JOHN KEY (Leader of the Opposition) : I move, That all the words after “That” be omitted and the following words inserted—

Hon Trevor Mallard: Admitted!

JOHN KEY: —omitted, Trevor; open your ears, mate—“This House has no confidence in the Government led by Helen Clark because it has presided over a decline in New Zealand’s competitiveness, and has failed after eight Budgets to deliver a meaningful reduction in taxes for New Zealand workers.” They are the facts, actually, and we will get to those in a minute.

That was Michael Cullen’s eighth Budget and his Budgets have not got any better. They have come in all shapes and sizes. We have had the lot. We have had the “chewing gum Budget”. We have had the “Bondi Budget”. Well, this afternoon we have had the “money-go-round Budget”, which will almost certainly be a minority Budget, with the bulk of people in this House either voting against or abstaining on a Budget that makes no sense.

What a cruel hoax it has been—what a cruel hoax! We have had months and months of Labour Ministers going up and down the country parading to businesses that good news was on the way—they were in for a $1 billion tax cut. Those were the words. The little thing Labour forgot to tell businesses was that after the KiwiSaver contributions, the Government is taking $2 billion off businesses. That is the truth of this Budget. Businesses have $1 billion given to them and they have $2 billion taken off them. We will go through the maths, if Michael Cullen cannot work it out, in just a moment.

How do they feel out there in the mortgage belt? The chewing gum in the “chewing gum Budget” has gone. The mortgage belt is not even getting the chewing gum in the “chewing gum Budget”. That has gone in this Budget, as well. And they do not get a personal tax cut; there is none of that in Budget 2007.

There is a special little treat for Aucklanders—they get a tax increase. I look forward to Helen Clark parading around Auckland and telling Aucklanders why she has a $1.7 billion cash surplus and a $6.3 billion surplus, but there is not enough money to pay for rail electrification, so we have to have a tax increase. We look forward to that.

The only thing that will be very interesting for workers when they go through this Budget is when they work out that not only will they not get a tax cut under Labour but they will not get a pay increase, either, because that is going into their KiwiSaver account. They will not get a tax cut, they will not get a pay increase, and they will not get a rise in their wages for years—not for years will they get an increase.

So where was the only place there was something positive on tax in this Budget? Well, interestingly enough, it was in relation to charities. Labour took National’s policy on charities. The interest thing is that when I announced it, Steve Maharey said it was Tory charity. It was Tory charity when I announced it. When I announced it, Helen Clark said: “Tax cuts for the rich.” Tax cuts for the rich is what Helen Clark said. And Michael Cullen went out and gave a speech in which he said: “The only thing that will work is the redemptive power of the State. It doesn’t matter how well-meaning charity is; it won’t work.” It was not in the discussion document. National put it up, and when Labour is imploding in the polls it steals anything it can from this side of the House, because we are the only people making sense.

This is the point in the exercise where the backbenchers over there realise they are gone. What I want to do for them is to take them through the little bits that Michael Cullen did not take them through—the little bits that Michael Cullen failed to tell them about when he was explaining it in Cabinet. You see, John Tamihere was right: change the odd word here or there, and make it—[Interruption] Well, actually, I say to Trevor Mallard: “You could be gone, as well, son!”. But we will come back to that member in a minute, because Aucklanders know all about his economic management. Helen Clark wants to put on a regional petrol tax, and he reckons he can afford a billion-dollar stadium, and now he cannot; now he has only $20 million. I say to him: “You’re gone, Trevor. Goodbye! Bye, bye!”.

Let us go back to the business of explaining what the backbenchers in Labour did not know. You see, we asked the Treasury officials in the lock-up how many people would take up this account. The answer, I say to Michael Cullen—and he knows it—is 50 percent of New Zealanders. Half of all workers will not take that scheme up, and I will tell members who those half are. They are those who cannot afford to, who do not earn enough. They do not earn enough and they will not take up this scheme. I will tell members what is worse: they are now being told not to ask for a pay rise, because some of their other mates, who earn a bit more and will put money into KiwiSaver, have to forgo their pay rise. The lower-paid workers of New Zealand have to give up their pay rise so that the higher-paid workers can get a cut through KiwiSaver. So they will not take it up.

Imagine those New Zealanders who are now sitting out there thinking they just want to earn enough to pay for a house. A whole generation of them want to pay for a house. Well, Michael Cullen has just told them that there are no tax cuts under Labour, no pay increases under Labour, and no chance for them to get their own money. That is what Michael Cullen has told them.

And he is doing it in a money-go-round that is pretty interesting. You see, when he announced KiwiSaver with no bells and whistles on it—[Interruption] Mr Burton should be a little bit careful, because everything of mine that his colleagues say things about, they adopt later on. So he should be careful about what he starts disagreeing with me on. I would just keep it to myself at the moment, if I were him.

When Labour announced the KiwiSaver scheme with no bells and whistles on, the Inland Revenue Department hired 400 people. What is going to happen now? What is going to happen when it has this scheme? Hundreds and hundreds more will be employed by the State civil service. That is what will happen.

I feel sorry for the poor old employer, because Michael Cullen could not do the maths. You see, this is the way it works. About 50 percent of the country will take up the scheme—a million people. And when their subsidy is paid in, the employers will get back about $700 million through their company tax cut, and the $400 million or $500 million they get for the contribution. But the employers will be paying in, on the average wage, about a $2 billion contribution by the time they match it at 4 percent of the average wage. So companies get $1 billion back and pay $2 billion out. That is what happens. And that is happening at a time when companies are thinking of leaving New Zealand, at a time when they do not have the right amount of money.

Hon Trevor Mallard: Wrong, wrong!

JOHN KEY: Well, do the maths: $50,000, and $2,000 times a million people is $2 billion. Hello! They are the numbers! I think we can work them out—OK? There we have it. New Zealand companies are leaving. They are leaving because they cannot cope at the moment.

Michael Cullen does not actually trust New Zealanders to get ahead. You see, he does not believe in growth. He has no interest in growth. The only message under Labour is that people will save through the New Zealand Superannuation Fund, and now it will make people compulsorily save through KiwiSaver. People are already compulsorily saving through the New Zealand savings scheme. So the only future under Labour is that the economy will not grow. That is the only future under Labour. Well, there is a future out there that is a lot brighter.

The time has come for there to be a just a little bit of focus on the inconvenient truth about Labour’s economic management. If Al Gore was here he would be making the commercial and the video right now, because the facts are pretty interesting. In 1999—[Interruption] Well, let me remind the Prime Minister of what she said when she came in here in 1999. We were 20th out of 30 countries in the OECD. She, the Prime Minister of New Zealand, said: “I’ll take New Zealand up in the OECD.” That is what she said. Well, I will tell the House what has happened: we have not gone up; we have gone down in the OECD. We are 22nd out of 30 countries. We do not compete with America. We do not compete with the UK. We do not compete with Australia or Canada. We compete with Portugal, Hungary, and the Czech Republic. Under Labour, that is our ambition. We are in a humiliating race to the bottom.

What also has happened in the last 8 years has been quite interesting. You see, in the last 8 years wages in Australia, after tax, have gone up at twice the rate they have in New Zealand—twice the rate. No wonder 700 Kiwis a week now leave for Australia! It is Export Year all right, but it should not be Export Year of our people. Our people should be earning more. Seven hundred of them a week leave for Australia. It is a disgrace. Tonight when New Zealanders are watching TV, they will be asking themselves a pretty interesting question: why does New Zealand, a country of 4 million people, have a million New Zealanders now living overseas? Why did one in four of them go to university? Why do one in two of them live in Australia? Why does Australia—a country of 20 million people—have only 800,000 of its people overseas? The answer is that in the last 8 years, for a start off, they have had some decent economic management in the form of Peter Costello, and, for 5 years in a row, Australian workers have got up the morning after Budget day and said: “I’ve got to keep a little more of what I earn.” And that is fair.

Under Michael Cullen, this is the only message: the only time there could possibly be a tax cut would be election year 2008. It has got nothing to do with the inflation rate, nothing to do with the surplus, nothing to do with the cash balance, and nothing to do with whether he believes in it; it is because election year 2008 is the only time a New Zealander is allowed a tax cut, and we say that is totally and utterly wrong.

Maybe when Helen Clark is in Auckland explaining to Aucklanders why they are paying more for their petrol despite her having a massive surplus, she can explain to them why—

Hon Trevor Mallard: Oh, this is interesting, yes.

JOHN KEY: Maybe Trevor can explain this question: why is a house in Auckland now the seventh most unaffordable in the world? Why does a house there cost 7½ times the average earnings? Is it because that house is so expensive? I do not think so. It is because our wages are so low. In 7 or 8 years of Labour our wage growth has been half that of Australia. That is why New Zealanders cannot afford a house, and after today’s announcement from Michael Cullen they will never afford one, because they are not getting a tax cut and they are not getting a wage increase; what they are getting is a little more than 45 years of renting, and then they get to retire.

What Michael Cullen should have been doing today is getting up and giving an apology. He should have been apologising for driving the highest interest rates in the developed world. He knows, like the Reserve Bank knows, like the IMF knows, that the reason our interest rates are so high is that he has been out of control with the cheque book. It is not just the quantity of what he is spending on; it is the quality of what he is spending on. He has to step up and take some responsibility for those interest rates.

While he is at it, when he looks at the inconvenient truth of his economic management, maybe, just maybe, he can explain why productivity is at an all-time low. Productivity in the private sector in this country is as low as it has been since the series began in 1988, and in the public sector it has gone backwards. [Interruption] As my health spokesman said, Michael Cullen is going to throw another three-quarters of a billion dollars at health, the waiting lists will get longer, the number of New Zealanders going overseas for health treatments will increase, and the quality of health care will go down.

