; the issue is whether or not debt is at a prudent level. Is it at a level that is sustainable for the New Zealand economy? Is it at a level where we can maintain our obligations and, over time, repay the debt?

I wish to direct the Opposition to page 6 of the report of the Finance and Expenditure Committee on this long-term fiscal report. The Finance and Expenditure Committee, including members of the Opposition, have written their report, and it addresses this issue directly—of the prudence of debt. So, according to He Tirohanga, the long-term fiscal report, the Government’s current debt is projected to reach up to 48 percent of GDP. Treasury informed us—that’s informing the Finance and Expenditure Committee—that debt levels are still consistent with the framework for considering debt prudent and that the Government is currently at prudent levels of debt. It is still a prudent level of debt. Now, we know that, over the long term, this debt will reach about 48 percent of GDP, but even at that level, it is still considered to be a prudent level of debt. It is a level of debt whereby the Government can service the obligations under that debt and can repay it.

In fact, previous papers by Treasury have examined the level of debt that is prudent, and they’ve suggested that, in New Zealand, this could be between 50 and 60 percent of GDP with a buffer of around 20 percent to respond to shocks. So, even under Treasury’s own rules, we are still at, or even under, the level that Treasury said was a prudent level of debt. The issue, then, might be how many shocks might we expect in the New Zealand economy and how will those affect us. And we do experience shocks on a fairly regular basis. They’re not predictable, but we kind of know that, over time, we face shocks—such as the global financial crisis, such as the Christchurch earthquakes, such as COVID-19. They seem to come along every seven, 10, 12 years or so. So the committee asked whether we could sustain these ongoing shocks. And in fact, Treasury have modelled exactly that scenario; it’s on page 29 of their report. Even under those conditions, the level of debt we have reached is still sustainable, according to Treasury itself. In terms of Treasury’s perspective on that debt, they said, “Yes, it’s sustainable for servicing the debt; yes, it gives us greater market access to the world; yes, it addresses intergenerational welfare.” We don’t like being in debt, but debt can be good, and it is a tool for the economy—not an end in itself. It is a tool that enables us to spread the cost of long-term assets over the generations.

In fact, the Auditor-General spoke to the Finance and Expenditure Committee about this long-term fiscal position report, as well. And they suggested that perhaps there should be a broader approach to fiscal sustainability—so focusing less, perhaps, on the negative factors, such as increasing debt, and more on the positive factors, such as the higher productivity and growing GDP that debt enables. And I do want to think about what sustainability of debt means. We might have a lower level of debt, but is that sustainable when faced with crumbling hospitals? We might choose a lower level of debt, but is that sustainable when we’re faced with failing water systems? We might have a lower level of debt, but is that sustainable when we simply don’t have enough schools? Debt enables us to address all those capital challenges; it enables us to spread the cost. So, far from being a bogey, debt is a tool for us.

I also want to address one of the other issues that was raised by the previous speaker, and that is the ongoing pressure of an ageing population and the effect it will have on our expenditure. It is true that New Zealand superannuation will, in fact, over time, demand a greater share of GDP as we support our senior citizens. I take it that we all agree that supporting our senior citizens is the right and proper and good thing to do. But I am also going to point out that it was the Labour Party in Government that took the most serious steps for supporting our senior citizens. It was the Labour Party in Government that introduced KiwiSaver—that enables people to save for their retirement. It was the Labour Party in Government, under the leadership of Michael Cullen, who set up the New Zealand Superannuation Scheme, the Cullen fund. It was the Labour Party that put money into it, and it was that party—the Opposition when they were in Government—who stopped contributing to the Cullen fund. If anyone doesn’t know how to sustain New Zealand’s superannuation, it’s that side of the House. On this side of the House, we have taken a prudent and long-term view as to how to support our senior citizens—who we will all be ourselves one day—through to a dignified old age.

And, on that point, I just want to talk briefly about the cost of living, because members on the other side of the House have pointed out, as is correct, that we are facing some real issues with the cost of living at the moment—as are countries around the world. Inflation is running, not caused by anything in particular here but caused by worldwide conditions. But whether or not it is caused by worldwide conditions, it is our job as Government to address the needs of the people who are affected by it, and that is precisely what we are doing. That is why we’ve had the Working for Families increases on 1 April; that is why benefits went up on 1 April; that’s why superannuation went up on 1 April; it’s why the minimum wage went up on 1 April; it’s why we’ve increased student allowances on 1 April; and it’s why we’ve got public transport assistance in there from 1 April. On this side of the House, even though we have not caused the cost of living crisis, we are addressing it as best we can to ensure that all New Zealanders—even though they are facing real pressure, and we are facing real pressure—can manage to get through. And we will continue to do that. Why? Because we are a Labour Government, and on this side of the House, we intend to ensure that all of our citizens live with dignity. And, of course, that is part of what sustainability is about; it’s sustaining all of us.

So in terms of this long-term fiscal-position report, it’s a fascinating and interesting report; it does give us some really interesting insights into the challenges that are facing New Zealand, but also it says that we’ve got some big policy decisions to make. We’ve got issues that we need to confront, but we’re in a pretty good position to do that in the next few years and on into the future. I commend the report to the House. I commend the actions of this Government to the House. Why? Because we’re getting us there all together.

E te Māngai, tēnā koe. Tēnā koutou e te Whare. Today, we are debating the fifth long-term fiscal position statement, He Tirohanga Mokopuna, produced by the Treasury. The last one was produced in 2016. In 2016, climate-changing carbon dioxide concentrations in our atmosphere reached 403.3 parts per million. In 2022, Hawaii’s Manua Loa Observatory tells us that they are 420.66 parts per million—that is a rather frightening trajectory. And for context for those in the House: carbon dioxide levels of 280 to 350 parts per million were the atmospheric context that created and enabled humanity to feed and build the modern world.

In 2016, median house prices were $489,000. In 2021, median house prices were $830,000. The 2016 version of He Tirohanga Mokopuna very clearly laid out what was then required, and is still required, for a healthy economy—the economy being those rules we set up about how we relate to each other and our planet, and how we exchange value. That 2016 report stated, “Intergenerational well-being relies on the growth, distribution and sustainability of the four capitals—financial and physical capital; human capital (e.g. health and skills); social capital (e.g. institutions and trust); and natural capital (e.g. water and biodiversity).” I raise this today because, whilst so much of this debate has already been consumed by the politics of today, there is real value in determining whether we, as policy makers, pay any real heed to the concerns that outlive a three-year political cycle. The 2021 report makes it clear that there are choices to be made about what happens next in setting the rules of our economy, and that each of these choices have trade-offs. The level of comfort that each of us have in what those trade-offs are, and the things we will prioritise as outcomes, are a matter of our respective political values. Of course, these are our ideologies.

