H V ROSS ROBERTSON (Labour—Manukau East) Kia ora tātou nō reira e te Whare, e ngā iwi, e ngā reo, e ngā hau e whā. When I rose to speak in the Budget debate on 2 June near 6 o’clock, the Chamber was near deserted, but not today. Let me tell the House why we in the Labour Party disagree with this Budget. Let me elaborate, and in doing so, I speak for the 185 different ethnic groups that reside in the boundaries of Manukau City.

I, along with my colleagues from Manukau, George Hawkins, Su’a William Sio, and Dr Ashraf Choudhary, disagree with this Budget for three reasons. First, it fails to invest in people and to develop the innovation and the skills and training that will give us a platform for a strongly based economy. That is the first reason. Second, it fundamentally undermines the future well-being of New Zealanders by creating a $37 billion hole in the future funding for superannuation. I am concerned about those in the 40 to 50-year age group. The third reason is that it repeals the tax cuts promised by the National Party in the election campaign when its members knew full well that they were unable to deliver.

That brings me to leadership, which is about the ability to motivate and inspire. Although the Prime Minister might have done that during the election campaign, he has let down the people of New Zealand. It is a question of integrity and it is a question of honesty. Where I come from a man’s word is his bond. The Prime Minister failed on all of those accounts. When I visited the schools in my electorate after the Budget, I was devastated at the savage cuts that had taken place. In the extension of high standards in primary schools across Ōtara, decile 1 schools—the most vulnerable in our society—have had cuts. We have had cuts to Bairds Mainfreight Primary School and to Dawson School, and I challenge Pansy Wong to stand up because that school is in her electorate. We had cuts to East Tamaki School, Flat Bush School, Mayfield School, Rongomai School—another of Pansy Wong’s—St John the Evangelist School, Sir Edmund Hillary Collegiate junior and middle schools, Te Kura Kaupapa Maori o PiripouoOtara, Wymondley Road School, and Yendarra School. All of those have had cuts to extending high standards across primary schools. That will be axed from 31 December this year. Yet, nationally, all of those schools signed up for 3 years. What does that mean? It means absolutely nothing in the hands of this Government.

It would be a shame if the economic constraints facing us today mean that South Auckland is further disadvantaged by the management of this economy and by this Government. Then there are the secondary schools—again another hit on the most vulnerable students in South Auckland. Improving academic writing for decile 1 secondary schools is gone from 31 December. Who is affected? It is students at Tangaroa College, Hillary College, McAuley High School, Otahuhu College, De La Salle College, Southern Cross Campus, Mangere College, Tamaki College, and Porirua College. Tamaki College is in the electorate of the member for Maungakiekie and I ask Mr Lotu-Iiga to get off his hind legs and take a call, and justify why his Government is cutting the funding from decile 1 schools.

Hon SIMON POWER (Minister of Justice) I know that the member Ross Robertson had only 4½ minutes left from his contribution in the last session. I am disappointed I missed that, because he has obviously spent the adjournment break thinking about how to conclude the last 4½ minutes—with a slightly new style, I notice. The style was slightly more assertive than what we have come to expect from the honourable member, and I wonder whether we are seeing a turning point here in his contribution to the debates of the House. There was a bit of fire in the belly over there from young Ross Robertson, a man who is about only one-third of the way through his parliamentary career, and who is, I know, someone deeply valued by his colleagues.

Speaking of people who are deeply valued by the Labour Party, I take this opportunity to congratulate David Shearer on his election over the weekend as the new Mt Albert MP, and to congratulate all those candidates who took part in that election, especially Melissa Lee from the National Party. It is good to have her back in the House. One question I have, though, is why all Labour MPs called David have to immediately start talking about the Labour leadership. What is it about Labour MPs called David that they are obsessed with the Labour Party leadership from the moment they get into this House? No doubt in the fullness of time we will know the answer to that particular question.

During the adjournment week I spent 2 days in Auckland talking with local businesses, in my role as Minister of Commerce, and I was also in the Auckland and Manukau District Courts—watching, actually—as Minister of Justice. I tell the House that those issues that Labour members have been raising over the last couple of weeks are not resonating, at all, with the New Zealand public. The people I spoke to over the course of that week were concerned with the economy; they were concerned with jobs. They were concerned with what was going on in the banking system—with interest rates and with what those rates meant for their mortgages—and they were concerned with how their children were getting on at school. When I met people in South Auckland, I found that education, health, and safety were the things most on their minds. I suggest to members opposite that they start listening again to what the people of New Zealand are saying is important to them. The danger of Opposition is that it is easy for Opposition members to run down a good Budget, but the key to getting back on the Government side of the House is for Opposition members to stop thinking that they know what is best, and to listen to what people out there in the wider country are saying about what matters to them. What matters to them is keeping the economy going during global turmoil, and of course Budget 2009 takes the necessary steps to ensure New Zealanders are cushioned from the worst effects of this global recession.

Hon David Cunliffe: No, it does not. Rubbish! It’s an idea-free zone.

Hon SIMON POWER: There goes the Labour member with the first name of David, who we know is watching and waiting, like a piranha circling, around Phil Goff’s caravan. He is the one waiting now. We on this side of the House know that that member thinks he has the numbers, he thinks he is popular, and he thinks the party is backing him, but we know what they are saying in the lobbies and corridors of Parliament. We know that that member is well ahead of where his colleagues think he is, and is in fact a long way ahead of where they think he should be now, if what I am hearing is anything to go by.

I was delighted to play a small role in Budget 2009, and I am delighted that it locks in national superannuation at the current rate in relation to the average wage. I am delighted that the Budget improves public services. There is a $3 billion boost in health over 4 years, which is focused on front-line services. There is $1.7 billion for education to raise student achievement. There will be 600 more police, who my colleague Judith Collins will be ensuring will get on to the streets of New Zealand from 1 January next year. Of course, this Budget takes a hard look at the regulation that businesses have become strangled by in recent years, and we will work hard to untangle that problem. This Budget creates a more productive public sector, and in particular I am delighted that there is $900 million over the next 4 years for justice initiatives aimed at improving public safety. There will be 246 more probation officers, as my colleague announced today. There will be 29 more front-line managers and 26 more psychologists to improve the quality of parole, which was effectively left to crumble under the efforts of the previous Government. There are improvements in the area of home detention and also extra prison beds. These are a sidebar for what taking law and order issues seriously means.

I suggest that Opposition members should focus on what the public of New Zealand are talking about and are concerned about. I am sure those members are polling; I am sure they are doing work that will give them an indication of the issues at the forefront of the public’s mind. They will know that the main issue is the economy. They will know that despite the sideshows of the last 2 or 3 weeks, the economy matters most to New Zealanders, and also their ability to get ahead. That is why this Budget did such a good job in balancing a very difficult equation in these globally terrible times.

We know that members opposite had no concern about whether a downgrade in the credit rating would make an impact on New Zealand, but I am delighted with the results that the Budget was able to provide to the credit-rating agencies. Members opposite do not understand that credit ratings matter to the costs that end up affecting the households of ordinary New Zealanders. Although members opposite might be happy to sit there and dismiss those credit ratings as being irrelevant to the good, solid working families out there, I tell them that the way those ratings are received makes a power of difference to the way that banks deal with consumers and borrowers in New Zealand. That affects people’s mortgages, amongst other things, and it does make a difference. So, yes, some hard decisions had to be made in Budget 2009, but Minister of Finance Bill English, the Prime Minister, and the other Treasury Ministers involved in the preparation of this documentation knew that this Budget would test the Government’s capacity to keep expenditure on the right plane, while taking account of the fact that revenues had been falling desperately when the previous Government had not done the homework and its promises had not been funded. That Government had not done what it was supposed to do, and when it was in Government it had not even acknowledged the impact that the global recession would have on New Zealand. That is why it was so important for this Government to tell a story in the Budget that was realistic, and that laid out the facts for New Zealanders to enable them to make their own decisions about whether Budget 2009 has delivered. I can tell members that they do believe it has. They understand exactly how difficult the balancing act is, and that is exactly what people were saying to me during the House’s adjournment last week.

Hon David Cunliffe: That’s why the super cut stinks. They want their superannuation protected.

Hon SIMON POWER: The member interjects, but I was on the road over the adjournment, not in front of a full-length mirror. I tell him that ordinary New Zealanders, who are out there working hard, are saying to us that this Budget is tough in many respects but these are tough times. This Budget has done what is needed to keep this economy going, amid global turmoil. I tell members that this Budget takes those necessary steps to ensure that New Zealanders are cushioned from the sharpest edges of the worst global recession that we have seen in this country since the 1930s, and I was proud to have a small role in that Budget.

The ASSISTANT SPEAKER (Eric Roy): The interjections have gone beyond the level of being rare and reasonable, and I caution members to refrain from incessant dialogue.

Hon TIM GROSER (Minister of Trade) The Budget strategy was a judicious blend of economic and social responsibility. Just before I try to analyse that strategy, let us just confront, for the first time, the uncomfortable political fact that the Labour Opposition has sought to disengage the public’s attention from. Before anyone started to talk about the international economic meltdown, this country was already technically in recession. In other words, before any of the severe international economic problems started to attract the attention of policy makers, 9 years of a Labour Government had reduced New Zealand to a state of recession. This country was already in a weakened state before it had to confront the realities of the worst economic downturn since the Great Depression.

When one looks back at the history of the previous Government, one sees that this is quite some political achievement. When Labour came into power it was the golden weather. New Zealand had uninterrupted productivity growth from the last 3 years of the 1990s, and it had the best terms of trade for 25 years. One thing Labour could do fabulously well was spend. Labour members are world champions at spending. Core Government spending, in Labour’s 9 years, went up from $32 billion to $60 billion—almost a doubling of the spend. But if that Government was good at spending, it was very poor at saving New Zealand from being one of the very few countries in the world that was technically in recession before the international downturn hit.

We can track the severity of that downturn just by looking at the operating balance before gains and losses statistics as they came through, over a period of about 12 months. In May 2008 we were $1 billion in surplus. If members track those statistics forward to the pre-election fiscal update in October, they will see that we were already $1.7 billion in deficit. Three months further on, the deficit had mushroomed to an estimated $4.1 billion. That really illustrates the growing severity of the situation this Government inherited and had to deal with, with a sense of economic and social responsibility. It got worse. By May the deficit had exploded to an estimated $7.7 billion. The deterioration of the accounts, unprecedented in recent times, indicates the magnitude of the challenge facing this Government as Mr English, the Minister of Finance, framed his first of what I think will be many Budgets.

That was, if you like, the broad macro-fiscal setting facing this Government as it set about the task of putting down a Budget strategy for New Zealand that would ride out the rough edges of this recession for disadvantaged people. That is precisely what we mean by showing social responsibility. The Government also showed a great sense of economic responsibility by putting up a strategy that would, on the one hand, protect New Zealand’s credit and, on the other hand, start to address some of the long-term economic challenges that are still there under the surface. When we have dealt with this recession—and we truly hope we will be out of it within the next 12 months, as we are starting to see, not just in New Zealand but internationally, the curve going upwards—we will still come back to having to face those challenges.

On the social side, let us just rehearse some of the simple statistics. We had $3 billion in extra health spending, and amongst the many highlights of that I instance 800 new health professionals. I recall—and I stand to be corrected about this because the number is simply extraordinary—that 56 reports were compiled on shortages in the health sector labour force; I believe 56 was the number. We have done something about that. We have allocated 800 new health professionals. The Budget covers that. We have put in the money to open 20 new surgery theatres. So against this background of very difficult economic conditions, and of New Zealand already being in a recession and hit with this double whammy of experiencing the deepest recession in the global economy since the 1930s, the Government has still managed to find the resources to upgrade our health sector. That is what I mean by showing a sense of social responsibility.

Let us look at education. There is $1.6 billion for new spending in education, including $523 million—almost half a billion dollars—either for new schools or for modernising existing schools. There is half a billion dollars to attack that deficit. We have put in $70 million to extend early childhood education in a number of different areas. That is precisely why we talk of this Budget as being socially responsible, as well as being economically prudent.

Then we start to address the deficits of the previous Government in respect of justice and crime. Spending has been allocated for the provision of 600 new police officers, with a large number of—

Hon David Cunliffe: What happened to Vote Conservation?

Hon TIM GROSER: Does the member want to talk about Vote Conservation? There will be $54 million of savings over 4 years. It will be $100 million more than the budget for conservation has been, as recently as 2007. Unlike that member’s Government, we are demanding productivity from our public services, and we will get it. The Department of Conservation vote will be managed with prudence and a greater attention to productivity, without letting down any of the essential conservation objectives.

Let me return to the central thesis. In respect of the deficits in the area of justice and crime there will be not only 600 more police officers, with a large majority of them in some of the most troubled areas of New Zealand, but there will also be 246 more probation officers. That is the sort of signal, if you like, of a Government that fully understands the social dimension of the challenge facing New Zealand. Consequently, the Government has put up a series of initiatives that addresses these issues in a very concrete and practical manner.

I will now turn to the other side of the coin, in terms of the economically responsible approach that has been taken to the Budget. All that the Opposition could talk about was the size of the stimulus, as if somehow, in some crude way, it was a case of the bigger the number, the better the result. Actually, that approach to public spending would have left New Zealand in a very, very difficult situation in terms of having fragile financial markets. Instead, what this Government has done is, first of all, provide a very moderate economic package. Overall net spending was actually increased by $2.9 billion, or, if we look at spending over the 4-year stream, by $5.8 billion—so much for the “slash and burn Budget”, which is what we heard from people who wrote their speeches before reading it! This was decidedly not a slash and burn Budget, and it would have been totally inappropriate to put forward such a Budget, given the downturn and given the need for the State to use its balanced book to cushion the impact of the recession on New Zealanders. That is why we took this responsible economic approach.

The issue of international financial markets was absolutely central to framing the Budget strategy of this country. The fact remains that this country is still vitally dependent on its credit standing, and still requires, unfortunately, very large inflows of private capital. People do not lend people money with the intention of seeing it go down a tube. If the risk profile of New Zealand had gone up, we would have ended up paying even more in terms of interest rates. On every householder’s mortgage we would have seen the practical impact of this. Every small business struggling to find a way through this recession would have had to bear the cost of even higher interest rates but for the fact that this Government took a highly responsible and balanced approach to its economic planning for the Budget strategy. As a result of that, as we all know, I think it is correct to say that New Zealand is the only country that in recent months received an upgrade in its credit rating.