I thought it was pretty interesting the other day when John Roughan made a very interesting comment in his newspaper article on Saturday. John Roughan said that John Key had a vision for New Zealand that was a “step change up”. Well, I agree with him. That is exactly what we intend to do. It is exactly where we intend to take the New Zealand economy. It is exactly where we intend to take things. Under National, it will not be election year when there is a tax cut. Tax cuts will be there, rolled out, sharing the benefit. We will not be putting on petrol taxes if expenses are at the height they are now, if we have the surpluses that this Government has.

Who owns this Budget? The answer is that nobody owns it. You see, this is a Government that has given up on the business of governing. Michael Cullen does not believe in company taxes. It is Peter Dunne who believes in that message. That is why Michael Cullen took $2 billion off the companies after he gave them $1 billion. Michael Cullen does not believe in company taxes. Michael Cullen does not believe in savings incentives, either—that is New Zealand First. Michael Cullen has no solutions for monetary policy; that is why he sent it to the Finance and Expenditure Committee. Michael Cullen does not have any economic message. It is a tired Government and it has absolutely no ideas at all.

While Labour is there, maybe, just maybe, Helen Clark might want to explain why she has racked up a bill of $1.7 billion for climate change. That is the record—$1.7 billion.

Hon Annette King: You’ve got 4 more minutes. Hang in there.

JOHN KEY: Maybe Annette King wants to explain why we are not getting $500 million. Well, I suppose it was Pete Hodgson who said we were going to get a cheque for $500 million. Now we owe $1.7 billion, and the Government will put $1 million into research and development to save it. That is the whole lot that is going in there.

Let me finish by saying something that I think members will find rather interesting. Labour’s pollsters are a company called UMR. Labour members know UMR’s pollsters very well. They have been running polls for them for a very long time indeed. What is just a little bit interesting is that last week a constituent of mine rang me to say they had been rung by UMR, which was undertaking a poll. The question was this: “What will voters remember of the legacy of Helen Clark and Michael Cullen?”. It is a shocking sign when Michael Cullen’s own pollsters think the end is nigh. They are writing the appendix now, before he has even gone. I tell you what: they did not need to undertake that research; they could have rung me, and I would have told them what it was.

Michael Cullen has had 8 years to capitalise on the best weather and the best economic conditions we have had in a generation. He had an opportunity to deliver a really bright future for New Zealand, and he failed, and no mickey mouse, roundabout Budget is ever going to save that. There was a time when I used to care who read Budget 2008. I will tell members this: I do not know whether it will be Michael Cullen who reads the Budget in 2008, and I do not care. I do not care, because I know who will read Budget 2009. It will be Bill English, and it will be a lot better Budget than this.

Rt Hon HELEN CLARK (Prime Minister) : Was that it? What a lightweight! As my colleague said, that speech makes a bird bath look deep. It contained no vision for New Zealand. It was a whole speech—

Madam SPEAKER: I am sorry, Prime Minister—please be seated. I do not mind the level of interventions, but they have got to the point where it is impossible to hear.

Rt Hon HELEN CLARK: A whole speech was spent promoting something that Mr Key’s finance spokesperson does not even agree with. The finance spokesperson is not allowed to go on Close Up tonight because he is going around saying that big personal tax cuts are not affordable; his leader has just spent his whole speech saying the opposite. It was just another bankrupt Tory speech from a leader who would bankrupt New Zealand.

Running an economy is not about taking short-term positions in the market. Running an economy is not about gambling our country’s future. That might be all right on the money markets for money traders, but it is not appropriate for running a country’s economy. We know that if John Key had had his way last election, right now New Zealand would be cutting its health spending and its education spending. Right now Kiwis would be paying much higher interest rates, because National was prepared to promise anything, regardless of the damage it did to New Zealand. The choices are very, very clear. The choices are that one can write a Budget that backs investment and savings, or one can write a Budget that squanders New Zealand’s economic potential—which is the National Party way.

This Budget is about growing and developing New Zealand’s economy and living standards. This Budget looks to the future and to supporting New Zealanders’ aspirations for prosperity and security. The National Party looks back to the 1990s—or was it the 1890s—as we have just heard. Its policies did not work then and they will certainly not work in the 21st century—they will not work. New Zealanders have got used to experiencing something much better under Labour—

Hon Marian Hobbs: I raise a point of order, Madam Speaker. I have very good ears, I have this speaker on full bore, but I cannot hear the Prime Minister.

Madam SPEAKER: There are levels of disorder that cannot be tolerated. We know that the basic rule in this House is that people are entitled to be heard. Of course members may make their interventions—it is that sort of debate—but those interventions have now got to the area where in fact it is extremely difficult to hear anything.

Gerry Brownlee: I raise a point of order, Madam Speaker. I hope that you are not going to listen to too many more appeals about this. At the very opening sentence of Mr Key’s speech, Mr Mallard—sitting right next to the Prime Minister—practically drowned out the rest of the House.

Madam SPEAKER: I thank the member. I listened very carefully when Mr Key was speaking and he could be heard. There were interventions—

Gerry Brownlee: He couldn’t be—

Madam SPEAKER: Mr Brownlee, do you wish to remain in the House for the rest of this debate? If you do, please do not intervene.

Gerry Brownlee: Quite honestly, no.

Madam SPEAKER: Off you go, then. Please leave the Chamber.

• Gerry Brownlee withdrew from the Chamber.

Madam SPEAKER: As I said, of course it is the type of debate where there should be interventions, but every member in this Chamber is at least entitled to be heard.

Rt Hon HELEN CLARK: All that latest exchange proves is that all the hollow men can do is holler—because they have no answers.

The experience of the Labour Government has been an experience of long-term economic growth, it has been the experience of low unemployment, it has been the experience of rising living standards with high employment levels and support for families, and it has been the experience of investing back into those all-important basics of education, health, superannuation, law and order, and infrastructure. This Government has turned New Zealand around—around from the nation that was demoralised and had no hope under a National Government. That was National’s legacy. There is no point even in having a poll that asks people what they thought about it; they know it was misery, it went on too long, and it must never come back.

Not only has the economy been growing under Labour but it has experienced the second-longest run of continuous economic growth since the Second World War. We have seen benefit numbers tumbling—not just of those on the unemployment benefit but of those on the domestic purposes benefit, and now sickness and invalids benefit numbers are falling as well. This Government has virtually eliminated the number of young people on the dole. It is down 92 percent—92 percent. All these things happen because of economic success under a Labour-led Government. Over there on the National benches, members have been sulking for 7½ years—7½ years—and I say there are at least 7½ years to go because their legacy was to leave behind a broken-down economy and a shattered society.

I ask members to look at what commentators are saying now about the 21st century economy. Perhaps Mr Key might like to consult the Hongkong and Shanghai Banking Corporation, which last week described the New Zealand economy as the miracle economy. That is high praise. Members should look at this month’s monthly monitor from Business and Economic Research Ltd. Its economic indicators are at their most positive right now for any time in the last 5 years, with 32 of the 42 measures higher than they were a year ago. So this Budget is written against a background of economic growth and development.

The challenge before the Government is to write a Budget that makes that situation continue, and that is best done by addressing the well-known imbalances in the economy. That means working to stimulate the export sector, which has been hurt by inflation pressures, particularly in the housing market. I am aware that although our exporters have shown considerable resilience, some of them are hurting and they wonder how much longer they can carry on. We know also that those high interest rates and that high currency have made the current account deficit particularly high, so the approach in this Budget—to promote investment and to promote savings—is the right approach at this time. It is the right approach at this time.

The Minister of Finance has outlined the three big areas of initiatives in the Budget—firstly, the business tax reform and assistance package of $3.4 billion promoting investment, research and development, and upskilling and exporting. There was a party over there on the Opposition benches that used to say it was the party of business. When did its members last deliver a business tax cut? It was not in living memory—not in living memory.

Hon Member: 1960s!

Rt Hon HELEN CLARK: It was in the 1960s with “Kiwi Keith”, not with “Money trader John”.

There is the $650 million rail infrastructure package, and there is the $3.2 billion KiwiSaver package. That package is good for our families, and it is good for the economy. It helps our families save for greater security in retirement, it boosts our nation’s savings rates, it makes us less dependent on foreign capital, and it gives us greater control over our own destiny. It is good all round.

It is good especially because it gives Kiwis an economic dividend from the growing economy without throwing fuel on the flames of the domestic economy. Members should make no mistake: the National Party approach outlined by Mr Key would see every family’s mortgage go up, every business’s mortgage go up, and the currency go up, and it would make the imbalances in the economy worse, not better. So this Government has set out to do what is right for New Zealand.

We believe that the corporate tax rate cut will help our businesses invest for the future. We believe that the new tax credit for research and development will support our businesses and industries in going upmarket. We also have more funding in this Budget for Government grants for science and research—a lot of it directly helping our businesses and industries innovate in their products and services. There is new money in this Budget for industry training and for tertiary education; that is good for the economy, too. There is extra support for exporters, and that new funding going into the market development assistance scheme means a near doubling of the baseline support for those grants. That helps our exporters get out to market.

The Government has long identified the state of New Zealand’s transport infrastructure as a brake on economic development, particularly in Auckland. So this Budget is not only funding the commitment we made to the State highway programme but it is also acting to secure the future of rail and public transport in Auckland and Wellington. We are looking—over the next 8 years—to a 50 percent increase in per person public transport journeys in Auckland. We are prepared to play our part in investing in that.

Our Labour-led Government is very proud of this Budget. Our philosophy has always been that the rising tide should lift every boat, and that as the country’s economic capacity grows, we must invest back into basic services—as our people expect us to. They expect Governments to deliver on health, education, superannuation, and law and order. They expect those things to be looked after, not cut, as they have long been under National Governments in the past.

