Taxation (Cost of Living Payments) Bill

I present a legislative statement on the Taxation (Cost of Living Payments) Bill.

💬 DEPUTY SPEAKER: That legislative statement is published under the authority of the House and can be found on the Parliament website.

I move, That the Taxation (Cost of Living Payments) Bill be now read a first time.

The world is experiencing inflation at higher rates than we have seen for many years. This is a combination of the effects of COVID-19. COVID-19, of course, disrupted methods of production and transportation around the world, and those effects are not yet over. This is part of the cause of inflation, as is the rising domestic demand in New Zealand and around the world which has meant that most of the world’s rebounding economically from COVID at the same time, creating inflationary pressures.

So inflation was already building when the war in Ukraine sent energy, fertiliser, and food prices higher, squeezing household real incomes. This is not just a New Zealand phenomena; around the globe, we’re seeing all countries grappling with the same issue. In the US, inflation is running at 8.5 percent; in the UK, it’s 9 percent; and, as the Minister of Finance in his Budget address today said, the OECD average is 8.8 percent.

We know that the cost of living affects just about all households, but it most affects those who are on low to middle incomes. We’ve already taken a number of steps to help those households: we’ve, of course, significantly increased the minimum wage each and every year; we’ve increased family tax credits; and we established the Best Start payment and the winter energy payment.

Treasury says that inflation will outstrip annual wage growth this year for the first time since this Government was elected in 2017. I noted in the Budget documents that the prediction for this year is wage growth of 4.6 percent against inflation of 6.7 percent. This follows years of strong wage growth and the same Budget forecasts from Treasury that next year, under this Government’s economic plan, wages will once again grow much more strongly than inflation. I would point out this is in contrast to the record of the prior National Government, where real wage growth was negative through the global financial crisis and remained very anaemic long afterwards.

In recent months, we’ve helped in other ways: we have slashed fuel excise duty, we’ve cut road-user charges, and we’ve halved public transport fares. Today’s Budget extends those measures and also halves public transport costs to more than 1 million people on a permanent basis. We’re also committed to dealing with some competition issues in the grocery sector to ensure that people pay fair prices for food and other basics—that issue will be covered in more detail in respect of other legislation which we are proposing to pass through all stages as part of this urgency motion to remove barriers to new retailers entering the market.

In addition to all of those measures, the Government is, by this bill, introducing a payment of $350 to help low and middle income people cope with current inflationary pressures. For each individual recipient, this is equal to half the couple rate for the winter energy payment. The payment is a temporary measure to provide support for individuals who earned up to $70,000 in the last tax year and are not receiving the winter energy payment. The income cap of $70,000 has been set to provide support to those who earn up to around the average annual wage, which is around $65,100. On that issue, with respect, the Leader of the Opposition had it wrong in his Budget address, about an hour ago.

This initiative is not aimed at people who are on a main benefit or superannuation; those people are already being supported through the measures I previously described, such as annual cost of living increases and by the winter energy payment which provides support for their living costs through the winter months.

A large group of people is supported by this payment—approximately 2.1 million New Zealanders will be eligible for the payment. The total payment of $350 will be split into three monthly instalments, each of around $160 million, with the first on 1 August, and this will be paid out by Inland Revenue. There is no application process. For those eligible, Inland Revenue will make the payment by direct credit into the person’s New Zealand bank account. To achieve this, we need to make some relatively minor changes to tax legislation to allow Inland Revenue to make that payment using information that Inland Revenue already holds.

As I said before, the first instalment will be made to eligible people by 1 August. This date allows Inland Revenue time to prepare for the payments, including obtaining bank details for the over 200,000 taxpayers for whom we don’t hold a bank account currently. It will also enable more people to complete their tax returns for the year ended 31 March 2022, upon which the entitlement is based.

The International Monetary Fund has said that now is not the time for substantial tax cuts. In contrast to other parties, we are not promising tax cuts that give hundreds of thousands of dollars each year in tax cuts to CEOs and little to others; we believe our solution is better and fairer. In conclusion, this payment will help more than 2 million New Zealanders, and I commend this bill to the House.

The question is that the motion be agreed to.

We have, today, the spectre of band-aid economics for an economy that is broken, for an economy that is sending New Zealand backwards, that has New Zealand households struggling with a cost of living crisis that is not only the deepest that’s been experienced in 31 years but a cost of living crisis that we learn, in the Budget today, is set to continue for many years to come. This is not a temporary cost of living crisis, which you might believe while you listen to David Parker talking about a three-month measure. This is a cost of living crisis that is set to have inflation outside the band that New Zealand has accepted for 30 years, above 30 percent, well out to 2025. If you think it’s bad this year, New Zealand, with inflation meaning that everywhere you go, the groceries, the petrol, every price you pay is going up each month, then don’t think it’s getting better under Labour.

Today, the Treasury confirmed that next year inflation is going to keep pumping hard. It’s going to be at 5.2 percent. Then the year after that, in 2024, are we going to see it come back then? No. It’s going to be at 3.6 percent. So what does that mean for hard-working New Zealanders? It means under Labour, every dollar buys them less. It means that their wages will not go as far. It means that their household budgets will be going backwards.

Do you know who else is going to be hit hard? That is every New Zealander who has a mortgage. We have not had a situation in this country for many, many years where inflation continues outside the band that the Reserve Bank is meant to accept as acceptable for three years. What that tells you is the Reserve Bank is going to be hiking interest rates high and fast, and New Zealanders are going to be paying thousands more for their mortgages.

So every New Zealander needs to know right now that this cost of living crisis is not temporary; it is the permanent gift that Labour is giving New Zealand, and it is set to bite very hard. It is set to take many people backwards. Not only that but we have an economic picture where growth is starting to stall, where we have growth out in the future years falling off a cliff, and we have the prospect of greater incomes in the future falling away.

So what is the Government’s response to this permanent set of challenges? Are they doing what we believe would be sensible and bringing some discipline and rigour to their own spending? No, no. Instead, what they are doing is the biggest Budget blow-out in New Zealand’s history. Fresh from having the highest levels of spending that we’ve ever had to get us through a pandemic, are they winding it back—are they winding it back? No, they are not winding it back.

In fact, what we have is a finance Minister who is not content with the biggest operating allowance in New Zealand’s history at $5.9 billion. No, that’s not enough for him. So ill-disciplined and careless has this Government become about its spending that he’s raiding next year’s Budget kitty as well. That’s right. He’s taking $2 billion from next year and he’s allocating it this year. That’s not enough either. He needs more. His thirst for New Zealanders’ money is insatiable. So he’s taking half a billion from the year after that Budget and he’s allocating that in the Budget this week.

You would think that at $8.4 billion, that might be enough to satiate the thirst that this Labour Government has for spending New Zealanders’ money, but no. On top of that, they’re going to spend the money that they get through the emissions trading scheme. They’re going to spend it on a whole bunch of climate change initiatives, including ribbon-cutting ceremonies for big business. Then what they’re going to do is they’re going to keep spending COVID money on top. So we have the biggest blow-out in Budget history being presided over by this Labour Government in a time of record inflation with a cost of living crisis biting in.