So let’s talk about those ideologies, about those trade-offs, and those priorities. As the Greens, we have always been clear about our four core founding charter principles, that rest on the foundation of recognition of Te Tiriti o Waitangi as the founding document of this country. The first of our principles is ecological wisdom. That is recognition of the fact that resources are finite. Even those resources that do regenerate need time, and space, and, God forbid, some planning, in order to regenerate. The second of those principles is social responsibility. That is, in realising and grappling with the reality that we do have those limited resources from an already heavily-exploited planet, we must realise that those resources are to be fairly and justly shared in order to have a stable society. The third principle is that of appropriate decision-making. That is that decisions should be made with those who are directly impacted at the core of that decision making. The fourth principle is that of non-violence. As power-grabs, fights over resources, and callous wars with untold casualties unravel across our planet, we have to decide whether we want to stand for evolved conflict resolution, or to be complicit—let alone participate—in further unnecessary destruction and devastation.

He Tirohanga Mokopuna tells us, and I quote, “policy options present trade-offs for current and future wellbeing in several ways”. And, further on, “the balance of policy measures is largely a value judgement for governments”. The Greens are not willing to trade-off the wellbeing of future generations, let alone their rights to a liveable planet. Nor are we willing to let inequality—this country’s shame, I might add, before COVID-19 came along and supercharged it as a result of the policy decisions throughout the last two years. We cannot continue to let inequality fester, which robs New Zealanders today of their right to participate, to contribute, and to live their best lives.

So let’s address three of the key issues that this report reflects, and exactly those policy decisions in front of the Government, and one big opportunity to learn from the economic response to COVID-19. He Tirohanga Mokopuna tells us that we must raise more revenue if we want to continue to provide a similar level of public health infrastructure, and continue to keep superannuation at the age of 65—which of course we can see that the National Party Opposition is rallying against, it wants all of those hard-working New Zealanders to continue hard-working for many more years to come—let alone if we want an increase in providing better public services and infrastructure.

Despite all of the long-stated myths, we know for a fact that Aotearoa New Zealand does not have a broad-based, low-rate tax system. In fact, as this report explicitly states, “New Zealand’s tax system currently relies heavily on a small number of tax bases.” Therefore, there is a really massive opportunity here as always, as has confronted Governments of the past, to make a decision to broaden our tax base, to make it more resilient; to re-orient its reliance, currently, on consumption taxes and income taxes; and actually to go about addressing some of the inequality by taxing massive capital gains or wealth, as this report touches on. I reflect on the fact that the top 1 percent of New Zealanders presently own 25 percent of the wealth in this country, and the bottom half own just 2 percent. Treasury noted at the Finance and Expenditure Committee, in hearings on this report, that they supported a capital gains tax, and said in a report on the capital gains tax that it would “improve the allocative efficiency of saving and investment by ensuring more economic income is taxed neutrally, would be progressive, and would improve the integrity of the tax system.”

Despite being referenced a number of times throughout the 2016 report, this is the very first time that climate change has received its own section in this long-term projection. In the most value-neutral way possible, Treasury tells us in this report, “Adaptation efforts may involve upfront costs, but [they] also have the potential to reduce the total costs from climate change over the long term.” We are here, of course, talking about—in very emotionless language—the financial implications of living in an island nation impacted by rising sea levels; coastal erosion; less predictable seasons; more once-upon-a-time, once-in-100-year weather events; potential food insecurity; mass human migration; and a potentially far harsher quality of life. These are the things that the National Party and the ACT Party trade off when they talk about reducing our nation’s role in doing anything about the crisis before us. Even as the Treasury says in this report, “There are also costs associated with inaction. Not proceeding with a given action to reduce emissions implies that other actions—with their own costs or benefits, financial, social and broader economic—will be needed if New Zealand is to achieve its emission reduction[s] targets.” You can’t negotiate with chemistry or physics. To prevent a radically warmed and drastically-changed world, we must act now. The world is changing—the question is whether we want to make a choice in how we respond to how that is occurring, which brings me to the very recent example of having made policy decisions that did make explicit trade-offs, much like He Tirohanga Mokopuna informs us that we must do, and we must confront.

At the beginning of the pandemic, Reserve Bank of New Zealand and the Treasury warned the Minister of Finance about what the balance of fiscal and monetary policy might look like. The Government was aware that an over-reliance on unconventional monetary policy that would flood our markets with cheap debt, available disproportionately to those already with assets, would have what they called a “distributional”—to the rest of us, “unequal”—impact. And we’ve seen that in house prices increasing by 30 percent. We’ve also seen intergenerational impacts—the Financial Services Council survey of 2,000 people in January found that 18- to 39-year-olds, 60 percent of whom rent, were hardest hit financially by COVID. They were least confident about the future, they were the most concerned about house prices, and the most worried about wage stagnation. A third did not have enough cash saved to last more than a month without income. I’ve seen commentators over the past few weeks talking about, and detracting, the number of young people who are currently getting support from their parents. But so few of those commentators have been willing to engage in uncovering the network of systems that have created exactly this problem, and that need, for some, for dependence.

Quite frankly, we cannot afford to continue with the status quo. It is exhausting people and it is exhausting the planet. And things are changing, regardless of whether we do. So the question confronting all of us in this House, and the question confronting the Government, is, “What kind of country do we want to live in?” Do we want to live in one which is climate-ravaged, which exists with extreme amounts of poverty, with deep inequality, with run-down infrastructure? Because none of those things are natural phenomena. They are, as this report so frankly puts, political choices.

Thank you. I rise on behalf of the ACT Party in a split call with our leader, David Seymour. Just to go back to what the fiscal position statement actually means: it differentiates between the Treasury’s other forward-looking reports such as economic updates and it does not forecast what is likely to happen; rather, it presents a range of policy options for choices for the Government to consider. The Treasury is the Government’s lead economic and financial adviser and we at the ACT Party certainly believe we have options and choices to be pretty clear with the New Zealand public with regard to public finance.