Investing in the long term is another feature of this Budget. It would not have been sufficient for this Budget to just manage the short-term macroeconomic impact of the recession. We also had to increase spending to address the crucial infrastructural deficits of the last 9 years, and that is exactly what we have done.

RAHUI KATENE (Māori Party—Te Tai Tonga) The context for Budget 2009 had been forewarned for months leading up to 28 May. The December Economic and Fiscal Update had made it clear that the operating position for the Government was likely to become dramatically weakened, and this would lead to the Government having far less flexibility, and to reduced spending from the public purse. Combined with the threat from Standard and Poor’s that New Zealand needed to achieve a stable position, these forecasts created the circumstance by which no one was expecting 2009 to be the year of the great lolly scramble.

True to form, Budget 2009 delivered upon that expectation, with priorities and policies that might generously be described as thrifty. For Māori, the context of recession is double-edged. We are well aware that in uncertain times Māori have been vulnerable to the changing market. In the Great Depression some 41 percent of the unemployed were Māori. More recently, the economic downturns of the 1970s, and later in 1995, impacted even more on poorer Māori, with the number of unemployed Māori being triple that for non-Māori. But we know too that out of periods of hardship, Māori have demonstrated remarkable resilience and a flair for entrepreneurship that has meant they are in a better position to take advantage of the economic recovery when it eventually appears.

This Budget, then, had to respond to the need to help people survive the recession and, at the same time, create opportunities to grow and prosper. It was not a choice of sink or swim. The choice was made to tread water while preparing the ground to develop. Such an approach finds favour with many of our people, who have developed knowledge of economic management out of necessity. There is a theory about the connection between indigenous people and the so-called thrifty gene. The theory is that over many generations indigenous peoples farmed, hunted, fished, and gathered food. In doing so, they experienced periods of feast and famine. To adapt to this changing need, the thrifty gene emerged, thereby helping our people to survive long voyages across seas.

Here in 2009, whether it is through the application of the thrifty gene or through the law of necessity, Māori have earned the reputation of thriving in an enterprise and entrepreneur culture, not because we want to but because we have to. As a result of Budget 2009, these skills will come into their own, with $12 million of new funding to phase in Māori development projects in housing, such as papakāinga housing, and the Māori demonstration projects. Our message to iwi Māori will be to get in there and take up the opportunities to partner with Housing New Zealand Corporation, in order to create job opportunities by developing affordable housing initiatives. We expect that employment or contractual opportunities will be realised in contracts with iwi or Māori groups when it comes to building or renovating the houses, and we will continue to talk with the Minister of Housing about taking that approach. Investment is going into increased infrastructure, and, again, we would expect that iwi Māori will benefit from construction jobs in the short term, and, in the longer term, from the evident gains in the lifting of economic growth.

Of course, the commitment of $15.9 million to settle outstanding Treaty settlements over aquaculture, and the additional $22 million to speed up claims in the Treaty settlement area, are both new injections of funding that we wholeheartedly support.

But of course it is not all good news in Budget 2009, and we know that the toughest times are yet to come. This Budget is set against a background in which Te Puni Kōkiri is predicting that Māori unemployment will rise to between 12 to 15 percent by the middle of next year. It is also set against the reality of a decline of some 700 jobs for Māori working in the construction sector, a 13 percent decline for Māori working in primary industry, and a 16.7 percent decline in accommodation, cafe, and restaurant jobs. This is the real bread-and-butter gauge by which we will measure how genuine this Government actually is about achieving significant outcomes in whānau ora for Māori. We need to retain employment, and we need to create employment options for our people where there currently appear to be none. But we need to do more than that, too. Māori hourly wage earnings are at $17.58, and they still lag way behind the economy-wide average of $21.41.

We want to see tangible outcomes that address the systemic failure whereby more than half of Māori students leave school without completing a sixth-form qualification. We are particularly concerned about the disproportionately high number of young people who are left behind. It should be a national crisis that close to 5,000 young Māori between the ages of 18 and 24 are currently on the job seeker’s register with Work and Income.

We are outraged at the savage cuts that were made in the adult and community education area, an area that has formed a key pathway for many of our people in re-entering an education system that has failed them in the past. On Budget day, it was announced that some $54.45 million would be withdrawn. That was supposedly the funding for “hobby courses”. There is huge concern within the sector about this decision. Adult and community education programmes help to restore the confidence of students, and can then help them to further their life and work options while, at the same time, rectifying any deficiencies in skills.

Budget 2009 attempts to respond to this situation, in a couple of ways. Firstly, it boosts Māori affairs funding to support families that are vulnerable during the recession. Whanāu social assistance services will receive $32 million, and for that we congratulate the Minister of Māori Affairs, Dr Pita Sharples. We congratulate him on his initiative in helping those who need it most. There are other opportunities in which our vulnerable families will be supported during these times of inevitable hardship. I congratulate another colleague, the Hon Tariana Turia, on her leadership in allocating new funding to help those many people who care for their whānau and friends who may be ill, frail, or disabled. The previous Government delivered a carer strategy, but forgot or failed to put aside any money to actually make the difference. Mrs Turia has been able to invest in a resource to ensure that people who are looking after their relatives are not penalised, but, more properly, supported to be able to provide the care their whānau requires. Of course, the $40 million set aside in the Community Response Fund to support voluntary groups to provide services to those most vulnerable to the recession will also be a resource that we know our people will be able to rely on.

Although these initiatives may help to cushion the shock, the initiative that we probably hold out the greatest hope for is the potential that we know will emerge from the Māori economic task force established by Dr Sharples. The $10 million spent in this area may well see tangata whenua positioned in a strong and secure state to take advantage of any opportunities that will flow on as the global economy recovers. The future looks much brighter for the leadership that is being developed by the Māori economic task force in managing tribal assets; advancing economic growth and infrastructure initiatives; leading education, trade training, and information and communications technology; encouraging small to medium enterprises; nurturing investment and enterprise; and taking the primary sector to new heights. This task force is a classic example of one of our oft-quoted beliefs: “Nāu te rourou, nāku te rourou, ka ora ai te iwi.” By sharing our gifts with one another, the people will thrive.

We believe that the inspiration and example being shown by the way in which Māori will approach these times will indeed be a gift for Aotearoa. The impetus to take up every opportunity while caring for the collective well-being of the people is what we in the Māori Party have every confidence will also be of great benefit to the nation. Kia ora.

KEITH LOCKE (Green) I wish to speak on the Ministry of Foreign Affairs and Trade’s budget and explain some matters that the Government should be paying particular attention to. Too few Governments on this planet treat matters of peace and human rights with the attention they deserve. One of the matters that I think our Government should give immediate and ongoing attention to is the horrific situation facing the Tamil people of Sri Lanka. Their aspiration for an autonomous Tamil region within the Sri Lankan State has been crushed by massive force.

This year anything up to 20,000 Tamils have been killed by huge air and artillery bombardment of the territory that for some years has been under the administration of the Liberation Tigers of Tamil Eelam, known as the LTTE. Most of the population of that territory—around 300,000 people—has been herded into what can best be termed concentration camps. I think that term is apt because what is happening to the Tamil people in those camps is similar to what happened in Hitler’s concentration camps, but without the mass extermination programme. The Sri Lankan Government aims to use the camps to destroy all traces of the former Liberation Tigers of Tamil Eelam administration, in the same way that Hitler used concentration camps to eliminate the German communists and socialists as a political force. All those associated with the Liberation Tigers of Tamil Eelam will either be imprisoned long term and re-educated, or will perhaps disappear. There have already been reports from the camps of what are called “white van disappearances” of young Tamil Tiger activists. Hitler believed that anything was justified in the war against communism, and the Sri Lankan Government proceeds as though anything is justified in the so-called war against terrorism.

The situation need not have been like this. There was a chance of negotiated autonomy for the Tamils in the north of Sri Lanka during the 2002-05 ceasefire. I toured Sri Lanka in October 2003 to monitor that process, and I saw that it was going well. I talked to negotiators from both the Government and the Liberation Tigers of Tamil Eelam. They were all quite hopeful and indicated respect for each other. While I was in the Liberation Tigers of Tamil Eelam capital of Kilinochchi, a Tamil proposal for an interim self-governing authority was presented to the Norwegian peace negotiators and was covered by the international media, but substantive discussions on an autonomy solution never eventuated. There was probably blame on both sides for that, but most damaging was the failure of the international community to keep the pressure on the Sri Lankan Government to go down the negotiating track and to not resort to war again. In order to do that, the international community should have consciously taken the conflict out of the context of the Government on the one side and the terrorists on the other.

During the 2002-05 ceasefire, the Liberation Tigers of Tamil Eelam was made a legal organisation by the Government of Sri Lanka and could freely operate anywhere in that country, yet the US, British, and Australian Governments kept on their designations of the Liberation Tigers of Tamil Eelam as a terrorist organisation, and the European Union added the Liberation Tigers of Tamil Eelam to its terrorist list. Of course, it is true that the Tamil Tigers have engaged in terrorist actions in the past, including political assassinations, but so has the Sri Lankan Government, on an even larger scale according to the statistics of civilian deaths in the reports of human rights monitors like Amnesty International. In 2003 and 2004 the two sides that had done such bad things to each other and to civilians were talking and could have reached a solution, with enough pressure and involvement from the international community. But the negotiating process lost momentum, and when President Rajapaksa came to power in 2005 he decided on a military solution. The tragic consequences for the Tamils are there for all to see.

What is New Zealand’s responsibility now? This Parliament took a good step in passing a resolution on 2 June “That this House notes its deep concern at the dire humanitarian situation in northern Sri Lanka and call upon the Sri Lankan Government to accede to United Nations Secretary-General Ban Ki-moon’s call for UN agencies to be given ‘immediate unhindered access’ into the internally displaced persons camps in order to bring aid to those who desperately need it, and ask the Sri Lankan Government to allow media access to the camps.” However, the New Zealand Government must take the next step and engage both directly with the Sri Lankan Government and through United Nations organisations to enable full access to the camps for international humanitarian organisations, human rights monitors, and the media. At present the media is allowed into the big detention camps only on guided tours, and is not allowed to talk freely and privately with camp inmates. I think it is appropriate to use the prison term “inmates”.

We must insist that all members and former members of the Liberation Tigers of Tamil Eelam, whether combatants or non-combatants, and their families be treated fairly and without discrimination. Surely it is now time for reconciliation, not for punishment and further suffering. People should be able to leave the camps and return to their homes if they so wish. Yes, war crimes have been committed by some actors on both sides of the conflict, but the identification of those and the prosecution of those responsible will have to be done with the direct involvement of the international community. Human Rights Watch has rightly called for an impartial international commission of inquiry to investigate the alleged crimes that were committed during the war, including the repeated bombing of civilians crammed into the small amount of territory held by the Liberation Tigers of Tamil Eelam in the last phase of the war, and accusations that Tamil Tiger fighters prevented civilians from leaving that territory.

The tragedy of Sri Lanka is very personal to many people in the New Zealand Sri Lankan community. Many of them have lost family members and friends back in Sri Lanka, or are desperate to find out their fate. We have a responsibility to them, as citizens of our country now, to take up the humanitarian and political issues involved, to help the Tamil people who live here to find out what has happened to their relations, to help those who survived the conflict in northern Sri Lanka to return home to their towns and villages, and to help survivors to get welfare assistance through the various agencies, including international agencies.

We should also not forget the underlying cause of the conflict and suffering: the failure of successive Sri Lankan administrations to allow the Tamil people their full rights, including their right to an autonomous area in the north of Sri Lanka. That issue arose from the time of independence, well before the Tamil Tigers were ever thought of. The personal stories of Tamil refugees living in New Zealand include terrifying stories of earlier times during the repeated pogroms in places like Colombo, when Sinhalese militia, one might call them, went door-to-door with knives and people were hiding in cupboards to try to avoid being killed.

I feel sadness myself because when I visited Sri Lanka in 2003, two of the people I met, Mr Nadesan and Mr Pulidevan, were key people in the political side of the involvement of the Liberation Tigers of Tamil Eelam in the negotiations. At the very end of the recent conflict they phoned their international contacts, and one of the reporters they talked to relayed the whole story to us in the Dominion Post late last month. Contact was also made with the Red Cross, the Sri Lankan Government, and the United Nations while Mr Nadesan and Mr Pulidevan were trying to work out a way to surrender, and they were told to carry white flags to the Sri Lankan Government’s line, which they did. As they were carrying these white flags, they and their families were gunned down.

Sri Lanka faces a very tragic situation today, and we want to engage in dialogue with Sri Lanka’s politicians to help to find a way forward. That includes the 22 Tamil MPs, who are at present under some siege.

PESETA SAM LOTU-IIGA (National—Maungakiekie) I rise to speak on Budget 2009. Before I start I congratulate two new additions to this Parliament. I first congratulate Cam Calder, who will be entering Parliament this week. He is a hard-working and faithful member of the National Party and a very good campaigner. I look forward to his joining us here in Parliament. I also congratulate David Shearer on a well-deserved victory in Mt Albert over the weekend. But this Budget is not about by-elections and new members of Parliament; it is about a road to recovery for this nation. We are over the sideshows. What we are really in need of in this country is political leadership. This Budget is a demonstration of the skills of the Hon Bill English in delivering a package to New Zealanders that is both measured and considered, in terms of the recovery of this country economically.

Budget 2009 takes steps to ensure that New Zealanders are cushioned and buffered against the sharpest edges of the worst global recession we have seen for over 70 years. The Budget is one I am proud to support, because it follows up an election in which promises were made. Promises were made to safeguard national superannuation for those who are in need. When I walk around the streets of Maungakiekie and talk to the elderly, they are thankful that this Government is supportive of their entitlements and superannuation benefits, and they say “Well done!” to Mr Key, Mr English, and the National Government.