So what should they do? Should they take a band-aid approach and pretend that this is just a temporary thing? Should they say to New Zealand, “Hey, look, it’s only going to hurt for September, October, and November, so we’ve got a little payment just to make it OK.”? Well, we say that is disingenuous in the extreme, because New Zealanders deserve to know that this cost of living crisis isn’t temporary. It’s not a three-month thing. It is going to go on for years. In November, we will christen Grant Robertson “Mr Christmas”, because do you know what the Grinch will deliver for Christmas? He’ll take away the temporary payment. He will say—Mr November will say—“Now, now. Labour’s done all we can. We gave you back a little bit of your own money for a little while and we didn’t like how it felt. I’ve got more spending to do. It all stops now.” Will New Zealanders be better off? No, they won’t, because they’ll be looking forward to more inflation, higher prices. They will be looking forward to slipping further behind each week.

So what is the alternative? Well, actually, what New Zealanders need is a disciplined Government that will get more bang for their buck, and not a Government that thinks it’s OK to just keep hiring public servant after public servant, spending more and more money on strategies and plans that don’t get results, that don’t get outcomes—a Government that will be more disciplined about its spending. Then what they need is a Government that will give them permanent tax reduction, because it is not acceptable for Grant Robertson to let inflation be his stealthy tax, his silent tax increase, that pushes more and more New Zealanders into higher tax brackets and forces them to pay more tax. They deserve permanent tax reduction.

That is why National has put forward a package that would give every taxpaying New Zealander some tax relief by indexing their income thresholds. Our package would be more generous to more people. Anyone earning more than $50,000 or more is better off with our tax reduction plan. For those on the median wage, $55,000 a year, listen in to this: National thinks you deserve $800 per year, not just this year but every year. What does Labour think? They reckon all you’re good for is 350 bucks. Well, I know what New Zealanders are saying right now. Some of them are saying, “350 bucks—you know what I could do with that? I might be able to get a cheap ticket to Australia, and if I buy that ticket to Australia, then I might find a place where I can get ahead once more.”

So we say choose a tax plan that is more generous to more people. Don’t choose a plan that says to some of our skilled, experienced teachers, police officers, some of the doctors in our community, some of the social workers in our community—don’t say to them, “You’re excluded from the plan.”, because that’s what Labour’s saying today. They’re saying to all of those teachers who are on the high step, “If you’re a teacher and you’ve got a partner at home or you’re a single earner and you earn over $70,000, nothing for you.” Because at the heart of this idea is a principle, and the principle is this: Grant Robertson believes he can spend New Zealanders’ money better than they can, and he intends to confiscate growing amounts of their incomes so that he can waste it and then redistribute it to them and expect them to be grateful for it.

Here on this side of the House we say it’s not working. If New Zealanders felt that the extra spending, the 67 percent in extra spending, was making them 67 percent better off, then they might have something to listen to, but they’re not seeing it. They’re sick of the big promises with no delivery. They’re sick of people who stand up and say, “We’re going to give $2 billion—$2 billion—of your taxpayer cash to KiwiBuild, and it’s going to solve the housing crisis, and there’s going to be 100,000 houses.” Then what do New Zealanders actually get out of the end of that? They get 1,300 houses. That’s all they get. They get a housing crisis that worsens, with rents up the most they’ve ever gone up—up $150 a week—with a situation where housing is more unaffordable than it’s ever been, where the State house waiting list has quadrupled, and where last night around 4,500 kids were forced to sleep in a motel room.

So they know not to trust this Government. They know not to trust Grant Robertson when he says he can spend their money better than they can. We say to New Zealanders: you deserve better than band-aid economics and a knee-jerk reaction because Grant Robertson realised he was out of touch and that there was a cost of living crisis. You need a Government that will actually get on top of the cost of living crisis, reintroduce discipline to spending, make sure that inflation is pushed down with a Reserve Bank who actually focuses on price stability—a Government that won’t let interest rates go through the roof, a Government that will give you the permanent tax reduction you deserve so that anyone earning $50,000 a year or more who works hard for their money will be better off. When the band-aid gets ripped off in November, New Zealanders can look forward to the smiling face of the Grinch: Grant Robertson.

The Opposition live in some fantasy world. They live in a world where they can say that an economy is broken when unemployment is down to 3.2 percent, an extraordinary low. The live in a fantasy world where they think it’s a broken economy when growth will be about 4 percent by about June 2023. They live in a fantasy world. We will have net debt topping out at about 19.9 percent of GDP. They call that a broken economy—it is fantastical stuff. It’s the sort of fantastical stuff that refuses to admit that there has been a global pandemic, refuses to admit that this is a Government that has responded nimbly to the global pandemic, and seems to think that New Zealand exists all on its own and doesn’t have anything to do with the rest of the world.

On this side of the House, we are realistic about what is happening in New Zealand and what we need to do to help New Zealanders. Inflation worldwide is rampant; it is running. In the US, inflation is at about 8.5 percent; in Canada, it’s 6.7 percent; in Germany, it’s at 7.3 percent; and in the UK, it’s heading towards 9 percent. The OECD average is around 8.8 percent. In New Zealand, we are not immune to worldwide phenomena, we were not immune to the global pandemic, and we are not immune to what is happening with inflation around the world. In Australia, they are currently at 5.5 percent inflation, and their Reserve Bank over there is predicting it is going to head towards between 6 and 9 percent.

Here in New Zealand, we are experiencing inflation too. But all the predictions are, in the real world, that it will ease off next year—this is a somewhat temporary problem. It is a spike. Do you know why that will happen? It is because central banks around the world are taking action to curb inflation—just like ours. We know that even though all the respectable predictions are that this will be a temporary phenomenon, driven by the supply chain crisis and the war in Ukraine—both situations are expected to ease up—it is nevertheless hard for New Zealanders at the moment. So we have a cost of living package that is designed to help all New Zealanders. Bear in mind that part of this cost of living package is the cut in the fuel excise and the reduction in road-user charges, which has been extended for another two months. It is the subsidising of public transport with a 50 percent fare subsidy, which is being extended for another two months. These are measures that help all New Zealanders.

Every single New Zealand family is better off as a result of those changes, but this particular change that we are debating now is cold hard cash in the back pocket of people on incomes below $70,000. On that side of the House, they oppose it. They oppose helping out families and helping out people who are earning less than $70,000 a year. What did they say? “Oh, we don’t like that.” They just want to carry on their mantra, “Tax cuts, tax cuts, tax cuts.” without thinking seriously about the nature of our taxes.

There’s a really good reason why we have chosen this approach in terms of helping out families through the winter that is coming. It takes time to put tax cuts in place. They don’t just happen magically overnight because someone in fantasyland decides that they should happen. It takes time to get them implemented and through systems. We can do this payment now. It will take a wee while to get it up and going, but it is money that will be in people’s back pockets this year. Unlike the Opposition, we are going to help everyone who has earned an income—who is not currently on a benefit or on super—from zero dollars to $70,000. So more people will be better off with what we’re offering to help them get through in this time when inflation is hurting. That is part of a package that we’ve put together. It is a package that is designed for all New Zealanders. It is a package that puts straightforward cash in people’s back pockets. It won’t cover all the costs. It’s a contribution to the cost of living, and it’s a contribution that on this side of the House we are proud to make to help New Zealanders out during the tough times. I commend this bill to the House.

