Appropriation (2024/25 Estimates) Bill

Thank you very much, Mr Speaker. Well, I adjourned the Budget debate—when was it?—two or three weeks ago. A lot has happened since then, and we were about to begin Budget urgency. But the debate on the Budget—a very good Budget produced by my good friend and colleague the Hon Nicola Willis—continues. I wanted to run through some of the highlights, as I see it, from the Budget because it was a very good Budget. It was a challenging Budget delivered in challenging times for New Zealand.

I want to start with that proposition because it is clear to anybody out there, walking around outside of Parliament in the real world, that it is challenging out there. Interest rates are high. The official cash rate is at elevated levels. Inflation is still outside the band, at over 4 percent. There is a palpable sense out there in the public that there are tough economic times, and people are feeling that. We acknowledge that on the Government benches, and I make the point that better times are ahead but it will be tough for quite some time because we are dealing with the hangover after the night before.

We are dealing with the feeling that happens when you wake up a bit late, at 11 o’clock on a Sunday morning and you start craving hash browns, bacon, and sausages and, in my case, a bit of black pudding, and you think, “Oh gee, last night I had a bit too much pinot noir from Central Otago.”, or, in my case, some whiskey, and that’s kind of what happened to New Zealand. We printed a lot of money and Mr Robertson came along and spiked the punch at the same time, and fiscal policy was not a friend to monetary policy. In fact, we just went full tilt on the accelerator. We printed a lot and we spent a lot, and every year that Grant Robertson was the Minister of Finance, he exceeded his Budget allowance. So he’d always turn up at the Budget Policy Statement towards the end of the year and say, “Next year, I’m going to spend a certain amount of money”. It was normally about $2 billion to $3 billion, and every year he would exceed it—every year.

It’s a bit like my diet. I always wake up on New Year’s Day and say, “Oh, this year I’m going to really get down to 90 kilograms.”, and it never happens. It’s a bit like that with Grant Robertson—he never met his allowances. As a result, the spending just rolls on, and, as financially literate members know—they’re normally on this side of the House—those numbers just cascade on top of each other. So, over time, you end up with enormous fiscal largesse. That’s how we ended up with an 80 percent increase in Government spending in six years—because he just added to the allowances every year. They just built and built and built and built, and we’ve ended up in the fiscal situation we’re in, to the point where—and this is in the Budget documents—Treasury advised there is a structural deficit. There is a structural deficit.

The first thing this Budget does is it starts the process of fiscal restraint, and that is extremely important. I find the attitude of members opposite towards this bizarre, because on the one hand—and Chris Hipkins is the sort of past master of this—Chris Hipkins says, “Well, Nicola Willis is borrowing all this money—tut, tut, tut. What about all the debt?” In this sort of new-found road to Damascus conversion of the friend of fiscal policy, he pretends to be worried about the debt, and then, on the other hand, he says, “But you’re cutting funding to this. You need to increase spending here. What about this? What about that?” He’s never seen something that’s a Government programme he doesn’t want to increase spending on.

Well, actually, Government is about hard decisions. Government is about making tough choices, and the last Government pretended that they could just continue to increase spending and never confront trade-offs. As a result, the money hose just kept being spouted and money just continued to flow, to the point where we had an 80 percent increase in spending and we have massive debt that we are going to need to repay. So there are lower allowances in this Budget and we intend to stick to them.

We start the process of fiscal restraint and we have gone through, line by line, and made a series of savings as a result of this Budget. Some of those decisions were hard. I’ve talked publicly about the First Home Grant decision, where we had to make the difficult choice to end first-home grants as low-value expenditure and reprioritise that money to social housing expenditure. Members are sort of crying a bit opposite, but they know I am right when it comes to effective public—

Hon Jo Luxton: You’re not right.

Hon CHRIS BISHOP: Oh, I am right—I am right. This is effective public policy. Subsidising demand for housing does not create new houses. The way in which you create new houses is by fixing the building system, fixing the resource consent system, opening up land—

Chlöe Swarbrick: Changing incentives, Bish.

Hon CHRIS BISHOP: —and funding infrastructure, and that is what we are focused on. And I know Chlöe Swarbrick agrees with me. Isn’t it interesting that the Labour Party have not promised to bring back the First Home Grant? They’ve criticised us for cutting it, but they have not promised to bring it back, and I find that intriguing.

The second thing this Budget does—and it flows from the first—is it reprioritises funding from the back office to the front line. We are unashamed about reducing the size of the bureaucracy and making sure we employ more nurses and doctors and police officers.

One of the best investments in this Budget—and I want to give a shout-out to the hard-working New Zealand First on this, and my good friend and colleague Casey Costello—is the commitment to hiring 500 new police. We saw the first fruits of that on the weekend with the new police on the beat in our CBDs, and isn’t that going to be a wonderful thing? When I go out there into the real world, people say to me, “We want to see cops on the beat. We want to see them walking down our main streets—we want to see them out and about.”, and that is a real way of deterring crime in and of itself.

That is just one example of the kinds of prudent and sensible investments you can make when you prioritise your resources. When you do the opposite, and you just pretend that money is free and that there’s a magical fairy at the bottom of the garden who can just keep inventing money, essentially, you don’t confront those tough trade-offs and you end up in the situation we’re in, which is a real situation of fiscal crisis where we have to make hard decisions.

The other thing this Budget does is deliver tax cuts—tax relief for hard-working New Zealanders. Now, there were a few people out there during the lead-up to the Budget—commonly, they’re commentators—saying things like, “Well, the Government should really cancel the tax cuts.” It’s an interesting proposition—it’s an interesting proposition. The thing about that proposition is it would have required the Government to break the central policy that the Government campaigned on.

So I just think it’s worth reflecting on—I mean, the Labour Party never believed in tax cuts in the first place. They’ve never seen a tax increase they weren’t in favour of and they’ve never been in favour of tax relief ever—ever. When the Government books are not going so well, they say, “Now is not the time for tax cuts.” When the Government books are doing well, they say, “Now is not the time for tax cuts. We should really do something else with the money.” You can never win.

They’ll never be in favour of tax relief, and it goes to the central difference between the parties. On this side of the House, between the ACT Party, the National Party, and the New Zealand First Party, we believe in letting New Zealanders keep more of their own money because it’s their money, and we believe they can spend it, generally, better than the Government can.

We also believe in this: we believe that after 14 years of fiscal drag, it’s time to remedy that situation. More and more people are pushed into higher and higher tax brackets, paying more and more of their money to the Government every year, to the point now where for people on the minimum wage, towards the end of their take-home pay, some of that money is in the middle-income tax brackets. That is wrong. That is crazy. Sensible countries do something about it, and we are now doing that.

As I say, the Labour Party need to remember who they purport to represent, because most of these tax relief benefits flow to low and middle income New Zealanders. On average, households benefit by 60 bucks a fortnight; households with children, $78 a fortnight; 94 percent of households will benefit from the tax package in this Budget.

I was so proud to see that legislation go through straight away on Budget night, because I know that come 31 July, a huge number of New Zealanders are going to wake up with more in their back pocket as a result of that package. They’ll be able to afford things they weren’t able to afford before: new school shoes for their kids, music lessons, and actually making it easier to pay the rent on time. Those things are important. That’s what the Budget package does, and that’s why I commend this Budget package to the House.

The Minister, Chris Bishop, who has just sat down, told us that Government is about hard choices. Well, we certainly saw those harsh choices that this Government has made in the Budget that was delivered in what seems like a lifetime ago now, given how much has been written about it. This is a Budget of broken promises, it is a Budget that is taking New Zealand backwards, and it is a Budget that exemplifies the wrong choices that our Government is making on behalf of New Zealanders.

Now, New Zealanders were promised much on the campaign trail—not least $250 a fortnight in tax cuts from the National Party on the hustings. What have most New Zealanders who have gone to the calculator to find out what they’ll be receiving found? They’ve found that it is way short of that. And what’s more, they’ve found out they had to start shelling out for bus fares, because the previous investment in having free bus fares has gone. They’ve found they’ll have to be paying for prescriptions again in many cases, because that is a choice that this Government has made to slash the funding in that area. They’ve found that, in their case, the free lunches in their child’s school will be reduced to nothing more than a snack. And these are, once again, things that are going to come out of the back pocket of hard-working New Zealand families. New Zealand families realise the wool was pulled over their eyes and they are worse off as a result of this Budget and not better off.

We have a Minister of Finance who is insistent on telling us that she hasn’t borrowed for her $10 billion tax cut package, despite borrowing $12 billion to pay for measures in the Budget. New Zealand’s debt as a percentage of GDP has risen. If the Government had not chosen to deliver $10 billion worth of tax cuts, the need to borrow that $12 billion would not exist. But, over and over again, we have a Minister of Finance and a Prime Minister who are intent on telling New Zealanders that black is white and they have not borrowed for their tax cuts. That simply is not true.