The Budget is also about improving public services. After 9 years of a Labour Government that neglected public services and that bloated bureaucracies, this Budget is about delivering front-line services. Let us have a look at the types of front-line services this Government will deliver. In the next 2 years 600 police will be delivered on the front line. The Minister of Police has made some gutsy calls and done some hard negotiation in a tight Budget to deliver more front-line police. On the campaign trail last year we heard from the people that what is required in our communities in order to safeguard our health and well-being is more police delivered to our communities, especially in Manukau City, which the members opposite harp on and on about until they are blue in the face. The extra 300 police for that area will be welcomed in a very good spirit.

This Government has produced a Budget that, ultimately, will control debt. Ultimately, it will control the debt curve that we were in danger of experiencing over a decade of deficits going into the future. That is because the previous Government increased structural spending of the Crown to levels that have been unheard of in this country. The Budget is about wise spending and about prioritising spending in the areas that matter most to New Zealanders. What are those areas? I am happy to report that our association—at least our working together—with the Green Party has produced a home insulation programme that will enable warmer, healthier homes for those most in need. That is right; 180,000 households will be eligible for grants of up to $1,800. If those people are of high need, and hold community service cards, then they will be eligible for grants of up to $3,000. That is to be commended.

On the subject of health, this Government is putting more funds—I repeat, more funds—into front-line services. That means we will be training more health professionals in a whole range of different areas—not just doctors and nurses but also psychologists, and people in mental health and right across the health sector. The Budget is about upgrading the health infrastructure. We are putting over $245 million into elective surgery theatres, which will be welcomed and will reduce the waiting lists that have been built up over the term of the previous Government.

My favourite area is education. Over the next 4 years $1.68 billion will be put in to improve facilities and lift our educational achievement. What does that mean? It is the biggest spending programme we have seen in education for many, many years. That is right; over half a billion dollars will go into modernising schools and building new schools. Having visited all the schools in my electorate of Maungakiekie, and seen the state of disrepair of some of those schools, I can tell members that these funds will be very much welcomed by schools right across this country.

One of our campaign promises was around the area of literacy and numeracy. In that area we will be providing over $36 million in order to help schools meet the national standards. We have seen that the evidence and research show that those who do not have numeracy and literacy skills, who do not have minimum standards in those areas, are more likely to be in prison, more likely to not contribute to society, and more likely to be disruptive. That is why we need to spend money in this area and need to encourage not just the students and teachers but also the parents of children growing up in this country to understand that improving literacy and numeracy is the only way to go towards improving one’s plight in life.

We know that education is a priority for this Government, as is health, but when this economy eventually improves, it will be the infrastructure development that this Government puts in place that ultimately will lead to higher growth, higher incomes, and a better way of life for New Zealanders. On that front, we promised $1.5 billion in ultra-fast broadband to the home, which is what we will deliver in the coming years.

We also have a Minister of Transport who is committed, with the National Land Transport Fund, to funding network highways. I am happy to report that State Highway 20 and the Onehunga foreshore development will go ahead. This Government and the Auckland City Council, and, to a lesser extent, our friends at the Auckland Regional Council, have put together a plan to develop that particular part of the foreshore and harbour. We also will ensure that train stations will be funded across the Auckland isthmus. We will fund train stations, and I mention again the station in Onehunga, which is well overdue. The train tracks will go into the heart of Onehunga, and the trains will take fans from the central business district out to Ericsson Stadium—or Mt Smart Stadium, as it is now called—because people do not watch the All Blacks since they lost in the last match, but they will go to watch the New Zealand Warriors. The train stations will be welcome in the Maungakiekie electorate.

Hon TREVOR MALLARD (Labour—Hutt South) I think it was 7 months ago that the member who just resumed his seat, Peseta Sam Lotu-Iiga, led the Address in Reply debate for the Government. He was supported by the following speaker, who was Melissa Lee. How the mighty have fallen! Melissa Lee fell slightly more publicly than that member, but he should be embarrassed about that speech and the way he gave it. He read it very badly, indeed. I would be embarrassed about the level to which I had fallen if I was that member.

I congratulate Chris Tremain on his election to the position of senior Government whip. As someone who has held that position, I know that it is an important position.

Peseta Sam Lotu-Iiga: A long time ago.

Hon TREVOR MALLARD: I say to that member that it was quite a long time ago, but the lessons one learns last for a long time. There are many people around the place who do not know those lessons, and I hope to teach those people some of them over the next period.

I do not want to say a lot about the Mt Albert by-election, but I want to say something about John Key and about his failure to lead at the end. I accept that John Key had a personal engagement in the Taupō area. I have had engagements myself from time to time over the past couple of years. But John Key knows he is the Prime Minister, and he is the person who set the date for the by-election. If he had an absolute commitment that he could not break, then the by-election could have been held a week later or a week earlier. Clearly, it is easy—

Hon Dr Jonathan Coleman: I raise a point of order, Mr Speaker. [Interruption]

The ASSISTANT SPEAKER (Hon Rick Barker): I am on my feet. The point of order will be heard in silence.

Hon Dr Jonathan Coleman: This speech has clearly got absolutely nothing to do with the Budget debate, and that member knows it. So why is he talking on an extraneous subject?

Hon TREVOR MALLARD: Speaking on the point of order, the Budget debate in these years is, other than the Prime Minister’s statement, the broadest possible debate there is. This is the broadest possible part of the debate.

The ASSISTANT SPEAKER (Hon Rick Barker): The member is quite correct; there are no prescribed limits to this debate. We are not debating a bill that has a defined purpose. The Budget debate has always been accepted as a very broad-ranging debate, almost like a general debate. The member is well entitled to speak very widely in the debate. If the member who raised the point of order had listened to the speeches made by members of his own party he would have heard that they strayed far and wide.

Hon TREVOR MALLARD: I say to Jonathan Coleman that he is known in our caucus now as “The Maestro”. He was the minder for Melissa Lee until he dropped his guts and ran away. As soon as it went rotten, where was Jonathan Coleman? He was anywhere but with his colleague Melissa Lee. He ran away; he was a chicken. When he thought Melissa Lee had a chance of winning, he was there as the big man, he was fronting up, and he was a hero. But at the point when Melissa Lee was obviously going to lose, “The Maestro” shot through.

I go back to the point I was making earlier. John Key could have been there at the by-election. One of the signs of leadership is being there when times are bad for one’s members, not just when times are good. He is not a chief executive officer and he is not someone looking after a fourth-level employee; he is meant to be a leader. The sign of a leader is fronting up in the bad times, as well as in the good times. Like Jonathan Coleman, when the pressure came on, John Key ran away. That is very, very sad.

Even with this Budget John Key ran away. This year’s Budget was meant to be a Budget for jobs. Where are they? We went looking for the jobs. The only real jobs in this Budget are those that have been cut. Jobs have been cut right through the Public Service. The Budget is about superannuation. There was an enormous opportunity to make an investment in superannuation here and to buy internationally while prices are low. The Budget was an opportunity to invest in New Zealand and to invest in jobs. What did the Government do? It stopped the contribution to the Cullen fund, not for 1 year but for 10 years. Why did it do that? It did that because the Government has no commitment to superannuation on an ongoing basis. Deep down the Government is like the ACT Party. It does not believe in superannuation funded through taxes. We are seeing that view coming through with this Budget.

I found something particularly interesting during my sessions of doorknocking in Mt Albert, which was how betrayed the people in the middle-class parts of Mt Albert feel by the National Government and by the fact that it withdrew the tax cuts. Those people sort of knew that the tax cuts had to be withdrawn, but their response was to ask why National promised the tax cuts in December. Why did National pass the legislation in December when it knew then that the tax cuts were unaffordable? The people feel a sense of betrayal and of being lied to, not by a Government that they voted against but by a Government, led by John Key, that they voted for. John Key said in December that of course the tax cuts were affordable, then in May he took them away again. That went down very, very badly. One of the problems with this Budget is that it is not so much that people lost the tax cuts; it is the fact that National members lied about the tax cuts after the election, as well as before it.

There are some particular education changes in this Budget that I will focus on. One of the changes is the interesting approach by the Minister of Education to fire nearly 1,000 teachers in election year. That is a particularly interesting approach. During the previous sitting week I asked what the criteria will be and how she will decide which teachers she will fire.

Hon Darren Hughes: No idea!

Hon TREVOR MALLARD: No, she does have an idea; she will set up a committee. She will set up a committee to decide which teachers will be fired in election year. Well, that is a very interesting approach. I think it is educationally stupid to fire a pile of teachers. I also think it is particularly good politics, from a Labour Party perspective, to have a Minister of Education who will spend the end of 2009 and into the beginning of 2010 deciding how she will fire teachers, effective from the beginning of election year. I tell members that if Allan Peachey was the Minister of Education—as he should have been if the appointment was based on talent and not on gender—then this would not happen. Allan Peachy would have got it right because he understands how these things work, and Anne Tolley certainly does not.

Hon Dr Jonathan Coleman: You never said that before about him.

Hon TREVOR MALLARD: I tell that member that I certainly have said that before. To be fair, when I was Minister of Education I had a number of reasonable discussions with Allan Peachey while he was the principal of Rangitoto College. I did not always agree with him, and he certainly did not always agree with me, but I acknowledge that he has a depth of knowledge and a commitment to education that is not found on the front bench of the National Government at the moment. His talent is not being used in the way it should be. He would not have cut professional development for teachers by 25 percent the way Anne Tolley has. I tell members that, in particular, he would not have cut 100 percent of the professional development for teachers who are working with gifted and talented kids. The whole lot will be gone from the end of this year.

Gifted and talented kids can make an enormous difference to our future. When I was Minister of Education I found that a lot of the education system focused on kids at the bottom of the heap. We did a lot of that. We did a lot of work for those kids and made a lot of investment in that area. But the students who can make the biggest difference economically in our community are gifted and talented students. They can make a social difference and they can make an economic difference. But what has happened? National has been captured by the people who do not like tall poppies, some of whom are still in the Ministry of Education. What does National do? It cuts the funding. It does not cut funding for gifted and talented kids by half or by 80 percent the way it did in some other areas, like adult community education; it cuts the funding by 100 percent. That is an absolute scandal.

Another thing National cut, which I want to focus on now, is a very good programme that was extending high standards across schools. The programme identified the schools that were going well and worked with them to share their good practice with other schools. Again, there used to be a lot of focus on failing schools. There is still too much focus on failing schools. One of the ways to stop schools failing is to identify the good practice—some of which, I acknowledge, was occurring at Rangitoto College—and share it with some of the other schools in the area. What did National do with that programme? It cut the funding by 100 percent.

DAVID GARRETT (ACT) I have been listening with great interest to speakers from both major parties. When I came into the Chamber the Hon Tim Groser was very eloquently outlining the deterioration in the economy immediately prior to and following the election. I diverge from Mr Groser on the approach that the National Government has followed, loosely known as a line by line analysis. In our view, the Government is approaching things from completely the wrong end. It is starting at the bottom, rather than the top, and looking at the rats and mice, if you will. When major savings are required in situations such as the one in which the country finds itself now, the proper course of action, surely, is to look first at whether a programme or even a ministry is actually required, and justifies the money spent on it. Let us take the Ministry of Women’s Affairs and the Families Commission just as examples. The approach should be to ask whether we need them at all. Do we need to spend this amount of money on this ministry or this programme? If the answer to that question is yes, then surely the proper approach is to look at the programmes that that Ministry undertakes, and evaluate which of them provide value for money. If some programmes remain after that exercise, then it is probably appropriate to do a line by line review.

But the ACT Party says whole areas of savings could and should have been made, such as the Ministry of Women’s Affairs. Why do we say that? It is really quite simple. I think the budget of the Ministry of Women’s Affairs is about $450 million. Let us ask the question: is that $450 million justified? Well, we have just seen the back of our second female Prime Minister, we currently have a female Chief Justice, and we have had by my count—I think I am right—two female Governors-General. I said in the House on another occasion that the old phrase—and the language shows how old it is—that girls can do anything is, indeed, obvious. So in that situation, why on earth do we need to spend $450 million on a Ministry of Women’s Affairs?

What about the Families Commission? What does it do? I am not sure of its budget; I do not think it is $450 million. What does it do? What has it achieved? The only thing I have seen is a glossy booklet that tells readers that Pacific Island families tend to go for relationship advice first to their family, and then to their church. My wife could have told the public that at no charge at all. It said that Caucasians, particularly males of a certain age, get their advice from mates down the pub. I could have told the public that for absolutely nothing. So the approach has been entirely wrong.

But let us focus on one particular programme: the home insulation fund, which consists of $323 million over the next 4 years. I confess quite happily that when I first saw this fund and we discussed it in caucus, I thought it was pretty sensible. There is evidence—is there not—that insulation saves electricity and makes homes warmer. I even argued the toss about it.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I regret doing this, but in order for the rest of the member’s speech to be informed I say that the budget for the Ministry of Women’s Affairs is $4.9 million, not $419 million.

The ASSISTANT SPEAKER (Hon Rick Barker): That is not a point of order.

Hon Trevor Mallard: I was just trying to be helpful.

The ASSISTANT SPEAKER (Hon Rick Barker): No, that is not a point of order; that is a debatable point. The member is interrupting the flow of David Garrett’s speech. I invite David Garrett to continue.

DAVID GARRETT: At first glance, the insulation scheme seemed to be pretty sensible. But then, when we look at it a bit deeper, past the feel-good intentions, and look at the actual facts, we see—as with many things, sadly—that the case for insulating homes at Government expense, or with Government subsidy, quickly falls apart. In an attempt to justify this expenditure, both National and Green members talk about the benefits to be gained from using public money to insulate homes. They claim that doing so will reduce health risks, lower energy consumption, and create savings for families. Yet the very same study that National cites to justify this policy—the study that says that people reported improved health after their homes were insulated—also shows us another interesting side to the story: it tells us that despite people reporting that such a move results in better health, general practitioner and hospital records fail to show substantive health benefits from the insulation of homes.

I admit that I was surprised by that finding. The reality seems to be that although people may have felt healthier, there is in actual fact no evidence that they were. There is no tangible statistic to prove that people’s health was really getting better. But despite that lack of evidence, in these most straitened of times the Government is willing to waste over $300 million of taxpayers’ hard-earned money—on the correction of the Hon Trevor Mallard, almost 10 times the budget of the Ministry of Women’s Affairs—on a scheme that makes people feel healthier, but has no effect beyond that.

Hon Darren Hughes: It’s more than that: it’s nearly 100 times.