In the health area we have been able to provide another $3 billion over the next 4 years. There is a particular boost for care and services for older New Zealanders and for people with disabilities. That might not matter to the National Party, but anyone with aged parents, and any aged person who needs that care and those services, knows that it matters that workers are properly paid. We value and appreciate what they do, and this Budget makes that possible. It never mattered to the National Party through the 1990s—and it does not matter to it now—that people then could not afford to go to the doctor. This Government’s Primary Health Care Strategy makes it affordable, and 1 July is the last roll-out date of that strategy—lower doctors’ fees and lower prescription fees for every New Zealander. But we cannot have that and have big personal income tax cuts—those are the choices. Do we look after the basics and invest for the future, or do we just squander tax as the “Money trader” would?

Education is a very high area of priority for our Government. Come 1 July a very important policy will take effect, which is the 20 hours’ free early childhood education policy—20 hours’ free. This is, without doubt, the greatest expansion of the public education system since the first Labour Government brought in free secondary education. That is how important it is. The policy has been constantly attacked by National, because it prefers to give tax cuts to its rich friends rather than look after children’s education. We know where our choice is.

The same thinking lies behind the big increase in this Budget of teachers and classrooms for small children. This Budget takes us well down the track to the implementation of the 1:15 teacher-pupil ratio in our new-entrant classes. That is the first time any Government has ever committed to that. Operations grants for our schools are up 4 percent in this Budget. Funding for student allowances is up, which means that 12,000 more students will have the opportunity to get a full or partial allowance.

As well, the Budget funds a very significant increase in New Zealand superannuation—a 5 percent lift in after-tax pension income. That was something negotiated with the New Zealand First Party after the last election. We have been prepared to fund it, support parties are prepared to back it, and it will make a substantial difference to our older people’s living standards. Also in the Budget is more support for respite care. Respite care is essential in giving a break to both carers and those they are caring for.

We also see significant new spending in the law and order area—again, that is something that has come out of the confidence and supply agreement with New Zealand First—as we put in place the 1,000 new police. What will be seen from this side of the House is support for our police—not abuse—support for them to do their job.

The Minister of Finance has focused on sustainability initiatives in the Budget, and we are working on ways of helping households and businesses save money and contribute to a cleaner environment. The urban rail initiatives are all about sustainability as well as public transport, and we are moving to promote greater energy efficiency in many ways. We have for some time been gearing up for a bigger programme to retrofit old homes that are not insulated. In this Budget, for the first time, we are looking to develop an interest-free loan scheme for a wider group of homeowners, so that they too can save money on their power bills and have warmer and healthier homes. That is very, very important. There will be a lot more promotion for businesses and homes generally about how to reduce their energy and water use, and recycle their waste. I will also give a plug to public recycling facilities. Frankly, some of the places, whether local or international, where our visitors visit are a disgrace in respect of rubbish. If we want our tourism image to be “100 percent pure”, as the posters say, we have to do something about cleaning it up, and the Government has made a commitment to do that.

Under the national identity theme of the Budget we are putting more resources into speeding up Treaty settlements. This House has passed legislation to close off historical claims by September next year, but that means we have to resource the negotiations and the inquiries that make settlement by 2020 possible. We will do that. There is more support for public broadcasting, including Māori television and radio, and for our digital content strategy.

There is more support for the Department of Conservation in respect of improved pest management around the conservation estate. Biodiversity is important to us. And we are supporting New Zealand’s representation and contributions offshore through extra support for foreign affairs, defence, police personnel, and, of course, overseas aid.

I know that this Budget could be written and delivered only by a Labour-led Government. Just think of what John Key had in mind. Just think of no new investments in health and education, and no new investments in families and superannuitants but, instead, of cuts in those areas. Just think of not boosting the transport infrastructure out of taxation but tolling across the network, as Maurice Williamson wants to do. Just think of not making investments in business growth, innovations, skills, and exporting, but of sitting back, as National did for 9 years, and letting market forces rip our country apart.

That is not the future Labour sees for New Zealand, and I do not believe it is the future that the support parties voting for this Budget see, either. We are supporting saving, investing, and growth and development. We are working for New Zealand’s long-term health and prosperity, off the back of considerable success from the time the Labour Government was elected. We look to lock in success through a better balanced economy, and that is why I say, with confidence, that this is a good Budget for these times.

Rt Hon WINSTON PETERS (Leader—NZ First) : I just want to say at the start of my address that in the long time I have been in Parliament, I have never before seen what I have just witnessed today. Members from one political party were prepared to listen to their leader, but after he had spoken they were “Gone with the Wind”. They are bad-mannered intellectual philistines, who are not prepared in a debating chamber to hear the alternative views of other parties on the biggest debate on any given day in any Parliament. A party that is not prepared to listen to the views of others is not worthy of governing. That is a disgrace. Mind you, it is that party’s problem, because those members will miss out on some great dialogue from here on in.

These debates are where New Zealanders look to for vision, hope, and leadership—not the kind of vision I have just heard from the Opposition side of the House, which was more like an ingratiating nightmare, but real leadership and vision. Then there are others who cynically see Parliament as a soap opera. As I said, after the last case of hot air from the leader of the National Party, National members vanished or went with the wind. There was a little bit more drama here and there, and the most predictable lines were played out to well-worn plots. That has certainly been true of the contribution we heard in reply this afternoon. There was no original script and no original lines at all. It arises because this House—in the case of so many of those National members over there, particularly the new members—is full of prima donnas. They could fill the cast of Shortland Street.

So the real question is what new performances have we seen in this Budget year thus far? We can see that for Labour this Budget is all about trying to find “Friends”. Labour now hopes that by “Mucking In” its poll ratings will rise. That is predictable. Although there are some people who have questioned the Government’s “Agenda”, the fact is that there is much that is commendable in this Budget, and those people cannot deny it. Much of what was in the Budget, I am pleased to say, my party has argued for over years. Even at this late stage I am pleased to see that it has now become the mantra of Parliament.

New Zealand businesses have been waiting to get the economy into “Top Gear”. Cutting the tax rate to 30 percent, which brings us in to line with Australia, will go somewhere towards achieving this. But if our businesses are to really see “Happy Days”, again, we must go a lot further. There is much good work that is being done to build our export capacity in Export Year 2007, with further initiatives in this Budget. But how much better would things be if all new export profits were taxed at 20 percent, and we pursued some of the policies of successful economies—like Ireland or Singapore?

Rodney Hide: Why just exporters?

Rt Hon WINSTON PETERS: Why just exporters? I say to Mr Hide that that is because we are an export-dependent country. That is why. Coming in here with ill-applied, American ideas—which is a totally different economy—is what has so constrained this country for the last two decades. We should focus on exports, because, like so few countries, we are export dependent. I say to Mr Hide that instead of going off to Dancing with the Stars maybe he should pay attention to what is going on in New Zealand’s economy. We must encourage our businesses to do better, both at “Home and Away”. It is the only way we will grow. New Zealand First fully supports the Government’s efforts—

Rodney Hide: You’re just jealous.

Rt Hon WINSTON PETERS: I am jealous? Excuse me? I am jealous of that spastic exhibition I saw on TV? For God’s sake, the only person who would be jealous is TanaUmaga—he cannot do a spear tackle that good! The member must be joking! I am jealous? Jealous of what?

Madam SPEAKER: Order!

Rt Hon WINSTON PETERS: Well, I was asked—and one can see why.

Madam SPEAKER: Could the member please return to the debate.

Rt Hon WINSTON PETERS: We fully support the Government’s efforts to build our savings base. The reality is that in Australia, and elsewhere, they have been playing “Who Wants To Be A Millionaire” for 15 long years. In fact, New Zealand’s savings strategy, until today, was like a Lotto draw—hoping and wishing that things would go away. I have to say that the announcement by Dr Cullen today, for New Zealand First, is a bit like going “Back to the Future”. I recall all of those comments that were made 10 years ago about New Zealand not having a savings plan. I recall all of those comments in particular from a party that claims to be conservative—but is just plain reactionary—that went up and down this country opposing a national savings strategy, and that put Jenny Shipley, who was hopeless, incompetent, and unprepared, in the job of Prime Minister. Where is she now? She has taken a “Slow Boat to China”.

Hon Members: Who was Treasurer?

Rt Hon WINSTON PETERS: Well, the Treasurer at the time was, of course, none other than yours truly. Today I am looking at a man, Bill English, who not only campaigned against the savings strategy but, in his next Budget, got rid of the programme designed to spend road-tax collections on roads. He will get up today and say otherwise, but if one looks at the 1999 Budget one sees that that is exactly what he did. So before people accuse New Zealand First of being “Supernanny” over compulsory savings, we suggest they look across the ditch and then tell us who was right and who was wrong.

Hon Members: We were right!

Rt Hon WINSTON PETERS: I say to those laughing backbenchers over there that they are not going to be here for 5 minutes if they keep on laughing like that. I saw Mr Borrows on TV.

Hon Member: Who?

Rt Hon WINSTON PETERS: Mr Borrows. I saw Mr Borrows on TV complaining about flak jackets not being carefully fitted and being too small. I wondered how the police could possibly know what would be the right size if they were all going to look like Mr Borrows.

We do share one of Mr Borrows’ concerns, and that is on the issue of law and order. We initiated the recruitment of 1,000 extra front-line policemen and policewomen. But our concern, for example, about the Department of Corrections today is that it is beginning to look more like “Prison Break” and “Getaway”. We have to do something about it. Our gangs are completely out of control on our streets at the moment. We have our own version of “The War at Home”, and it is not pretty. We can, and we must, do better. The time has come to declare war on gangs, and to say that enough is enough. The time has come to give the image of Māori a chance instead of the degrading vision so often on TV at night at 6 o’clock, which is that very abhorrent vision that the Māori people in this country do not want. The time has come to act now. In South Auckland on any given day and at any given school—and sometimes this will be for one classroom—one can find 15 kids with serious weapons on them, mostly knives. Ask any teacher who knows. This is way out of hand, and the sooner we do something about it then the better we will be.