But what we do see as a result of this Budget is laid bare. I think one of the most interesting reads of any Budget is the Budget Economic and Fiscal Update. That tells us a great deal about what Treasury is saying the impacts of the Budget being delivered are. They tell us that house prices are going to continue to rise. They tell us that there is going to be upward pressure on rents because of the removal of interest deductibility. We also see in the analysis of the Budget that child poverty will rise. These are the results of the Budget and the choices that the members of the Government have made in a Budget that they are delivering to us. We know that it will take so many hard-working New Zealand families backwards and they will be worse off.

If I have a look at what this Government is doing in terms of climate—and what they are not doing, more to the point—this is a Government in which the best they can say about their positive vision for addressing climate action is, “Well, we didn’t cut that line of the previous Government’s work.” There is $3 billion worth of initiatives and climate action carved out in this Budget. There is $3 billion of investment that was about securing New Zealand’s security, New Zealand jobs, and New Zealand’s future that this Government has taken the knife to, to pay for tax cuts and give tax benefits to landlords. That’s the kind of self-interest we are seeing from members on the other benches. We’ve seen money to partner with New Zealand businesses to reduce industrial emissions and keep jobs in New Zealand slashed by a Government saying it doesn’t want corporate welfare but has absolutely no plans to do anything about industrial allocation of emissions trading credits. What they are saying is they would rather go out and pay other countries $100, $200—who knows how many hundreds—per credit rather than cut emissions at home.

Well, I can tell members—the economic geniuses, self-proclaimed, on the other side of the House—the New Zealand Steel deal delivered for New Zealand emissions reductions at $18 a tonne. Go out and find me an international credit anywhere that will deliver emissions reductions so cheaply and will benefit New Zealand in so many ways. But what was laid bare when we had the chance to scrutinise the Minister of Climate Change, the Minister for Energy, and any of the Ministers involved in this work was that is no plan, there is no vision, and, frankly, there is no understanding of how New Zealand needs to get to where it needs to get.

We’ve seen money stripped out of the Warmer Kiwi Homes programme, a programme that returns so much more than it puts in. We’ve seen money pulled out of the Community Renewable Energy Fund, a programme put in place by our Government to work with communities to not only generate badly needed renewable electricity but also to create community resilience. Support for the energy, education, and communities programme—a programme that was working with some of the most vulnerable New Zealand households about how to reduce their power bills—is gone because this Government would rather fund $2.9 billion in tax relief for landlords than helping some of our most vulnerable families pay the bills and get by. The just transition programme and any money for us to stimulate a hydrogen industry in New Zealand is gone from a Government with no foresight who thinks economic development is selling houses to each other and then claiming interest deductibility on it. That’s the kind of choices that are laid bare in this Budget.

One of the things that we do know about the kinds of choices that this Government has made is that they are not interested in what will take New Zealand forwards. It is a Budget that consistently looked over its shoulder. It is a Budget that only is intent on taking New Zealand backwards. And let’s look at some of the other markers that just show how far back this Budget is taking New Zealanders.

Unemployment, according to the Budget, is due to peak this year at 5.3 percent, and I want everyone just to pause: 5.3 percent doesn’t sound like a big number, but that represents hundreds and thousands of New Zealanders who will be without work and that will need to make ends meet. Was there anything in this Budget for them? No, there was not. What we’ve seen is we’ve seen the minimum wage exemption for disabled people cut. There was money actually taken out of the Budget to make sure that we were paying disabled people the minimum wage, and we’re told that we can’t do that, otherwise disabled people will not be employed. No, they won’t. There was money in the Budget to subsidise employers to ensure that dignity of work and good pay could be given to those people.

What we are seeing is a set of choices laid bare. It is not, as we would be told by the Minister of Finance and the Prime Minister, a Budget that is giving the biggest boost to working people. No, it is not. It is taking working people backwards. It is taking money out of the back pockets of working New Zealanders to pay for $2.9 billion worth of tax relief for our landlords. It is taking money out of our children’s future by scrapping climate initiatives. If there was ever a greater testament to the lack of vision and the lack of ambition for New Zealand that a Government could carry, it was contained in the pages of the Budget that was delivered by this Government two or three weeks ago. It is a Budget that will not benefit those that need it the most; it is a Budget that is making the wrong choices and taking us backwards.

The member who resumed her seat, the Hon Megan Woods, doesn’t believe that 3.5 million New Zealanders believe tax relief—doesn’t believe hard-working New Zealanders should get tax relief. Now, that’s a sad place to start, because, in reality, the Budget that was delivered by the Minister of Finance, Nicola Willis, on 30 May prioritised hard-working New Zealanders.

I want to tell the House this, because that side of the House does not think those 3.5 million New Zealanders get it. They do. They absolutely get it. They know that each and every day that they are struggling, that they are doing it tough, they know, although we might still see some months ahead, it will actually get better, and they know why. They know, because they voted in a coalition Government at the election last year that they could depend on for delivering their promises. They knew that there was a Minister of Finance who not only delivered a Budget on 30 May but also delivered a mini-Budget before Christmas, literally weeks after coming in, to actually lay the foundations for what our country needs, not just in the days and weeks ahead but the months and years ahead.

That side of the House thinks that New Zealanders don’t get it. They think New Zealanders don’t get it, but, actually, what are they doing at home? They are thinking about how they take more care with their weekly budget, how they balance it. Actually, for far too many, it is too tough. Some of them might have to borrow to get through this period of time, but they are not wasting their money on frivolous things that don’t lead to a better life for them.

The other side of the House don’t think that hard-working New Zealanders get what our Government is doing for them. So the 3.5 million New Zealanders who understand—and as Minister Bishop quite rightly laid out, he described it in other terms. I’m going to describe it as the sugar hit—the sugar hit of the previous Government spraying money away around everywhere, not caring whether it landed, not caring whether it actually delivered anything or delivered any outcomes. But you know what it’s like when you’ve had too much sugar. If you stop sugar, it’s a crash and you feel rotten, your head hurts, and you feel sick, but, actually, once you’ve got through that period without the sugar, you are actually way better off. That’s exactly the period of time. Unfortunately, based on Treasury’s forecasts, it could be sort of six months—hopefully not too much longer than that—but this Government is up front with New Zealanders about the position we are in and what we have inherited, but, more importantly, the steps we are taking to resolve it.

It was fascinating—scrutiny week last week was the opportunity for the Opposition to grill Ministers on their budgets and on their estimates, and, gosh, wasn’t that surprising. There were actually very, very few opportunities for the Opposition to land a hit, because at the end of the day, New Zealanders everywhere, from one end of this country to the other, are contacting their new MPs—and we’ve got some fantastic new MPs in this House—and they are contacting Ministers and they are saying, “Keep going. We know the decisions you’re taking are tough, but please keep going.”, because they absolutely know they are the right decisions.

The member that resumed her seat before me was somewhat interesting when she talked about the Budget Economic and Fiscal Update and the fiscal update that was provided by Treasury and talked about the unemployment rate rising to 5.3 percent. If we can hold it at 5.3 percent, despite these absolutely dire economic situations and circumstances we have inherited, that’s actually a win.

Here’s the thing: despite there being very low unemployment, that side of the House, when they were in Government, managed to clock up an extra 70,000 people on the jobseeker benefit—

Hon Member: Outrageous.

Hon LOUISE UPSTON: Absolutely outrageous. At a time when many businesses everywhere were desperate for staff, it is just unbelievable that they were so successful in doing that.

So, instead, this Government lays out a clear plan—it will be ambitious—for reducing the number of people on the jobseeker benefit by 50,000. But if we just picked a number out of the air and said, “Oh, well, sounds like a good number. Sounds like a good slogan.”—no, there’s a detailed plan that goes with it, because the coalition Government, every Minister, every MP that’s working hard on the ground knows that it is our job, even in tough times, to improve the lives of the people we represent.

In social development and employment, it’s reducing the number on the jobseeker benefit. So what have we done? First and foremost, we do believe, on this side of the House, that there are rights and responsibilities. If somebody’s on the jobseeker benefit, they have the right to get welfare support, but they have the responsibility to take steps that they should be taking to improve their chances of finding a job, so if they don’t, there should be a consequence. It’s called a sanction.

What else have we done to make the welfare system more active? We’ve introduced Kōrero Mahi, so if somebody signs on for the jobseeker benefit, within two weeks we want them back at a seminar connecting with the Ministry of Social Development, talking about what steps they are taking to find a job—actually, not that kind of shocking or stunning, right?

When we announced it, one of the journalists was like “But surely that already happens.”, and, like, no, unfortunately, it doesn’t. After signing on for a benefit, somebody could go for up to 12 months with zero contact—zero. So, instead, we are a Government that is focused on supporting people into employment. It will be hard, these times, particularly the next six months, and we do recognise in the Treasury documents that the numbers are due to increase. But rather than just say, “Oh, you know, that’s tough.”, no, we will double our efforts to support more Kiwis into work. That is exactly what this side of the House will do.