DAVID GARRETT: The member is right: it is 100 times more, is it not? It is 80 times more. One of the other reasons the Government uses to justify the home insulation fund is that the insulation will reduce energy consumption. Again, I thought that that was a no-brainer. But again the facts show that what we think is the case is actually very, very limited. The very same study the Government cites as proof of the benefits of this fund found that the power savings after insulation equated to about $50 a year per household. That means that the Government will spend over $300 million to make homeowners no healthier than they are now, although they might feel better, and to help them save $4.08 on their monthly power bills. That is not exactly value for money, is it?

But there is a more important point that seems to be missing from this debate: just because insulating people’s homes seems like a good thing to do and appears to have some benefit—but only on the surface—that does not mean that the Government should be doing it. Many things are good, but it is not, and never has been, the role of the Government to deliver everything that people want. The role of the Government is to deliver things people need that they cannot provide for themselves—things that would never be provided in the absence of a Government. The police force is a good example of that. That is a public good, and that is what the Government is there to deliver: public goods. The Government is not tasked with providing private goods. These are goods that people want that they could either provide for themselves or live without.

The delivery of private goods is not the Government’s role; it is the role of the market and private business. In fact, a Government that interferes in our lives like this is something to fear. After all, a Government that is big enough to give people everything they want is also big enough to take it all away.

A healthier approach to the Budget, rather than people asking “What’s in it for me?”, would be to ask “What is this going to cost me?”. I will quote the late, great Frank Haden again: the Government has no money; it gets the money from the people. Every policy and every spending plan costs taxpayers. Far from providing benefits, every spending plan places a cost on the private sector, a cost that is ultimately borne by individuals and families.

I will now come back to the topic of insulation. I would like to propose an alternative: rather than having more Government spending in order to ensure that homes are insulated, why do we not require information about insulation to be placed on land information memorandum reports. Why not allow individuals to make these decisions? If insulation is really so valuable, then people will be willing to pay more for it. If information about insulation were to be included on land information memorandum reports, potential buyers would be able to negotiate a lower price with the vendor, just as we can now negotiate a lower price in order to purchase a car that is without a current registration or warrant of fitness. Another argument we have heard to justify this spending is based on the issue of rental properties, and the fact that there are now no incentives for landlords to insulate homes for their tenants.

An alternative that involves a little bit of statism would be to require that landlords advertise whether their rental property has been insulated, as well as the type of heating that has been installed in that property. A rental property that lacks insulation would, on the logic of this policy, be worth less than one that is, just as a home with a garage is worth more than one without. Tenants would value a home with no insulation as being worth less than one that is insulated, and would be able to negotiate the rent based on that fact.

Hon DARREN HUGHES (Labour) Labour has no confidence in this Budget because it does not have a plan to protect or create jobs or to support our country through the difficult economic times we are facing. All through this Budget debate we have heard nothing from the Government about how it wants to make this Budget about jobs. In fact, the only policy that one could point to that might be slightly related to employment is, of course, the bicycle lane, and we all know that is just one big in-joke between the Prime Minister and the Minister of Finance. They laugh about the way the bicycle lane managed to make its way through the Budget process. They do not laugh because they want the jobs that come from it—and we all know how few jobs will be involved—but because it is just a little palsy-walsy joke between Mr Key and Mr English.

Throughout the Budget debate it has become clear how little Government members know about what is in the Budget. Whenever members are questioned about areas where there have been cuts in this Budget, they do not know which programmes have been affected by it. At question time Ministers cannot explain or elucidate on what will change as a result of the Budget process, and the Budget funds are being misdirected. As this Budget continues to be unpacked, more and more issues are being found by the Labour Opposition in which the Government is under pressure and not delivering to the people of New Zealand and not keeping its word from the time of the election.

I will now say a quick word about the changes we have seen in the House in the last few days. I would like to congratulate Nathan Guy on his promotion as a new Minister in the Government. We do not agree on a lot of things about how things should be done in the community of Ōtaki, but I am personally pleased for him that he will have the opportunity to serve as a Minister. I can assure him of my representations to him on Transmission Gully in his role as Associate Minister of Transport. I acknowledge the new Government whips and I look forward to working with them. I would like to make a special acknowledgment of the election at the weekend of David Shearer, a man of substance and quality, and a worthy successor to the Rt Hon Helen Clark. In the Mt Albert by-election, David Shearer showed how one should campaign. There is no doubt about that. Candidates should campaign on things they believe in, they should campaign on things they know are true and can be done, and they should focus on what matters to the communities in their electorate. That was one thing that the National Party fell away on.

I cannot let this moment pass without making a reference to the strategist of the Mt Albert by-election. This is the person who called all the shots when it came to Mt Albert—

Hon Trevor Mallard: “The Maestro”!

Hon DARREN HUGHES: —the man whom I have heard described as “The Maestro” of New Zealand politics, Dr Jonathan Coleman. I say to members that if Dr Jonathan Coleman ever gives them a prescription, they should see another doctor. Members should get another doctor’s opinion if Dr Coleman ever tries to give political advice. He was in donkey deep with the strategy for Mt Albert. If any person has “The Maestro” visit him or her with some political advice, I say that he or she should run a hundred miles. If Dr Coleman says turn left, go right. If he says move ahead, put it in reverse. Whatever Jonathan Coleman says, do not follow his advice. He reminds me of Murray McCully.

Hon Trevor Mallard: McCully’s better than him!

Hon DARREN HUGHES: But McCully took the National Party vote from 47 percent in 1990 to 20 percent in 2002. Jonathan Coleman has a great role model—

Jacqui Dean: I raise a point of order, Mr Speaker. It would be good if the member speaking could refer to the member by using his full name—the Hon Murray McCully.

Hon DARREN HUGHES: Sure; the Hon Murray McCully. If the member wants to engage in worship of one of her colleagues and she chooses Murray McCully, I say good on her. I say to members that we now know something about the political judgment of Jacqui Dean. She will be praising Jonathan Coleman next week. Jonathan Coleman went on Q+A on the weekend and he said that National had a strategy in Mt Albert. His voice became more and more strangulated as the interview went on, as if not even he could believe that he was saying this. Dr Coleman said there was a strategy; then he said that they followed it to the letter. National planned what it did in Mt Albert. The party members sat around and said: “Here is an idea. Let’s insult every member of the community we can think of. Let’s insult poor people 2 days before the poll. Let’s park in disabled car parks on television. Let’s do all these things to follow the strategy down to the letter, because Dr Coleman is “The Maestro”. I say to members that someone should know he or she is in trouble when it is only Don Brash who thinks that person will be the next leader of the National Party. That is what Jonathan Coleman has: Don Brash in his corner.

Then we come to the issue of John Key, the Prime Minister, who, up until 6 weeks ago, could do no wrong. What a tough 6 weeks it has been for the Government. The political management of the Government has been all at sea in the last 6 weeks, and we saw that on Saturday when nobody was present to support Melissa Lee. No senior member of the National Government was there. Jonathan Coleman looks surprised—I said no “senior” member of the National Government. You know, on a political show on television, when it was said that no Ministers were there, one of the commentators said: “No, Jonathan Coleman was there.” Two of the other commentators said: “Who?”. They had no idea who he was. Where was the Deputy Prime Minister, the man who really runs the National Party? Where was the president of the National Party? They had all cleared off. John Key said that he had a longstanding personal commitment, as though he had nothing at all to do with setting the date of the election. The Prime Minister personally chose the election date. If he could not look in his diary to see where he was going to be on that date, he has less control of his office than I thought he had.

Let us wind back the clock to when the Mt Albert by-election was called. All the right-wing bloggers and the Government’s friends and columnists were saying that it would be tough for Labour and that the party vote was pretty close in last year’s election. They said: “Since the election the Nats have gone up to 60 percent in the party vote. Labour’s down to 30 percent. This could all be on; this is a big test for Phil Goff.” They all fed into that. That is why “The Maestro” wanted to be involved in the strategy. He thought: “If I could pull this off, I might get on to the second row of the Government benches, instead of being marooned on the third.”—for reasons we just do not understand; however, that is where he is. By the time the by-election came, it was a rout. We got a higher share of the vote than we got in the 2008 election. Ravi Musuku did better than Melissa Lee did, and that is why “Musuku” has entered New Zealand politics. To be “Musuku’d” is to be abandoned by one’s political party and forgotten about.

We know that John Key has always said that explaining is losing; that has always been his political mantra. But has he not spent 6 weeks explaining? He has spent 6 weeks explaining Christine Rankin. He has spent 6 weeks explaining the Auckland super-city debacle. He has spent 6 weeks explaining why he promised tax cuts in November, passed them into law under urgency in December, and welshed on the deal in May 2009. He has spent 6 weeks explaining why he has put in jeopardy the future of New Zealand superannuation and why he has slashed KiwiSaver for working New Zealanders over the course of their lives. He has spent 6 weeks explaining who Melissa Lee is and why she says the things she does. He has spent 6 weeks explaining why the Waterview Connection now costs $8.4 trillion, or some ridiculous cost that the National Government keeps exaggerating. And he has spent 6 weeks explaining the ministerial personnel of the National Government. Last Monday he said he did not want to talk about personnel issues any more, and today he was still talking about them in question time.

This Government is beginning to come apart at the seams after just 6 months. I am surprised at that, because it had an extraordinary start. But in the last 6 weeks we have seen mistake after mistake being made. What I find curious is that normally parties learn from their mistakes, but this bunch keeps on repeating them. National members have no mechanism or ability to learn from their mistakes, and that is why they should enrol in night school classes, not cut them. They should be enrolling in adult and community education and in Politics 101, not cutting those courses, which they are doing.

I will say a word about the adult and community education sector, because it provides an opportunity for 400,000 New Zealanders. This Government is cutting it and saying nothing about it. I have been contacted by people in my community of Horowhenua who are really worried about this issue because those kinds of courses represent real hope and a chance for people to get back into the workforce.

Hon Parekura Horomia: It says they were hobby courses.

Hon DARREN HUGHES: But what happened? National is too keen on making jokes about the courses and calling them hobby courses, as Mr Horomia points out. It is too keen to mock them and be silly about them, even though Bill English—when he was in Opposition—acknowledged how important they were for people to have a better chance to get ahead.

What I am most opposed to in the Budget is not actually the tax cut changes. I think the Government misled the public over that, and at the 2011 election those members will have to account for the fact that they gave a personal guarantee. They even used the words: “We will not cancel the tax cuts like Labour.” They could not have been more explicit. But what I am worried about is superannuation, because last December the Government halved the contribution from employers to KiwiSaver, and it has now gutted the Superannuation Fund. There is not a single member sitting over there who will be responsible for fixing up that problem in the future. It is the same old Tory way. The Muldoon Government did it, and none of its members were around to fix the problem. The Bolger-Shipley Government did it, and none of its members are around to fix it now.

And now, once again, a National Government is ruining New Zealand superannuation for people. It will be impossible to deliver superannuation in the future at the current rate of entitlement and at the current rate of superannuation, as a result of what National has done. John Key and Bill English will be footnotes in history by the time that expensive bill affects the country. I think the National members ought to hang their heads in shame about that, because they have transferred a massive problem on to the future. It is not something that will go away.

Technology will not change an ageing population. Technology or policy-setting changes will not get away from the fact that New Zealand superannuation will be needed by people. National has walked away from every idea that was good about dealing with this problem: KiwiSaver allowed workers to build up their own individual savings; and the Cullen fund allowed the Government to put money away for the future, during the good times. This Government has walked away from both of those things. I do not know who those members think will fix the problem for them, but they do not seem to care because it will not be them. That is the legacy of this Budget. This Government cannot make any decisions about the long term; its decisions are about lurching from one political crisis to the next. In the last 6 weeks we have seen that holus-bolus, and I think we will continue to see it.

JACQUI DEAN (National—Waitaki) I am very pleased to take a call following on from the previous member for Ōtaki, who delivered a predictable and very unexciting speech. He touched on the Budget, maybe once, maybe twice, and, even then, both times he got it wrong. I will tell the House why I believe that that member, the previous member for Ōtaki, got it wrong. When I am on the streets, knocking on doors and talking to people, do members know what people think about the National Government Budget? People think it is a great Budget. Do members know why? Because it is about jobs. This Budget is an economically responsible Budget. It is about the creation of jobs.

I want to touch on one small Budget initiative that I think illustrates the intention of this Government. It was raised by the previous member for Ōtaki in a laughing kind of way. That initiative is the cycleway. Do members know why that previous member for Ōtaki raised the issue of the $50 million allocated to create a series of regional cycle tracks? It was because Labour members do not get it. They do not understand that regional development is very, very important for the economic recovery of New Zealand. They do not understand that a shining example is right in front of them, right in my very own electorate of Waitaki, which has proven over the past 10 years that economic recovery and economic welfare are achievable through initiatives such as the Otago Central Rail Trail. This initiative was, by the way, a winner in the 2008 Trustpower Community Awards, and deservedly so.

Let me tell the House about the Otago Central Rail Trail. That community organisation has turned round the economy of Central Otago. It has done that by creating an opportunity out of what was a liability. The organisation worked in partnership—

Hon Lianne Dalziel: That’s right.

JACQUI DEAN: I am glad to see the member opposite Lianne Dalziel is agreeing with me. Maybe there is one member from Labour—[Interruption] Maybe there are two members from Labour who agree with me. This is marvellous! Labour members are supporting this initiative, and I think that is fantastic. They must tell their colleague Darren Hughes, because he does not get it. I am very pleased to see that at least two members opposite understand that an investment of $50 million in regional cycle tracks can and will make a difference to the regional economies of New Zealand.

A number of jobs have been saved through this initiative. A number of women and men, for example, who have spare accommodation on their farms, have turned that accommodation—old shearing quarters and old barns—into accommodation for cyclists, thereby creating work not only for themselves but also for other people in the community. That is the key. It may sound like a small thing in the context of this wonderful Budget, but it is good news when we can create two, three, or four jobs—where there were none—out of a single accommodation industry. In such a small but important way, this initiative encapsulates why this Budget, the first of this National Government, is all about jobs.

I want to pick up on a fantasy that was expounded by a couple of earlier speakers. Mr Trevor Mallard was one of those speakers who claimed that National should have known that the economic situation was getting worse. We should have known that the situation was as severe—

Hon Lianne Dalziel: You did know.