Three hundred and fifty dollars is an interesting amount of money for three months. I’ll tell you what 350 bucks buys: a one-way plane ticket to Sydney, Melbourne, and Brisbane—and that is what young Kiwis, in fact middle-aged New Zealanders, will be thinking about as they stare at this Budget and this paltry, pitiful amount of money that the Government has deigned, in its wisdom, to give back to New Zealanders.

This bill and the Government’s Budget summarises the difference in approach between National and Labour. Labour wants to rapaciously take as much of your money as it’s possible to take, churn it round the giant bureaucracy in Wellington—which has had 10,000 more bureaucrats added to it in the last four year—take all the dead weight loss that is involved in the tax system and all the bureaucracy in the tax system and all the bureaucracy of the tax system and all of the reduction in economic activity—take all of that, and then, if Grant’s generous enough, he’ll give a little bit of that back to you for three months.

💬 DEPUTY SPEAKER: Order! I just want to make a comment. There’s been quite a bit of using incorrect names and shortened names. Please use full names, it will reflect in the Hansard, and people will know who members are talking about.

Grant Robertson, the Minister of Finance for the next 18 months—after which, hopefully, New Zealand will never be subjected to his rapacious, tax-hungry ways ever again—is a man who believes that the Government can just take as much money as it’s possible to take, and then, if he’s generous enough, he’ll give some of it back to you: the poor, long-suffering taxpayer.

So there’ll be a big group of New Zealanders who will stare at this Budget and stare at this bill and say, “Yeah, 350 bucks, OK, well, look, I’m not going to turn down 350 bucks; it’s better than nothing, because I’m staring at inflation of 7 percent and my wages are only going up 3 percent, and I’m staring at inflation above the 3 percent threshold over to 2025.”, but they will also look ashore and say, “You know what? Actually, I’d be better off in Australia or further afield.” So $350 is an interesting sum of money, because it’s about a one-way flight to Sydney, Melbourne, and Brisbane. It probably won’t get you to Perth, but it would definitely get you to the east coast of Australia.

Let’s be extremely clear about the numbers in this Budget: 6.9 percent inflation, now a wage growth of around 3 percent. What does the Budget say? It says that, for the next three years, inflation isn’t going away. This is not a one-time thing. This is not a temporary thing. Deborah Russell said, “You know, oh, well, it’s forecast to come down.” Yeah, it’s forecast to come down; it’s forecast to come down from 7 percent to 3.6 percent to 3 percent. That is still massive inflation. Kiwis—

💬 Hon David Parker: No, it’s not.

Yes it—David Parker says, “No, it’s not.” David Parker remembers—I’m not having a go at his age but it is just literally true that David Parker remembers inflation of 7 percent, 8 percent, 9 percent, 10 percent; I don’t, because I’m 38 and people my age and below don’t remember serious levels of sustained inflation above 5 percent or 6 percent. They don’t remember it because they’ve never experienced it, and what they’re about to experience is what that is. It’s the robber in your back pocket. It’s the thief that you can’t do anything about. It’s happening here in New Zealand and it’s going to continue and it’s going to be bad. It’s the thief in your back pocket.

There are things the Government could do to make it better; not this—not this band-aid approach which the Government is proposing in this bill—but have some fiscal disciple. Grant Robertson has spent, since 2017, an extra $51 billion. He said that, for this Budget, he was going to be fiscally prudent and it was going to be all balanced and all of the rest of it, and everyone went, “Well, OK, well, whatever.; $6 billion is actually the single biggest increase in the new operating allowance in New Zealand history, but OK, $6 billion.” What they have tried to submerge within the paraphernalia sent out alongside the Budget, what the Government has neatly tucked under the covers, is that it is not just $6 billion of new spending this year; it’s much, much more than that.

You take your $6 billion—it was actually $5.9 billion, to be fair—but they’ve also pre-spent $2 billion from Budget 2023, so that’s money that’s been allocated in the 2023 out-year that has been brought forward to 2022, and, to make matters worse, they’ve taken $400 million from Budget 2024 and brought that forward. So that brings us up to $8.4 billion. Then, on top of that, the Cost of Living Payment package, which we’re legislating to allow the IRD to do, is separate. Grant Robertson has just decided that that’s separate to the operating allowance, that’s outside it. So that’s another big chunk of money: $800 million, or so. This is not prudency; this is profligacy. This is an attempt to submerge within the Budget papers a massive Budget blowout. It’s a huge increase in spending.

Does anyone seriously think that in Budget 2023, which we hope will be Grant Robertson’s last one, he’ll turn up and say, “Well, look, I’m just going to have to rein in the fiscal spending; I’ve just spent too much.”? Does anyone seriously think that? No, because for five years now—Budget 2018, Budget 2019, Budget 2020, Budget 2021, and Budget 2022—there’s always a reason; there’s always another excuse. There’s always a reason. He just turns up and there’s another reason to spend more money, and now we find ourselves, if we spend an extra $50 billion—spending’s up by 70 percent in the last five years. Does anyone seriously think that we’re going to turn up to Budget 2023—which, by the way, is an election year, which is not normally a year in which Governments fiscally constrain themselves; normally, they turn on the spending spigots—and Grant Robertson’s going to say, “Well, I’m very concerned about the fiscal discipline; I’m going to have to wind it back.”? No. Of course he’s not going to do that; we’re going to have another spend-up.

The best indication of a future with Grant Robertson and Labour is what happened in the past. They just spend, spend, spend. They’re addicted to it—absolutely addicted to it, and it’s not good quality spending.

What is the outcome of 10,000 new bureaucrats? Are we getting a 68 percent increase in effectiveness off that spending? Absolutely not. I’ll tell you what it’s going on: have a look through the emissions reduction—I hesitate to call it a plan; it’s more a propaganda paraphernalia produced by the Ministry for the Environment. I have no doubt that a lot of people have spent an awful lot of time doing a lot of website design work and coming up with strategies and developments and every synonym for “strategy” and “plan” you can think of under the sun. But all that is within that is just more plans. Climate change is what is happening while you’re making other plans. Like, it’s just literally a series of plans and strategies and development.

New Zealand Transport Agency spin doctors—they spend more money on consultants, more money on plans and strategies and propaganda from the transport agency, than we actually do building roads or any public transport projects. We know that all too well here in Wellington, where we’ve spent five years stuck in gridlock because the absurdly named Let’s Get Wellington Moving project is doing the exact opposite while a lot of people make a lot of money doing consultancy reports for something that is just not going anywhere. They spent $2.5 million on the Mongrel Mob, $51 million on a cycleway that’s never been built—a cycleway across the Auckland Harbour Bridge—more money on health restructures. Poor quality spending.

The point is that this poor quality expenditure is driving up inflation. If you don’t believe me look at page 44 of the B.3 in the Budget: “Inflation is being driven by strong domestic demand pushing up against constrained supply.” Strong domestic demand of which Government spending—extremely high Government spending—is a massive component of it.

So the question is: is this enough or is there a better way? Our argument is that there is, because if you’re someone on the average wage, you get nothing from this, and anyone on 50,000 bucks a year or more gets more from National’s plan. There’s no doubt about it. Our view is that we need permanent spending restraint and fiscal disciple and permanent adjustments to the tax thresholds, which would deliver more money in New Zealanders’ back pocket.