Another group of New Zealanders that we are supporting in this Budget is, of course, disabled New Zealanders. Unfortunately, what we’ve seen, and this is a classic example, in the creation of Whaikaha - Ministry of Disabled People—the previous Government set it up with a big fanfare and they set these wildly high expectations but actually didn’t address the fundamental issues of funding the disability support service that they knew and were in the establishment Cabinet paper yet did nothing. They did nothing to address it, so this Government comes along and inherits a mess.

Do we just surrender? No, we are doing the work; we have a review to understand exactly what has happened but, more importantly, what we need to do to solve it, because disabled New Zealanders, their carers, and their families deserve better than what the previous Government set up the ministry to do. I’m absolutely committed that Whaikaha will be successful. Disabled New Zealanders need them to be. They need us as a coalition Government to deliver better. Whether it’s access, whether it’s employment, whether it’s ensuring there are sufficient care and support workers, our Government is focused on improving the lives of disabled people, their families, and carers.

I want to return to where I started and say this is a Government who is absolutely delivering for New Zealanders. So, even in challenging times, we focused on New Zealanders being able to keep more of what they earn. The other side of the House doesn’t think they deserve it. They don’t think they deserve it. It’s outrageous—that is absolutely outrageous. They think they can spend it better than taxpayers can. Well, actually, no, we trust and we back New Zealanders. That’s why we’ve allowed 3.5 million New Zealanders to keep their own money, and we will be incredibly careful with what they provide in tax. That’s why every Minister has been very careful in looking at expenditure, focusing on the front line—is it delivering results or is it not? Yes, that means some tough choices, but if you think about this Budget, it’s delivering more in health, more in education, more in disability, and in keeping our community safe.

E te Māngai, tēnā koe. Tēnā koutou e te Whare. There are things that none of us could do alone. There are few New Zealanders who have the individual wealth to build schools or hospitals or pay the $20 billion annual superannuation cost that we have as a country. That is why we form society. It is why we decide to come together to help to pay for things, whether that be the infrastructure or the services that all of us fundamentally agree and value and say that we need. That is the point of a representative democracy—the point of all of us, as 120-odd MPs in this place, coming together to make decisions on behalf of New Zealanders about how we best make decisions in the collective.

Unfortunately, the discussion that we are having tonight, on the bill which implements the spending announcements in Budget 2024, is that we are not so much grappling with vision for the future of this country, let alone the present day; what we are grappling with is a shredder. There are no foundations in this Budget for the flourishing or the wellbeing of people or the planet.

There are a lot of different places I could start on this, so I’ll start just firstly by responding to two Ministers who have so far contributed to this debate—the former, the Hon Louise Upston, who just said she thinks this side of the House thinks that New Zealanders just don’t get it. And I’d really like to respond to that point, because this is something which I’ve been banging on about for the last six or seven years that I’ve had the privilege of occupying a seat in this Parliament. I think New Zealanders are a heck of a lot smarter than a lot of politicians and a lot of the mainstream media give them credit for. I think New Zealanders can see through a lot of the nonsense and the bluster and the slogans that come out of this place. So I just want to address that right upfront: New Zealanders are actually tired of the nonsense that comes out, probably in most people’s perspective, of every single political party that’s represented in this place.

The best that any of us could do or hope for with the privilege of our position is to engage in a robust, evidence-informed debate. To that effect, I’d just like to put it on the record, for the sake of the House’s knowledge, that I wrote to the Minister of Finance in the wake of the Budget and asked for her to carry on with the work that she had promised she would do in Opposition—that is, to pursue the independent policy costings unit, which, of course, the former Minister of Finance, the Hon Grant Robertson, and the Hon James Shaw, as associate finance Minister in our first term, in that relationship with Labour, tried to get across the line but was shot down by National. So we’re hoping to revive that for the sake of transparency and independence, so that we can have a meaningful and informed, evidence-based debate on Budgets, least of all on a universal set of figures.

Now, there have also been some statements from the likes of the Hon Chris Bishop, who was speaking about how this Budget is occurring in the context of unconventional monetary policy, especially post-COVID-19. For the uninitiated, unconventional monetary policy was the programme by which the Reserve Bank decided to basically print more money—

Hon Paul Goldsmith: Money-printing.

CHLÖE SWARBRICK: —yes, the Hon Paul Goldsmith—through programmes like the Large Scale Asset Purchase programme and Funding for Lending. Interestingly enough, back in 2020, Treasury and the Reserve Bank of New Zealand advised the Government—and the Greens actually went on about this quite a lot too over the last few years—that the pursual of this unconventional monetary policy without mitigating fiscal policy would result in what the Reserve Bank and Treasury called “distributional impacts” but what the rest of us in the real world call “greater inequality”. That is something which the Greens are on the record, time and again, asking the former Government to meaningfully address. We cannot pretend that what the Reserve Bank did happened in a vacuum back then, and we cannot pretend that what they are doing now also operates in a vacuum. Monetary and fiscal policy are supposed to operate hand in glove.

We also heard commentary about the Budget Economic and Fiscal Update, and there’s a really interesting point in this, actually—that is, that we know, based on the projections from this Government’s operating allowance that they’ve handed themselves, that they have said, in this window of the next two years, they are going to have $2.4 billion of new operating allowances for each of those next two years. But guess what! What Treasury, what the Government’s own officials say, is that you need at least $2.5 billion. That’s $100 million more than the Government has already allocated themselves just to keep the lights on—that is, with the level of services that New Zealanders are accustomed to and expect. So that might be why it is that we are starting to hear, out of our nurses and our doctors and our medical profession, that there’s, effectively, a hiring freeze on at the front line. And do you know what that does? When you don’t invest in issues as they arise, those costs accumulate. That is in direct contradiction to all of the bluster and nonsense that we have heard from this Government—that they are somehow good economic or fiscal managers. You don’t get to have that reputation simply by saying it, especially when the facts operate in entire contradiction to that.

What this Budget does is, in fact, actually set us up for austerity. It sets a bunch of programmes up to fail, so that the Government can ultimately end up cutting those programmes or privatising those programmes. We see hints of that in the changes to the school lunches programme, which takes the average cost per child from approximately $8 to $2. I can point to a number of schools within my constituency who have written and pleaded with the Associate Minister of Education that this will not work for them and asked whether there is any wiggle room or discretion whatsoever. These are the hard choices that the Government keeps telling us about. Its hard choices are to cut school lunches for our kids and to hand $2.9 billion in tax cuts to landlords. Those are some really hard choices for this Government!

We’re also seeing the can kicked down the road on climate change, and the Hon Megan Woods spoke a little bit about this.

Hon Simon Watts: What a load of rubbish.

CHLÖE SWARBRICK: I’m so glad that the climate Minister is here in the House to actually hear the recounting of his inability to answer any straightforward questions at scrutiny week last week. We heard from that very climate Minister that the market was working properly, when the emissions trading scheme (ETS) auction failed last week. Do you know what that does? It puts a $700 million hole in their revenue plan and the Budget that is unable to now be directed, not into the Climate Emergency Response Fund—because they cut that; they’re not interested in decarbonising industry. What it does is it cuts $700-odd million from the revenue that they need to fund their tax cuts for landlords. Make it make sense!

On top of that, we also heard both from the Minister of Climate Change and from the Minister of Finance that they are still committed to our nationally determined contribution on the Paris Agreement. This is a really important point, and if I can drill into it, because the Minister of Climate Change, of all people, should be interested in this: our contribution as a country, as one of 196 countries under the Paris Agreement, is to say that we are going to keep below 1.5 degrees of warming. And as the UN Secretary-General put it just this past week, that is not just some airy theory, abstract target; that is the scientific fundamentals for retaining life on Earth as we know it—in fact, the climate necessary for growing food, which this Government constantly tells us it cares about. And do you know what? What we have from the Ministry for the Environment and from Treasury last year, in approximately November 2023, was an estimate paper that they pulled together to try and put some kind of figures on the amount of money that we are liable to be on the hook for, up to the year 2030, as a country, regardless of who’s in Government. And do you know what they estimated?

Our offshore liabilities are looking to be somewhere between $3.7 billion and $24 billion for offshore mitigation. That is a necessary figure, to the tune of however many billions of dollars, even if we were to meet our very own emissions reductions budgets, that we will have to pay others to reduce their emissions. Meanwhile—riddle me this—this Government has also made decisions knowing full well on their own official advice that their Budget will also increase emissions. But they haven’t budgeted for those offshore liabilities, to the tune of billions of dollars to 2030—again, kicking the can down the road on that. And, on top of that, alongside shredding the work programme that was already under way at the Climate Change Commission to price agricultural emissions—the only sector in our economy that is currently not priced under the ETS but also represents 5 percent of our GDP and half of our emissions—they’ve also set up their own working group to apparently do this work by 2030, which, as we discovered at scrutiny week with the Minister of Climate Change, has no budget allocated to it. They can’t tell us the terms of reference, who the members are, or how much this new working group is going to cost.