JACQUI DEAN: Members opposite are saying that we did know. Did we? Did Labour know? Could anybody have known? The Budget 2008 forecast, which was made in May of last year, showed a surplus of 0.5 percent of GDP, or a $1 billion surplus. A little over a year ago the country had a $1 billion surplus. It was the golden weather of 9 years of a Labour Government. Labour members were still very full of themselves at that point—a little over a year ago.

However, when the Pre-election Economic and Fiscal Update was announced in October 2008, the situation had changed. We were then looking at a deficit of 0.9 percent of GDP. That was a $1.7 billion deficit. How quickly that happened. Then we moved forward to the December 2008 forecast. By then the deficit had grown quickly from 2.2 percent of GDP to $4.1 billion. So much for 9 years of a Labour Government; so much for 9 years of stunning Labour economic management. Do those members have a plan? No, they do not, and, no, they did not.

But the news just gets worse. The Budget 2009 forecasts from May this year show a deficit of 4 percent of GDP, or $7.7 billion. Who could have seen the sharp combined impact of the international downturn and the economic recession? That means that over the next 3 years alone the New Zealand economy, following 9 years of Labour stewardship, will lose around $50 billion of output. Compare that with the forecast in the 2008 Budget. Who saw it coming?

After 9 years of a Labour Government, after 9 years of fair economic times, what did Labour members have to say about it? Their claims now are so hollow. The claims of the two previous speakers I have heard this afternoon that National should have seen it coming are so hollow. Just listen to these two quotes. One is from the New Zealand Herald in September last year: “Finance Minister Michael Cullen thinks the worst of the economic recession is probably over—and that Labour’s tax cuts will help to push the economy back into positive growth just as voters head to the polls.” That is what Labour hoped. Unfortunately, that was not to be, because the people of New Zealand voted for a National Government, and now I am so proud to be standing here today talking about the first Budget of the National Government. But I have one more quote to share with members, again from the New Zealand Herald,in October 2008. When was the election?

Hon Member: November.

JACQUI DEAN: This was just before the election. This was on 1 October 2008, just a week before the election: “Finance Minister Michael Cullen is optimistic that Congress will ultimately approve a rescue plan. Cullen sees no need to urgently reorder Labour’s spending plans to take account of the deteriorating conditions.” Labour’s words are absolutely hollow. I want to finish my contribution to this debate—

Hon Member: Thank goodness. So do we; we want it to finish, as well.

JACQUI DEAN: Labour members have loved my speech. I have turned a couple of members over to the National side. Whereas the two previous speakers rubbished the cycleway initiative, two members of Labour, two former Cabinet Ministers, have this afternoon come over to National’s thinking and now support the national cycleway. I welcome that. I welcome their continued support for the project.

I am very pleased to have had a speech in this Budget debate. Thank you.

AMY ADAMS (National—Selwyn) What an honour it is to have the chance to rise to speak in support of the first Budget of what I am sure will be many Budgets of this National-led Government. I start by acknowledging the fine speeches of all of my colleagues from this side of the House in this debate. It has been very interesting to listen to them all, and I particularly commend the member for Waitaki, Jacqui Dean, who gave a brilliant speech to the House. But the greatest accolades have to go to the Minister of Finance, the Hon Bill English. Our Minister of Finance has done a remarkable job in very difficult times, and the message I am hearing loud and clear from my community and the people of New Zealand is that this Budget is a remarkable piece of work, in the times that we are in. It is sensible; it is prudent. It is a Budget that maintains entitlements, controls debt, controls Government expenditure, and does all of that while positioning our economy to grow strongly as conditions improve. I want to take a moment to look at each of those elements of the Budget.

The first thing I mentioned is that this Budget maintains entitlements at a time of severe uncertainty for the people of New Zealand. I will touch on some of the things this Government has already done in the lead-up to the Budget to provide support, reassurance, and security for the people of New Zealand. We have had the ReStart package for people who are made redundant during the recession, and a voluntary 90-day trial employment period for new workers in order to create the conditions where employers are willing to take the chance to create new jobs. There is a Job Support Scheme to help employers and workers who agree to a 9-day working fortnight, and a tax assistance package to make it easier for small businesses to manage their cash flows. And, of course, our first tranche of tax cuts on 1 April delivered 50 percent of the package that we wanted to deliver. Those are some of the things we have already done in the lead-up to this Budget to provide support and security to the people of New Zealand.

In this Budget, despite all the scaremongering from Labour members, and despite all their desperate attempts to scare the people of New Zealand about superannuation, we have reassured all New Zealanders that the superannuation entitlement is locked in at the age of 65 and is maintained at 66 percent of the average wage. The members opposite have got very excited and tried to get the media worked up by suggesting that the fact that contributions to the Superannuation Fund are being deferred puts the fund at risk in the future. I tell those members that we are already looking at a deficit of nearly $8 billion this year, yet they want us to borrow another $2 billion to invest in the stock market and play the market. The Superannuation Fund has been losing money in the last little while—over the entire period since its inception, it has managed returns of only a little over 3 percent, which is less than the risk-free rate of return—and the Labour members think it is a fund for which we should be borrowing $2 billion more than we are doing in order to invest in the stock market. For what? This fund would provide 11 per cent of superannuation entitlements after 2030—only 11 percent.

The best thing that this Government can do to protect superannuation for New Zealanders is to build a strong, stable economy. That is what we are doing, that is what protects superannuation for New Zealanders, and that is why New Zealanders can have faith that this Government is maintaining their superannuation entitlements.

The Budget also does an amazing job of controlling the spiralling debt projections. The debt projections, without these Budget initiatives, were absolutely horrifying. The Minister of Finance had to get on top of debt if we were to have any hope of future economic prosperity for this country. That was, I think, in some sense the No. 1 imperative of this Budget. Labour members demonstrate a clear lack of financial understanding when they suggest that ensuring we were not downgraded was unimportant. If our credit rating had been downgraded, we would have put another 1.5 percent to 2 percent on the mortgage rates of every New Zealand family.

Hon Dr Wayne Mapp: They don’t care.

AMY ADAMS: They do not care about the families; they do not care that families’ mortgage bills would have shot up. If we had not got on top of debt, this country would have been spending more on debt servicing than it would on health. That is what the economy under a Labour Government would have done.

Under the previous Labour Government the projections for debt were looking to exceed 60 percent of GDP. The Labour members on the other side of the House did not care about loading up our future generations with debt up to their eyeballs; they did not care that they would have put the equivalent of a second mortgage on every family in New Zealand. Labour wanted every family of four to carry a debt of $180,000 so that it could spend up large. Its attitude was one of never mind the future, chuck it on the bill, load up future generations with debt, and let that debt blow out. But instead our Minister of Finance has now brought the debt projections of over 60 percent of GDP down to a number that will peak at 34 percent of GDP. He has managed to ensure that New Zealand is taken off negative watch and secured our position in the international funding markets, which is, to anyone who understands the basic principles of economics, fundamentally important at this time.

Another one of the goals that this Budget met was to control the effects of 9 years of ill-disciplined growth in core Crown expenditure. It has often been said that if Labour knows anything, it knows how to spend money. We have certainly seen that happen. The previous Labour Government let its spending grow at twice the rate of its income. Which budget adviser would tell people to double their spending at twice the rate of their income? What sort of political party would do that?

Jacqui Dean: Michael Cullen would.

AMY ADAMS: Certainly, Michael Cullen would, and that is what the previous Labour Government did over 9 years. It let its spending grow at twice the rate of its income. That had to stop. This Budget is the first step along the road towards getting that unsustainable, ill-disciplined, core Government spending under control.

The Budget also takes important steps towards positioning our economy for growth. It does that in a number of ways. It creates a lot of jobs. Members opposite do not want the public to hear that, but I say this Budget creates a lot of jobs. It creates jobs through the home insulation package. It creates jobs through roading projects. It creates jobs through new capital development in schools. It provides 900 new jobs in the justice sector alone: 600 police, 246 probation workers, 26 psychologists, and 24 front-line managers. Those are real jobs, and that does not even touch on the downstream jobs that will be created—jobs like those that we have seen being created in Central Otago through the cycleway. The Budget takes steps towards positioning this economy for growth by insisting on the raising of educational standards, and by putting $290 million aside as the first tranche of our $1.5 billion broadband roll-out. We have put an extra $1 billion into the State highway fund over 4 years, which means spending of up to a billion dollars a year in the State highway fund. That is significantly more than we would have ever seen under a Labour Government.

I take a moment to look at some other specific areas that have real meaning to me. The first is youth justice. Certainly, when I saw the work done in my electorate in the Burnham Military Camp, through the Limited Service Volunteers programme and the Youth Life Skills Cell, I became a complete convert to the benefit of military-style training. This Budget will deliver $81.6 million for our Fresh Start initiatives, which will make a real difference for young offenders. I salute that spending.

The primary sector is the last point I want to mention. The primary sector is at the heart of our economy. It is the sector that will pull New Zealand out of the recession. This Budget delivers in real, measurable ways to the primary sector through a strong economy, through low interest rates, through strong infrastructure, and through the Primary Growth Partnership putting $190 million into agricultural research and development over 4 years. That is real money and it will make a real difference. We are cutting bureaucracy and raising productivity, and by doing that we are enabling the primary sector to take the lead role in taking New Zealand out of this recession and putting us on the road to recovery. With a National Government in place, I have every faith that this economy and this country are well on the way to the position that they should be in. Thank you.

Hon PAREKURA HOROMIA (Labour—Ikaroa-Rāwhiti) Mihi kau ana ki te hinga o te māmā o Rāhui, e tangi hoki te ngākau.

• [An interpretation in English was given to the House.]

[I acknowledge the passing of Rāhui’s mother, and the heart grieves.]

Tēnā tātou. I have sat here this afternoon and been really interested to hear a lot of the overheated platitudes about how great this Budget is. Of course, it is not great, and members opposite know that. We listened to Tim Groser painting an incredible picture of the macro-infrastructure in this country that the National Government has supposedly created with this Budget. If members understand the macro and the micro, they will understand that a balancing act is played by those who stretch the truth. First, they cut funding, then they deny having done so, and then they take out of the system a whole lot of resources and finances. That is what has happened. Then they come along with a whole lot of puffery and suggest that they will patch it up and that people need to look forward to that happening.

The previous speaker, Amy Adams, talked about superannuation, which is what I want to talk about. In respect of the issue of intergenerational adjustment, I say that a large number of young people will be relying on superannuation over the next 35 years. Is it not amazing that the Minister of Finance believed that one of the planks and cornerstones of the Budget was to ensure that New Zealand received a decent credit rating from Standard and Poor’s? If that is what John Key has hinged this Budget on, then God help us, because this is the same organisation that sent Fannie Mae down while people have been trying to rebuild General Motors in America and in all of those countries that are struggling like anything. The more-than-wealthy people in the constituencies of members opposite do not, and will not, understand that we need to ensure good social outcomes whilst ensuring that there is good, prudent fiscal management. Michael Cullen gave this country that; he gave it in bucketfuls.

Members opposite have talked about the issue of redundancy in respect of the 90-day bill, but what has that legislation done? The previous speaker talked about energising the labour market to ensure that people get jobs. I inform the House that in September 2008 the number of Māori on an unemployment benefit was 24,000, while the number of unemployed was 23,000. Today the Māori unemployment rate is just short of 40,000. What does that tell us?

Members opposite can pontificate and say that this Budget is a great Budget, but they should tell that to the eight people in Dannevirke who lost their jobs last week. They should tell that to the people in Napier who are wondering whether the factory will be open on Monday. We see the bluffing from members opposite, and we see their low-down stinking fibs. People were Pied Piper-ed to the polls by John Key, who said that if they voted for him they would get tax cuts. One of the most deplorable actions in modern politics happened in this House the week before last. National did away with the tax cuts, but 30 percent of the initial tax cuts went to 3 percent of the people. It went to people like the fellow opposite from Hamilton.

Members opposite have this notion that a number of jobs will be created. The cycleway will create some jobs, but that reminds me of a great song:

Ridin’ along on my pushbike, honey

Sh, sh, ahh, sh, sh, ahh.

Do members remember that song? The words “Tryin’ to find out where you are” got into Mr Key’s head. He is riding along on his pushbike and trying to find the future pathway for his next two Budgets. He will not be putting together a fourth Budget, and the Mt Albert by-election result tells us why.

This Budget talks about new policemen, but the problem is that there are no cars to take them around in.

Hon Lianne Dalziel: They will be on pushbikes.

Hon PAREKURA HOROMIA: They will be put on pushbikes. That is why Mr Key will build the cycleway. I have just worked it out! There are not enough cars for the new policemen and policewomen, so they will be put on pushbikes.

Hon Tony Ryall: Bobbies on the beat.

Hon PAREKURA HOROMIA: That is right; the member from the Bay of Plenty is old enough to know that.

Hon Tony Ryall: In touch with the people!

Hon PAREKURA HOROMIA: Well, this Budget has really distanced the Government from the people. The Government has blamed the recession on Labour, but it should give that up. The recession is an international trend, and if Government members do not understand the fundamentals of that, then God help the people of this country.

The Government talks about the growth in the Public Service, and this Budget is the first deep hint of privatisation in that sector.

Hon Member: Oh!

Hon PAREKURA HOROMIA: Oh, yes. Minders will be assigned to chief executives, but those people have a direct contract with the head of the State Services Commission and should not be interfered with. So we are looking at a new hook in respect of employment rights in this country. It is like the 90-day bill: things are shortened up so that everybody gets a seasonal job and so that workers can be laid off whenever it suits employers. That is really, really dishonest.

We have heard all of this talk about a larger injection of funds into education. Most of that talk is about capital infrastructure and fixing school buildings. The last Labour Government did the adult and community education sector proud; no one can say that we made an 80 percent cut to that sector.

Bill English made an interesting comment to a Māori business breakfast the other morning. He said: “We do not want Māori sitting at home smoking or having babies.” How deplorable is that? Most Māori do not do that. How disgraceful. He said that Māori could invest in the infrastructure of this country and that Māori could get going with their businesses. Well, Māori do not need the Government. This is real papa State stuff. It is interfering.