What is the Government seriously saying? “We’re going to have a three-month increase in people’s take-home pay, and we’re going to get to November and December and then it’s going to go back up again, running into Christmas.”? Yeah, right! This will just be continued. Why don’t you just legislate for what we should do in the first place: legislate for National’s plan which delivers more money in New Zealanders’ back pockets and actually reflects the cost of living crisis that we are experiencing?

Thank you, Mr Speaker. It’s a real privilege to be able to stand and take a call on the Taxation (Cost of Living Payments) Bill. Now, I’ve been an MP now for around 18 months, and I’ve watched politics for a number of years, and it’s quite clear that the National Party have never had a good history with numbers. Their previous Budget had a massive hole in it, but, you know, what did they do? They shifted their spokesperson, and they moved them on. So based on what the National Party is suggesting—because they haven’t actually provided us with an alternative budget. Based on their tax policy that they’re standing by, which are tax cuts, they’re saying a person on minimum wage would receive $110 in a tax cut. So based on the measurement that the previous member had used, $350 under this side of the House’s policy gets a person a one-way ticket to Australia. Under the National Party, they would dump you in the middle of the Tasman Sea, because that’s exactly what the National Party tax policy of tax cuts does.

A person who earns over $180,000 underneath their policy would receive an $8,000 tax cut; a person on the minimum wage would receive $110. There is an absolute injustice and imbalance in that sort of policy, so that’s why we are saying we need people to get short-term relief. This is targeted; it is focused. It is focused on those who are in the most need, those who earn the median wage and have the lowest incomes. Under this tax policy, they will get short-term relief of $350. So let me put that to you in practical terms: that is enough money to help you with your warrant of fitness; that is enough money to help you with the registration. What does $110 a year get a person on the minimum wage? Doesn’t even get you your registration. So that’s why this Government is absolutely supporting a cost of living payment amendment that we’ve got on the table today.

One of our previous members—Dr Deborah Russell; fantastic academic and tax lawyer—said there was a lot of fantasy world, a bit of misinformation that was coming from across the other side of the House. So let me put down the real facts, the real information: a return to surplus in 2024-25—

💬 Chris Bishop: Oh yeah, I’ll believe that when I see it!

—unemployment rates projected to remain at record lows—3.2 percent. Yes, Mr Bishop, “Oh yeah”, because, actually, even though you’re saying you’re looking at the Budget documents, we had the Reserve Bank in last week, and we talked about the actual pressures that are causing the inflation, so it would have been good if members on the other side of the House had actually paid attention, because a third of it is from the Ukraine-Russia pressure overseas—international pressures; a third of it is around tradables, which has come through a lot of the pressures coming from all the supply pressures; and a third of it is within New Zealand. So I’m saying to you, the unemployment rate at 3.2, the net debt forecast peaked at 19.9 percent of GDP—that’s lower than Australia, the US, the UK, and Canada. And economic growth—growth—4.2 percent in 2023.

If you don’t believe me, then how about you listen to the IMF—the International Monetary Fund; independent. And what did the IMF say? When they released their annual review for New Zealand, they found New Zealand was in a strong position. They also said, “Now is not the time for substantive tax cuts that give more significant amounts to CEOs than low-income earners.” The IMF said, “Now is not the time for substantive tax cuts.” So, therefore, this payment is a temporary measure to provide short-term support for those who earn up to $70,000. And these are the people that are hurting. It’s that middle. It’s that $70,000 and below. The payment is a temporary measure for those who are not receiving the winter energy payment, which came through earlier because we knew that we had to provide support for people over those winter months.

The income cap of $70,000 is set to provide support to those who earn around the average annual wage of $65,000. So what does that mean? It means that 2.1 million people will be eligible for the payment. What is 2.1 million people? That’s Auckland, Wellington, and Christchurch. That is the population of people who will benefit from the changes that are covered in this bill. So, therefore, I’ve got nothing much more to say other than the substantive tax cuts across the road will dump New Zealanders in the middle of the Tasman Sea, whereas this will provide a short-term measure of relief for our families—for 2.1 million people. Let me leave that again: 2.1 million people will benefit from this. So, therefore, I commend this bill to the House.

I rise on behalf of the Green Party to speak on the first reading of the Taxation (Cost of Living Payments) Bill. It’s been quite the ordeal listening to the National Party members who keep talking about expenditure and advocating for austerity, ignoring that, right now, many of our low-income communities are struggling to get by. This bill is an acknowledgment that many of our communities are struggling to make ends meet. It is a temporary payment of $350 targeted towards people earning less than $70,000.

But there is a problem. In an acknowledgment that people are struggling, what we are ignoring are some of the communities that actually are doing it the toughest—that the sign of this legislation, and the intent of this policy, seeks to leave behind people on main benefits. We’ve known for years that these are the communities that are on the breadline. I think it’s appalling, and a disservice to the communities that we’re supposed to be serving, to not include them in a stimulus package, effectively, lifting incomes to allow people to make ends meet at a time where inflation is growing, where global events are putting pressure on supply lines, and, therefore, the cost of basic essentials is going up.

Yes, people on the benefit are already receiving the winter energy payment—but the Government knows that it is not enough. This is why, in 2020, the Government acknowledged this by doubling the winter energy payment at a time when things were tough. And things are still difficult for those families. It is a shame that over a million people will be excluded from this payment by design and by political choice. It didn’t have to be this way. The Green Party has advocated that, as part of responding to our inequality crisis, we need permanent increases to incomes so that families can thrive, not just survive.

Recently, there was a group of organisations, under the Te Tapeke Fair Futures group, that released a report explaining just how much some families were struggling to make ends meet. Some of them were under $307 in order to just provide for basic essentials.

This research was backed by some of our organisations that are doing the most at the front lines—including Barnados, the Manawatū Tenants Union, Monte Cecilia Housing Trust, Auckland Action Against Poverty, New Zealand Disability Advisory Trust, Auckland City Mission, Child Poverty Action Group, the Disabled Persons Assembly (New Zealand) Inc., FIRST Union, Save the Children, and many others. These organisations know the struggles that our communities are going through. In fact, people on the ground have been speaking to the media and to politicians for many years, explaining that we need permanent fixes to our income support system.

So I’m stoked for the families that will find some temporary relief through this legislation, but I’m deeply disappointed that we are ignoring the reality that incomes remain too low. I’ve heard members of Government talking about how this is a Budget of health. I want to say that researchers and communities have told us, for many years, that we need to be focusing on the things that determine whether someone will be healthy—and incomes play a massive role in that. When families are struggling to make ends meet, they go through toxic stress. That toxic stress builds up and contributes to families getting sick. If we’re serious about building an infrastructure that is fit for purpose, and a health system that delivers for all people in Aotearoa, we need to have livable incomes. This is a massive missed opportunity to ensure that everyone is looked after.

The inequality crisis is not going to go away in three months’ time; in fact, it is not new. So we’re calling on Labour to look at the many recommendations their own Government reports have put out. The recommendations that people on the benefit have been talking about—to increase main benefits; to individualise the income-support system; to scrap benefit sanctions; and to look at genuine, transformative solutions so that our families are able to fully participate in their communities. Kia ora.

I wonder, do the Green Party, as partners with the Labour Party—did they know about this initiative? And, if not so, I can understand the disappointment in the member’s communications.