We’re left scratching our heads, and, again, in a position where we are dealing with a ticking time bomb, whether it is on the front of climate change or whether it is on the front of inequality or child poverty. There is so much more that could be said about the fact that this Government is just leaving the infrastructural deficit to continue eroding away at the quality of life that New Zealanders deserve. Different choices could be made. And I’d note, interestingly enough, that the Government itself and the Minister of Finance referred to the need for us to do fiscal consolidation. To that effect, there are tons of international bodies, the likes of the International Monetary Fund and the OECD, who have pointed out one of the key things we could do is fix our tax system with a capital gains tax.

Thank you, Madam Speaker, for the opportunity to talk about the 2024 Budget, and what a great Budget for New Zealanders this Budget was. It’s quite interesting when you follow the Green Party over there, because every single speech they end with has to be “A new tax—a new tax.” It’s all about more tax. They haven’t seen something yet that they don’t want to tax. Everything they see, they want to tax, and that’s their modus operandi.

But this Budget was about tax, and it was about tax relief for hard-working New Zealanders, who, by the way, haven’t had tax relief since 2010—14 years. The other side have been happy to let inflation erode people’s real incomes, let tax creep continue to take its toll on people’s incomes, and they didn’t do anything about it. In fact, I think it’s really important to note that whilst it’s been 14 years since New Zealanders have had tax relief, it would be a lot sooner if the last Government hadn’t repealed the tax relief that the last National Government put in place in 2017. Because, of course, in 2017, the Hon Steven Joyce legislated tax relief, and the very, very, very first thing the Labour Party did when they came into power was to repeal the tax relief that New Zealanders had received under that National Government.

That is exactly how that last Government operated: tax, tax, tax, spend, spend, spend, and not worry about the future, while this Government is now having to clean up the fiscal mess left behind by the last Government. And what a mess it is, a mess all over the place: the borrowing, the borrowing, and the spending. In fact, us as Ministers, going through our portfolios, having to clean up our portfolios and find the savings and make the tough decisions is exactly what the New Zealand public have been expecting of us.

That is exactly why the New Zealand public voted to get rid of that last Government—because they could see the reckless spending that they were going down. Spending like drunken sailors, not worrying about the future, borrowing money and nothing to show for it—nothing to show for it. Then they have the audacity to stand up and say, “Oh, well, we have to be, you know, worrying about the $3 billion iReX project.” Well, I’m sorry; again, nothing to show for it. Nothing to show for it, even after six years in Government. So, this Budget was about giving New Zealanders the tax relief that they need to ensure that New Zealanders can address the cost of living crisis. I’ve heard members on this side speaking in this debate about the pain that New Zealanders are currently feeling—and it is real, it is real. The economy is in a tough position left behind by the last Government who had no plan for the economy, who had no plan other than to tax, spend, borrow, tax, spend, borrow.

Well, this Government has inherited that mess and we’re having to make the tough decisions, but the first and number one priority for this Government is to provide that tax relief for working families, so that New Zealanders can just keep a little more of what they earn—the principle of keeping a bit more of what they earn. [Interruption] I tell the members on the other side of the House: they don’t believe in it; they just want to take it. If they ever get back into Government—if they ever get back into Government—I can guarantee New Zealanders that the first thing they will do is increase taxes. The first thing they will do is increase taxes because that’s exactly what every single Labour Government does. They get in and they increase taxes on working New Zealanders. [Interruption] They know it—they know it. They can feel it deep in their hearts. They can feel it. They feel the desire to keep taxing New Zealanders. It’s bubbling away as they interject in my speech. They can’t wait—but they won’t because the public of New Zealand can see right through it. The public of New Zealand won’t let them ever get hold of the Treasury benches ever again, because they know that this country has fundamental challenges which need fixing: the cost of living crisis, crime, public services—making sure that public services actually work for New Zealanders—and, of course, infrastructure.

I heard the member who sat down just before, Chlöe Swarbrick, talk about the infrastructure deficit. Well, billions of dollars were borrowed, and what have we got to show for it? They cancelled the roads of national significance—gone. We think about the Northland Expressway up to Whangārei—cancelled. No planning done for the last six years. I came in and asked the NZ Transport Agency what major roading projects across the country had been consented. Well, the good news is—the good news—there’s one. It’s Warkworth to Te Hana, going north of Auckland. The bad news? There’s only one: Warkworth to Te Hana. The pipeline of infrastructure was stopped by the last Government, other than, of course, the pretty pictures: the pretty pictures of “Auckland Light Fail” and Let’s Get Wellington Moving. The beautiful pictures and slogans which they spent hundreds of millions of dollars on; they couldn’t even deliver a business case—they couldn’t even deliver a business case. An absolute fail.

We have inherited an infrastructure deficit that we are tackling in this year’s Budget, and I’m proud of the investment that we’re putting into roads, into rail, into fixing the potholes on our roads, improving public transport for New Zealanders. This Budget delivers for infrastructure in New Zealand. As Minister of Transport, of course I’m incredibly proud of the $2.68 billion increase in investment in roads and rail and public transport to support the Government Policy Statement on Land Transport: another billion dollars to advance the roads of national significance and major public transport projects—isn’t that great for the regions of New Zealand where roads are what are critical to unlocking the economic growth and productivity of our country?—and $939 million for the recovery of the roads which were damaged by the East Coast, North Island weather events. That is going to make a huge difference to the State highways and the local roads. And $266.9 million for rail in our metropolitan rail networks. This is going to mean that the City Rail Link in Auckland is able to be opened, with the rail rebuild completed in 2026.

This is going to make a huge difference to Auckland. For six years, talking about Auckland light fail, whilst the last National Government made the tough decisions to start the City Rail Link, which would double the capacity of our rail network in Auckland. That is real change for our public transport network. That will make a real difference to congestion and getting Aucklanders moving. The last Government didn’t even deliver a business case, let alone some pretty pictures. Another $200 million to support KiwiRail to carry out maintenance and renewals of the national rail network; money for the Civil Aviation Authority so we can keep the important work they do going; money for Surf Life Saving in the Coastguard to help them on the critical safety work that they do. We have made a huge investment here as well in decarbonising the bus fleet, which is going to make a big difference in terms of lowering emissions in our public transport system.

This additional $2.68 billion goes on top of the already announced draft Government policy statement, which includes over $20 billion of investment in the next three years. I’m proud of the decisions already made by the NZ Transport Agency to invest a 91 percent increase in pothole prevention and maintenance on our State highway network, and an increase of 50 percent of pothole prevention on local roads. It’s not just about making sure there’s increased funding—we need it—but also making sure that there are outcomes delivering for New Zealanders. We have set very clear expectations around how we want that money to be spent and the targets that we want the agency to be delivering against.

This Budget delivers for the infrastructure that New Zealanders need. This Government understands the infrastructure challenges New Zealand has, and we’ve also set aside an increase in the multi-year capital allowance, increasing it to $7.5 billion because we do know there are other challenges and other decisions that need to be made in terms of infrastructure in the coming years. We’ve obviously had the conversation earlier today around the ferries; there’s other major roading and rail projects and other infrastructure challenges this country faces. We will face up and make the tough decisions, invest in the infrastructure that New Zealanders rely on so we can grow our economy, boost productivity, and help New Zealanders get where they need to go quickly and safely. This Government’s Budget delivers for infrastructure. Thank you, Madam Speaker.

A Budget represents a series of choices that are made by a Government. A Budget makes a series of claims about what a Government is doing. But when we dig down into those choices, when we dig down into those claims, then the character of the Government is revealed. What is revealed in this Budget is something that I can only think of as being devious. It is a Budget that alleges that it gives with one hand, and then it takes with away with the other. It makes a whole series of choices that leave ordinary New Zealanders worse off. They talked up large, they promised they would deliver, but what have they done? Public transport subsidies: gone. Free prescriptions: gone. Bare minimum wages for people with intellectual disabilities: gone. Proper school lunches: gone. The second year of the Apprenticeship Boost: gone. All these things, small amounts—a bit here, a bit there—but they all make a real difference to families.

That Government over there talked up large about the tax threshold changes, talked up large about what that might do for families. But, on this side of the House, we’ve had family after family contact us, sending us messages, talking about the increased cost of public transport, talking about the prescription fees that they will now have to pay, talking about how they will be worse off as a result of the choices that that Government has chosen to make in this Budget. So they’ve made very small changes, on one hand, in the tax thresholds, and then they have taken them away on the other. Not only that, they have derided—they have derided—ordinary New Zealanders for the things that they choose to spend money on. A Minister talked about the “frivolous” things that people spend money on. Frivolous things like prescription charges, frivolous things like public transport, frivolous things like food for their children—characterised them as “frivolous” things. How outrageous. It is going to be so much tougher for so many people because of this Budget.