Hon Steve Chadwick: Paternalism.

Hon PAREKURA HOROMIA: It is paternalism. This is real papa State stuff.

The Government has spent a long time waxing lyrical about the fact that Labour did not do the right things. We ensured that there were income-related rents. We ensured that prescriptions were affordable. We ensured that a lot of other issues that are relevant to those who have less were looked after.

We hear talk about military training. That is the sort of mindset that some people have—“Stand up, polish your boots, don’t piss on the ground, get up at 4 o’clock in the morning, and you’ll get yourself right.” It is disgraceful. International studies of military training have been undertaken. Three major reviews over the last 10 years have told us that it does not work and that recidivism actually accelerates as a result of military training. I could be smug and say that military training makes people fitter so they can run quicker!

To stop funding superannuation would be outrageous. Any fine financial mind will know that if we do not fill up the gap now, we will start to race up investments to try to double the booty in order to get to where we need to go. That trend will accelerate out over 11 years, and it will be interesting for whoever has the mundane job of ensuring that we fill up that hole. People in Mt Albert have been telling us that they are afraid. People in my constituency are asking what is happening to superannuation. Those are real, real worries. What is happening to the tax cuts that have not arrived?

This Budget is a whole lot of smoke and mirrors. The regional rural development programme in Tai Rāwhiti, which saw an increase in production of nearly 61 percent on properties and outgoings, has been cut. There is no more support. That is the sort of thing this Government has done. In respect of the pūtea for research and science, I ask what the first thing was that the Government did away with. I have heard members opposite squawking and saying: “We’re going to invest so much in researching what size of bike to put on the cycleway.” It is a laugh. It is a joke. The Māori Party made a long list of promises. None of them have made their way into Mr Key’s Budget. There is always a fluffy promise.

JONATHAN YOUNG (National—New Plymouth) In response to the member’s question about what is happening to superannuation, I say that nothing is happening to it. It is not going away. Budget 2009 has locked in national superannuation, and it is set at 66 percent of the average wage. This Budget, the first of many Budgets by the new Government in dire economic times, has to make changes simply because of the economic situation that the Government inherited. Obviously, Opposition members are very unhappy about those changes, because the Budget reorders and reprioritises some of the things they sought to do. But we believe that we have presented a prudent and responsible Budget that will bring New Zealand to a place of recovery after the worst economic times since the 1930s.

The Budget is both pragmatic and prudent in its approach, and it will have a powerful effect. It will address the deepening situation that New Zealanders face in the long term, and it will address short-term issues. The response of New Zealanders has been overwhelmingly positive. They support this Budget. Members should never underestimate the common sense of the voting public, which is something Labour forgot last year. The Budget is pragmatic in that it is aimed specifically at building the economic base of New Zealand through creating an environment where jobs and growth can occur.

In previous months this Government has passed a strong raft of legislation to support businesses—to the tune of half a billion dollars in relief—which is something that Labour never did. Last year the previous Government, as we understand it, was looking at a $1 billion surplus. From the Pre-election Economic and Fiscal Update, we recognised that that surplus had become a $1.3 billion deficit in just a short number of months. Three months further on, that deficit grew to $4.1 billion, and in May this year New Zealanders in businesses, homes, and the workplace were facing a $7.7 billion deficit.

The National Government caught a hospital pass, and we have not dropped the ball. New Zealanders are saying that National has safe hands. When I hear people speak of what is happening, I hear even staunch Labour people saying: “Well done, John Key. You’re doing a good job.” The deterioration of the public accounts shows the enormity of the challenge facing this Government. In the midst of this, Bill English presented a Budget that carries a strong sense of social responsibility but also attends to the critical necessity to turn round the New Zealand economy. That is why New Zealanders are glad to have a National-led Government. It is turn-round time. This is essential, so that when we begin the climb out of the bottom of the trough we will be ready for the challenge and the opportunities that are before this nation.

There is a world of difference between a decade of surpluses and a decade of deficits. It is easy to govern in good times. It takes real prudence and pragmatism to govern in difficult times. That reminds me of a story from some years ago when a friend of mine sought to buy some personal life insurance. A bit like overseas financiers, the insurers wanted to know whether the investment they were going to make would be risky. This person had experienced more growth in girth than in height, so the insurers requested a physical audit. This person was sent to the doctor. The doctor said: “You’re healthy. There are no signs of disease. Your blood pressure and weight are within normal limits.” Then, prudently, this person went to a fitness instructor, who said: “You’re in terrible shape. Your resting pulse and your body fat percentages are way above normal. Your flexibility is poor. You’ve just flunked the treadmill test.” If both assessments are right, what does it mean to be fit and healthy?

The Leader of the Opposition has, in effect, said that we need not worry about listening to the fitness experts. He has told us not to worry about credit agencies and their ratings. “Ignore them. Things will be fine.”, he said. New Zealand, according to “Dr Phil”, is fine. But after the Budget, Bill English was able to report that Standard and Poor’s had removed the negative outlook from New Zealand’s AA foreign currency rating, and Moody’s Investors Service said that New Zealand’s rating, which is on a stable outlook, was not immediately affected by the projected debt path.

The Opposition, of course, says that that does not matter. But we know that if our credit rating had dropped, we would have seen a 1 to 2 percent increase in interest rates flow through New Zealand businesses and households. Businesses that are already struggling with reduced margins would have found an increase in their costs through an increase in interest rates, and they would have had to cut costs. One of the areas where people cut costs, of course, is in their staffing levels. So we cannot say that negative credit ratings would have no effect. They would have a dire effect on New Zealand. Mr English went on to say: “This is a positive reaction that will benefit New Zealand households, businesses and the economy as a whole. It acknowledges that the Budget strikes the right balance between supporting New Zealanders through the recession in the short-term, and setting in place a credible fiscal and economic plan for the medium to long-term.”

There is a difference between an economy that may be called “everything’s fine”, and an economy that has to get fit to meet the challenges of a global recession. I was talking just last week to a constituent who made the comment that the recession was forcing him to run his business smarter—that is, by necessity. The reason why it is important to do things smarter is that compared with the previous Government’s forecast in the 2008 Budget, the forecast this Government is working with shows a decrease in the nominal economy of $50 billion over the next 3 years. That is a sizable contraction, and it has a flow-on effect. Not only do New Zealand businesses have less money to work with but also tax revenue will be considerably lower than expected.

In response to that situation, a smart Budget has been presented by the Minister of Finance, the Hon Bill English. A decrease in revenue has led him to deliver a prudent Budget that controls Government borrowing and debt but also sees an increase of $2.9 billion in new core Crown spending. The Budget is smart because it redirects resources to areas where they will make the most essential difference. It brings a fiscal reprioritisation so that the most good can be achieved for the most people.

Of course, we cannot change the future without changing the present. When members opposite attack the policy changes that Mr English has brought about, in many respects they are not presenting any alternative, except to maintain the status quo. Let me tell members where the status quo would have taken us. By 2022 it would have taken us to debt of 70 percent of GDP. The policy changes presented in this Budget bring that debt down to 37 percent in the same period of time. The Budget brings a good balance, as Mr English has said.

Today we have heard a lot about adult and community education as one area where adjustment has occurred. There are, of course, some social and community benefits in this area, but the Government’s investment of $124 million over the next 4 years will focus on skills that will connect people to their workplaces, and bring people into places where they can work. As much as I might enjoy making a mug and feel good about it, the reality is that very few of my mugs will earn me a living. In terms of priority, this Government wants to ensure there is food on the plate and drink in the mug, and not empty plates and empty mugs in our nation. Literacy and numeracy is a vital area of investment that will connect people to the workplace.

On Cape Egmont, very close to where I live, we have a lighthouse that gives ships a sense of location and direction. Strong leadership is essential when times are tough. The lighthouse does not really come into its own until it is dark and stormy, and then everything depends upon it. Leadership is like that. It is most needed when there is uncertainty and when the horizon gets lost in the rise and fall of surrounding circumstances.

Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) I listened very carefully to that contribution from the MP for New Plymouth, Jonathan Young. He said that this Budget was pragmatic, prudent, and smart, but I wonder how he explains that to the constituents of his electorate of New Plymouth, and to people who are involved with adult and community education at Spotswood College and Waitara High School. Adult and community education is not just about making mugs. It is about parenting programmes and basic accountancy, and it could be about basic business skills. I think Mr Young needs to be able to say quite clearly to those involved in adult education in the New Plymouth constituency that they will be absolutely unaffected by the cuts to adult education. We know from the feedback we are hearing from all over the country that those people are absolutely concerned about the cuts in this area. I do not think the member understands that, and I am concerned about that. People listening to his contribution, particularly in Waitara, will be very concerned about what he said on the issue of adult and community education. He will be held to account on that matter alone.

There have been many contributions from members opposite saying that the National Government’s first Budget will take the sharp edges off the recession, but no plan has been given to the country to explain just how that will look in its totality. What is the plan for protecting jobs and creating new jobs? Will a cycleway actually deliver to the people in Waitara? Mr Young could not even say that. Sure, everyone knows that $51 million has been committed to a national cycleway, but how will that deliver jobs and benefits back to regions like New Plymouth? Even Mr Young could not explain that, and he needs to.

If the Government is saying that this Budget will take the sharp edges off the recession, people will want to know what the plan is. If funding is being redirected to other areas, people will want to know how many jobs will be created and how that will then be translated back to their own regions. That is the type of question that National constituency MPs will be required to answer when they go back into their communities. We know that in the area of adult and community education alone the benefits of cutting that particular fund will be tested. The credibility of the Government will be tested on this issue, and it will come back to bite it.

On the issue of tax cuts, I am absolutely pleased that the Government decided not to go through with the 2010-11 tax cuts that the National Party promised in the 2008 election. The thing is that the National Party knew when it was campaigning in the election that the tax cuts it was promising were unsustainable and could not be delivered. What did the National Party do? It went out and sold a lie to the public. If we heard anything in the Mt Albert by-election, it was that people felt duped. National Party members were going out, looking constituents in the face, and saying that the Budget would take the sharp edges off the recession. How could Mr Young stand alongside Tariana Turia and defend the first tranche of tax cuts, which delivered nothing to 70 percent of Māori voters in the Te Tai Hauāuru electorate. How could he do that when they delivered nothing to Māori who earn $40,000 and under? He cannot do that.

There are a number of areas where the National Government, in its first Budget, will be held to account by people who matter in our communities. The Government says it is listening, but it is clearly evident that it has heard those voices and forgotten about them, because it is acting in a way that totally rejects some of the real concerns they have.

Unemployment is increasing. We heard a contribution from Rahui Katene, who put a fine point on just what the unemployment figures might look like in Māori communities. She said that Māori unemployment was predicted to rise to about 17 percent, which would double the number of unemployed Māori from the time that we were in Government. That will have a critical effect in many small communities. Members can take the example of the 50 mining jobs that were lost in Huntly. That was not just about 50 miners; it was about 50 families. That has happened under the National Government’s regime. At a time when Government members were saying their plan would take the sharp edges off the recession, 50 families were being affected. It is very difficult to get jobs in Huntly, and it will be very difficult for those miners who are aged 55 and over. What is more damaging to them is that they have no guarantee that their entitlement to superannuation of 66 percent of the average wage will still be there when they reach the age of 65. They are concerned not only because they are 55 and it will be difficult to get another job in the current economic climate but also because they have no absolute guarantee that by the time they reach 65 they will get superannuation. This will come back to haunt the Government.

The fact that National refuses to pre-fund superannuation, has deferred payments for a decade, and will expect a future generation to pay double in taxation to be able to fund superannuation is a concern, especially to Māori communities, because it is a double blow. We will have to rely on future generations of workers, Maori and Pacific Islanders in particular, who are currently at the tail end of underachievers in the education system, to pay more tax to fund the baby boomers to get their superannuation. The difficulty with that picture is that the National Government has not demonstrated clearly the level of investment that it is prepared to put into lifting Māori and Pacific educational achievement right now. There is no plan, no picture, and no comprehensive level of investment. No plan has been explained to us in the House. We understand the necessity of that investment and the need to lift the opportunities for the current generation of workers to be able to respond to some of the pressures of the future and to deal with the issue of superannuation.

Those members are not listening to the real needs out there at a community level. I hear from mums and dads who are really committed to education, and who want to do what they can to help their kids get through school and to read with their kids in the home. They say: “Hey, look, we just don’t know why $32 million is going to private schools when our kids are in public schools. Most Māori kids we know are in public schools—kura kaupapa or whare kura. Why is that Government dishing out $32 million to private schools when our kids do not get the support they need in public schools to help them get through the educational system?”. Those questions need to be answered, and they have not been answered well by National.

More important, Jonathan Young, like every other National member—especially my colleague from Hamilton David Bennett—knows that in a time of recession, people from the community and voluntary sector need more support, not less. Why is National gutting the funding to that sector? The Pathways to Partnership funding was dedicated funding over 4 years that was committed to that sector and to supporting essential services in our community. That funding was put forward with the knowledge that we were moving into a recession and that vulnerable families would need support. Why is the Government gutting the funding to that sector?

I, alongside local MPs, took the Minister for Social Development and Employment into the Waikato region so that she could hear about some of the work that is being done in Hamilton and in the Waikato region to ensure that there is a strong and comprehensive network of collaborative services in our region to respond to the very important needs there. It really concerns me that the Minister could not give any confirmation or commitment that there would be dedicated funding to the sector. The only thing that members of the community and voluntary sector are worried about is survival. When the National Government talks about taking the sharp edges off the recession yet the community and voluntary sector is just worrying about survival, something is not happening; a message is not being heard. Again, I say that the Government needs to be concerned about this.

The Government is cutting funding to enterprising communities that create employment opportunities. Why would it do that? It has cut the tertiary allowance, which allowed more Māori mums in particular to go back into training. Why did it do that? It has cut youth skills funding. That funding stream provided an opportunity for kids who have already been disenfranchised from the education system to re-participate in training and education. Why did it do that? The National Government has cut funding in all those areas, but I think the areas where it will be held most accountable are those of superannuation, of adult education and training, and of what it is doing to be accountable to the young people of New Zealand who have to be able to be in a position to make a strong contribution to this nation, especially Māori and Pacific young people. If those members think for one minute that superannuation has a future, then they have to demonstrate that, at the other end, Māori and Pacific young people, who will comprise the majority of the workforce in the next 20 years, will be lifted above their current educational achievement rates, as things are sadly lacking in this area. There has been no demonstration of that commitment whatsoever.