This Government has lost its nerve tonight. Grant Robertson treats our income as if it’s just there to be chopped up into taxes, and I see the Minister’s left the room. He believes that every—

💬 Hon Carmel Sepuloni: You’re not allowed to say that!

He believes your money is—

💬 Hon Carmel Sepuloni: Point of order, Mr Speaker.

ASSISTANT SPEAKER (Ian McKelvie): Order! Order! The member shouldn’t refer to people who have left the room.

Thank you. This Government believes that your money is a Government resource, even before it’s taxed. And, once again, with this Budget, we’ve now found out the price to gain political support, and it’s $350. That’s $27 a week, which probably gets you a slab of Speight’s. I’d like to price check that, but I haven’t had the opportunity yet to do that.

In terms of the Taxation (Cost of Living Payments) Bill, there’s been no regulatory impact assessment; no advice from Treasury on this. So when was this constructed? Was it just dreamt up because, “Hey, we’ve got a problem with the cost of living, under the pressure from the ACT and the National parties.”? And was it slipped in before the Budget was printed a couple of days ago? Because this can’t seriously be a strategy that will help people with the cost of living. It’s temporary, it’s got to be wound down quickly—just like the fuel taxes—and it doesn’t actually lead to success.

That’s why the ACT Party argues for major tax cuts—and the public deserve them this time—where we have a simple, three flat-rate structure of 17.5 percent for people under $70,000, and 28 percent for those above. That would have stimulated the economy, it would have helped with the cost of living, it would have actually made sense in the mind of the public, and it would have been something the IRD would have backed and administered easily. But no, we’ve come up with Mr Parker’s initiative that—after his great speech to the nation on taxation and helping people, this is what the Labour Party has come up with.

Now, in terms of the Commissioner of Inland Revenue using their powers to do this and to sign it off, we’ve got a situation where, under urgency again, we’ve missed the story. It’s as if Labour has missed the story of the golden goose, or maybe it hasn’t. A key part of the “brain drain Budget” is to not tax too many productive people. Households are facing the greatest cost of living crisis ever. Even though the Prime Minister and Mr Robertson were sharing cheese rolls today, people this weekend will be going, “Can I pick up that kilo of cheese which is more expensive, or do I do without?”

It’s only four years ago that—under this Budget, the amount of tax per person has gone from $15,825 up to $21,945. So it’s not even giving and taking away; this is just taking away. This is, potentially, the greatest piece of political spin this Government has ever done. It’s not transparent; it’s just been a hit, and it hasn’t been thought through in a fashion that actually will get traction in the household this weekend. It’s going to fuel inflation, it’s going to drive up—with the Monetary Policy Statement next week—the rates of mortgages and rentals. Everything this Government does is like pouring fuel on the fire.

The public would rather have tax cuts like ACT is proposing, and not to leave for Australia. We’re now the highest taxed country in the Asia-Pacific region; our Aussie friends have pulled ahead, our Singaporean friends have pulled ahead, and our South Korean friends have pulled ahead because they’re more productive. And so we want real change; not something that’s thrown out which lasts for a year. There’s three monthly payments—it’s like going down to Noel Leeming, right? This is not how Government tax should be administered, and it is money out the door to try and cover up that this Government has a cost of living crisis—it admitted it today, and we know that this is not going to fix it.

So if you look at a nurse under ACT’s alternative budget, they’d be $2,000 better off if they had a better tax rate. A family on an average full-time salary of $73,000, a part-time worker earning $30,000, and two children could be $2,800 better off. A nurse, and a teacher, or police officer near the beginning of the year earning $60,000 would be nearly $800 better off. So why is this Government just not giving back to the people? Why is it so intransient, considering the other programmes that it’s given out billions and billions of dollars to? The first people that should have got this money are the citizens of New Zealand. So everyone’s getting squeezed—nothing’s changed today except a few extra dollars chucked out which will buy a few loaves of bread. The Kiwi battler is going to make a decision about this Government, on how it earns its money, how it pays its bills. It wants the Government to get out of its life, and it wants transparency in the day-to-day management of its household income.

This was the day for Grant Robertson to tighten his belt, but, no, he loosened it. He’s fuelled inflation, he’s off to the races again with a five-year plan that doesn’t make sense in a holistic way, and Mr Shaw says we need two more Budgets of enlightenment. Well, where does that leave the country at a net debt level? So we’ve got to start earning away in a productive economy, and we’ve got to accept that things are tight. But, you know, in the New Zealand household people are tightening up their budgets, they are saving $27. They are actually doing it, right? They’ve been doing it for a long time now, before this Government has stepped in today.

So Grant Robertson needs to stop treating our revenues like he’s going to tax them and fill the gaps in his Budgets. And he needs to stop telling the people—and insulting the people—of New Zealand that this is what you’re going to get to get through this crisis. This is the greatest crisis of living we’ve seen in a long time in this country. And Mr Parker needs to adopt his attitude about Government resources and taxes, where he’s taken in so much money that it’s time to contemplate a cross-party alliance to reduce taxes and give Kiwis a break.

So in terms of this piece of law tonight, and the explanatory notes—they’ve very, very interesting—under the scheme, a cost of living payment has been indexed to $70,000 per annum. I asked Treasury today, in anticipation of this moment, “Could you define to me what a low and middle income earner was?” And they said, “We don’t know. We haven’t got a definition in the Budget packs.” I said, “Well, how are we supposed to do the calculations?” So Treasury has not defined what a low and middle income earner is, and that just about sums it up. So there needs to be changes there as well. So thank you for the opportunity, Mr Speaker, to speak on this bill. We will look at the numbers very carefully, but we won’t be supporting it.

Thank you, Mr Speaker. This is shaping up as a fairly typical post-Budget day, you know: we propose, they oppose. That’s what we’re doing. I’m happy to be on the side that’s proposing, at this stage, because there are no alternatives. But just in case there are people listening, they’ll listen to the various speakers here—and I’m now following the ACT Party. Now, the ACT Party—there’ll be accusations, there’ll be people yelling meaninglessly across the House, as we’re just hearing now, but I’d just like to quote a little interaction that took place on the radio today—on Radio Live—where one very distinguished New Zealand economist Shamubeel Eaqub was speaking, in fact, with the leader of the ACT Party. And during the leader of the ACT Party’s continual accusations that somehow this Government was responsible for inflation, Mr Eaqub shook his head during most of Mr Seymour’s speech, saying it made him angry to listen to, calling it “economically illiterate”: “It is not Government spending that is driving inflation. We had the UK hit 9 percent inflation yesterday because there is a global inflation crisis. Yes, we should talk about inflation, yes, we should talk about Government spending but you can’t just tell lies about what’s going on in the economy. [The] whole thing that … is wasteful Government spending that is causing inflation is simply not true. If you’re ACT you can say there are parts of the spending that we don’t like, and we wouldn’t do that because it doesn’t add value, it’s not efficient. That’s fine. But don’t do it on the basis of what I think we completely wrong to things to say,” Eaqub said to Newshub.

💬 David Seymour: Point of order, Mr Speaker.

So, those who are listening to that—

💬 Hon David Seymour: I hope that Greg O’Connor didn’t mean to accuse me of lying—

ASSISTANT SPEAKER (Ian McKelvie): In fact, I don’t think he did.

💬 Hon David Seymour: I hope not.