On Friday evening—Thursday evening or Friday evening—1News featured a story about food banks. I took particular notice because Lady Maliena Jones was featured in one of them; she runs a food bank in West Auckland. As it turns out, the Ministry of Social Development sends people along there for food parcels when they need them. On the one hand, people are struggling to get by, looking for Government assistance, but they get sent to a food bank—a food bank which is no longer receiving Government assistance itself. Taking away with one hand—sorry, allegedly giving with one hand, and taking away with the other. It is so hard for people out there.

So when we look at this Budget, the word for it is “devious”. That deviousness extends right through, into some of the stuff that has gone on in the Budget documents—right into this document I’m holding. Sitting in the Budget document, sitting in the revenue strategy, is a claim that a good tax system is one that rewards effort and individuals’ investment in their own skills. Sitting in the regulatory impact statement for the tax threshold changes is the revelation that some people, as a result of this Budget, will face a personal income tax rate of 128 percent. For every single extra dollar they earn, they will be taxed $1.28 because of the changes that have been put in around the tax thresholds and the abatement rates and so on—it’s a complicated place in there. But that example, sitting in the Government’s own documentation, shows that they do not set out to reward hard work and effort. Instead, they create real barriers for ordinary people. That is a devious Budget.

When we dug into the Budget numbers even further, we found that the examples of families were made-up—created through modelling, while someone tapped away on a calculator. They could not tell us how many families would actually receive each of these alleged changes in the tax threshold. Devious hidden charges on ordinary people. This is a shameful Budget.

Tēnā koe, Madam Speaker. Thank you. First, I want to acknowledge all of our tamariki mokopuna who have descended upon Nelson—beautiful part of the country—who are performing in their national secondary school kapa haka competitions that started today. My nephew performed today. We wish them all the best and we want them to know that they are champions to all of us already.

I also want to acknowledge the other champion team—the Blues—much to the disgust of a lot of Wellington members. I am very proud of the Blues team. But I want to come back to the kapa haka. The reason why I want to come back to the kapa haka is that if the members on the other side of the House simply listened to what our young people are saying—and they’re performing it on the national stage that took place today and will take place over the next couple of days—they are clearly sending a message to this Government that the cuts, that the direction that this Government is taking this country in isn’t the right one for future generations. It is one that looks towards the now and doesn’t look towards the future.

When we look towards the Budget, what became abundantly clear to members on this side of the House is that there are two ways to make an impact on the Budget if you’re in the Government. The first one is to be a Minister and bungle a decision, and then, all of a sudden, the Minister of Finance has to scramble to find money and do a pre-Budget announcement because of a bungle by a Minister. That’s one way to do it. The other way to do it is to, simply, break a promise during the election campaign, realise that people’s lives depended on that particular promise, realise the mistake, and then, all of a sudden, start scrambling for next year’s Budget money and make an announcement around the treatment of cancer patients.

This has been a shambolic Budget process from this Government. We heard repackaged Labour announcements introduced again in this Budget. I want to talk about defence. One of the pre-Budget announcements was “Oh, we’re going to invest in remuneration.”, which is fantastic. We support that. We started a lengthy process to increase remuneration for our New Zealand Defence Force (NZDF) personnel. However, the next announcement was “And we are replacing the Pinzgauer and Unimogs.” That was already well under way under the Labour Government. In fact, we received the first tranche of those replacement vehicles while still in power. Yet we’ve had this repackaged, old announcement put into this Budget.

The next announcement that came out was: “Oh, we’re going to continue an investment into the Linton logistics hub.” That was already started, well under way; in fact, the Rt Hon Dame Jacinda Ardern broke ground on that particular project, and it was under way in my tenure as a defence Minister. Now we’ve seen it repackaged again in the appropriations in the most recent Budget. So that tells me that the defence spending from this Government has decreased. It’s simple mathematics. It will decrease to below 1 percent of GDP. Now, on that side of the House, we’ve heard numerous statements from the Prime Minister and members and Ministers saying that, “We’ve got to replace the 757s. We value the NZDF; they do this amazing work.” They’re just not prepared to invest in them. If we found the way that decision making happens in this Government, what we can do is continue to keep the pressure up to make sure that this Government puts their money where their mouth is when it comes to the replacement of the 757s.

I heard today from the Prime Minister that we’ve got to try something new and we’ve got to try something different. In order to pay for the matters that they’ve announced in the Budget, they’ve taken away. One of those things they took away was something new, something different, something innovative, and it was Te Aka Whai Ora. It was made very clear that if you want different results, you had to actually do something different, and that’s what Te Aka Whai Ora was. It was the ambulance at the top of the cliff—or the fence at the top of the cliff, in this case—and not the ambulance at the bottom. I’m really saddened by the decision from this Government to cut that and to put the money elsewhere, when I know that that was going to make a significant difference.

Some of the words I heard through scrutiny week—cute language, by the way. For example, when questioned on why they were cutting allowances for NZDF personnel to be able to go on and do further study, which is a huge incentive for our NZDF personnel, these were the words that were offered back to me: “We aren’t making cuts; we are simply limiting the allowance.” Hmm! Cute language, to me. That tells our NZDF personnel that this Government doesn’t care about them, will not invest in them, and will not invest in their future, and that can only mean that the NZDF is going backwards. Tēnā koe, Madam Speaker.

Thank you very much, Madam Speaker. It’s an absolute pleasure to be back in the House and listening to the dreary stories coming from the other side. It sort of just makes you remember and go “Well, actually, didn’t we just have a Budget 26 days ago which actually provided significant relief to hard-working New Zealanders?” And that is the case. That was the reality 26 day ago. We had an absolutely superb Budget. Nicola Willis, our finance Minister, delivered on our promises to those families across this country. Hard-working Kiwi families are now going to get hard-earned tax relief after a decade of waiting. And this coalition Government has delivered upon its promise to make that a reality. I’m proud of that. I’m proud to be part of a coalition Government that is delivering because, gee, I must say after six long years of non-delivery and neglect, we are now having to tidy up that mess. But I’m proud that we are, and we are embarking on that process.

You know what? The average-income household will be $102 a fortnight better off from 31 July. That is a real addition to those families and for an average-income household it’s going to make a real significant impact. What’s interesting, though—[Interruption] Right; that’s pretty reasonable. That’s a contribution. Do you think that side of the House voted in support of that happening?

Hon Member: Did they?

Hon SIMON WATTS: No. No, they didn’t. Labour, the Greens, and Te Pāti Māori voted it down, voted against the tax cuts, and that’s proof that on that other side of the House, they are not facing the reality of what households in this country are facing.

The Budget analysis also showed that 727,000 households will benefit by at least $75 a fortnight and 187,000 will benefit by at least $100 a fortnight. That is a significant element of a contribution versus the status quo. And let’s remember, the status quo is no tax relief and it would have been no tax relief under Labour, Greens, and Te Pāti Māori. But this coalition Government has delivered upon the promises that we made. The sum of $3.7 billion is the amount of tax relief that is going back into the back pockets of hard-working Kiwis. And that is real change and real effect for what is an incredibly important part. And I’m pleased to be part of a Government that has delivered that aspect.

I also am proud, as the Minister of Revenue, that the Inland Revenue Department, who have responsibility to make this a reality, are working very hard to be prepared to do that. They’re doing a great job, and I am looking forward to a matter of weeks away when that money starts to flow into the back pockets of those individuals in particular, and that is going to be great.

The other aspect, in regard to the relief that we provided, was also in the area of FamilyBoost, and that is acknowledging that a significant element of the amount of money that families with young children spend is on early childhood education—a significant amount. And, again, this Government heard and listened in terms of the challenges and pressures that those families were under and took the leadership required to be able to provide relief to those families. And so, again, they are going to be able to claim up to about $900 or so a quarter to be able to provide relief to pay for those funds. And that is targeted again to families under a household income of $180 grand. And that is real. That is real money going into the back pockets. Again, in comparison to the status quo of what was being offered on that other side, that was zero. And so that is the reality again for that aspect.

The other aspect in terms of the Budget that has been announced previously, as we’ve noted, is that it was against the backdrop of some pretty significant fiscal mismanagement. I mean, it’s hard to sort of explain the reality of what we have inherited in regard to fiscal mismanagement. But every corner you turn—or one turns—there is a significant amount of challenges and issues, and there is wastage all over the place.

But this Budget is a clean-up job. It is a clean-up job to make sure that after six years of New Zealand being neglected financially, we are able to start turning around that economic mismanagement and get back on the tracks to making sure that this economy will grow and prosper. And hard-working Kiwis who do that hard work for this country are going to be rewarded as part of that. And that is the right outcome for them.