The Treasury points out the importance of a strong and sustainable fiscal position. We’re only positioned to respond to future shocks if we stay solvent and crises if we can maintain low debt levels, but that has blown out massively. How do you get back to a situation of low debt to GDP? By getting wasteful spending under control. Sadly, this Government has exercised no restraint, no control when it comes to spending New Zealand taxpayers’ hard-earned money, and, as you’ll see from some of the plans here, they haven’t even modelled the effects of climate change, super, or anything to do with demographic change in this country. Yet in this Budget, there will be money dished out for a green agenda. It used COVID as an excuse to expand the size of Government. It was purely ideological. Thirty percent of GDP was used, and Labour believes that politicians should be making decisions about how to spend taxpayers’ money. Grant Robertson knows much better how to manage money, but he’s going along with it as well.

Grant Robertson used the COVID fund, which was meant to support people through the impacts of COVID, to spend money on anything and everything under the sun; it didn’t have to be COVID-related. It was a slush fund, and we’re now in a position where we’re less able to withstand future shocks. Our kids or grandkids are going to have to pay that money back through higher taxes and fewer services, and it’s no wonder 50,000 people are forecast to leave this country in the next year, voting with their feet against the Labour Government. And now Treasury is looking at how it can raise extra money from taxpayers, increasing income taxes, a capital gains tax, environmental taxes which are no doubt along the way. These will be hugely damaging to the economy.

Here’s an idea: before the Government looks at increasing taxes again, it should have some control when it comes to spending. It’s a pretty simple equation. Everybody else is expected to—households, individuals, businesses are all expected to live within their means. ACT has consistently pointed out where the Government could make savings without cutting core services. There is fat in the Budget. You don’t need to look too hard. Not only does the Government need to get total spending under control, Treasury points out that the quality of spending needs to be better. Light rail, the Provincial Growth Fund, the Auckland cycle bridge—the list of wasteful projects is long. Ministers in this Government have absolutely no idea how hard it is to make a buck in the private sector, but they sure know how to blow the money on taxpayer initiatives. Future Governments will not be able to avoid hard choices over the next 40 years, and we ask the finance Minister to act prudently on debt levels and spending, starting at this Budget.

If we want to attract people, ideas, and capital to this country, we want a competitive economy. If we’re to encourage people to work, save, and invest, we need to keep taxes low. The only way we can keep taxes low is by getting spending under control, and the Government has completely and utterly failed at that. Future Governments are going to have to make hard choices, as we say. We need real change that means reducing tax, bureaucracy, and waste, and maximising opportunity for every single New Zealander and their kids. ACT will hold this Government to account on this mission, and we believe that the 40-year plan has modelling in it which is insufficient to call anything prudent at this moment.

The next call is a Labour call—or is this a split call? My apologies.

No worries, Madam Speaker, I know you’ve just come on shift but thank you for the call. I rise in support of my colleague’s speech. These long-term fiscal statements are extremely important. I think they’re one of the most important things that our Treasury does. They’re especially important for young New Zealanders, and those not even born yet, because the long-term fiscal statement allows us to think about what sort of finances this Government will have when everyone currently in Parliament has moved on. It allows us to understand how our decisions today will affect the options that our children and grandchildren have tomorrow.

In my opinion, it doesn’t get nearly enough attention. And I have to say, when I look at the standards of this report, which used to be called the long-term fiscal outlook, the way it’s been watered down and focuses on a whole lot of different things—well, if you go back to, say, I think it was about 2009, it was very clear: it set out what the figures were, what the drivers were, and where we’d get to if we didn’t make any changes, and what some of the options might be. You read the executive summary of this report now and all you get is word salad. So I am concerned about the quality of the report. I’m concerned about the quality of Treasury, I think it’s been neglected and diverted from its true purpose—not just by this Government but, frankly, by the previous one.

Nevertheless, there are some messages that come through that are inescapable, and they are, similar to earlier long-term fiscal statements or outlooks, that if we keep doing what we’re doing we will run out of money. And the reasons are simple and they haven’t changed for as long as we’ve been debating these statements: there are more people living longer, requiring more healthcare, and staying on super for longer, and, as they do so, they have fewer children, meaning fewer taxpayers picking up the bill for more dependants.

To give you an idea, the number of people who are over 65 at the moment’s about 16 percent; in 40 years’ time it’s 26 percent—more than one in four people eligible for the pension. And by the time you take out kids that don’t pay any tax—and there always seem to be a few people on unemployment benefit, especially under Labour—then the number of people left to pay the bills is vanishingly small.

And to give the Treasury some credit, they do go into what might make it possible for those bills to get paid. Well, actually, they make a few assumptions: they think that Government will be able to borrow at 2.3 percent by 2045. So they’re predicting that interest rates are going to be stay really low—I hope they’re right. They’re predicting 1 percent per year labour productivity growth. And GDP growth is, therefore, a measure of labour productivity and how many working-age people come and stay in New Zealand. And that gets you to a few conclusions: for the next generation and the one after that, the people who are going to be working and paying taxes in this country for the next 40 years, according to this report, what matters is how many people choose to come and make their home in this country and stay, and what is their labour productivity.

And you can guess from that that a few more things are going to matter. Do we make it attractive for young people to be in New Zealand? Do we make this a place where they have good jobs that are connected to global opportunity? Or are we going to spend most of our time and our national life navel gazing about identity, obsessing over co-governance and political correctness—that most people disagree with and have never had a say on? Are we going to have an economy that ties people up in constant bureaucracy, where it takes longer to get permission to do things than actually do it?

And is it going to be the case that every time this Government worries about the cost of living its only answer is to tax off people who are productive and give it to someone else? Because if that’s going to be our philosophy—and I’m sorry but that’s a summary of this Government’s philosophy—then we are not going to attract highly productive people, we’re not going to attract them to come to New Zealand, we’re not going to retain them when they’re here, and we’re not going to get foreign investment. We’re going to be a place that will actually lose the ability to look after people. That’s the thing that the Labour Party often fails to understand; if you can’t get production, then you can’t pay for Labour’s projects. And this report is a wake-up call that this country needs to start thinking about productivity and stop indulging Labour’s fantasies. Thank you, Madam Speaker.

About 2½ years ago now, when I, like all New Zealanders, saw the ominous approach of COVID-19, we saw what it was doing around the world. We looked at China, we looked particularly at Italy, and we knew it was coming.