I think that when Jonathan Young goes back to New Plymouth and David Bennett goes back to Hamilton, the community and voluntary sector will hold them to account quite strongly. They will get the clear message that National’s first Budget was a flop.

DAVID BENNETT (National—Hamilton East) The previous speech was from a member whom I hold in high regard and have a great deal of respect for. She has proven herself to be an effective member of Parliament. However, today she has delved to the depths of Labour Party tactics and has tried to bring fear to ordinary New Zealanders. All that speech was about was trying to make fear part of the New Zealand psyche. New Zealanders do not need to have fear; they need to believe in a future.

This Budget gives New Zealanders a strong future. This Budget is seen by the international community as being successful, and it will deliver results in this time of recession. The National Government is not going out there and creating fear amongst our communities. Those communities already know about the reality of the recession, whether they have been affected through the private sector, the Government sector, or the voluntary sector. People know what a recession means, and they know that nobody will be immune from the effects of a recession. They know that everybody will have to make sacrifices as this country goes forward and tries to pull itself out of the recession. The Labour Party does not acknowledge that. Those members come into this House and try to tell the people of New Zealand that everything is fine and we should be spending more and more.

The reality is New Zealand cannot do that at this time; it has to be considerate of the economic situation and make prudent choices that will deliver a stronger economy going forward. I think Jonathan Young was right when he said that we got a hospital pass. We got an economy that was going into recession, a country that had huge debt levels going forward, and a country that had had 9 years of poor economic management. Only now are we are turning that round, and in the 9 months that we have been in control our credit rating has increased. New Zealand is now seen by the international community as improving at the worst possible time in terms of the economic conditions, and that is because we have prudent economic management, decision making that is in the best interests of this country, and no fear tactics. We are not going out there and trying to create a sense of uncertainty in these very uncertain times. We are going out there and delivering a future, not creating uncertainty for people who are in a dangerous position.

The Labour members talk about superannuation, and that is the classic example of how they are creating fear amongst out community. The Labour Party preys on some of the most vulnerable members of our society. Labour takes advantage of the uncertainty of people on fixed incomes about their future, and it tries to create a sense of doubt and loss in them, when they do not have any reason for such feelings. The Prime Minister has made a watertight commitment that he will look after superannuitants and will not change their entitlements, and we are maintaining them in this Budget. This is being done at a time when it is very difficult to maintain things. In Australia the Government could not maintain people’s entitlements, but the National Government has maintained entitlements for those who are on fixed incomes. The most vulnerable members of our community have been looked after by the National Government in the most difficult of times. Voters will remember that. They will treasure that, and when they vote at the next election, they will remember that National looked after them in the most difficult of times. They will remember that we did not create fear in their minds but delivered for them, so that they had some security going forward. I am very disappointed in the previous speaker for creating that fear, because she knows better than that. She is an experienced member of her community and of this House, and she knows that creating fear in her community is not in the best interest of this Parliament at this time.

We have to ask what the Labour members would have done in their Budget if they had remained in Government. They would have done all the spending. There would have been no areas where they looked at expenditure; they would have increased expenditure. They wanted to build a tunnel under one of the suburbs of Auckland, and that was another couple of billion dollars that they were going to spend. They were going to have universal student allowances, that great promise they had during the election campaign. Would they have honoured that promise in this year’s Budget if they had remained in Government? Maybe not. Maybe David Cunliffe would have had to sit there and tell his members that he could not do the things they wanted to do.

But the Labour Party members come here now and try to tell us they would have done those things. There is no chance that they could have done them, because they would have realised that doing them would increase the debt cost to New Zealanders by at least 1.5 percent. That would mean that New Zealand families, businesses, and our corporate community would be paying more for their borrowings. In these times when our assets are lower than they were, that would mean we would be losing money. We could have seen a situation where, because of Labour’s increasing spending, New Zealand businesses went under even further than they have gone. That would have meant there would be fewer jobs around than there are.

Hon Steve Chadwick: Tell us about Maungatautari and the $54 million cut to conservation.

DAVID BENNETT: We have heard the members from Labour talking about adult community education. I have a little story for them.

We had a meeting in Hamilton, which one Labour member attended. A school mentioned that it was not very happy that its adult community education courses were under review under this Government’s policy. The school said it had a really popular course that it is doing at the moment, and that it thought that course should be able to continue. I asked what the course was. The course was on teaching people how to buy property. Labour members expect the Government of this country, during the biggest recession we have had in living memory, to go out there and provide a free course to people who have enough money to buy their own home. That is the mentality of the Labour Party. That course does not add to the value of people who are trying to get a decent job or go on to further education. That is what those courses should be about.

If we are to have adult community education, it should be provided so that people can go on to further training or get a job. That means people need to concentrate on the fundamentals of reading and writing. Those are the basic things that need to be focused on in education. Adult community education courses offer another chance to a lot of people. That chance should not be a false hope; it should be a real hope that what people are getting from a course will add value to them as people, so that they can go out and get a job or go on to further education. The National Government will not create false hope. We will not go out there and create fear in our communities. We will deliver a situation where we provide real and constructive actions in order to help people. I am sure we will see the community education providers develop and do well out of this Government’s policy, because it will give them the opportunity to focus on what is needed for people going forward, and not on the Labour Party’s mantra and fear tactics.

If we look at the basic core expenditure of the Government, we see it has been maintained in our core areas. In education and health there are moderate increases that are consistent with the needs in actual construction, for example, in education, to provide jobs so that people can be working within their communities, and also to provide a stimulus for the economy. That is something we can be very proud of in the Budget that was delivered a few weeks ago. Not only was the Budget prudent but it delivered some increases in expenditure in those core areas. The New Zealand public will be thankful for that expenditure. Within a few hours of the Budget our credit rating went up. Our credit rating went up the week before England’s credit rating went down. Our credit rating went up. That is a measure of the success of the Budget. Not only did the New Zealand public accept this Budget but they accepted that the superannuation entitlements were maintained.

Given the talk about superannuation, the Cullen fund, and what Labour wanted to do, I want Labour members to do something. I want Labour members to go to their bank managers tomorrow and say they want to borrow the value of their house in order to invest that money on the US stock exchange. I want to see those Labour members go out there to their bank managers tomorrow and ask to borrow the value of their house in order to put the money on the US stock exchange. Let us see how far they get with their banks.

Hon Lianne Dalziel: There is no US stock exchange.

DAVID BENNETT: OK, on the New York Stock Exchange—whatever members want to call it. I want Labour members to go out there and try to do that tomorrow. Let us see how long they last. Nobody would do that; it is stupid. The banks would not support that, yet Labour expects the New Zealand Government to borrow money in order to do that.

Hon MITA RIRINUI (Labour) I will start by supporting the comments of the former Minister of Māori Affairs the Hon Parekura Horomia in acknowledging the passing of the mother of the member for Te Tai Tonga, Rahui Katene. It is important that we acknowledge the particular sad events that affect members of this House, even though Wayne Mapp thinks it is a bit of a joke.

We have a saying in Māoridom that we use quite often, particularly in times like this. It goes like this: “Mā te huruhuru te manu, ka rere.” It is a statement about economics. In other words, a bird without feathers will never fly. An economy without investment will never grow. We had some important events on the weekend, particularly in Mt Albert. I acknowledge first the promotions of Nathan Guy and Chris Tremain, but I especially acknowledge the achievement of the new member for Mt Albert, David Shearer. He ran a typically Labour grass-roots campaign, which many of us in this House could learn from.

Craig Foss: Ha, ha!

Hon MITA RIRINUI: Once again, we have a bit of sarcasm from someone who has never done a day’s work. As much as the National backbenchers and ministerial aspirants will try to talk up the Budget, they know that the result in Mt Albert sent them a very strong message. The message was that the Budget was no good. National members often tried to talk it up in their pre-Budget statements, saying that the Budget would be for the underprivileged underclass and those who are most vulnerable. The people of Mt Albert waited with bated breath for that Budget, but it never came. The reason I know that is that I travelled to Mt Albert more than once to assist my now parliamentary colleague David Shearer on the campaign trail. That was the very strong message that came through from almost everybody we spoke to. Those who did not comment very much about the Budget were so disgusted they just walked away.

There are still in Mt Albert some very long-term residents, working-class people who have been there for a very long time, who are the heart and soul of Mt Albert. People in Mt Albert told us that with this Government and this Budget their days in the sun were over. They are retired people, those most vulnerable people whom the National Party claims it was targeting with the Budget. They are the people who sent the clear message to the Government that, 6 months into its term, they are already fed up with it. They are the people who also observed from Mt Albert the happenings in Auckland, particularly in relation to the Auckland super-city proposal. They are the people who said they put their lives into the Auckland region and into its development and put everything, including their life savings, into making a place for themselves in Auckland. Their greatest fear is that this Government, with its super-city proposal, will now alienate them from any decision-making process, and, more than that, that the assets they have built up over a number of years will be lost to them. Their greatest fear is that Rogernomics is back on the agenda and that those assets will be privatised and sold to the—

Hon Parekura Horomia: Highest bidder.

Hon MITA RIRINUI: —highest bidder, as my colleague put it. That is the reason, in my view, and after talking to the people of Mt Albert, why David Shearer had such a great victory.

My speech this evening is not only about Mt Albert. I have always been pro Māori development. I have always been pro policies that are good for Māori. We have had 9 years of good policies for Māori. Now I see some very dangerous policies being introduced. Although my target should be the Māori Party, I have to put the blame for negative Māori policies squarely on the shoulders of the Government. It was the Government that decided that the Māori Affairs portfolio should sit outside Cabinet and that the Minister of Māori Affairs should no longer be in the decision-making loop, so that the Minister of Māori Affairs would be deprived of crucial information. The position needs to make a constructive contribution to the Budget process.

I listened very carefully to the member for Te Tai Tonga, Rahui Katene, in her contribution. I have to describe it as a very naive contribution. Although she put her heart and soul into her delivery, it became obvious that she has no idea about the Budget process and about how important it is for Budget bids to be placed before the Minister of Finance and Cabinet. That did not happen in this case. That is why the Opposition is continually asking Ministers whether they consulted. Did they consult the Minister of Māori Affairs? Did they consult the Associate Minister of Health, the Hon Tariana Turia, through the Budget process? Although they say that they consulted them, I doubt very, very much whether they listened. They did all the talking and none of the listening. That is obvious in the way that the Minister of Māori Affairs was thrown a hospital pass by the Minister for Treaty of Waitangi Negotiations and made an announcement last week here in Wellington, at a very, very large meeting of Treaty claimants, that he was going to inject $22 million to speed up the Treaty settlements process. It became obvious to me that the Minister does not understand the Budget process. All that the Budget told us was that there were going to be cuts right across the public sector. One cannot say, on one hand, that all those cuts are being made, and then on the other, have the Minister of Māori Affairs stand up and say he has some new money. There is no such thing as new money when cuts are being made across the public sector.

The Minister of Māori Affairs claims that the $22 million is to speed up the Treaty settlements process and allow for independent facilitators to work alongside the claimant communities and the Crown to ensure that there is open dialogue. That was the practice the previous Labour Government adopted. I congratulate the Minister for Treaty of Waitangi Negotiations, because he is actually formalising that approach, but $22 million is not going to do it. When one looks at the number of attendees at the meeting, from the far north, to the deep south, and even from the Chatham Islands, one has to ask where the $22 million will come from and how far it will go. The Treaty settlements process is a very, very complicated one. It is a very, very adversarial one. If one wants it to work, one has to get serious about resources. At the table I sat at during the meeting, the people were saying to each other that the $22 million would cover them, but they did not know about the rest of the guys in the room.

We can see that if National is serious about reaching its 2014 deadline, it will have to do better than what it has done. The Minister of Māori Affairs needs to understand that the $22 million he so proudly announced at that meeting will come out of his Budget. It is not new money; it will come out of his Budget. The reason why he does not understand that process is that he is not part of it. Although I am sympathetic towards him, I say that if one is not in the loop, one does not get to have a say. He is not in the loop.

Regarding the cuts across the State sector, I heard the member for Hamilton East, David Bennett, mention the free programmes to teach people how to buy a house. What has he got against homeownership? What has he got against helping people to get into their own homes? If he has a problem with people owning their own homes he had better tell the Minister of Housing, because I do not think that he knows that. David Bennett had better have a chat with the Minister of Housing because I think he might be alone in his views. There are all these anomalies in terms of what has been said by the Government and what is actually happening in the communities. As I said earlier on, I am pro Māori development. There is nothing at all in this Budget for Māori development. Of course, we will have a task force for Māori economic development. Wake up everybody; we are already there! Māori are already there. So what will National members tell Māori that they do not already know? What will they do with their $10 million? I think it is just smoke and mirrors. I do not believe that it actually exists. I heard the honourable member Tariana Turia announce earlier in the week that she will have a task force for whānau ora, and it will tell her what whānau need.

CRAIG FOSS (National—Tukituki) I will endeavour to wake up the audience—those listening and those in the gallery—after the previous speech by Mita Ririnui.

Hon Mita Ririnui: I said nice things about you.

CRAIG FOSS: The member did say mostly nice things, and I thank him, but he spent about 5 minutes talking about the Mt Albert by-election. I cannot find Mt Albert mentioned in the Budget at all.

Firstly, I would like to put into Hansard my acknowledgment of, and congratulations to, my colleagues. I am referring to the now Hon Nathan Guy, my colleague Jo Goodhew, our new junior whip, and, of course, my good mate from the mighty Hawke’s Bay, Chris Tremain, who is now our chief whip. I am sure that all those people who are watching and listening in Hawke’s Bay will join me in celebrating and congratulating the great Mr Tremain.

Hon Members: Oh!

CRAIG FOSS: He is now the whip; he grants the leave! There is just one thing regarding the gentleman who has resumed his seat and his talk of Mt Albert. We are most interested and intrigued about Labour’s member-to-be, David Shearer. He is not a member yet, but we are looking forward to the Labour Party’s new defence policies once he is sworn in. We are presuming that those policies will be about privatising defence, subcontracting defence, and doing an efficiency audit. I think Mr Graham Scott is quite intrigued and looking forward to doing a bit of work on behalf of the party opposite because previous papers from Mr Shearer are very, very interesting, and, perhaps, point to a whole new direction under the so-called leadership of the Hon Phil Goff. We look forward to that.