In regard to some of the key elements within this Budget, there is $1 billion for cyclone relief and resilience. I acknowledge the Hon Mark Mitchell for the work that he does in that portfolio—really, really important. But I tell you what, Minister Mark Mitchell has been on the ground in the regions, continuously working with those communities and $1 billion to sort that is significant. And I acknowledge the work that you have done.

On my left, or on my right, we’ve got the investment of $2.5 billion of investment in roads, rails, and public transport. The Hon Simeon Brown has led that, and he has inherited a basket case. I think that’s probably the most polite way that you could explain what he has inherited. But he has delivered $2.5 billion of investment, and I know that people in my community of the North Shore and in Auckland and around this country are thankful for the fact that they have actually got, at long last, someone in that seat that actually knows what they’re doing, are going to deliver for hard-working Kiwis, and get more roads built for this country to let this economy get ahead. Isn’t that great to hear?

Law and order: well, again, jeez, Mark Mitchell is doing a sterling job in that area with $2.92 billion of extra funding to restore law and order; $69 million of youth offending funding; $194 billion in terms of corrections, and $226 million importantly—importantly—on 500 additional police. I acknowledge the announcements you’ve also made this week about more police on the beat, because I know my community in the North Shore are sick and tired of the crims working like they run our streets. Well, I’m sorry, Minister Mark Mitchell is now back. We have got funding of $2.93 billion extra funding—crims, we’re coming to get you and your period of the happy life is over, and Mark’s going to deal with that and make sure the funding’s there.

Those are just a couple of the examples which show the importance. But in my portfolio of climate change, I am very proud that we have been able to ensure that we’ve got additional funding, particularly in the areas of climate adaptation. We know the implications of the impacts of climate change in our regions, in our provinces, in our cities. We saw that last year with the Auckland floods in the aspects around Tairāwhiti, Hawke’s Bay, and Gisborne, etc., and $200 million for flood resilience is an excellent start in what is going to be an area that we are going to need to continue to invest in.

It’s $2.6 billion of climate change investment that we have continued. We’ve done an assessment in terms of what was being spent previously. I’ll be clear: we did stop quite a lot because it wasn’t adding any value. It wasn’t reducing emissions. On this side of the House, we are focused on outcomes and reducing emissions, and we’ve got $2.6 billion to make sure that we deliver on that. We are going to be releasing a clear plan in terms of how we deal with the actions around climate change in a matter of weeks. We do have a plan and we do have a strategy, and that is two things that the other side didn’t have. So I can tell you what: who owns climate change and who is taking action and who is going to deliver the outcomes? This side of the House are making the implications and the actions required. And they know it. You can hear them, they know this—they know the reality. I am proud to be able to be part of that and the investment in this Budget is making that a reality.

So we’ve covered off a number of key aspects in regards to that—just a flavour, just a sampler, a sampler within that Budget, and I didn’t even talk about education. In education, under Minister Erica Stanford, there’s $2.93 billion of additional investment to lift educational achievement, and, my goodness, hasn’t it dropped over the last six years? But Erica Stanford’s back in that seat, she is getting into that area, and as a father of young children within the education system, I am, again, proud that we are investing in order to lift educational achievement.

I’ll tell you what, what all that sums up, what all of that says to me and to New Zealanders, no doubt, is that this Government is getting this country back on track. And isn’t that a great thing. Isn’t it great to be part of a Government that’s getting stuff done, getting stuff done that matters to hard-working Kiwis and getting our country back on track, and that is why I’m proud to be part of this Government.

Thank you, Madam Speaker. This Budget lays the foundation of what ACT campaigned for—real change. You know, travelling up and down the country campaigning, there were two key issues that New Zealanders were facing: cost of living and crime. I’m very proud to say that this Budget addresses those things. This Budget is for the change makers of New Zealand, those people who wake up before dawn to tend to the farm, the people who take a risk to start their own businesses, and the parents who send their children off to school expecting a world-class education.

My kids were here during the Budget urgency, and when I asked them about what they would do in their Budget, they said, “Free ice cream for all kids.” Well, guess what, kids! We’ve got something better than that; we’ve got $153.3 million to establish charter schools to give you a real good quality choice when it comes to your education. This Budget brings back charter schools to finally give New Zealand families a real choice when it comes to their education. One size does not always fit all, and charter schools will provide the ability for communities to innovate, create education facilities that work for their children—Māori, Pacific, rural; any community you can think of. Communities know what our children need, and now we will unlock their ability to do so.

Of course, the Labour Party revelled when they shut down our charter schools, because they believe that the unions and the Post Primary Teachers’ Association (PPTA) know what works for children’s education more than the communities of the children in question. I’ll listen to the success stories of the children who felt betrayed by the public school system and went on to charter schools and realised their true potential over the PPTA any day.

There is $477.6 million to continue the healthy school lunch programme for two years. All of this drama created by the Opposition that we were axing the free lunches for school was just a big ruse. The reality is we were actually saving the programme. The previous Government didn’t even budget or forecast for the coming years. It was a fiscal cliff, like many that the previous Government left us. Not only is the programme continuing but it’s going to be more efficient and more cost-effective.

After the many years of economic vandalism committed by the Ardern and Hipkins - led Government, we are finally on the right track to empowering our economy once again and supporting Kiwis where it really counts. For the first time in 14 years, we have delivered tax relief to hard-working New Zealanders, letting Kiwis decide how they spend their own money. Radical isn’t it, guys? The Labour Party would disagree with this, thinking that they know better than Kiwis when it comes to how they spend their money. Well, the election results show us that Kiwis are sick of this mind-set. The Government is doing what Kiwi families have been doing—tightening our belts. We’re cutting the back-office bureaucracy bloat in the Public Service, and we’re getting back to the core focus on outcomes for New Zealanders.

The ACT Ministers have been finding savings everywhere. Just to name a couple, in internal affairs, the Hon Brooke van Velden saved $421 million, eliminating unnecessary programmes and expensive initiatives such as three waters and fair pay agreements. Oranga Tamariki: the Hon Karen Chhour shifted the focus to front-line staff, saving $319.6 million. Education savings: the Hon David Seymour saved $107 million in the school lunch programme. And this is just some of the savings that we have.

We are cutting the bureaucracy and red tape across this country; removing agricultural emissions from the emissions trading scheme; bringing back mortgage interest deductibility because—guess what!—owning a property and renting it is actually a business and you should be entitled to the benefits of running a business; opening up education opportunities with charter schools, bringing back three strikes; and much, much more in order to get New Zealand back on the right path.

There is $668.7 million to address youth offending, including a military-style academy pilot. Crime has been out of control in New Zealand. In my suburb alone, robberies and ram raids have just gone out of control under the last Government. Cashmere, Z; the Warehouse, Barrington; Mobil, St Martins; Hornby Mall, Subway, Wigram are just some of the places that have been affected. “Between January 2017 and January 2024, there was a total of 2,186 ram raids,” Chris Cahill, the New Zealand Police Association president, was quoted last year as saying in response to youth crime in Christchurch. Police are really struggling to deal with this recidivist group of the most serious offenders. Front-line officers feel hamstrung. Well, guess what! Six years of cuddling criminals and playing tag and release is over under this Government.

We are calling time on the free ride home after a hard night of ram raiding, creating harm and destruction within our communities. Serious youth offenders will now be held accountable for repetitive criminal behaviours, and our children’s Minister, the Hon Karen Chhour, has done an excellent job in this space. Her announcement on Sunday shows how committed she is to giving our young people the right path and a brighter, more productive, and more positive future. We will never accept that it is a normal part of New Zealand life to see headlines about children as young as 11 involved in ram raids. In Christchurch, there were some kids as young as eight, even, which is actually quite outrageous.

ACT will always go further, whether it is spending reduction or tax reduction. However, we can say with confidence that this Government’s Budget has gone further with ACT as a leader in the team. This Budget is not for the politicians, but for you, the New Zealanders, the change makers who innovate, achieve, and work tirelessly to build a better life, a better country, and a better future for New Zealand. So thank you, Madam Speaker.

Hon Paul Goldsmith: Mr Speaker—Madam Speaker.

I call the late Hon Paul Goldsmith.

Well, I thought I had three minutes to go and here we go. It’s great to be here talking in this Budget debate after what has been, I think, a very well-received Budget up and down this country, where people have noticed the feel and experienced the pressures that are on many households after a long period of slow growth with higher interest rates and inflation that we’ve experienced as a country for a long while now.

We now have a new Government that is determined to change that and turn that around. But first get inflation under control, which, longer term, leads to lower interest rates and allows people to get more for their money—their weekly pay packet—after all the housing costs that they experience. So that’s the primary reason why this Budget has been a very disciplined Budget after a period of ill-discipline from that fellow called Grant Robertson, that used to hold that post.

Secondly, for the first time in 14 years, this Government, under Nicola Willis, with the leadership of Christopher Luxon and the rest of the coalition team, including my good friend and colleague Shane Jones sitting down the aisle there, is about offering the first tax relief in 14 years so that New Zealanders have more money in their pockets. A lot of people have had adjustments for inflation over the last few years, apart from taxpayers, and they’ve had to pay more and more.