What sort of environment are we providing for our young people to learn in under those circumstances? We have heard from all of the apologists—all the sociologists. We have heard them say that it is too hard or that we should give these young people a chance—well, we in New Zealand First say that they have had their chance for four long decades. We say that it is game over. The war on gangs is now a “Game of Two Halves”. We are now entering the second half, and New Zealand First says that it is time for the right team to start winning. We will outlaw the gangs, hunt them down, shut them down, and rid our society of their scourge. [Interruption] For those members who laugh, let me say that they laugh because they know nothing of the society in which they live. How can they, with their pristine backgrounds? That member from Hamilton has never done a day’s work in his life. He probably thinks that manual labour is the President of Mexico. I ask members to have a look at him.

I say that the gangs have had their warning. Any party that seeks to work with New Zealand First after 2008 will meet the condition requiring their support, which is the assurance that gangs will be shut down once and for all. One could say that they could be “The Departed”. I heard a lady on Radio New Zealand National today between 9 a.m. and 12 p.m. Her name was te Heuheu. She has been 30 years in that world of association with the gangs, and she was as certain as I am that they should be outlawed. She is Māori; she is sympathetic, but this abomination must go, and go now.

We are pleased with the $400 million extra going into the elder-care sector—it desperately needs it. It is long overdue. We hope that it also relates to proper wage adjustments within the aged-care sector. We cannot have women of 55 or 60 years of age, who are experienced and conscientious, getting the lousy wages that they have been getting. So I am pleased and delighted—as are my colleagues—for that $400 million extra going into the elder-care sector.

We applaud the increased funding for making free health-care more accessible for children under 6. But we ultimately hope that that will extend to all primary school - aged children. New Zealand First believes that there should be a little “Nip/Tuck” when it comes to the administration where health care is concerned. There should be much less administration. Far too much of our health sector looks like “ER”—one dramatic crisis after another. New Zealanders deserve better.

New Zealand First is pleased with the massive increase in overseas aid, with most of it going to the Pacific. I am also delighted with the greater expenditure on the one agency that is our image abroad—the Ministry of Foreign Affairs and Trade. I am grateful for the Government’s support on that initiative. It is desperately needed if we are, in an economic sense, to match the First World in the 21st century and also fulfil our obligations to our own neighbourhood. Success in our own neighbourhood makes us strong in the eyes of others miles and miles away—in the European Union, the US, and Asia. It is important. One could say that we believe in being good “Neighbours”, but I will speak more about that later. As we strengthen our own neighbourhood we make our future more secure—the two things go hand in hand.

This Budget is an MMP Budget, because this is an MMP Parliament. New Zealand First, like United Future, welcomes efforts on reducing business tax. The United Future party, though, I am sad to say, seems to be going through its own version of “Downsize Me!”. Some parties deserve this and some do not, and New Zealand First feels genuinely sorry for Peter Dunne and his remaining colleague on this matter. We know exactly what it is like to have people ride into Parliament on one’s coat-tails. We know about all the effort, the sacrifice, the expenditure, the door-knocking, and all the work over years to get them here, and then they suffer from delusions of grandeur and stab one in the back. The soap opera about which I speak reminds of that called “Rome”,where someone has been left with a knife in his back. The explanation on this morning was a disgrace. How can a person call himself a Christian when the first act of his party is 5 months of deception against his leader and the troops that put him here?

When it comes to the National Party on the soap opera front, the only thing I could describe its members as is “Lost”. They are several divided tribes who never know whom they can trust and whom they cannot, and they are stuck someplace they do not want to be. They went from having “The Odd Couple” of Don and Gerry to “My Two Dads”—the present couple.

John Key, of course, is going through his own version of “The Apprentice”. First it was Jenny Shipley who got the line: “You’re fired.” Then it was Bill English: “You’re fired.” Then it was Don Brash. The one whom they said was the greatest leader the National Party had ever seen, Don Brash, was told: “You’re fired.” Then, of course, there is Nick Smith. He is living proof that still waters run shallow: “You’re fired.” Then there was Gerry Brownlee, Parliament’s heaviest lightweight: “You’re fired.” Why was it that John Key today kept on screwing up his notes after he had completed each page of his speech? Why would he be screwing up his notes?

Hon Annette King: Cos he’s talking rubbish.

Rt Hon WINSTON PETERS: My colleague says it is because he was talking rubbish. He was getting it ready for the round filing basket. That is typical.

Nathan Guy: You can do better than that.

Rt Hon WINSTON PETERS: Yes, of course I can, and I will get to that member shortly. Now we are going through the John Key episode. He and Bill English are playing their own version of “Whose Line Is It Anyway?” over everything from tax cuts, climate change, and dealing with the newly discovered underclass. Of course, John Key is right in the middle of an “Extreme Makeover”. Everything Don Brash stood for, John Key is renouncing. On Treaty policy, an extreme makeover; on climate change, an extreme makeover; on KiwiSaver, an extreme makeover; on 4 weeks’ annual leave, an extreme makeover—and I could go on. National’s solution, of course, has always been based on one of “Outrageous Fortune”: tax cuts funded by savings on services, cutting services, large borrowing, and selling off more of the family silver—just like National members did back in the 1990s. For a brief time I was able to stop them, but they went straight back to it. [Interruption] It was October 1998. Despite all the desperate rhetoric, they are really like “Desperate Housewives”, looking around for a suitor come the next election. I know they will climbing over cut glass. I saw them do it before, twice, and now they are coming again.

ACT, of course, is still reminiscing about Dancing with the Stars, but all the stars have gone now. In fact, we have seen Rodney go from “Two and a Half Men” to disappearing “Without a Trace”, just like his party. For most of New Zealand, of course, the Greens are a combination of “Fantasy Island” and “Fear Factor”, and although most New Zealanders had wished the Māori Party had stayed on the “Marae”, we now have those members stepping into “Native Affairs”. They are not an option that National wants to entertain.

Then there is the one drama show that is now topping the ratings because it is original, creative, and has integrity, just like the one political party that now stands out from all others and offers real hope in 2007. The show is, of course, called “Heroes”, and the political party is, of course, New Zealand First. We are the party that has demonstrated that one can have quality policy solutions, and that one can argue for them for years and get defeated, but those ideas, because they are quality ideas, will one day become a reality. Today we saw that almost get there in the savings plan announced by Dr Cullen. We have proven that New Zealand can have policies—

Hon Maurice Williamson: This is like “One Flew Over the Cuckoo’s Nest”.

Rt Hon WINSTON PETERS: Well, we know who flew over the cuckoo’s nest in the case of Maurice. He kept on coming back.

Which party is a hero to our seniors? It is New Zealand First. We want to ensure their quality of life is so much better through higher superannuation, through the SuperGold card, and through the huge increase in the funding of care for elders. We are heroes to New Zealand business because we have gone for tax cuts. We want to rewrite the Reserve Bank of New Zealand Act so that our exporters might get a fair go, and that is what we will be arguing to do all the way to the 2008 election. We want a Reserve Bank of New Zealand Act that recognises that New Zealand is a uniquely export-dependent economy. We are heroes to New Zealand families. Young people today and other people on the minimum wage are getting $70 more per week because it is in our agreement to get that. We are heroes to Kiwis who want to see the Kiwi way of life preserved, their ideals protected, and their quality of life enhanced.

I close by saying we are heroes to those who want to see New Zealanders as one people—different cultures but bound by shared values. We want to end the politically correct nonsense that has surrounded the Treaty, and it will take heroes to do it. You see, New Zealand needs political heroes who are prepared to stand up on the tough issues when others will not. Who told me in Rotorua back in 2005: “We can’t afford to pay more to the superannuitants.”? Don Brash did. We stuck it out, and it is there today. We know we take a risk in standing up and fighting for ordinary New Zealanders, but it is worth it. It is not easy. We now have business tax cuts, a huge change in the savings plan, $400 million for aged care, the greatest ever increase in overseas development aid, and 1,000 extra police. As they say in the ghettos of North America: “Is that black enough for you?”. I close by saying that it is not easy, but that is what heroes do, and it is what New Zealand First does best.

JEANETTE FITZSIMONS (Co-Leader—Green) : I start by congratulating the Minister of Finance on his pale yellow tie. I remember that last year he wore a Shot silk tie with red and blue in it. I guess that leaves him with no other choice next year than to wear a green one, and we look forward to that. Ever since the Prime Minister—[Interruption]

I raise a point of order, Mr Speaker. I apologise for not noticing that you had taken the Chair. I have very little voice left and will not be able to shout in this speech. I am not asking to be heard in silence; I am asking just for the noise to be down a bit.

The ASSISTANT SPEAKER (H V Ross Robertson): That is at the discretion of the House.

JEANETTE FITZSIMONS: Ever since the Prime Minister declared an aspiration for New Zealand to become carbon neutral and truly sustainable, the nation has been waiting for the means to this end to be revealed and funded. Instead, we have a Budget designed to make us a teensy-weensy bit less unsustainable in a few years, with carbon emissions growing just a little bit more slowly than they are now, provided we do not upset anyone and provided we continue to move slower than all our trading partners.