ASSISTANT SPEAKER (Ian McKelvie): I think what he did was quoted someone else—

💬 Hon David Seymour: Who did, and read it—

ASSISTANT SPEAKER (Ian McKelvie): And he’s entitled to quote someone else. He certainly wouldn’t have accused you of lying, himself.

💬 Hon David Seymour: —into the record, because—

ASSISTANT SPEAKER (Ian McKelvie): Order!

💬 Hon David Seymour: —the British have spending too.

ASSISTANT SPEAKER (Ian McKelvie): That’s enough—that’s enough.

I will never be the only person to do that, Mr Speaker. Anyway, I’m a fairly conservative sort of a chap, and a lot of the accusations here are about the spending today. Going back to when we first had COVID and we were looking at, basically, shutting down our economy, we were looking at giving workers or businesses the wage subsidy, and I struggled to get my head around—I’ll be quite honest—that we could do this, and it would turn out to be the best thing we could have done, not only for health but for the economy. But, actually, it turned out to be absolutely the best thing we could have done, and, even, I think, the greatest detractors of our Government across the other side will think that that’s the case. Now, come forward two and a half years, we are at another crisis, and a crisis that I won’t repeat that’s happening around the world—although I will repeat our economist’s facts about what’s happened in the UK: projected to get to near 11 percent by the end of the year. So we are in another crisis, and we’ve got to look at a pragmatic approach to it, because the losers of that are ordinary New Zealanders.

Now, those who are going to speak after this, from the other side, just imagine a world where none of these things had happened. Imagine we didn’t have the winter energy payment. Imagine we hadn’t increased benefits. Imagine we didn’t have tax relief at the pump. Imagine we hadn’t halved public transport. Where would we be? The accusations being made across the House there is “Get more money into the hands of New Zealanders”, which is exactly what we’re doing.

On a select committee I’m on, we’ve had the shipping companies in, we’ve had the port companies in, and the general belief that the crises we have in supply chains—caused by a shortage of ships, caused by a shortage of containers and, latterly, caused by China’s shutting down their ports—are things that actually can be relatively temporary. The other thing I would ask those who are going to stand up and cast aspersion on this, say: what would happen if the Ukraine war were to end in the next month? I suspect that those petrol prices that we drive past every day would very quickly go down.

So this is a world that there are things that could happen, are likely to happen, that actually could have us in exactly the same place as we were after the lockdown, after the wage subsidy in particular that, actually, we’ll look back and say that this was the best thing we did for New Zealanders. In the past, we gave that money to the businesses; now we’re giving it to people. In fact, those that are great believers in the trickle-down theory might just stop and think that maybe what we’re doing here, and what we’ve so successfully done, we’ve actually introduced the “trickle-up” theory. So I’m very happy to support this.

My pleasure to speak on this bill—although not a great pleasure, in the sense that we are not supportive of this bill and we’re not supportive of this Budget. Fundamentally, we don’t think their plan for dealing with the cost of living crisis that New Zealanders face is any good, and our plan would be a lot better. That’s why we’re standing up for our plan, which is actually about leaving more money in the hands of New Zealanders, not using inflation that has been partly created by Government activities, partly by global factors, to sneak more taxes out of the hands of New Zealanders.

So if this Government had adopted National’s policy of just simply adjusting the tax rates for inflation, Kiwi households on the average income would be $1,600 a year better off. So they’ve taken that extra money from their pockets and then they turn up at the Budget and say, “Oh, you should very grateful because we may give you a cheap bus fare for two months and possibly a cheap railway fare for a couple of months, and some people will get a winter payment, but if you’re on the average wage, tough luck—you’re not getting anything.”

So if we go back to what this Budget was all about: Labour, I think, up until about a month ago, had their clear plans that the Budget was all about climate change and health restructuring. They’re going to spend a lot of money—billions and billions of dollars—restructuring the health system just as we’re coming out of a COVID crisis, which nobody thinks is a very smart idea, but there’s billions of dollars being spent on all that and, unbelievably, no measures of actual outputs of what we’re going to get which is better for all that money. That doesn’t seem to be an issue at all.

So they were going to talk about climate change and health restructuring, and then, I think, about four weeks ago, they woke up and thought, “Aw heck—aw heck. The issue of the day is actually a cost of living crisis and we haven’t done anything about that. Maybe—maybe—people aren’t so focused on those issues right this moment when they can’t afford to buy a block of cheese and they can’t afford to pay the rent and they’re wondering how they’re going to feed their family and have an opportunity to get ahead. Maybe we might have miscued and maybe the $6 billion of extra spending—the biggest amount of extra spending in the history of New Zealand all focused on other things and not to help New Zealanders deal with this cost of living crisis. Maybe we may have miscued!” and so what we see is, on top of the $6 billion, they suddenly came up with an extra package. I think they scrambled it in very late in the piece—that’s partly why there’s no great deal of information backing up this piece of legislation. So they scrambled it in, added it on top with a little bit of cherry and cream, and said, “There you go, New Zealanders, you should be happy because we’ll give you an extra two months of cheap bus fares and if you’re very lucky you’ll get a short-term bit of help with winter energy payments.”

Well, New Zealanders deserve a lot better than that. New Zealanders deserve better than a backwards Budget that is taking this country backwards, back into debt, back into slow growth, and also New Zealand families going backwards where the cost of living and inflation is going forward faster than wages, so that New Zealanders are going backwards. The only thing going forward in this country right now is those stolen vehicles driven by 11-year-old kids, ram-raiding shops up and down the country. That’s the only thing that’s going forward!

This Government has just missed so many opportunities to help New Zealanders. You don’t see anywhere, in any of the Budget material, is a plan to get the country growing more quickly, to actually generate more money; it’s all about restructuring and redistributing money from those who work. Nowhere do you see—apart from a slimmed-down version of Shane Jones’ original growth plan, which I have no confidence will be well thought through or anything like that—anything about the regulatory reform, the plan for growth that New Zealanders need to get ahead. The recipe for that is pretty simple, it always has been the same, which is to provide a stable, predictable environment where people feel confident to invest, where they know that the rules aren’t going to be changed underneath them all the time, and where they’re not overtaxed and over-regulated so that New Zealanders can get ahead and actually back themselves to succeed globally.

All we hear in this backwards Budget is more costs, lots of money being spent, and no accountability for the outcomes. That’s why this bill is not what we need. National has got a better plan which would leave more money in the hands of New Zealanders’ pockets.

E te Māngai o te Whare, tēnā koe. Thank you for the opportunity to speak after our finance Minister just delivered a wonderful Budget. I’m really proud of the tough job that he has balancing everybody’s wants and needs, and we are here in the Chamber this afternoon, passing the first piece of legislation, under urgency, to give effect to those Budget announcements.

We are here debating the Taxation (Cost of Living Payments) Bill. I take this opportunity to take the Māori Party’s call this afternoon. This particular bill is so that we can give effect to the announcement that we will be introducing a payment of $350 to help middle-income people cope with the current inflationary pressures. I have heard from my constituents about the impact that the cost of living is having on them and their whānau and so I know that this announcement today is going to make a real difference for those whānau. That is on top of the package that we already introduced, and have been implementing, on 1 April, which boosted support for families through Working for Families, the family tax credit, Best Start, and expanding childcare assistance. It also boosted the student allowance and the student loan living costs. We’ve also lifted the minimum wage, reduced the cost of fuel, and increased superannuation, and we have kick-started once again the winter energy payment.