Now, I’m keen to talk about the investment in restoring law and order in this country that comes from this Budget, because the number one issue on the doorsteps was a concern around the cost of living, particularly in Auckland and the Waikato and the northern parts of New Zealand, but also around many parts of New Zealand was a concern around law and order and public safety. People want to feel safe in their communities, and they keep seeing ram raids, retail crime, violent crime increasing, gangs intimidating the population and taking over towns, and they feel unsafe and they’re concerned about the safety of their community.

They want a firmer response, and that’s what this Government is delivering through its legislative programme and what it has allowed for in its Budget through extra resources for the police in order to go and catch people. Because one of the most important ways to deal with violent crime—we have a target to reduce the number of victims of crime by 20 percent—is to increase the chances of being caught, and, secondly, once you’re caught, being held to account.

The first part of that is about giving extra resources to the police to go out there—500 extra police out on the streets—and making it more likely that people are going to be caught. Secondly, of course, we heard the refrain time and time again when we visited the victims of crime, when we go to the dairies, when we go to the sports shops and the many other retailers around the place who have been the victims of violent crime—the number one message that we hear over and again is, “Well, there’s just no consequences. These kids, they caused $50,000 worth of damage to my shop. My insurance has gone up. I’ve been knocked about. We live in fear. We’re feeling put upon and we’re working our guts out trying to just make a go of this country and make a living to look after our kids and we’re getting set upon time and time in by the same mob and there’s no consequences for them.”

So we heard that message and we want to change that. That’s why we’re making changes in so many areas, such as stopping the gravy train cottage industry around cultural reports that have happened. Secondly, we’re giving the police the extra powers that they need to go after gangs, banning gang patches, stopping them sort of gathering in groups, being able to give extra powers to deal with organising crime, and also dealing with the firearms that so threaten our safety in our society.

Then we’re going to bring back the three-strikes legislation. Now, one of the consequences of bringing three strikes is that it holds our worst repeat offenders in custody, out of harm’s way, for longer. That’s the purpose of it: that if you are a repeat serious offender who has had violent crimes over an extended period of time, we want you off the street so that you can create fewer victims. That’s the purpose of it and that’s what we’re going to do.

Then, secondly, we’re going to deal with the youth crime situation that we’ve inherited. Even—what was the name, Jacinda Ardern?—Jacinda Ardern admitted that we need extra tools to deal with the repeat youth offenders. Because it’s blindingly obvious to everybody that there is a small group—I’ve got four young people in my family; most people in this country, most young people don’t go anywhere near the court system. Actually, overall, youth crime has been falling over the last few decades. Most people do well; they don’t get in trouble. Everything’s fine.

There’s a small group who do get in trouble and for the majority of that group, the light-touch rehabilitative focus approach that we have—not dragging them through the courts, but actually giving them every opportunity to recognise the gravity of what they’d done and move on—works well. So the vast majority never go near the courts and the vast majority of the ones that do get into trouble, they do it once and they’re never seen or heard of again. So the light-touch system works.

But there is a small group—a small group—where that doesn’t work. They are the serious repeat youth offenders who are doing the ram raids in our community, bringing in aggravated attacks with hammers, and causing chaos in our retail space, in particular. That’s the group where we need some different tools, and that’s why we’re introducing the Young Serious Offender category which dials up the consequences for them. It may, instead of a pat on the head and “We’ll see you again next weekend”, be an ankle bracelet or it might be juvenile facilities because there has to be consequences for serious crime. Secondly, we’re providing for some military academies. Again, it’s a different approach, another tool, that the judiciary can use.

Now, people will say, “Oh well, you’re only interested in punitive reactions.” Well, yes, a little bit of punitive reaction is required, but nobody has ever suggested that’s the only thing we’re doing, because we’re also focused on dealing with those long-term issues of crime. But you got to do both: you can’t do one or the other.

You can’t just focus on long-term issues and think that everything is going to be solved, because you’ve got to deal with the problem right here, right now, on our streets and in our shops—those who are wielding the claw hammer and causing the damage. But long term, we’ve got to deal with a catastrophic rise in truancy that we’ve seen and the fact that 3,000 kids are waking up in emergency accommodation. And we need to work on those long-term housing, mental health, and addiction issues as well. So that’s what this Government is certainly focused on.

I just want to also just mention the arts before the end of my speech. I just want to just make the point that against a strong ripping tide where it has been a tough Budget, we held our ground. One of the great contributions we made was through Te Matatini and the kapa haka, and I was up in Ruatōria and I met with Tā Selwyn Parata this weekend and they’re very proud of that and we’re pleased to make that contribution. Thank you, Mr Speaker.

My contribution to this debate is framed in the way I grew up—a product from the school of hard knocks. This Budget most certainly was designed to enable us to put our hands around the throat of expansionary expenditure of an operational nature.

Now, just remember where we’ve come from: monetary policy that sunk to a global low; money printed as if a fiddler’s elbow was turbocharged; fiscal policy that was loose as a goose. The Budget now is constructed in very straitened circumstances: number one, there is no monetary saviour coming our way. It’s evident from the Governor of the Reserve Bank that he is going to hold the line and that interest rates are only going to drop bit by bit. And the Crown, through this Budget, is confronted by the fact that if we continue the profligate approach enjoyed by the last regime, the ratings agencies will come knocking.

So, then, what is the Government to do? First, strip unnecessary regulatory barriers from those who are willing to invest—boost their confidence, grow the certainty so that they will invest. How do we do that? As reflected in the expenditure items of the Budget, move on with a far more permissive resource management process that gives people the confidence when they make a commitment, they’ll actually get an approval before they get the gold card.

Secondly, give a greater degree of confidence to people that already have businesses that they will actually be able to invest without suffering too many penalties. And what’s the response to that? The response is the fast-track bill, which, by the way, now has a majority of New Zealanders supporting it. Forget about all the apocryphal tales from the other side of the House. Forget about the fact that they left the deadweight hand of bureaucracy upon the economy. We are stripping all that away and we are introducing investors back to our natural legacy of mining, of fishing, of horticulture, where we are going to meet what the world wants. The world wants food, the world wants rare minerals.

Now, of course, I can hear it now. My opponents, large in volume, small in number, will cry that somehow we’re compromising Papatūānuku by actually going on to the Department of Conservation (DOC) estate and mining. The DOC estate covers an inordinate amount of New Zealand and it’s overrun by rats and weasels and pests, etc. It’s tailor-made for a new approach so that extractive sector investments can take place in appropriate places on the DOC estate, and this Budget, by contributing to the costs of passing the fast-track legislation, improving the Resource Management Act, is going to deliver an overdue dividend for regional New Zealand.

Yes, there will be a loud number of minority voices, but they are only a tiny fraction of the New Zealand public. Yes, there were people covered in Gaza scarves and other such detritus walking up Queen Street. They don’t represent New Zealand; they represent that tiny portion of the public who want to dislodge this Government. We are not going to allow the economy to be continually assailed by all of these catastrophising stories. We are going to turn on the engines of growth. How we’re going to do that is not only through stripping red tape; we are going to work on a process of co-investment. And it falls to me, with my characteristic modesty, to remind everyone that we have the $1.2 billion fund which will help boost the productivity, develop the resilience of the regions of our motu.

Now, there were a few critics who didn’t quite like the administration of an earlier fund. Fortunately, now they’re my dearest friends. In fact, I feel a whole lot of applications coming from certain members who may have had a doubting Thomas approach in the past. Oh, the winds of change, they do bring various beneficial offerings from time to time.

Another thing I’d like to focus on is that we can’t create a prosperous economy unless we modernise our infrastructure. But how do we modernise our infrastructure unless we can give investors, contractors, a sense of confidence that they’ll not only get an approval but there is an agenda to blend private and public capital to accelerate the delivery of infrastructure. But what is the community looking for, in a commercial sense? It’s looking for a long-term, broad range of projects so that capital can be mobilised, labour can be mobilised. And we have a long-term pipeline that will be delivered through the fast-track legislation which is wending its way through the Environment Committee.

As I said to a number of loud but largely dislocated voices in Thames the other day, improvements—I don’t want to mention any names—

Hon Mark Mitchell: Catherine.

Hon SHANE JONES: Apparently I’m not allowed to refer to that person by that name. But those who were present, and, in particular, the person that you mention, their criticism of modernising infrastructure, I’ve described as belonging to the “Flintstone School of Economics”. And what is their response when I go out and I actually meet with that tiny minority of loud Luddites who do not want us to develop mining, who do not want oil and gas? What do they say to me? Something akin to “yabba dabba do”. We cannot back down when our economic circumstances are so dire.

