Taxation (Cost of Living Payments) Bill

Good morning, members, as we recognise Pink Shirt Day today.

Members, the committee is resumed for further consideration of the Taxation (Cost of Living Payments) Bill. I remind members that they’re able to participate remotely. If you’re on Zoom and want to take a call, please type “call” into the chat. You should also use the chat if you’d like to raise a point of order. If we receive new tabled amendments, I’ll advise members so that they can refresh the House papers page to see the new amendment.

Finally, it’d be helpful for members to ask multiple questions, if they have them, of the member in charge during the call.

Members, before we move to consideration of clauses 1 and 2, last night during the votes of closure, Part 1 and Part 1 stand part, the votes were recorded incorrectly. The correct vote on both votes was 67 votes in favour, 42 votes against, and 10 votes in abstention.

Members, we come now to our final debate, clauses 1 and 2, which is the debate on the title and commencement.

This bill as it lies on the Table is referred to as the Taxation (Cost of Living Payments) Bill. It should be called the “Cost of Living (Look at the Squirrel Running up the Tree) Bill”, because that’s basically what it asks New Zealanders to do. Why do I say that? Well, to qualify, an income can’t go over $70,000.

💬 Kieran McAnulty: Point of order, Madam Chair. The member is extremely experienced. He knows that he can’t use debates on this clause to criticise the content of the bill, and proposing that a bill be called “a squirrel going up a tree”, I would argue, is exactly that.

Speaking to the point of order—

CHAIRPERSON (Hon Jenny Salesa): It is myself who is able to rule things in or out of order. I would allow the member to continue.

Thank you, Madam Chair. As I was saying, the bill should be called the “Cost of Living (Look at the Squirrel Running up the Tree) Bill”, because that is what it asks New Zealanders effectively to do. Seventy-thousand dollars is the threshold—for someone earning—to get this payment. Let’s look at that $70,000. That person will be paying $14,000 in tax, leaving them with a $56,000 income, and slightly less when you take off ACC and anything else that the Government might like to throw on as a result of this particular bout of urgency. But of that $56,000, $4,000 has already been lost in purchasing power through the current inflation rate—$4,000 out of an annual income, through last year’s inflation rate—and we’re being asked to support a bill that apparently is going to make up for that by giving people $350. It is an absolute misleading of people in New Zealand.

I don’t begrudge anybody getting the money—they need it—but it is just inappropriate to call it a cost of living payment when it goes nowhere near that cost of living and when Government policy, riddled throughout this Budget, is robbing people because of the high inflation rates we have at the present time. Four thousand dollars, for that $70,000 earner, is lost in purchasing power and the Government wants to deny it’s happening.

Thank you very much, Madam Chair. I want to join my colleague Gerry Brownlee to look at the title and commencement of this bill, because you’d ask yourself, with the Taxation (Cost of Living Payments) Bill made up on the hoof, what took it so long. What we do know, when we read the limited paperwork that is on the Table this morning, is this bill was only thought about a couple of weeks ago. This Government has been dragged kicking and screaming into the cost of living crisis. They wouldn’t even admit it, and now here we have a policy—in fact, the total expenditure of $800 million sits outside the Budget of $6 billion. That’s how much this bill is made off the hoof.

I just want to quote some figures from Stuff NZ this morning. They called it the cost of living reality check. Renters—the cost increase for them has been $52.75 a week for a couple, bearing in mind the uplift from this bill is only $54, so it cancels itself out, whereas for a homeowner, they’ll get $54 a couple under this bill—the cost pressures increase has been $134.25.

So here we have a Government that’s put a bill up, but let’s not forget, if we’re talking about commencement, it doesn’t start till 1 August. Why doesn’t it start till 1 August? Well, they’ve made it up off the hoof and they’re not ready to implement it yet. Even in the Minister’s own words, they still don’t have 200,000 people who are entitled to this; they don’t have their bank details. That’s 10 percent. Then they still need to employ 750 fulltime-equivalents, and we know under this Government that won’t be a ceiling; that will be a minimum—so a thousand new bureaucrats on top of the 10,000 increase they have already employed.

And this Government’s got form in this space. Let’s not forget the legislation we had to bring before the House around the road-user charges, with the reduction of the excise tax—poorly thought-through legislation, and here we have a bill that doesn’t have the right title, and, we would argue, the commencement’s too late, but, of course, this Government is too late into the cost of living crisis. They would not accept it, they would not call it a crisis, and now they are giving a bare minimum, as my colleague Gerry Brownlee said—a squirrel up a tree—to say, “Hey, we’re doing something.” But when you drill down in the figures, this does not cover the true cost for struggling Kiwis. And let’s not forget the average Kiwi wage at $72,000 will not qualify for the $350.

Overnight, we’ve learnt that people in America have seen our Budget before we did. Newspapers had access to the content of our Budget, which inextricably can’t be explained by Treasury yet. But it would actually augur something that is in consistency with this bill, which is just rushed, rushed, rushed. And we at the ACT Party, who were the first to actually expose the cost of living crisis—

💬 Hon Paul Goldsmith: Ha, ha!

Well, actually, it—and that’s right, Mr Goldsmith, and then you took on the crusade—would identify that at a dollar per day over the next year. Is that really going to solve the cost of living crisis in New Zealand? I don’t think so. And I think the polls will still show that after this reaction to this payment it won’t stop here. Come October, more will be needed. Unbudgeted aid that hasn’t been allocated yet will have to be discussed. Inflation is not going away. Monetary policy next week would show that the cost of living will increase further through mortgage interest rates.

But getting back to the bill. The cost of a Labour vote has been defined as $350. The tax per person in this country has gone up from $15,825 to—

CHAIRPERSON (Hon Jenny Salesa): Order! Order! Can the member come back to the debate that we’re having right now, which is on title and commencement?

Yeah, it’s relevant—because the title of this bill, with regards to the office that has described it, is actually going to tell Kiwis that the cost of living payments bill is going to solve their problems. And it’s not.

So we at the ACT Party want to make it very clear today, before we go into the weekend, that this is a bill that’s described as something that’s not going to help and it’s not going to actually define what the problem is. Thank you.

I move, That the question be now put.

I will report this bill without amendment.

House resumed.

Mr Speaker, the committee has considered the Taxation (Cost of Living Payments) Bill and reports it without amendment. Mr Speaker, I move, That the report be adopted.

The question is that the report be adopted.