An announcement was made that we were going to lock our country down for an unknown period that could be up to six weeks or two months, and it was something of an eye-opener for me. It was a bit of a road to Damascus, because I remember sitting there thinking that you can’t shut a country down for six weeks or two months, because the long-term fiscal impacts will be so great that we would actually give away everything that we’ve got in the however many years we measure ourselves as having been in New Zealand. But I do remember that the Prime Minister at the time said, “If we look after the people, the people will look after the economy.”, and that’s exactly what happened. We did look after our people and, in doing so, the dire projections that were made in most of the fiscal and Treasury predictions at the time didn’t come into play, and they didn’t come into play because we did concentrate on that which makes up a country: its people. So we did that, and we do now find ourselves in a much better position than we would have been by doing just that—by concentrating on our people.

Now, I move forward to the document we’re discussing today, or the background to it: He Tirohanga Mokopuna 2021. As the previous speaker has said, it does make some quite ominous reading, because, on sitting and reading this document, it outlays many scenarios. It looks at the demographics to come, it looks at the income to come, and it looks like the state of the world. Taken alone, you could walk away and you could actually end up thinking the way I was thinking in March 2020, which was that “Yes, we’re were in real trouble here.” Actually, we’ve now run an overlay of this—run an overlay of this—of people.

Now, you’ve heard some speeches from across the floor in which they presuppose the status quo, and that’s when I sit on this side of the House and feel very fortunate to be here, because those members on the other side of the House, such as the member who just spoke, the shadow Minister of Finance—what they make all their predictions on is the fact that nothing will change, because they know it can’t change because they represent the status quo. They represent those who benefit from the status quo; therefore, nothing can or will change.

We’ve only got to have a look at the history of this country to see the major changes that have taken place that have enabled us to be where we are today. I look at the Treaty of Waitangi, and that was unique. That was something that, for the first time, colonials did respect, or attempted to respect—let’s not talk about what subsequently happened. But there was certainly an attempt to acknowledge that the indigenous people—Māori—did have rights in this land, and that’s something that had been pretty much ignored everywhere else that Europeans had gone beforehand. That has laid the framework to where we are today, and for many of the things we consider, we consider against that framework.

The next thing was the land reforms of the 1890s. Now, New Zealand was, essentially, owned by about 270 families around the country, who were only interested in grazing this country and weren’t interested in intensifying. They weren’t interested in the burgeoning meat trade, because they were doing very well, thank you, from just producing wool and sending it back to old Blighty. Certainly, Jock McKenzie, at the time, and Richard John Seddon realised that this country was not going to thrive if we allowed those who were beneficiaries of the status quo to call the shots, and, of course, calling the shots they were. You’ve only got to have a look at the occupations of those who were in this place, or the equivalent of it, at that time. So, fortunately for us here today, again those changes were made, and we now have a country that is able to turn into the intensive, productive, agricultural country that it is. That simply would not have happened had those who were the beneficiaries of the status quo been listened to.

I then move through to the Depression, and we compare ourselves with the United States here. When we locked down and when the world’s economies collapsed around our ears, what did we do? We, basically, retrenched right across the board. They had Herbert Hoover in the United States, and here we had the then country party, led by Forbes, which I think was the name of the leader of that Government, who, essentially, looked after the status quo. The decision was made that they would entrench the spending, and those who really suffered were those who were on the periphery—the poorer people. But the ones who got through the Depression—in fact, history will show that many of those families who made quite a lot of money during that time actually had money when going into it.

Then, coming out of both those situations, where there was the New Deal in the United States under Roosevelt and, of course, here, we had Michael Joseph Savage, we entered into a major State house - building regime—again, things that we are beneficiaries of today. All those things, again, were opposed and they were all things that couldn’t possibly have been done by a centre-right Government at the time.

So in the time given to me—in fact, I see that the time has gone very quickly—we could actually go through many of these things, but we arrive where we are today at this report. Now, again, those dire projections have been made. One of the things that comes through here is the change in the demographics that is going to happen in this country, and the reason why we simply must invest today where we are is that the money that we have, we’ve borrowed. An amount of it has been borrowed. We’ve been through a fiscal shock, a long-term shock, a hundred-year shock, against which, again, we could have retrenched. We could have, basically, not borrowed any money. We could have allowed the businesses, who have benefited greatly, despite the accusations from across the floor, from wage subsidies and the other fiscal stimulants that have happened, and—

💬 Hon Member: But it’s just to help pay the wages.

—unless they’re in tourism or hospitality, they’ve generally done pretty well. And those members over there who are complaining at the moment, I would challenge them to go and talk to their local tradies and ask them, or go and talk to the businesses involved in construction and see what their biggest problem is. Their biggest problem is actually an inability to deliver, and at the moment, it’s certainly not a shortage of orders on their order book—that’s not the thing those members will hear.

Again, we’ve got ourselves into that situation, so we now go to look at the future, and this is a good document. We’ve heard all the speakers here talking about how it is essential that we do look at the world we will be in in 2040. The bottom line through here through the different scenarios is that you can put a template against it as to what we are doing today, and what we are doing today is investing in our people. You will see that the money that has gone on apprentices, for example, means that we will have a generation of highly trained people through the next 20 or 30 years, because we’re getting that with those tradies I talked about before, many of them are looking at retirement. They will be replaced, so we will have a workforce capable of keeping this country working.

We look at the money for education, and, again, I’ll go back to something that the speaker Nicola Willis talked about, which was Better Public Services. What they were was cheaper public services. Anyone can run a surplus if they don’t pay the bills and they don’t do the maintenance.

What this Government has had to do in preparing ourselves for the scenarios painted here in this report is to ensure that we do have the actual schools available where our pupils will be taught. There’s no point in talking about the need for education if we’ve got nowhere to teach them, and that’s what happens if you don’t pay the bills and you don’t do the maintenance. For example, if you don’t build the classrooms and you don’t maintain the classrooms, which, again, was a legacy of the last National Government, then you end up where at some stage, someone has got to pay those bills—because the status quo says, “We don’t need it right now for schools.”

I look at what happened in Tauranga as a very good example. If you don’t invest in the sorts of services that your young people need, you end up with a town that is where it is now, and that’s why you need to appoint a commissioner.

So, against the background of this, I look at what this Government is doing, where our investments are going, and where the borrowings are being invested, and I am satisfied that, knowing what’s coming, we’re doing what we can now to ensure that we inure ourselves against that. Thank you, Madam Speaker.