Today, those who are not receiving any of those things I have just mentioned, which is approximately 2.1 million people, will be eligible for a payment of $350. The income cap for that is $70,000. The reason that is the cap is because that is around the average annual wage, and I have heard from people who have contacted me about what we’re doing for those on middle incomes. This is what we are doing to help you, who, we know, are also impacted by the cost of living crisis. Approximately 2.1 million people are going to benefit from today’s announcement once we pass this legislation through the House this evening.

One thing I want to add to that is that there will be no application process. That’s one of the things that I often find when we make these announcements—people straight away ask where they apply and what they have to do. The Inland Revenue Department are going to be able to use the information that they are already able to gain, under the authority they have, to be able to determine those who will be eligible for the payment, and it will be processed.

I don’t want to prolong this contribution in the first reading. We’ve got plenty to get through over the course of this evening and possibly tomorrow. So with that, I commend the bill to the House.

I received emails and Facebook messages this afternoon from Gina, Zaha, David, and Ahman—I hope I pronounced that correctly—saying thank you to Grant Robertson for the cost of living payments. I said I would pass their thanks on because they are constituents in my Taieri electorate in South Dunedin and South Otago who will benefit from these cost of living payments, who have felt pressure from the cost of living because 37 percent of people in my electorate over the age of 15 earn between $10,000 and $30,000, and only 13 percent earn more than $70,000. So this $27 a week will mean much more than the proposed tax cuts by the National Party. My constituents, many of them in that bracket will get $350 per adult in three monthly payments from 1 August. They are the people who are earning under $70,000 who don’t qualify for the winter energy payment. So that is getting money where it is really needed, and if we put that together with those who do get the winter energy payment across New Zealand, that equals 81 percent of people receiving targeted support. That’s 2,136,000 people. So that is part of a plan that we have to take away the short-term pressure that has been caused by short-term inflation.

Let’s look at what National’s plan is. Well, it doesn’t actually have a plan apart from tax cuts for the rich. So their plan would give about $2.50 a week in tax cuts for the lowest-paid workers, $18,000 for leader Chris Luxon if he was to become Prime Minister, and a $270,000 tax cut for Mr Luxon had he still been the chief executive of Air New Zealand.

💬 Hon Member: Per annum.

Now, that’s per annum—that’s right. And if they had to go into Government with ACT, which is highly likely, they would have to freeze the minimum wage because it’s what David Seymour has said, and reverse climate change initiatives. We know that climate change is the biggest existential threat that we have at the moment. They would reverse that, and Mr Luxon has not ruled out actually abolishing several of the ministries that serve our people, including the Human Rights Commission, Ministry for Women, Ministry for Pacific Peoples, Ministry for Ethnic Communities, and Ministry of Māori Development—all ministries which have received funding in today’s Budget to make sure that we leave no New Zealanders behind.

I am proud and congratulate Grant Robertson for this balanced Budget because he’s done this in an environment where the global economy has been volatile. We’ve seen inflation in the UK shoot up overnight to 9 percent. That’s a 40-year high. But with his prudent fiscal management, he has been able to continue to put people first. We can support low and middle income New Zealanders, and that is also from the work that all New Zealanders have done to pull together during COVID to make sure that we keep New Zealand going, and I really want to thank all New Zealanders for doing that.

The fourth Wellbeing Budget talks about a secure future. It’s a long-term approach. It takes a long-term approach to health and climate, but we have seen these cost of living pressures on people. It is not stagflation, and anyone who doesn’t believe me, just look at the Reserve Bank report and their appearance in front of our Finance and Expenditure Committee meeting last week where stagflation was asked about repeatedly. They said it is on their radar; it is not currently a threat to New Zealand, and anybody who tries to say that is talking it up. These are temporary pressures and they need swift and temporary solutions, and that’s what we’re doing by passing this legislation under urgency so that we can get money into the pockets of New Zealanders to make a difference as quickly as possible. That’s 1 August and that will be targeted support, along with the two-month extension to the fuel tax cuts, there is also the extension of half-price public transport, and for those people on community service cards—and there are many, many in my electorate—they will be able to use their Community Connect, which means they will permanently get half-price public transport.

That is going to be an absolute game-changer for people in my electorate, people have lobbied me for many months saying, “Please, can I have changes to public transport.” so they can get out and about. It will help their wellbeing. It will help them studying at the university.

So to those people who contacted me this afternoon, thank you so much for passing on your good wishes to our Government. I just wanted to share that with the House tonight and to say congratulations to Grant Robertson for an excellent Budget in a very difficult time globally.

Thank you very much, Mr Speaker. It is a pleasure as the member of Parliament for North Shore and part of the National Party to talk on the Taxation (Cost of Living Payments) Bill first reading.

For those watching at home, we’ve only received this bill within the last half hour to 45 minutes or so, so you will appreciate that most of this is pretty new. But when you look through this bill, this Government has had a significant amount of time to put together a piece of legislation to deal with a cost of living crisis that has been impacting Kiwis across this country for a very long time. But when you get into the detail of this bill—and I’m looking forward to future stages, and I look across there to the Minister Parker—there has not been much detail done on this bill. And that indicates to me—it indicates to those watching at home and those stakeholders who have not been consulted on this bill—that this has been put together in a rush. These guys are panicking. They are seeing the numbers on the walls, they can see the polling data, and they have worked out, “Surprise, surprise, we’ve got nothing in our tool kit which deals with the cost of living crisis.” And that is a big issue for them.

So what is their solution? Well, you’d think, let’s do something of substance. Let’s do something that’s actually going to impact those individuals across this country that are just so heavily impacted, those ones that are struggling to pay their mortgage as a result of interest rates increasing by 2 percent, those that are paying a lot more at the pump or those that are paying a lot more for food when they do their weekly shop with groceries. So what this Government have decided to do is they’ve decided to do a bit of a lolly scramble, a bit of a sugar hit, and say, “Here you go. Here’s $27 a week, $350 one-off, that’s it. By the way, we’re going to take away the other benefits we’ve given you around extending the fuel excise and halving public transport fees probably in the future. We’ll do this as a bit of a carry over and good luck.”

Well, I tell you what, I’ve probably only had about 45 minutes to look at this bill, but I’ve had enough time to look at a one-way flight to Sydney, and you know how much that is, Mr Speaker? On 1 August, when this bill comes into effect, it’s $300. So I tell you what, they’ve got $50 to buy a packet of cashew nuts when they get to the shop at Auckland Airport before they leave this country in the brain drain which will result because Kiwis no longer have confidence in this country being able to deliver for them, and that is because of that Government over on that side.

I tell you what, for the ones that decide not to leave to go to Australia on 1 August, they’re going to use this money to buy 9 litres of petrol every week for their Toyota Corolla. That’s all it pays for: 20 percent of a tank of fuel. That is absolutely nothing for these things. Or maybe they might decide, “I’m going to go into the supermarket, and with my $27 I’ll buy one block of tasty cheese and I’ll buy 3 litres of milk.” That is it.