This is the first Budget since the Stern report, a World Bank report on the costs of addressing climate change, which showed that addressing climate change would be costly but not nearly as costly as ignoring it. It is the third Budget to have ignored the Millennium Ecosystem Assessment report, which told us that the resources we depend on now—fresh water, climate, soils, and fisheries—will not be there for our children if we continue to use them as we do now. It is the first Budget since Al Gore’s An Inconvenient Truth hit the screens, raising public consciousness to the point where the ShapeNZ poll this week found that over 80 percent of voters think that climate change is a problem, 36 percent think it is an urgent and immediate problem, while only 8 percent think it is not a problem at all—they are mainly ACT supporters. If the Prime Minister’s aspiration is serious, we might have expected a price on carbon this year that is linked to the world price, and a fairly rapid transition to polluters taking full responsibility for their carbon emissions. We might have expected a substantial fund to invest in cleaner technology, better planning and design, sustainable infrastructure—like public transport, a decent rail system, and coastal shipping—planting of steep eroding land, and incentives for businesses to be more sustainable.

Earlier this week in the House I quoted from Lester Brown’s highly respected book Plan B: Rescuing a Planet Under Stress and a Civilization in Trouble. He says: “Saving civilization means restructuring the economy—and at wartime speed. It means restructuring taxes to get the market to tell the ecological truth. And it means reordering fiscal priorities to get the resources needed to restore the earth, eradicate poverty, and stabilize population … If we cannot restructure the tax system to enable the market to tell the truth, we almost certainly will not make it.” He is talking about the survival of large sections of humanity and of many other species with which we share the earth, by protecting and restoring their life support systems.

I have argued in this House for the last 10 years that we need to change the way we measure economic success in order to focus on human well-being and include environmental sustainability, and that the genuine progress indicator would be a good way to start. We have also been arguing that we should reduce taxes on desirable things like goods, work, and enterprise, and instead tax waste, pollution, and the use of scarce resources. Once again, after 10 years, we have a Budget that largely ignores that. In fact, this Budget takes a step backwards, in that last year we still had a plan for a carbon tax to come into effect this year. Now it has gone and there is nothing to replace the lost $360 million of revenue.

Income tax, company tax, and GST are bearing even more of a burden, proportionally. A huge opportunity has been lost with the business tax cuts handed out indiscriminately to polluters and conservers, fossil energy and renewable energy, organic farming and highly toxic farming, good employers and bad employers, and innovators and laggards in technology. Those cuts will produce no change in behaviour and serve no public good, except for lining a few pockets. Instead, we could have had a system of tax incentives that rewarded sustainable investments, especially in technology to save energy and water, reduce toxic materials, and replace fossil fuels with renewables. A Government that truly cared about sustainability would not have missed this opportunity.

This Budget was the chance for the Government to show whether the Prime Minister’s statement was a serious policy goal or hollow rhetoric. It was the chance for the Government to put its money where its mouth is. But the money turns out to be only farthings. Specifically, in a Budget where a surplus is identified as $1.7 billion, we are told that there is $7.5 million a year for “sustainability”. I will be generous and add to that the $18 million for energy efficiency, the $16 million a year capital investment in rail—which, of course, does not come off the operating surplus—and some amount on climate change that must be small or it would have been identified in the speech. We were given no numbers on that. It is not that there is nothing in this Budget that goes in the right direction; it is that sustainability is a minor footnote. What is there is the result of hard lobbying by the Greens from a position right outside Government where we are not even supporting on confidence and supply.

However, let us celebrate the small things, starting with the initiatives that flow from the Greens’ cooperation agreement with the Government. On energy efficiency, an overall package has been put together as part of the New Zealand Energy Efficiency and Conservation Strategy to upgrade people’s homes. Declining funding for insulating low-income homes is being replaced so that we can continue at the rate of 12,000 a year. A new interest-free loan scheme will enable people to get their homes insulated and to pay back out of their power savings. That will also include clean, efficient heating devices, because insulation alone is not enough to improve health and well-being if there is no affordable heating source. We also have the new building code coming into effect later this year, with upgraded insulation requirements for new homes, which in effect will mean double glazing through much of the country. There is new money for the Home Energy Ratings Scheme to go operational at the end of this year, giving every home the chance of a quality mark in energy efficiency. This will protect homebuyers by informing them about the energy performance of the home they are considering buying, and it will provide a market advantage for those with superior standards. The $15.5 million Green-initiated solar water heating programme is funded in this Budget and is already rolling out, with better quality standards, consumer information, installer training, and grants for complying systems.

Also new, as signalled in the Greens’ cooperation agreement but without any acknowledgment today in the speech, is $2.2 million a year for the ecological restoration of three of New Zealand’s foremost wetlands—Whangamārino in the Waikato, the Ashburton Lakes and Upper Rangitata River in inland Canterbury, and the Waituna Lagoon in Awarua wetland complex in Southland. This new baseline funding is more than 10 times the funding these sites have had to date. We can expect it to reverse declining water quality, control invasive pests and weeds, and protect endangered birds—such as the bittern, fernbird, crested grebe, and the wrybill—some of which are internationally important, as they fly across the equator twice a year to breeding grounds in Siberia and Alaska. Eventually, these sites will have the potential for the reintroduction of locally extinct brown teal. The Greens have ensured that a large part of these projects will be delivered by partnerships between the Department of Conservation and local communities, especially adjoining landowners, iwi, and local conservation and land-care groups. They will also operate as test beds for new methods of control that are acceptable to local communities.

The revelation of my co-leader, Russel Norman, that our savings in the Superannuation Fund and other Government funds are being invested in nuclear weapons production, uranium mining, tobacco, landmines, and other socially and environmentally destructive practices has obviously somewhat embarrassed the Government. We are very pleased to see the transparency requirements for managed funds and the advisory committee on socially responsible investment. But we do not note any change signalled in the Budget for the investment of public funds, such as the Superannuation Fund and accident compensation.

After years of pointing out the embarrassment of being near the bottom of the OECD in our generosity to countries struggling to survive, we celebrate the increase in overseas aid from 0.27 percent of gross national income (GNI) to 0.3 percent. This is a big victory, considering that the Government previously intended raising it to only 0.28 percent in this Budget. The Greens have been pushing the Government hard on this—as stated in our cooperation agreement, and for some years before that. Of course, much of the credit should go to the determined effort of the whole aid community over several years under the 0.7 percent campaign. The Greens will continue to work closely with this campaign for a timetable to get New Zealand from the 0.35 percent of GNI that this Budget projects New Zealand to be at by 2010, to the 0.7 percent international target by 2015. It is urgent to help developing countries in Pacific Island States at our back door to leapfrog the fossil fuel age and develop clean energy technologies that will give them a more stable future.

One of the most important investments we can make to reduce carbon emissions is in transport—in particular, to reduce the huge imbalance between funding for new roads and for lower carbon transport options. Labour-led Governments have, for the last 5 years, poured megabucks into roadbuilding. They have so stretched the capacity of the construction industry that it is pushing up prices far faster than inflation. All the international evidence is that countries that rely primarily on road transport, with poorly developed or non-existent rail, public transport, and travel demand management, have high carbon emissions. In New Zealand, transport is responsible for almost half of our carbon dioxide emissions—one of the highest proportions in the world. Public transport spending has not kept pace. What improvement there has been is largely owing to the influence the Greens had in a special agreement in the 2002-05 Government where we managed to get a substantial part of the petrol excise ring-fenced for public transport, travel demand management, walking, and cycling.

We are pleased to see some further progress in this Budget, as a result of our efforts. First, the Wellington rail improvements will take some pressure off the Kapiti Coast road. This Budget funds only about half what is needed, but if the rest were funded we might well find that pressure for Transmission Gully would reduce considerably. I have to give some credit to the Option3 lobby group, which has consistently done the analysis to show that an improved rail option on the western corridor would be cheaper and more sustainable than more big roading projects.

We also, finally, have the prospect of a mechanism for funding the electrification of the Auckland rail system, which is an essential first step to increasing its carrying capacity from 5 million passenger trips a year to 38 million, and eventually more. We have watched the Government gradually warm to the idea, as Auckland has made it abundantly clear that it wants more spending on public transport and proportionately less on roads. There has been a petition, e-cards, and a very well-attended public meeting in Auckland calling for the Government to fund its share of the capital cost, which will allow more frequent, more reliable, cleaner, and quieter trains.

A regional petrol tax, of course, still has Auckland paying for it, yet it does not have to pay a penny for State highways like the western motorway, known as State Highway 20. This is the big imbalance that must be addressed. Big roads cost the regions nothing; for public transport, they have to find much of the money themselves. Legislation still has to be developed to provide for regional petrol taxes. We will reserve our position on that issue until we see the bill. Yet another way of funding yet more roads is the last thing we need. It is time to even up the balance a bit.

It is pretty clear that if the Greens had not been in Parliament, it would have been hard to find much in this Budget to support the Prime Minister’s stated goals. But in looking at the new things in the Budget, we should remember also the many Green initiatives that are included, without headlines, because they were found, in previous years, to be so effective that they have been baselined. As a result of previous Green Budget initiatives, which are now permanent, we have, for example, environmental legal aid, community internships, organic farming support, increased energy-efficiency funding, and the Conservation with Communities programme, to mention just a few. The last Budget allocated $11.5 million to the Buy Kiwi Made programme, run by my colleague Sue Bradford. In August this year we will see the beginning of the Buy Kiwi Made media marketing campaign. The Green Party looks forward to that, celebrating New Zealand manufacturers during the difficult period they are facing and encouraging New Zealand consumers, including the Government I must say, to support New Zealand products when they make their purchasing decisions.

Past Budget initiatives that are not baselined but continue to be funded this year, include environmental education and support for schools to offer better food to children. There have been calls today for a Budget that delivers tax cuts so that an economy running on consumption-led growth can consume even more. Consumption-led growth is what one gets with a high dollar, giving us cheap imports but poor export returns, and massive household debt fuelled by a perception of wealth from rising house values. Banks are not just offering easy credit; they are pushing credit in our face and suggesting we are fools if we do not let our house pay for a new car and an overseas holiday. So we support much greater enforcement of current rules on capital gains, but we doubt they are strong enough or that they will work without addressing also the use of loss-attributing qualifying companies.