Thank you, Madam Speaker. I fear the Labour colleagues who have just been speaking have not got the meno about what this debate is, because Dr Deborah Russell spoke virtually all about the present, and Greg O’Connor gave us a treatise on what happened in the 1880s. But actually what this is about is the next 40 years.

Now, I’ve mentioned this before, my favourite economist is Henry Hazlitt, and I commend his book, Economics In One Lesson to all MPs as a primer on what—

💬 Helen White: No. Ha, ha!

Oh, there she goes. Yes, well, there’s the socialist chuckling away. But let me remind the House what he said in part one: “The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences … not merely for one group but for all groups.” And then he went on to say this: “There are men regarded today as brilliant economists, who deprecate saving and recommend squandering on a national scale as the way of economic salvation; and when anyone points to what the consequences of these policies will be in the long run, they reply flippantly, as might the prodigal son of a warning father: ‘In the long run we are all dead.’ And such shallow wisecracks pass as devastating epigrams”. Well, I would suggest that that prodigal son is none other than the Minister of Finance, Grant Robertson, because he is kicking the can down the road on all of the significant issues that the Long-term Insights Briefing has got. And we’ll touch on the three main ones: superannuation, healthcare, and climate change. And I’m afraid the Government’s position on this is woeful.

First, the rhetorical question: if this is long term and we don’t have to panic today, at what point do we start doing small things differently regularly so that in 40 years’ time we don’t have debt at 200 percent of GDP? And the reality is that should already have started. And the previous National Government in the 2017 election campaign—in fact, the last two—started an honest conversation about what superannuation changes might be necessary and the small but direct changes to the eligibility criteria that would take the worst edges off the cost of superannuation in the next generation. And Jacinda Ardern agreed with the previous National Government when she was in Opposition. In fact, she thought we weren’t doing enough. But when she became Prime Minister, she vowed to resign rather than make changes to superannuation policy. So here’s a Government that says, “Oh, yes, we’ve got to take important action.”, except they don’t take important action. And when they do, it goes the other way.

Take climate change. There’s been quite a bit of discussion here, and there’s been lots of lofty rhetoric by both Labour and the Greens on this, only their record is terrible. Gross greenhouse gas emissions are going up, not down. That’s exactly what happened with the Clark Government when they talked a good game and greenhouse gas emissions went up by 10 percent on their watch. They flat-lined over the nine years of the previous National Government, notwithstanding that there was quite significant population growth. A Labour Government comes back to office, and greenhouse gas emissions go up again. Why aren’t we surprised by that? They ban oil and gas in the Taranaki, and then import 2 million tonnes of Indonesian coal to fire up Huntly because we have a problem with electricity supply.

💬 Simeon Brown: Oh, that works, doesn’t it!

Even Te Huia—my favourite one and Simeon Brown’s as well: we know that it would be less harmful on the environment to take the passengers on the Te Huia train and put them into four-wheel drives. They would get there quicker, cheaper, and with fewer greenhouse gas emissions. How on earth is that a progressive Government actually doing policies that are going to avoid the sorts of harm that this report proposes?

And I won’t have time to touch on the third of the trifecta, and that is the health system. But I’ll just say this: at a time when we need to ensure improved health to prevent long-term conditions, this Government is focused on spending half a billion dollars rearranging the deck chairs in the health system for no demonstrable gain in health outcomes for New Zealanders now nor in the future. That is a significant waste. It’s a distraction in the health system from what we should really be doing: small, steady steps towards avoiding these, and we’re going backwards.

I find it quite incredible that Te Paati Māori has chosen not to speak on the long-term fiscal position. I’m happy to do so in relation to Māori health, because if there’s any party that should be speaking on Māori health I think it’s the Māori Party. Māori have been side-lined and excluded for decades and they have the worst wellbeing outcomes in New Zealand. We all know the statistics. They’ve got significant lower life expectancy and significantly higher rates of chronic and infectious diseases, injuries, and suicide. The report acknowledges that if we think COVID has been difficult, the challenges that we’re going to face around some of these things like health, like an ageing population, and like climate change are going to make COVID look like a walk in the park. It highlights the importance of planning.

There’s a saying, an old saying: if you fail to plan, then you plan to fail. Well, National has no plan. Their policies have failed Māori. In fact, they simply don’t have policies. They say they want equality of opportunity, but they refuse to articulate a single policy that will help Māori achieve equality. Worse, they say they will cut the new Māori Health Authority completely. History shows that a tweak here, a tweak there doesn’t work for health reform. We need to make a fundamental change and I have seen what “by Māori, for Māori”, and for everyone else, can do in my own electorate in Taieri, looking at Te Kaika. It’s our local health provider.

They were the first in New Zealand to set up a drive-through vaccination clinic at the Edgar Centre in South Dunedin. They had that clinic set up overnight prior to the vaccines even being delivered, and the Southern DHB thought, “Oh, we’d better get on to that waka.” They got the vaccines delivered. Te Kaika got vaccines into people’s arms incredibly quickly. My own family went down and by December 2021, almost 100,000 people in Dunedin had been vaccinated by them. They drove the region to one of the highest vaccination rates for Māori in New Zealand. That is what collaboration looks like, that is what success looks like, and that’s the type of model that the Māori Health Authority will be able to empower in New Zealand. It’s about partnership. It’s about having a seat at the decision-making table for health.

But the National Party don’t understand wellbeing. They don’t understand that wellbeing is achieved differently by different people, and then achieving wellbeing is a key driver of equity. The report that we’re debating today underscores that. It highlights how important social inclusion is for our long-term fiscal health. The Treasury gets this. In fact, the Treasury yesterday released a report which looks at the Living Standards Framework, and it tweaks them. It adds to them some fundamental institutions such as whānau, hapū, iwi, households, civil society, markets, and so on. And what that does is it helps us to get a baseline for wellbeing from which we can plan into the future. That report says that addressing 21st century challenges means a greater focus on long-term intergenerational wellbeing outcomes. That report, by Treasury itself, says it’s going to take more than macroeconomic levers to do that.

That’s how this Government operates as a Government. We are looking at wellbeing, we take wellbeing seriously, and we are measuring it. It has given us the baseline to be able to make the 1 April changes which have put more money into the pockets of students, superannuitants, working families, minimum wage earners, and others. We have done that by taking this country through COVID and weathering COVID with an economic outlook that is better than many of our key trading partners. Our economy has grown by 4.9 percent, outperforming most of the OECD. We are in a strong fiscal position. Despite what the other side would have you say, our debt is lower than expected. Our deficits are lower than expected.