And when you look at the criteria of this bill—and I can tell you what, this Government have not done the detail, and I’m not surprised, because they are not over the detail. They do not have the capability in this space, and it is coming out of this bill like you would not believe. The criteria is pretty much undefined. I’m looking forward to the future stages to be able to question the Minister around, actually, what information does Inland Revenue have in order for them to be able to assess the criteria for these payments to be made by 1 August? I’ll let you in to a little bit of a secret: they haven’t got all the information required in order to make those payments by 1 August. That’s why they’re waiting for 1 August, because they can’t make it happen tomorrow. They have not got all the criteria and information and the data required, and that is because they’ve just worked out this policy pretty much last week. That is the type of lack of planning from this Government, and this bill personifies the attitude on that side of the House of a Government out of touch; a Government not willing to listen to Kiwis. They haven’t even consulted on this taxation bill with people outside of Government. What is going on? It is a band-aid Budget, and Kiwis are going backwards.

I had a look at the eligibility, and, of course, you have to, according to this—and I’ll go into a little of that later on—earn under 70 grand a year to qualify. Well, there is 495,000 Kiwis who earn between $70,000 and $100,000. And what about that point that was made by the ACT member before around the fact that “low to middle income” has not even been defined by Treasury? This is an absolute scam. It is not dealing with what the title of the bill says around impacting and benefiting low to middle income New Zealand. It excludes a whole lot of people. The criteria, actually, will end up to say that, actually, a large number aren’t going to get it.

And then they have to work out both New Zealand tax resident and present in New Zealand. So what does that mean? Does that mean I can’t go on holiday for three months? Does that mean if I’ve all of a sudden gone over to Australia on the day that this is eligible, I can’t get the payment? Have you seriously thought through this bill? No they haven’t; they’ve made it up last week. That is what’s happening in this country.

We have got a Government that is making up as they go along. And you know what? That is such a huge disgrace for my children and for my grandchildren that will inherit the significant amount of growing debt by this Government, sitting around 41 percent before you adjust it to the lower number that looks a lot better. They are going to inherit that. Total borrowings have clicked over $200 billion. That is the legacy of a Government who are spending like there is no tomorrow. That is the legacy of a finance Minister—Grant Robertson—who is addicted to spending. And you know what? When you’re addicted to something, you can’t get off it. And he is going to keep on spending all day long. And that is a real concern. That is a concern for hard-working Kiwis like the people in my electorate of the North Shore, or down in Southland at the bottom of the South Island, or Invercargill or in Auckland Central or wherever you are across the country—

💬 Hon Carmel Sepuloni: What about South Auckland and West Auckland, are they hard-working as well?

—because those Kiwis are hard-working and they are not going to benefit.

And, of course, I can hear the Minister over there yapping on about something. I can’t hear her in detail, but I’ll read the criteria, because who are not eligible or qualify for this payment, of course, include sole parent support, those on the jobseeker support, student hardship, emergency benefit, superannuitants, all those individuals are excluded from this $27 a week payment. So on the outside, this looks like a really nice thing to do, but I tell you what, when you scratch the surface—like what you do when any of you, any time you scratch the surface on this Government’s policy—the truth comes out. And what we can see is this is a policy that is not going to deliver the benefits required for middle New Zealand and those that are squeezed so hard.

What is so disappointing is, again, the fact that this has been so poorly planned. And we have had a long opportunity and chance in order to be ready for today. It is no surprise that we face a cost of living crisis in this country. We have had ample opportunity to consult, to engage, to listen, to be informed by Kiwis in terms of what they are facing in terms of the challenges that they face day in, day out. But have that side of the Government used the time that they have been given to do the simple task of getting out of their offices in Wellington and listening to hard-working Kiwis? Well, the simple answer is no. And this bill proves the fact that they have not done their job.

We’ve mentioned in terms of where we could be today if they had only taken on some of the advice around National’s economic plan: a plan that takes into account fiscal responsibility, a sensible and pragmatic plan that puts money in the back pockets of hard-working Kiwis, a plan that will actually benefit those across this country who are contributing a significant amount. But they have squandered that opportunity, and that is a great, great issue in itself.

I want to end with a fact that the spending today was in the region of $6.5 billion of increased spending—increasing to $7.5 billion next year. That is an absolutely horrific scale of expenditure. And the challenge is that will not deliver the outcomes that Kiwis in this country deserve, and that’s why National oppose this bill.

Getting a lecture from National on the cost of living feels a bit like getting tips on frugal living from the Kardashians. I struggle to take it seriously.

I definitely struggle to take it seriously because this bill provides here-and-now support for those people facing a cost of living crisis in New Zealand. It provides $350 in the pockets of middle New Zealanders over this winter and that is what is needed right now. I would like to acknowledge Grant Robertson for delivering a fantastic Budget that delivers right now what we need and continues New Zealand on the right track. Our economy is one of the strongest in the world, with a triple A credit rating, record low unemployment, and lower debt right now than Australia, Canada, the United States, and the United Kingdom.

However, despite those positive results, we know that global inflation pressures are hurting New Zealand families right here, and the world remains an uncertain and volatile place. That is exactly why Budget 2022 provides further relief to those on lower and middle incomes in New Zealand to help pay for food, to help pay for petrol prices, and to help pay for energy bills until inflation is brought back under control.

So what is National’s plan that we’ve heard so much about? National’s plan is to point to the global phenomenon of inflation and blame the Government for that and to say quite a lot about fiscal discipline—a lot—but will not actually say what they’ll do about it.

But I’ll tell you what: you only have to look back on National’s track record in the history of New Zealand to see what they do. They cut health, they cut education, they cut housing, and they cut welfare into those areas. What they do is what they’ve said already: put money in the pocket of those top brackets of New Zealanders. Offer no real solution except for tax cuts—that’s all we’ve heard.

An interesting fact is that money—that $350 that we’ve heard today in the House that will not buy very much—is still far in excess than what that family would receive under a National programme of tax cuts. It is far more than what they would receive under that programme.

So it’s a sad thing today that those members opposite will vote against a bill that provides here-and-now support for middle New Zealand families, and I find it quite trite that they vote against that and still cry aloud. The payment is a temporary measure to provide short-term support for those individuals who earn up to $70,000 in the tax year who are not receiving the winter energy payment already.

The income cap of $70,000 has been set to provide for those who provide around the median wage of $65,000 a year. The group we’re targeting is specifically those who are less likely to have had those increases on 1 April that have already come into force, and to provide more help for those who haven’t been able to receive Working for Families and the increases in the minimum wage.

Approximately 2.1 million people will be eligible for the payment and that’s a significantly large amount of New Zealanders. The total payment of $350 will be split into three monthly payments of around $116 each, beginning on 1 August, and will be paid by the Inland Revenue.

Now, we know for a fact there is no silver bullet fix to inflation and the rising cost of living in New Zealand. But we are taking a range of actions. We’ve cut fuel tax to provide immediate relief for Kiwis as the war in Ukraine drives up prices. From 1 April, we’re increasing support for families, pensioners, and students, and, in May, our winter energy payment restarts, giving the 1 million people an extra boost to help with their heating bills.

From the day we came into Government, we’ve worked hard to lift wages, to reduce cost pressures on Kiwis through measures like cheaper doctors visits, free lunches in schools, and a family tax credit. I’m proud to be a part of a Government that delivers a Budget that keeps New Zealand on the right track and provides the support to those people who need it the most.

I commend it to the House.