We also give qualified support to the tax rebates through KiwiSaver. It is a clever way of ensuring that the assistance does not add to consumption-led inflation, and that it goes to those on low incomes equally with those on high. This, I have to say, is vastly different from the scheme put forward in 1998 and rejected comprehensively by New Zealand voters. However, it continues the current discrimination between part-time workers and full-time workers, and against beneficiaries such as invalids, who will have no savings in their old age.

To conclude, we cannot vote for this Budget because it fails to deliver even the first stage of investing in a sustainable future, making a mockery of the Prime Minister’s goals. Our cooperation agreement always anticipated that this would be the case, given the current make-up of the Government and its support. That is why our agreement is to abstain. However, we see no reason to break our commitment and oppose the Budget, given that the Government’s side of our very modest agreement is slowly being delivered. There is some way to go yet to implement the full agreement, and there will need to be progress next year, but we have no evidence at all that a National-led Government would deliver anything closer to the programme the Greens have outlined for survival; so we will not vote to bring down the Government.

We hope that over the next year or so the competition to win the votes of the increasing number of New Zealanders who are seriously concerned about environmental sustainability will move from where it is now—a race to be not last—to a race to be first. Then we may have a partner that we can work with enthusiastically in a new Government.

Dr PITA SHARPLES (Co-Leader—Māori Party) :Tēnā koe, Mr Assistant Speaker. I was thinking of previous Budgets, previous Governments, and, in particular, a former Minister of Māori Affairs. We call him he Tipua—one of a kind—a leader of Māori who was able to advocate for, and achieve, the transfer of State resources to assist the Treaty partners in the path to self-determination.

The leadership of Sir Apirana Ngata established the benchmark by which we can assess all subsequent Budgets—as we do today. Not for Ngata a Budget in which Māori are denied, as in 2005. Not for Ngata a Budget in which the Minister failed to bid for any new funding for Māori, as in 2006. Not for Ngata a Budget in which funding for Māori projects is allocated, but not in any amounts of any significance, as in 2007—the add-on Budget.

The Māori Party will be the first to say we support any appropriation to advance Māori development. We are relieved that the Crown appears to have finally recognised the innovation and initiatives led by Māori, even if that recognition is, at best, tokenistic. This Budget allocates some $3.3 billion, of which $19.9 million is new funding specifically for Māori. That equates to a grand total of 0.6 percent of the funding. Wow! But, forever looking for the silver lining, we welcome the investment in the proud and independent voice of Māori being enhanced through $1 million a year for iwi radio, and $5 million a year for Māori television, the voice of our nation—mātātou, for everyone.

We welcome the move towards reconciliation promoted with another $2 million a year to the Waitangi Tribunal. We are pleased that the initiative that Tariana Turia pioneered—the Mauri Ora framework—to support whānau in the prevention of violence has been extended to include another 60 workers. We congratulate those hard-working heroes in our community—Māori wardens—who are today rewarded with $2.5 million of support.

We come to this House saluting the spirit of enterprise and entrepreneurial vigour that has defined tangata whenua. We think of the whānau who gathered in an old factory at Pukeatua in Wainuiōmata some 25 years ago to set up a language nest, te kōhanga reo. That initiative grew into a movement of some 513 kōhanga reo to nurture te reo rangatira. Today that initiative is rewarded with the equivalent of $6,000 a year for every kōhanga. That is not a lot, but every bit counts.

But we also recognise that one of the main difficulties facing both kōhanga and kura kaupapa Māori is the challenge of finding trained and experienced teachers who are fluent in te reo. Although the Budget provided for some support for kōhanga, and funding for year 1 teachers, we are mindful that some 30,000 students are currently receiving Māori-medium education, and we were disappointed to see that there was nothing explicitly allocated for kura and wharekura other than the capital funding for property.

Indeed, I would call this Budget the add-on Budget. It adds little trinkets for Māori to sprinkle in and stir, little gems like $30,000 a year to conserve Māori taonga. That does not sound like much when we know that Sotheby’s has valued the Treaty of Waitangi at $32 million. Although we are of course mindful of being grateful for small mercies, a number of things just will not go away. For a start, there are some 9,000 Māori students who woke up last Budget day to the news that the manaaki tauira fund had dried up, leaving them under financial strife to buy textbooks, learning resources, and study materials, and to pay their fees.

Yes, there will be another $150,000 a year for the Ngārimu scholarship, and we are pleased to see the $6 million in research capability for wānanga. But the unknown factor, of course, is how this will increase retention and completion rates in tertiary education for Māori. Although some might be happy enough juggling the small change, we cannot ignore the grim reality of other statistical pressures that are literally in our face—facts such as that although 21 percent of the school population is Māori, Māori account for 41 percent of all stand-downs and 47 percent of all suspensions. Another fact is that 53 percent of Māori left school without even a National Certificate of Educational Achievement level 1, compared with 20 percent of Pākehā. This is a picture of total system failure for Māori in general stream education, a system in which 91 percent of Māori children are enrolled. This Budget does not include the Māori education strategy that Māori have been calling for.

So perhaps the picture might be brighter for health. The Māori Party has long been concerned that Māori infant mortality is also significantly higher, with 7.2 deaths per 1,000 births compared with 5.6 deaths nationally. We are thus well pleased to see a $124.2 million investment in child and youth health over 4 years. But, again, we come to the crunch. We know all the determinants, facts such as that 40 percent of Māori are expected to develop type 2 diabetes, with 5 percent of that number dying each year, or that life expectancy for Māori, on average, is 8 years less than for Pākehā. PricewaterhouseCoopers suggested that $50 million per year would be a good start to avoid the massive future cost of preventing and treating diabetes, such as that involved in heart failure, blindness, circulatory problems, and amputations. This Budget allocates a quarter of that, giving $50 million over 4 years.

We do not see much in this Budget that will address the rise and rise of poverty; that will satisfy the 120,000 New Zealanders who petitioned Parliament to “make poverty history”. They must be heard. Indeed, our preliminary analysis suggests the gap between rich and poor just continues to grow wider. An offering of peanuts will not do much to address the pervasive assault of poverty that afflicts so many in our whānau. All of these figures give us every reason for arguing for the management of appropriations to be in the hands of the Māori partner. The Crown has failed in its capacity to fulfil the promise of article 3 of the Treaty of Waitangi. Insufficient funds for Treaty settlements, including quantum, mean that attempts to address article 2 breaches remain unfulfilled.

Governments speak of “what the country can afford”, despite successive years of accumulating surpluses—a whopping $7 billion dollar surplus. It appears to us that the price of justice for Māori—the price of citizenship, which Ngata wrote of in 1943—will always remain a debt. It is a debt that the mean-spirited appear unwilling to pay. On the basis of human rights and Treaty jurisprudence, a compelling case exists for an independent and adequately funded approach that unbundles funding to be redistributed fairly.

The Māori Party believes that Māori social aspirations have been poorly served by the mismanagement and policy neglect inherent in a mainstream bureaucracy. Mainstreaming, from its very genesis, was never about Treaty justice or enhanced citizenship rights. It was about savings; savings for the Crown sliced off the backs of Māori. As a consequence of mainstreaming, Vote Māori Affairs was reduced back in 1991 by $212.4 million. Of that, $114 million was retained by the Crown as savings. These are savings that could well have prevented a reality in which 36.5 percent of people receiving the unemployment benefit are Māori. They are savings that may have addressed the stark face of poverty, extreme income inequalities, and the rising proportions of Māori families in severe hardship.

This Budget does not address that stark reality. The Māori Party believes that the only way we will truly achieve change is to instigate the unbundling of funds to assess the effectiveness of money spent for, and on behalf of, Māori. The way to do this is painstakingly simple. It requires a technical amendment to the Public Finance Act to enable Te PuniKōkiri to monitor all Crown agency expenditure on Māori. At this current point in time, the Treaty partner is being denied the information to be able to reliably gauge the effectiveness of the Government spend on Māori. If we are to truly recognise two parties to the Treaty, we must also agree on how the Budget allocation is to be shared, managed, monitored, and reported upon.

The Treaty Tribes Coalition has advised that the greatest shortcoming of our present constitutional arrangements is the failure to recognise the fundamental significance of the Treaty. The Treaty Tribes Coalition is a major force amongst Māori. We want to see that all legislation introduced to this House is able to maximise the fulfilment of Māori aspirations. A starting point to how such a strategy will be achieved is found in the genuine progress index. This is a system of accounts that gives priority to an alternative economic system—a system driven by kaupapa—by measuring the true costs against the benefits. Under such an index, we welcome the EnergyWise package: $20 million a year for energy-efficiency initiatives, and $7 million a year to enhance sustainability. These are real steps in preparing for climate change.

We believe that if the State were to unbundle the funding, we would be in a far better position to assess social, economic, and cultural policies and programmes to determine what effect that spend is having on Māori. We do not want any more piecemeal adhockery. We seek progress on a grand scale, progress and prosperity, and the outcomes that really would achieve meaningful change. Thank you, Mr Assistant Speaker.

Hon PETER DUNNE (Leader—United Future) : United Future is pleased to give its support to this Budget, because in many senses it delivers on a number of the key policy objectives that were put in our election policy in 2005 and that were part of our confidence and supply agreement with the Labour-led Government. I refer to the business tax review, to the changes in the donations regime for charities, and to the establishment of a pest-control group to study how future pest management can occur in this country. I want to talk about each of those in a little detail in the time I have available this afternoon, because collectively they demonstrate the role that a small party can play in supporting a Government to achieve its policy objectives and make significant progress for the benefit of the people of New Zealand.