National has no plan except to cut taxes for the rich, for those earning over $180,000 by several thousand dollars a year, by giving $2.50 or so tax cuts for our lowest workers, and by building a whole bunch of new roads. Well, that’s not going to be great for climate change. Labour has got us through COVID, and Labour will get us through the next decades because we have a plan, we care about wellbeing, we have a baseline, and we care about people. Thank you, Madam Speaker.

A reminder to all of our members who are online. Please seek a call if you’re expecting to take a call. The next call is a split call and I call on Debbie Ngarewa-Packer, who is joining us remotely—five minutes.

Tēnā koe e te Pīka. Tēnā tātou e te Whare. It’s good to be here to speak, certainly as a tangata whenua for Te Tiriti, which may have started in the 1800s but didn’t end and evolves, as we too must evolve, in a Tiriti-centric Aotearoa.

So Te Paati Māori give credit to the Government in some parts; certainly for trying to change how we view economic success in Aotearoa—an inclusive society that is embracing their tangata whenua. We’ve long known that GDP is not an accurate measure of success, let alone of the health of our people and environment. So we need to ensure the changing of public perception matches the changing of the reality for Māori. COVID-19 has highlighted this reality and exposed just how brittle our economic system is during times of crisis and, as usual, we have seen Māori take the full brunt of it. We will continue to support the Māori Health Authority and more thought towards supporting the Government that realises our potential.

A few things for us stood out in this year’s statement from the Long-term Fiscal Position. One is that people living longer, healthier lives could become fiscally unsustainable if the retirement age doesn’t shift to reflect this. My tungāne Rawiri Waititi caused a bit of a stir in the media last week when he suggested we do just that: change the age for superannuation to better reflect life expectancy statistics. When we look at the fact that life expectancy for Pākehā males is 80.9 years versus 73.4 for Māori, and 84.4 years for Pākehā women versus 77.1 years for wahine Māori, it would only be consistent and equitable to lower the retirement age for Māori to reflect this.

As referred to earlier, Treasury predicts that by 2060, 26 percent of the population will be over 65 years old, compared to 16 percent in 2020. So by 2043, Māori are projected to account for 21 percent of the population but only 11 percent of the 65-plus population. So while people around us are debating co-governance and stale politicking, the reality is we have a health system that sees Māori die seven years earlier than non-Māori in this country. At the same time, every piece of advice given by tangata whenua and experts over the course of this pandemic—and other health kaupapa—has been ignored.

So it’s good to hear earlier that the Minister of Health is acknowledging this and reviewing what could be done better. Until we are able to raise life expectancy with radical change across the board, Māori will continue to work themselves to the bone for this country while not living long enough to fully enjoy the benefits of their hard work.

Another statement worth highlighting from this report is that our current debt levels don’t need to be lowered for our Government to continue to borrow money. Change is happening, and yet we still have the National and ACT kei te tangi hei te kurī [crying like dogs] every time the Government invests just a little bit into social services, as though debt collectors are waiting at the Parliament steps. It’s no wonder the Leader of the Opposition had no idea what the word ‘public’ in ‘public transport’ meant yesterday.

The report also talked about a more sustainable taxation system. We need an end to the current situation which has poor and working class people subsidising the rich through tax policy. Right now, we’re seeing the biggest wealth transfer in generations from hard-working whānau to greedy property developers and landlords who’ve created a generation of renters living pay cheque to pay cheque. So we need to shift this tax burden through tax on wealth including capital gains, ghost houses, pollution, and land value. We would provide tax relief to low income whānau while improving the progressive nature of the tax system, including through exempting food and sanitary items from GST.

We’ve got a plan to do this and we welcome the Government to keep picking policies from our manifesto and to implement. An easy one could be to remove GST from food. We’ve seen things being done overnight by lowering GST.

Before I end, I would like to say that, look, we need to raise the minimum wage to $25, we need to double baseline benefits, we need to stop punishing beneficiaries with sanctions, we need to cancel income support - related debt, and we also need to support a Government that’s focused on creating a sustainable economy. We want a fair society and healthy environment. We are the only party in Parliament whose tax cuts aren’t for the rich. Our people are struggling and we need to make sure that we have an economy that’s able to have a liveable climate. Kia ora koutou katoa.

Thank you, Madam Speaker. I want to talk from my perspective as a new MP. I came in and I went into two select committees. One is the Finance and Expenditure Committee and the other is the Transport and Infrastructure Committee and what I have been absolutely pleased to see is that what we do firmly always looks forward. It isn’t something where we are stuck in the present or the past; we are looking always to a better future. So I’ve done things like met people like the Infrastructure Commission and the Green Investment Fund and those bodies have been set up specifically to make sure that we actually doing that work.

This was a very interesting report because it looked at that perspective of 40 years and it was something which contrasted with some of the behaviour I’d seen in the interviews that we’d done, etc. from the Opposition because I firmly come to the conclusion that what was going on was there was a living as if there was no tomorrow. There was a platitude—there were lots of platitudes. There were lots of things like, “We are for investment in electric vehicles.” but actually then there was a crying out of material which was, “No, no, we can’t go this fast. We can’t do it this way. It’s a tax.”, etc. Every impediment that could be put up was put up to actually moving towards that sustainable future and it worries me because it is of concern that that is what the New Zealand public are being told.

Now, my experience was also in Auckland, where I had seen what had happened to transport because people hadn’t thought forward. In fact, one way of looking at this is to look back and to say, “Forty years ago, what should Auckland have done?” What Auckland should have done is it should have had a decent public transport system and it should have invested in it.

One of the things that was absolutely a lesson for us all was our health system, because what we had in our health system when I arrived in the early part of my involvement in 2017 in the Auckland campaign was we had decrepit hospitals. We had hospitals where there was water dripping from the roof when people were trying to conduct a surgery. That was utterly unsustainable. And what we have now is a report that we are looking at which talks about that. Not only does it talk about building up and reforming the health system as being an absolute priority for the 40-year future but it also talks about the connections of that health of our people with all the other parts of our economy. It makes the connections in the report about things like actually the state of our houses.