I want to finish my contribution off on the Māori side, beyond this Budget. The Waitangi Tribunal is overdue for a haircut, what we call in Kaitāia a “kinacut”. It not only needs better members, it needs a writ that brings it up sharp very quickly. In my view, it has no business entertaining concepts or undertaking inquiries to do with the constitution. That’s the business of directly elected parliamentarians such as ourselves. So I look forward, during the course of the life of this Budget, to work taking place to bring the Waitangi Tribunal to a spot where, hopefully, both sides of the House can accept that it may have a role, but it is not the wandering, not the convolvulus, not the expansionary writ it is giving itself. And stop saying that the Treaty should only be known as Te Tiriti. The Treaty of Waitangi cannot be dismembered. The Treaty of Waitangi is a bilingual, bicultural, inseparable document. And this dangerous ideology pushed around by the party who’s currently engulfed in about five or six reviews—so they’re going to be busy on other matters for a while to come—should not gather traction in terms of how we view the future.

Similarly, a change that, no doubt, will be ushered through during the course of this Budget, paid for by this Budget, will be reframing what is the extent, what is the width and the breadth of the seabed and foreshore legislation. That legislation, decisions made under that legislation, cannot continue if they have the effect of chilling, undermining, infrastructure development. The notion that when we expand our ports, as is the case of Tauranga, they are consistently and constantly having to pay a toll in order to keep the local claimants of the Takutai Moana brigade happy is not only offensive, it must be halted immediately.

The final thing I’d say on this matter to do with Māori elements and the Budget: co-governance is gone; co-investment is in. If you want to know one reason why we’re sitting here and they’re sitting there, they allowed that viral, intimidating, undermining policy of co-governance to go into the recesses both of the State and policy where it didn’t belong. Consequently, it will no longer blight or undermine the delivery of policy. I say again, the Treaty, our citizenship, is indivisible. Kia ora tātou.

Here’s four things about this Budget’s impact on the health system that all New Zealanders need to know. The first is that the Government has been shamed into keeping its cancer medicine promise. I want to shout out to all the patient advocates who held their feet to the fire for three long weeks post-Budget, who demanded that they meet their commitments, and who pointed out the cruel and manipulative thing that has been done: making a promise to people with terminal illness during the election campaign and not following through. But has it kept its promise? Actually, no. It is not purchasing the 13 named medicines. It’s giving Pharmac medicine to work down the options for investment list. Whose promise was that? That was Labour’s promise.

In fact, when I went up and down the country with Dr Reti, pointing out the problems with his commitment, pointing out that he had left out haematology patients, pointing out that it would undermine the independence of Pharmac, pointing out that it would reduce the ability to strike a good deal, what did he do? He ignored it. What did he do when he came into Government? He ignored it. He persisted with his idea that he could do things differently. What was he saying at the Health Committee up until a few days ago? That he was going to do this some other way, that he was still contemplating an alternative. Well, every single week he did that meant people didn’t get their medicines. It was foolish and it was unnecessary. Now it’s left the finance Minister in the position of rewriting Budget 2025 three weeks after she’s delivered Budget 2024. This is a coalition of chaos.

The second thing you need to know is that funding for the health system has come down in real terms. Each New Zealander is getting 4 percent less spent on them in their healthcare than they were in the last Budget. That is because the Government did not take new advice on the true cost pressures on the health system when they came into Government. Te Whatu Ora told us at annual review that the true cost pressures have increased from those estimated before the election, but the Government didn’t fund it. The Minister of Health couldn’t give a straight answer to our select committee on that, but the Council of Trade Unions have done the work: a 4 percent cut for every New Zealander.

The third thing every New Zealander needs to know about the health system in this Budget is that as a result of the previous funding cut, there is a hiring freeze in public hospitals, there is a hiring freeze for back-office staff. That means that doctors and nurses are having to find their own notes, schedule their own clinics, do all the admin that takes them away from caring for people. We also hear reports of clinical vacancies, front-line roles being cut, vacancies not being filled, critical shortages at Palmerston North oncology department not being filled. Remember the promise that this Government was going to put money towards the front line? Well, it seems like that is not the case in the health system. There’s a surgical hospital on the North Shore of Auckland that they cannot staff because of this hiring freeze in public hospitals, and when they do staff it, they’re going to move staff from one ward, in an existing hospital, to another. There’ll be no increase in capacity.

Half the funding for medical students they promised—no nursing and midwifery bonding scheme. By the way, if you’re a graduate nurse, the Government can’t give a clear answer on what your chance of getting a job in a New Zealand hospital is. It’s a disgrace. This Government campaigned on there being a workforce crisis, and now the workforce is going backwards.

The fourth thing you need to know is that it’s going to cost you more to go to the doctor—that’s right. Dr Reti made lots of hints about funding primary care more, the ACT Party campaigned on a 13 percent increase for primary care, and what have they delivered? Four percent. And practices are allowed to, in compensation, put their prices up. So that’s costs on to the people at home—you’re going to pay more to go to the doctor because of this Government’s underfunding of the health system.

Now, look, I get it; running the health system is hard. We face so many challenges with the workforce, with rising demand. It is a very tough job. In that situation, why wouldn’t you use the best science and expert advice to run the system better? Why wouldn’t you keep world-changing smoke-free legislation so that you’d have fewer people coming in for smoking-related illnesses? Why wouldn’t you keep free prescriptions? Why wouldn’t you support nutritious, healthy lunches? This Budget is taking New Zealand and its health system backwards.

Very much like what’s happening in the health system, the education system is also suffering from this Budget. It’s only just on an hour ago, when I was talking to a parents’ support group of young people with neurodiverse needs, that they were practically crying on that Zoom call to me about the lack of support that they have seen in this Budget for them and their young people. In fact, many of them on that call said to me that this Budget has nothing that will encourage inclusion in their young people’s learning pathways. It was a real, real shame, and I felt such sadness for those people, of the experiences that their young people are facing at the moment, and them as parents as they’re moving towards inclusion.

One of the aspects that I think is absolutely criminal is the letting go of the people that have been supporting them and their young people towards an inclusive education pathway over the last few years. They talked about the work that had been done by the Ministry of Education and Whaikaha to build together towards that very much inclusive system—a system where we want to see young people in their mainstream classrooms, where their teachers understand the needs of those young people, where the support staff understand and are able to include those young people in every aspect of the schooling life, and particularly where those young people feel valued and where they have success in their schooling.

That work had been ongoing, work that had come out of the Highest Needs Review, and yet we know from speaking to the people that were at the Ministry of Education who were leading that work that those people have been let go. I got very—well, non-answers last week from the Minister and the Ministry of Education about where that work is heading. In fact, in this Budget, when you look at target students as a whole, there is $5 million less in this Budget than what there was in the last Budget for our target students. That does not sound to me like a Government that is committed to inclusion and to making certain that every young person in the schooling system, in the education system, will experience success.

Also, Madam Speaker, I heard exactly the same in your home patch yesterday when I was in Hokitika and Greymouth. Principals said to me that they could see nothing in there that was for the young people that they are seeing constantly, on a daily basis, coming through the doors of their schools, and they felt aggrieved that there was no support that was coming through that would help those young people be included within the schooling space, but also to support the teachers with the professional development for those young people. Yet we hear constantly this stream that “We’re a Government that’s committed to including all young people and to learning support.” I’m calling on that—that is not right. When you’re seeing that a Budget has $5 million less than the last Budget, that is not a Government that is committed to learning support in this country.

Then we see that there is no money for that but we have $153 million set aside for charter schools—privatisation by a slow drip. We hear this political distraction: “That will help those young people that don’t fit into school.” Well, we’re talking about a very small student population, but we also know that there’s already people that are lining up and companies lining up to put their interests forward in becoming part of those charter schools—companies that are already making money out of early childhood, which isn’t a slow drip of privatisation; it’s a very fast drip of privatisation in this country. It scares me and so many other people that are very heavily involved in education that we would see this coming through into the compulsory sector as well.

This is going to be the biggest undermining of a quality public education that we would ever see, and I am very much committed to fighting for that quality public education system. How can anybody justify spending that amount of money on a very small number of young people who possibly would succeed in school anyway over those young people who are really struggling to be included in the schooling pathways?

Then the speaker prior to me, my colleague the Hon Dr Ayesha Verrall, talked about the school lunches. I spoke to people in Dobson yesterday about the school lunches and how much of a difference it makes to their young people. Next year, the year 7s and 8s in those schools are going to go without those lunches where the year 0s to 6s will continue on. That is not right. Those year 7s and 8s will be excluded from a programme that is making a huge difference to them at this point in time. It’s gone from a lunch to a snack. This Budget is taking education backwards.

Members, this debate is interrupted. We will suspend for the dinner break and resume at 7.30. Thank you.

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

The House is resumed. Before the dinner break, we were speaking on the Appropriation (2024/25 Estimates) Bill and the amendment proposed to it.

I move, That this debate be now adjourned.

Motion agreed to.