This Budget contains a $3.4 billion business tax package. It is the biggest business tax package since 1988 and the first change to our corporate tax regime since that time. I am very proud of the fact that what the package delivers is entirely the policy United Future put to the electorate 2 years ago. We talked about reducing the company tax rate to 30c in the dollar. That is achieved. We talked about bringing in a research and development tax rebate regime at around 15 percent. That is achieved. We talked about the need to maintain competitiveness in our international tax regime, and, through the work being done with the forthcoming changes to the international regime, we can tick that off as achieved, as well. Although we can sit here and feel some satisfaction at our achievement, the really big gain is for New Zealanders, because all those gains represent wins for New Zealand workers, for their employers, and for the enterprises for which they dedicate their time.

One of the key objectives of the business tax review was to maintain competitiveness with Australia and to boost productivity in New Zealand. By moving to a rate of 30c in the dollar we match the Australian rate and we come close to the OECD weighted average. But, more important, we go ahead of the Australians, because we do not have the state taxes, the stamp duties, the capital gains taxes, and the other impositions that go on top of the federally imposed corporate tax regime in Australia. At the time we started to talk about comparability with Australia, some people asked: “Why limit your horizons?”. It is very simple: 70 percent of New Zealand’s business is with Australia. Australia is our major trading partner. If we can get a competitive advantage over Australia, then we are well placed to take on the rest of the world, and that is what the driver of that business tax review was.

But at the time we released the document, I think that potentially the most significant point came late in the document and was overlooked by many. That was the review of the international tax regime that we foreshadowed. A discussion paper was released last year. The Budget today makes it clear we are going to move to an active-passive regime for New Zealand income earned overseas. I want to explain that in a little more detail, because it is critically important. At the moment we tax all New Zealanders, businesses or otherwise, in New Zealand on their worldwide income. So a New Zealand company that may have a manufacturing plant in Shanghai, for instance, paying the local tax rate that may be equivalent to 10 percent in the dollar, is, under our current regime, taxed on that rate plus, then, the statutory rate in New Zealand. It makes no sense and it is a complete disincentive for those businesses to stay in New Zealand. Of course, they will want to relocate manufacturing plant offshore to be nearer to markets, but what we are having at the moment is that they are relocating the entire business because of the tax disadvantage.

So the introduction of an active-passive test means that income earned actively overseas—in this case through the manufacturing entity that I gave the example of—can be offset against tax payable in New Zealand. That will even out a number of the discrepancies that are present at the moment. We have worked very closely with the business community. We have consulted widely with them, and we will continue to do so in the ongoing design and implementation of that package.

It is significant in most of the comment I have seen since the Budget that there has been very positive recognition of both the change in the company tax rate and the move to reform our international tax regime. It is rather absurd, when we look back on all the changes that have occurred since 1988 in the international economic environment—the growth of free trade around the world and the opening up of various closed economies in the past—to see that we are one of the few countries that maintain the same international tax regime today as in the days when the Soviet Union was alive, when the proverbial Polish shipyard was alive right through eastern Europe, when the growth of China had not started to explode, and when all the developments we have seen in recent years, and that we have been so keen to be part of, were incipient. So it makes common sense to change our rules now to get us up to play with everyone else’s game. That is exactly what today’s changes are all about, and I am very, very pleased to see those.

Similarly—and I refer to changes to research and development rules—we have often prided ourselves on Kiwi ingenuity. We call it the No. 8 fencing wire mentality. In more recent times we talked about what originally was the Team New Zealand approach—it then became the Weta Workshop approach—of innovation, skill, and brilliant devising of new products by New Zealanders. Then we lament the fact that people say that it is too difficult to do business here and that they are going elsewhere because the regimes are more attractive. A 15 percent research and development scheme, in the way it has been outlined in the Budget, will give us the scope to retain a significant amount of that investment and opportunity in New Zealand and also to attract new investment in the research and development area. I think that is a very positive thing, not just for our image of New Zealanders but also for those young innovators coming forward who have skills, who have ideas, who want to work in New Zealand and make this country their base and their home, and who want to see this country benefit from the innovation they have to offer. So I am pleased for them, because this Budget and these moves represent a victory on their part, as well.

I refer now to the area of charitable donations. I hate to steal the Leader of the Opposition’s thunder, but I have to tell him, in good truth, that the very day he made his first announcement was several hours after we had actually decided on the policy that is contained in the Budget. So although he is a little bit behind the eight ball, I welcome his support. It is one of those happy coincidences, and I assure the member that it is absolutely true.

Rodney Hide: Did it leak?

Hon PETER DUNNE: No, it did not leak. As far as I am aware he just happened to divine the same sort of thinking that we were working on.

But let us go through what it means. At the moment every New Zealander who makes a donation to a registered charity—there are about 90,000 of these organisations in New Zealand, and we as individuals donate around $356 million to them each year—gets a rebate of 33c in the dollar on the first $1,867. Under the proposals contained in this Budget, which will be law from 1 April next year, there will be no limit. That rebate will apply to every donation made, and it will apply to every donation made by a business, by a Māori authority, or by other corporate identities. So the total set of restrictions is being lifted and New Zealanders will be able to embark upon the development of a culture of giving, knowing that the State is there to support them in that endeavour. I think that is extraordinarily positive, not only for the generosity of New Zealanders—for their sense of philanthropy—but also for the role of the voluntary and charitable sector in New Zealand moving forward. I am delighted we have been able to deliver that.

But it goes one step further. We are also investigating the introduction of payroll giving, which means that the deduction can be made at the point of payment. The employee simply notifies the employer of the charities he or she wishes to make the donation to, and the rebate will be payable instantly. That happens in other countries. I think the Australians have moved in that direction; the British certainly have. We are looking at the feasibility of legislation coming in next year to provide for payroll giving in New Zealand. So a complete new way of approaching charitable donations is on the way. The one area we need to do more work on—and it was contained in the discussion paper; there is huge support for it, but we have to develop the mechanisms a little better—is how we recognise the voluntary contribution of time. I give notice that that is on the agenda, as well.

To sum up—because I know, Mr Assistant Speaker, that you are going to call me to a halt very shortly—this Budget, titled “Saving and Investing”, is a positive statement for the country’s future. Its achievements, as far as United Future is concerned, show what a small party working constructively in Government in the MMP environment can achieve. In that sense, contrary to some of the doom I have heard, I think this Budget is a triumph for the politics of collaborative Government, where partners work together to achieve policy objectives within a coherent whole. I think New Zealanders will look with some satisfaction at the fact that we have been able to bring together a Budget that is as bold as this one is in so many different areas. That is why United Future is pleased to support it.

RODNEY HIDE (Leader—ACT) : The ACT party will not be voting for this Budget. We will not be abstaining on this Budget; we will be voting against this Budget. This Budget can be summarised as one of spend, spend, spend, and tax, tax, tax. It is another Michael Cullen Budget that has the same old policies, the same tired old policies, that he has trotted out Budget after Budget.

When Michael Cullen took office, he famously said that he would be judged, and his policies would be judged, on whether he achieved 4 percent real economic growth. Well, the judgment is in on that, I say to Dr Cullen, and those famous words should be his famous last words. The outlook in this Budget for the next 5 years—and I am amazed that no one from the Government has talked about economic growth—

Hon Member: You will.

RODNEY HIDE: Well, I will not, actually. The outlook for the next 5 years is a paltry 2.3 percent increase in economic growth. That is only because in years 4 and 5 the Government is hoping the growth rate will pick up. In the next 3 years the outlook for New Zealand is an average growth rate of less than 2 percent per year. That compares with Australia, which is topping nearly 4 percent a year. So the outlook is for the gap between New Zealand and Australia to widen.

We see again in this Budget from Michael Cullen no plan, no direction, and no strategic vision for New Zealand. The only thing this Budget guarantees is more spending, higher interest rates, and lower economic growth. In 2000, when Dr Michael Cullen took over as Minister of Finance, Government spending per year was $9,000 for every man, woman, and child in the country. So, for a household of four people, that amounted to $36,000 a year. That is what the Government spent, on average. Of course, we have to ask ourselves what that average family of four gets from the Government. Is it getting $36,000 worth of benefit? I do not think so. Well, now that spending is $13,000 a year per person, and in 2011 it will be $15,000 a year per person. Under Michael Cullen, core Government expenditure has increased by $20 billion, which is a 32 percent real increase, and it is set to go up over the next 3 years by another $9 billion.

Do members know what is truly shocking about that increase? It is that Treasury itself says it can see no benefit from that extra spending. There has been no improvement in Government service, and every Kiwi knows that. In fact, the more money that has been thrown at Government departments, the poorer the service from them has been.

We hear that this Budget is about savings and investment. Well, the way to achieve savings and investment is to have more money in people’s pockets and to have a higher economic growth rate. The way to achieve both of those is to cut taxes comprehensively across the board. There is the money to do that. That is what this Budget should be about. But, of course, the Labour Government is about spending money to win votes; it is not about managing the economy for the good of the country. That is why the ACT party says that we need, now, a tax payout rights bill that would put politicians on a constrained budget and hold the level of Government spending at where it is. And if politicians like Dr Cullen want to spend more money in real terms, then they should go to the people in a binding referendum. That is what the ACT party says we should be doing, so we can have some confidence that the size of the Government in the years ahead will not ever become bigger than it is now.

You know, Michael Cullen says that we cannot let people spend their own money, because that would be inflationary. Well, Milton Friedman got a Nobel Prize for explaining that the cause of inflation is monetary policy, not people actually working, earning, and spending their own money. Monetary policy is what causes inflation. So the idea that somehow allowing people to spend their own money is inflationary is totally wrong.