I remember in that 2017 campaign I talked to Dr David Geller and it was one of those things I’ll never forget because he had worked in health for a long time—I think he’d just become New Zealander of the Year. He talked about how chronic health had been an issue. So he started his career in health looking at trauma because people would come in with an accident, and by the time I was talking to him in 2017 it was all about chronic health issues because people were living in damp conditions. The children had rheumatic fever. Those are consequences that we will see play out for the next 40 years. So all these things are interconnected and this report actually points that out and it talks about responses and it talks about the absolute social contract that we have in health—that now people understand how important it is.

After all, I think it’s not a coincidence that it comes from the Labour benches, that connection, because it is about understanding the connection between people. That’s a fundamental ideal of Labour—that connection between people, no matter how much they earn. Whereas if you earn lots, if you are on $180,000-plus, it’s very easy to forget that connection between people, that actually it’s going to be OK for you because, at the end of the day, you can write a cheque. Unfortunately, most of the country can’t write the cheque. They need a health system that actually does produce, and I think we’ve finally got a handle on it. I think we’re talking about equity rather than equality. We’re talking about actually providing people with equitable outcomes. I commend that response. Thank you, Madam Speaker.

Thank you very much, Madam Speaker, and I rise on behalf of the National Party and as the member of Parliament for North Shore. I firstly want to acknowledge our deputy leader and finance spokesperson, Nicola Willis, for her contribution earlier today. The National Party strongly supports long-term planning, and acknowledges the importance of long-term planning in terms of the future of this country. Over the next 40 years—and we’re talking forward to 2060—we’re obviously going to work very hard to grow our country and ensure that it is both fiscally and environmentally sustainable. And in 40 years, I’ll be in my 80s, so I might not still be standing here in this House, but my children will be in their 50s, and in 2060 there’ll be other MPs, no doubt standing in this House—maybe at this pillar right here—and we need to ensure that the decisions that we take over the next 40 years put those individuals in the very best position that we can do to make sure that they can take advantage of both the challenges and opportunities that they will face at that point in the future.

I want to acknowledge, if I may, those who have come before us, because I think that is the point of what this long-term plan is, and in particular, my grandparents who fought in World War II—in the Pacific and Africa and Europe, and in the medical corps in Japan during World War II—and I wear my poppy today in pride and remembrance of them and other people who have served our country.

So the people within this House, and those in this room right now, are in a unique role in order to make decisions around the long-term future of this country, and, in effect, our role is to ensure that we are guardians in terms of the prosperity and protection of this country. But we are at an important point and crossroads right now in terms of our country’s future. In this report on the long-term fiscal position that Treasury have put together—and I want to acknowledge the work of Treasury, because I think they’ve done a good job in terms of this report. But we have a cost of living crisis in this country, and middle New Zealand are being squeezed. So that is the current challenge that they are faced with right now. And we also have inflation that is running at very high levels, and so what that simply means for Kiwis out there today is things are more expensive, and their ability to be able to afford those elements within their lives that are, in effect, “nice-to-haves”, are just simply becoming out of reach.

The other aspect in terms of what will impact us in terms of the next 40 years is that the interest rates have nearly doubled in the last two years. And so what that means in terms of the affordability for Kiwi households is that the ability to repay that mortgage is going to take longer for a home loan, and it also means that household budgets for Kiwis that are out there today are going to get tighter and tighter, and that is real pressure.

So the importance of decisions made off the back of this plan are critical, and, sadly, under this Labour Government, what we have seen is a doubling of debt, nearly, in the term in which they’ve been here, in the last five years. And this debt is forecast to increase, as well.

So we’ve got a significant burden and issue building in the background that we are going to need to resolve and mitigate, to be able to set up those that come after us in the future to be able to deal with the challenges that they will face. Because the reality of what we’ve been through with COVID in terms of that economic shock is that it has had economic and societal implications—we’ve got to be clear—on our population, such as the low attendance at our schools, which has been an implication in terms of the COVID element. We’ve seen a decline in the mental health of our population. Those impacts are going to be felt over the next 40 years, and we’re also seeing increasing crime and increasing family violence. These factors all will impact the implications of decisions that we will make over the next period of time.

The other aspect that’s going to impact this is the large-scale reform that this Government is embarking on, particularly around health and in local government. The real issue there is that it is built on benefits that are unsubstantiated; they’re not going to deliver the outcomes that they talk about. And this is the burden that this Government is leaving for future generations, and that is a great shame.

The other reality is that we’re going to face economic shocks or natural disasters, according to Treasury, every seven to eight years. So the reality is by 2030, we in this House are going to have to deal with and respond to another significant event, and it may be before 2030. But these events will and do continue. And so our ability to deal with what’s in front of us today—respond, but also quite rapidly begin to start setting ourselves up for what comes down in the future—is also critically important.

So I think what Kiwis are really looking for out there is a Government that’s going to put in place a practical and competent plan in order to deal with it—a plan that deals with the short-term implications that we’re faced with, but also a plan that delivers long-term outcomes. And what we see from that side of the House is a lot of talk but not delivery around the outcomes that Kiwis need in this country. They need a Government that’s going to get results, not just talk and make promises, and do what every Kiwi household does today: they live within their means. And this Government has lost focus around that.

This Government is on a trajectory of higher spending, and it’s reinforced in this Treasury report. The higher spending is becoming baked in, and that is only adding to the fact that our debt levels are increasing, and Treasury have stated that this trajectory is not sustainable. So we need to have an adult conversation with the country. Kiwis are sensible, and they understand that this Labour Government can’t continue to spend like there isn’t any tomorrow. They need to be prudent and considerate, but they also need to be accountable for what they promise, and balance the books and make sure that we have a programme to repay debt.

What we definitely know from the finance Minister over on that side is that this Government will not repay any debt while they’re in the seats over there. They keep referring to percentage of GDP as a measure. They will not repay the debt, like every other household in this country needs to do, and that is a great shame.

So New Zealand needs a plan to address the level of debt that we face, and the Treasury, actually, provide a number of recommendations and options within their plan. This Government had their heads in the sand in terms of dealing with this issue. They can’t keep kicking it for touch. They can’t keep buying time and not dealing with this issue. And we’ve heard that across on the other side in regards to superannuation. It is loud and clear. They are ignoring the advice of officials that our population is living longer, we are more healthy in old age, and if we do not deal with the issue around superannuation, which is increasing the age of eligibility, the trajectory of debt is unsustainable.

On this side of the House, we understand the reality that impacts Kiwis; on that side of the House, they’ve got their head in the sand on the big significant fiscal issues that will have implications on my children and future generations, and we need to see some leadership and some competent fiscal management around that.

The other aspects that are raised in this report that are really concerning is the Minister has not asked Treasury to prepare analysis on what it would take to balance the books. How is it possible that he has not asked that simple question, he being the Minister, around how you would balance the books? That shows that there is no forward look around how we’re going to deal with the issues that these guys are building up.

And the other aspect, as I mentioned, is around the superannuation trajectory. These are unsustainable and they ignore the reality that is going to hit Kiwis. So Treasury have said the way in which you deal with superannuation is increase the age of entitlement. On this side of the House, we agree with that, and that’s something that we’ve committed to. Why? Because that is the sensible thing to do.

They have also recommended that you reduce spending, particularly around new spending. Well, we’ve talked a lot today around the fact that we need to focus around quality of spend, and we’ve got a number of examples, as my colleague Andrew Bayly mentioned before—a long list of examples where we’ve seen poor quality of spend.

Lastly, Treasury, in their wisdom, say that we should increase tax rates. Well, I tell you what: on that side of the House it’s the one thing they’re good at, aren’t they? They’re great at increasing taxes that impact Kiwis and households, but they haven’t talked about the fact that we need to grow the economy, and that’s what, on this side of the House, we will do. We will mitigate the impacts of the cost of living crisis, we’ll focus around growing the economy, and we’ll make sure that we are investing in health and education and law and order and also addressing climate change. But also, in addition to that, we’ll make sure that we are preparing for the future and the next economic shock that will impact us. Only under a National Government, under Christopher Luxon and Nicola Willis, will they be able to deliver these outcomes for Kiwis and for New Zealanders. Be accountable for getting what needs to be done, done. I tell Kiwis that are out there at the moment: hope is coming to a town near you, soon. National will get it done.

Thank you, Madam Speaker. Well, we’ve heard it officially: National is increasing the age of super to 67. This means that people aged 65 and 66 are going to have put their bodies on the line—their bodies on the line—for two years to pay for Chris Luxon’s tax cuts. They’re going to pay for Mr Bayly’s tax cuts because the hard-working New Zealanders, those who work hard, have been told today by the National Opposition that they don’t deserve the pension. If you’re 65 you miss out; if you’re 66 you miss out—you have to wait till you’re 67. Looking to the future, we must always care and look after our older people so they can retire with dignity. And this is why Labour has made a commitment to make sure that we have no changes to the rate of the entitlement age for New Zealand superannuation because we believe—this Government believes—that people of 65 and over are worth it.

This is, sadly, in stark contrast to the Opposition National Party in outlining, frankly, what must be the only plan I have heard from the National Party. The only plan they’ve got for the future is to raise the pension age. And, let’s not forget, they don’t want to put any more money into the Superannuation Fund either. And let’s not forget another thing about the National Party: they were against KiwiSaver—that’s right, they were against KiwiSaver. So they’re not in it about looking after people in retirement. Not at all.

Now, it was a brutal blow when they cut contributions to the Cullen fund—$20 billion lost over a decade—but that’s what a conservative bunch they are. This decision to not put any money into the Cullen fund is something they’re going to do again. The super fund is a long-term investment funding a global portfolio. It’s an approach to help smooth out the cost of superannuation between today’s taxpayers and future generations. And this is what we’re here to talk about: the future.

Our commitment is keeping the superannuation age at 65. It’s also why we started back the contributions to the New Zealand super fund, to ensure the sustainability of superannuation and the current retirement age. This New Zealand super fund has posted its strongest result ever. It increased it by 29.63 percent, ending this financial year at $59.8 billion—an increase of $15 billion over the last 12 months.

Now, as the local member for Tukituki, it’s very important that I actually talk about the types of investment that the super fund does because, right in my electorate—for example, take Turners and Growers’ global partnership with the New Zealand super fund and an innovative alliance to invest in Envy Apples, one of New Zealand’s premium and delicious export apples—they invested in 40 hectares on Hawke’s Bay orchards right in the heart of Hastings. But oh no, oh no, National wouldn’t do that. National aren’t into investment, they’re not into growth and opportunity—that’s not what they’re here for. They’re here to lift the superannuation age to 67, where all of those hard-working people are going to have to work for another two years to pay for the tax cuts of people who earn over $180,000 a year. Mr Luxon, he’s going to get his $8,000 bonus in tax cuts at the expense—at the expense—of people having to now wait another two years for their pension.

Now, if we keep investing in the New Zealand super fund, by 2030 we’re going to have at least $109 billion in that fund—$109 billion in a decade. Imagine what we’ll have by 2040. And, as this report shows, New Zealand currently spends considerably less on pensions than the OECD average. And, as with other advanced countries, this percentage is likely to increase in future years, and we are well aware of the long-term pressures associated with an ageing population, but that doesn’t mean you just up the pension age. This is why we have committed to ongoing contributions to the New Zealand super fund—we don’t believe that raising the age of eligibility would be equitable.

Remember, we have introduced a Māori Health Authority to help because we have a Māori population who are dying younger—dying younger—than our population. So this is why we need to invest. And, as this report shows, transitioning to a retirement age of 67 does not actually solve the problem.

Now, the second point I would like to make is this:

💬 Hon Gerry Brownlee: That’s it, nothing. Nothing at all.

And that speaks volumes; silence speaks volumes. “Nothing. Nothing at all.”, Mr Brownlee, because that’s what we hear from the National Opposition—you have no plan for the future. You never, ever, ever come in and say your plan for the future; the only plan you’ve got—the only plan you’ve got, Mr Brownlee—is to increase the pension age to 67.

Now, this speech is about the future, and I just got off a Zoom call, hearing my daughter’s school report and talking to her teacher via Zoom. That’s technology.

💬 Kieran McAnulty: Was it a good report?

It’s fantastic—fantastic. And that’s technology, though, because the future is about innovation. The future is about having ideas and entrepreneurship, number eight wire thinking—that’s what this future should be about. And that’s why this Government has a plan—we’ve put climate change right in the front, we are backing Kiwis, we are backing business, and we are backing our older generation because we will keep the super age at 65. We believe that it is absolutely imperative that we look after our older generation. And that’s the exciting future that people know from this Government, a Labour Government, who are putting people first. Thank you, Madam Speaker.

The question is that the motion be agreed to.

Motion agreed to.

I declare the House in committee for further consideration of the Appropriation (2020/21 Confirmation and Validation) Bill and the COVID-19 Response (Courts Safety) Legislation Bill.