Of course, we are all in favour of the cut in the company tax rate that has occurred, from 33 percent to 30 percent, but now we have widened the gap between the top personal tax rate and the company tax rate. Tax accountants will have a field day, and the other complications that have been introduced will complicate our tax code further. We should be aiming for a low flat tax across the board, without the exemptions that arise when, just because the Government has a policy that it wants people to follow and invest their money in, it thinks it therefore has to give them a tax break.

Here is what a real Budget would do for New Zealand. It would drop the top rate of income tax across the board to 20c in the dollar. That would be a boost for investment and savings, and, indeed, for economic growth. We would hold Government spending, in the medium to long term, in real terms. We would deal to red tape with a regulatory responsibility bill. We would demand transparency and accountability from all Government departments through service-level agreements that would see departmental heads fired for any failure to deliver that. We would actually take the shares of the State-owned enterprises and distribute them to everyone. If the State-owned enterprises truly do belong to the people of New Zealand, let us see that. And we would take the Cullen fund—a Government fund—and distribute that money to everyone by putting it into their KiwiSaver account or into an education endowment, so that it is their money.

We have seen even more money go on health. And where are the benefits of that? There have been absolutely none. In fact, the one thing that the Labour Government has done in health is to actually deny us the opportunity to see the size of the waiting lists and to see the performance that is occurring. More money has gone in, but now we are not even getting the information that we used to get on the performance of the State health system. Why is that? Because it is woeful. We cannot achieve a better result from our health system by pouring in more money. If we could, it would actually be working now, because we have never seen an increase of money go into the health system like the increase we have seen under Labour. The way to fix the health system is the same as the way to fix everything else in the economy. It is not to run it like the Soviet Union used to run its economy; rather, it is to empower consumers—empower New Zealanders through the provision of competition and choice by introducing the private sector into the delivery of health.

The key thing New Zealanders are looking for in a Budget is the direction that a Government is going to take. We see nothing in this Budget except a process of spend, spend, spend, and tax, tax, tax. The way to approach a Budget is to introduce a taxpayer rights bill and to hold Government expenditure in real terms. If politicians want to spend more of people’s money, why do they not go and ask them to agree to that, by having a referendum on it? That is the ACT way. Thank you, Mr Assistant Speaker.

Hon JIM ANDERTON (Leader—Progressive) : All I can say is that if Milton Friedman is the answer to New Zealand’s economic problems, then I do not know what on earth the question was. I have to say to Mr Hide, if he is interested in the facts, that the economic growth gap between Australia and New Zealand has actually closed in the last 7 years, but as I do not think the facts will ever get in the way of Mr Hide’s reactionary prejudice, I suppose it is a bit wasteful to give him those facts.

As leader of the Progressive Party and a coalition partner in this Government, I want to say to the House how proud I am of this Budget. I congratulate Michael Cullen on it and I look forward to this side of the House delivering many more Budgets. I am proud of the Budget because it turns its back on the selfishness and government-for-privilege that is the Opposition’s only reason for being. I am proud of it because it is a Budget for all New Zealanders. I am proud because this Budget completes the decisive turn away from the disastrous policies of the 1980s and 1990s, to which the National Party Opposition would drag us back. Well, I am not even sure of what it would drag us back to, after hearing the speech from the leader of the National Party. I have not got a clue what its policy is, except that it would borrow a lot more money to pay for the groceries. That is all I heard.

I am proud of this Budget because KiwiSaver will make a dramatic difference to the wealth of individual New Zealand households—and the only one who seems to be in any doubt about that is Mr Key, the futures trader. I am proud of it because the business tax changes it introduced are the most sweeping in 20 years, and it is the most comprehensive measure to lift innovation and productivity since I have been in this House, which is now going on for 24 years. I am proud of it because it invests heavily in our present and future needs without worsening the stressed parts of our economy.

I am proud of this Budget because it invests in infrastructure and builds the capacity a modern economy needs—something that Governments successively in the 1980s and 1990s failed to do. I am proud of this Budget because it makes a deep investment in tertiary education and an investment in the needs and skills to demand higher incomes in a global economy. I am proud of the initiative the Budget takes in my portfolio areas—in the primary sectors that form the backbone of our economy and in protecting vulnerable young people from suicide and drug abuse. I am proud of the Budget because it invests in better social services, in stronger health-care, and in education.

I am proud of this Budget mostly because it is a Budget that is carefully shaped to fix New Zealand’s problems, increasing our savings in a way that will last for generations, lifting our innovation, productivity, and exports, and investing in the infrastructure that we need. Every serious problem this Budget fixes is a problem that the National Party Opposition will ignore. We could have chosen a Budget, of course, that scratched the short-term itches—the ad hoc and ultimately damaging approach to which the National Party is still addicted. We could have gone back to the past, to the destructive slash and burn of the 1980s and 1990s, as the National Party evidently still wants to do. But this Budget is much better than that. This Budget will make a difference to generations of New Zealanders. KiwiSaver is a historic scheme. I invite Mr English to say whether he would repeal the KiwiSaver scheme if he were ever elected to Government. Let us hear from Mr English about the real policy National would follow.

The expansion of KiwiSaver is one of the most important social programmes ever introduced into New Zealand. KiwiSaver is a very strong incentive to New Zealanders to save. It is a very strong incentive to keep New Zealanders of talent here to build for the future. The challenge for the Opposition is to say how it would create savings anywhere near as comprehensive as these. It could not and it would not, because it does not actually see the need for saving. We need to save more because not enough New Zealand households have enough saved to live in retirement in the way they do during their working life. What does the Opposition propose to do about that? Clearly, the answer is “nothing”. It proposes to ignore our poor household savings rate because it stands only for people who already have ample savings and it does not care about the average New Zealand family.

What is there about an incentive for a poorer family to earn three times more than what it saves in its savings account for its future in terms of buying a house or for retirement? It is an indictment that the National Party leader holds poor New Zealanders in contempt by thinking that they will not be able to count like that. Obviously he cannot count; they can.

We need to save more because we have a problem with interest rates and a high exchange rate. I am happy that New Zealanders feel that their household wealth is rising, and they are enjoying the use of better-quality cars, plasma TVs, and all the rest of it, but the inflationary pressure is burning our exporters. The high real interest rates are holding back our businesses. We need to move the pressure from household spending to household saving. Ever since the 1980s the current account was forecast to be repaired by exporting more. After all the pain we went through in the 1980s and 1990s, the end result is that the exporting share of GDP is more or less the same as it was. But the current account deficit is worse now than it ever was. We need to lift our exports and we are not going to reduce our current account deficit until we save more.

This Budget will make a difference to our exporters. It invests $80 million in export market development assistance. Is Mr English against that? It cuts the company tax rate. Is Mr English against that? I called for the business tax rate to be cut 3 years ago. I am glad I have had to wait only that length of time to see it brought to fruition, but I will not claim any credit for it. We will not go there.

Hon Trevor Mallard: Everyone else is—why don’t you?

Hon JIM ANDERTON: That is true. One reason that the cut will make a difference is if there is a substantial differential between the top personal and top corporate tax rate. That encourages business to leave more capital in the business to grow it, instead of taking the capital out in dividends. It makes sense to me. Everyone who is arguing now for the top personal tax rate to be cut as well as that, is actually arguing for less capital in our businesses. How will that help grow the New Zealand economy? Perhaps Mr English will tell us.

So the question for the Opposition is this: what is the most important challenge for New Zealand? Is it cutting taxes? That would be mainly for those in the top income tax bracket. Anyone in this House who does not know that tax cuts benefit the most affluent New Zealanders does not have a faintest idea. Is this Budget about saving more, or is it about blowing the current account, increasing interest rates, and bashing exporters with a still higher exchange rate, which is every single bit of the policy I hear coming out of the National Party—spend more, borrow more, save less, and invest less? Or is the Budget about saving more for investing in our future?

This Labour-Progressive Government is today making a $3 billion to $4 billion investment in innovation. Has the National Party ever heard that word? Does it have any understanding of what it means? This gives our businesses the tools they need to compete effectively and to make sure that New Zealand becomes a much more attractive place in which to invest in new enterprises for the benefit of all New Zealanders. It gives our infrastructure a shot in the arm. There has never been a time in the last 100 years when we have invested as much in new roads and new rail, and in this Budget we are now deepening further that pool of investment.

The only reason we are able to do that is the fiscal prudence that Michael Cullen has shown over the last 7 years to put us now in a position to deliver. The thought that a National Party might ever get into Government and, with profligacy, wipe out all of those advances is one of the most appalling thoughts I could have.

We are investing in our most important industries to future-proof them from the challenges they face, whether they be challenges in different markets, or problems down on the farm. In my primary sector portfolios this Budget strongly supports a pro-business approach to these industries. This Budget increases research and development in the primary sector. It increases research and development in the primary sector. It increases capability at the border to keep out organisms that can harm our biologically based economy. It funds initiatives to protect rural communities from adverse weather events and erosion, and it improves the environmental performance of the primary sector.

This is simply a landmark Budget. Saving and investment will build on our progress over the last 7 years. It will continue to transform New Zealand into a more dynamic and innovative economy. The Budget provides solutions to meet challenges we face today and tomorrow, and its social investment will allow New Zealand families to enjoy a better quality of life—something this Government stands for absolutely. It strengthens our place in the world, it strengthens our economy, and it strengthens security for New Zealand. I strongly commend it to the House and I congratulate the Minister of Finance, who has delivered not only his best Budget but the most profound Budget for the future of this economy, and all New Zealanders should be proud of it.

Hon TREVOR MALLARD (Minister for Economic Development) : I move, That this debate be now adjourned.

• Motion agreed to.