I also note, and it should be on the record, that the best shearer is already in Parliament.

Iain Lees-Galloway: Oh, that was on your Twitter the other day!

CRAIG FOSS: Yes, it was. I thank the member; I have found a follower. The best shearer is Colin King, a champion New Zealander shearer. But with all due respect, I look forward to meeting the new member.

The economic naivety and the Budget naivety of the previous speech is quite fascinating. This Budget, which I hold in my hands, is a fantastic Budget. I have spoken on it a few times, and on the bills in and around it. It is the “Road to Recovery Budget”. It is in blue. It is a blue-covered Budget, and how long we have waited for that. Unfortunately, it is full of red ink from the previous administration of 9 years, which was full of misspending, misappropriation, unaccountability, and good photo opportunities. At the end of the day, they cost hundreds of millions of dollars. The public noted this, and last year on 8 November they booted the previous administration out for those various reasons.

These are extraordinarily tough economic times. It is a once in a sixty year co-ordinated recession around the globe. At least our Minister of Finance, the Hon Bill English, has put together a structure, a plan, to help ease New Zealand through and to avoid the sharp edges of the recession. It is working; that is right. I contrast that with the Labour leader’s comments in the New Zealand Herald recently. His plan was basically to cross his fingers and hope we get through the recovery.

Hon Member: Rubbish!

CRAIG FOSS: Yes, it was noted in the New Zealand Herald that he wanted to cross his fingers and that, hopefully, New Zealand would not suffer too badly, or something along those lines. That quote came hot on the heels of his giving two fingers to the credit rating agencies, and that showed his naivety and lack of nous in terms of how important the upgrade was and how important at least maintaining our credit rating post-Budget was to New Zealand families, New Zealand workers, and New Zealand jobs. If that particular member’s policies had been followed through, we would have a new “Goff tax” that would be about 1.5 percent on interest rates, which would cost about $650 million in this economy per annum. I say well done to Mr Bill English for the Budget that we have. New Zealand has already applauded it, and New Zealanders understand that some of the decisions and prioritisations had to be made in this very, very challenging environment.

I note that up until this time over $1.5 billion of personal tax cuts has been shared by New Zealand under this new Government—$1.5 billion. To help small to medium sized enterprises and most employers in New Zealand to ease them through this recession, $500 million per annum is now out there. When I hear those somewhat unusual speeches from the other side, I say to them that there is actually $2 billion helping the economy through this recession.

I have some quotes from the other side about the recession, but I would like to go straight to the superannuation fund. The fear that is being portrayed out there by the other side, in the various confused press releases and speeches, is something I think we should have a look at. Superannuation entitlements are unchanged—66 percent at 65 years. Working for Families entitlements are unchanged. All benefits are unchanged.

Hon Steve Chadwick: For now!

CRAIG FOSS: There they go again; they just do not seem to get it through their heads. We noted that the speech Mr Goff thought he was going to give post-Budget was not the one that was going to work. He had convinced himself that all these things were going to happen, but that just shows how off the mark he was. I have a couple of quotes from Michael Cullen’s first reading speech when the New Zealand Superannuation Fund legislation came in. I note that some members call it the Cullen fund, and a fund that has lost over 30 percent to 40 percent of its value—probably $6 billion or $7 billion over 9 months—is a fund that I am quite happy to call the Cullen fund under that measure. I also note that a certain former member wrote to a newspaper asking that it be called something along those lines. I quote the previous Minister of Finance, from the Labour Government’s first speech on the introduction of the Superannuation Fund: “Should a Government decide not to contribute at the required level reported in the Budget and Economic Fiscal Update, the Minister will be required to include in the Fiscal Strategy Report an explanation for the departure.” There is no problem with that. Right back then the person who set up and designed the fund, and who negotiated with officials and various agencies, acknowledged the fact that the fund should be paid out of cash surpluses, full stop. Right here in the previous Minister’s first speech on the New Zealand Superannuation Bill, he talks about any reasons for departure and the processes that should be followed if, in fact, full contributions cannot be made. He also outlined the process for partial contributions to be made. So those somewhat deluded members who have been saying that this situation is something new and that contributions to the Superannuation Fund should not be suspended in any way, shape, or form—in fact, that we should borrow to fund them—should go back and look at the previous Minister of Finance’s speech on it.

I note—and this is particularly important—that “Where the Government of the day decides to pay less than the required contribution to the fund, it will be required to pay in at least sufficient funds to provide for the current costs of the New Zealand superannuation entitlements in that year.” That is a pragmatic reflection that superannuation is actually paid out of cash. It is “pay as you go” and earn as you go, and it is paid out of cash. Previous speakers have given statistics about how much the Superannuation Fund would contribute to New Zealand superannuation entitlements 10, 15, or 20 years out, but right here the previous Minister of Finance—the person who put this construct in place—puts paid to all the accusations from the other side, because he allowed for and described the methods by which any contributions could be pulled back, held, or made less. Here is a very interesting quote from the same Minister’s questions and answers when he was launching the fund. The question on the Beehive website was: “Can’t the Government borrow when the future cost of NZS rises?”. Here is the answer: “If the government tried to borrow to cover the rising cost, it would have to look at permanently-escalating debt, which is clearly unsustainable.” That answer was from the previous Minister of Finance. Good grief!

I go back to the Budget. I point to page 1 of the Executive Summary of the Budget, which is the key point of the Budget. I am talking about permanently escalating debt. If we look at this graph, we see that the blue line shows debt if the policies of the previous administration were to continue. The black line is the figures—the statistics—from the Budget as read by the Minister of Finance recently. That gap between the lines is the credibility gap of the previous administration. If we did not have a Budget like the one we have right here, New Zealanders continue to leave in droves and we would continue down the OECD rankings. The graph shows debt reaching 70-odd percent of GDP without the Budget 2009 policy response; under this Budget the debt is at about 36 or 37 percent of GDP, and we have a credit rating hold—in fact, an upgrade—from Standard and Poor’s. I cannot emphasise enough the importance of that credit rating upgrade to New Zealand now and in the future, and to New Zealand’s ability to raise the funds to get us through this recession. We do not necessarily want to borrow the funds, but we have to in order to get us through this recession. This Budget gives one of the best funding tracks—debt tracks—in the OECD.

Finally, perhaps there is a bit of a turn in New Zealand’s slide that it has been sliding down for the last 10 years in the OECD. This is a most excellent Budget. Let us wait and see how it pans out.

Hon CHRIS CARTER (Labour—Te Atatū) This Budget, which this House has just passed—not, of course, with the votes of the Labour Party and other Opposition parties—fails to address the critical issues that face New Zealand. These are issues like jobs, with 1,200 New Zealanders every week losing their jobs. It also creates deaths by a thousand cuts. These thousand cuts are taking place in virtually every Government department. The last 9 years saw a Labour-led Government that did amazing things in this country. There is not one area in this country, from housing to conservation and education to health, that was not enhanced, expanded, and developed, and that was not innovative, cutting edge, and about building a stronger New Zealand, an interesting New Zealand, and a New Zealand where people were proud to live and proud to go out of our country and say that they come from New Zealand. This is a country that is cutting edge in social policy, cutting edge in economic development, and cutting edge in environmental issues.

Opposition members think back to the jobs that they had in Government. I think back to the ministerial portfolios that I had. The Department of Conservation, which I was privileged to manage for 5 years as Minister of Conservation, has had $54 million cut out of its programme. I think the Department of Conservation is the most beloved agency in this country. It manages one-third of our nation and looks after the protection of our unique biodiversity. It has had $54 million cut out of its budget.

I think of Enviroschools. I was lucky enough to be Minister of Education for about 14 months until the last election. Education in New Zealand is among the best in the world. Our schools feature incredibly highly in any OECD scoring. In the Programme for International Student Assessment for all 15-year-olds our students are top in the English-speaking world. The programmes that are taking place in our schools are amazing. Educationalists from all over the world come to look at them. A whole host of these programmes have been cut in this Budget.

We heard during the election campaign from National that it was on an education crusade. What has this crusade involved? Well, it has involved discredited national standards in primary schools. League tables for 5-year-olds are ridiculed all over the world among leading educationalists, rejected in the UK, and rejected in the US, where Bush’s No Child Left Behind programme has been discredited.

This is the great crusade on education of Mrs Tolley, the new Minister of Education. We must not forget, of course, her wonderful cutting out of healthy foods from schools! Thirty percent of New Zealanders face obesity. There is a growing obesity epidemic among our teenagers. The contribution of Mrs Tolley—a woman who has herself battled obesity and undergone radical surgery to deal with it—is to bring in a new regulation that throws out the healthy foods and lets schools sell Coke, lollies, and pies. The message we give to schools is that junk food is OK, yet 40 percent of New Zealand teenagers face obesity. This is the crusade on education!

Today in the House during question time we learnt about what was not part of the crusade on education. Children with severe physical disabilities are having their funding cut. I say to members of the House that that is part of National’s crusade on education. We learnt from the Associate Minister of Education, Mrs Roy, that these poor, most vulnerable pupils, who are very severely physically disabled, are losing all their funding. We also heard that this coming week is the week for acknowledging and celebrating gifted and talented students. It is a week to acknowledge the special needs of gifted students in our schools. What has happened to their funding? We learnt today that that has been cut as well. That is part of the crusade on education that we heard so much about from the National Party in the election campaign.

We have also heard this week about the funding for Enviroschools. Twenty-five percent of New Zealand schools are Enviroschools. That money has completely gone. That is part of National’s crusade on education. What was so important about Enviroschools? New Zealand has such a strong reputation as an environmentally conscious country. Children have had amazing educational programmes and amazing learning programmes happening in schools around environmental education. Last year as Minister of Education I visited over 300 schools. I wonder how many Mrs Tolley has been to in the last 6 months; I doubt whether it is even 30. I went to over 300, many of them Enviroschools. The learning programmes—in which children were learning about nutrition, about measurement, about biology, and about cooperative learning—were incredible. They were cutting edge. Educationalists came from Chile, Britain, and the United States to look at our Enviroschools programme because it was considered cutting edge in the world. But the money for it is gone.

We heard a lot in this House last year about funding for information and communications technology in schools. I was asked lots of questions as Minister of Education. What has happened to the funding for professional development for information and communications technology? Strangely enough, that is gone as well in this Budget. That is part of National’s crusade on education. What about the programme extending higher standards across schools?

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

Hon CHRIS CARTER: It is a pleasure to resume the debate as we discuss this year’s Budget. The Budget, which I explored at length before the dinner break, shows that the so-called crusade in education that we heard so much about from the National Party before the last election has turned out to be just $35 million for private schools. Cuts have been made to programmes for physically disabled children and information and communications technology in schools. The Fruit in Schools programme is now at risk; the Enviroschools programme is gone; and the information and communications technology development programme that we heard so much about before the election from the National Party is now gone. The Extending High Standards in Schools programme has also gone. During the election campaign we heard so much about extending standards in education, but that programme is gone; it has been cut. It was a fantastically successful programme that explored best practice between schools. It was a chance for schools to share their successes with other schools, to build up the professional competence of teachers, and to develop a better educational outcome for our students. That has all gone in the so-called crusade for education that we heard so much about.

I have been promoted from education to foreign affairs, and I would like to—

Hon Bill English: Demoted!

Hon CHRIS CARTER: I heard the incredibly successful Mr English. He is the man who in the 2002 election got 20 percent support. He said that I was demoted from education to foreign affairs. Well, if that is a demotion, I think lots of us would like such demotions. I was very proud to be the education spokesperson—

Hon Darren Hughes: He knows all about demotions.

Hon CHRIS CARTER: Yes, that is right. Was he not once the leader and he got 20 percent of the vote in an election campaign? He is such a success himself.

I was delighted to be Labour’s education spokesperson, but I welcomed the challenge of foreign affairs. I am very interested to see that Mr Key will be travelling to the Pacific on the annual Pacific trip in a few weeks’ time. He will be visiting four countries in 3 days. That must just about be a record. I guess it also shows the commitment that he and his Government have to relationships with the Pacific. Our Minister of Foreign Affairs, Mr McCully, will not be accompanying him, and I think that is just about a first. I went with our previous Prime Minister, Helen Clark, on her Pacific trip in 2004 when I was the Minister of Conservation. That trip took over a week and a half. We spent about 4 days in Papua New Guinea, a country with which we have an important relationship. It was a country where we spent quality time developing a whole series of linkages in aid, conservation, education, and so on.

In speaking of aid, I point out that New Zealand has had a proud record in its engagement in the Pacific. Mr McCully, Mr Key, and their mates in the National Party have changed all of that. They have absorbed NZAID back into the Ministry of Foreign Affairs and Trade. Unlike the 14 countries in the OECD that have made poverty alleviation their primary aid objective, those National members have made economic connections their primary focus. There is not a single country in the OECD that has that as its primary function of overseas aid, because aid is about helping one’s neighbours, it is not about making a cheap buck or anything like that.

I am ashamed of what Mr McCully is doing in foreign affairs. Our country was a small country but a proud country in the world. New Zealanders could go anywhere in the world and say “We come from New Zealand”, and people would say “Nuclear-free; didn’t involve yourselves in the Iraq War.” It was a country that we were proud to be citizens of; we were proud of our actions as an international player. Indeed the promotion of our previous Prime Minister to be the head of the United Nations Development Programme is a part of the tribute that the world has paid to New Zealand. What sort of pride do we have now in a country that has reduced aid, that has made aid just an arm of business—what a surprise—and a country whose Prime Minister can visit four Pacific countries in 3 days? That is something we will change when we regain Government in 2011.

Hon CHRISTOPHER FINLAYSON (Attorney-General) What a second-grade contribution that was from a second-grade member! That member was so useless he was booted out of conservation and then booted out of education. It will not be long before the new whiz-kid from Mt Albert takes over from him in foreign affairs.

I have listened very carefully to the various contributions to this debate in the last 2 sitting weeks, and what a contrast there has been between the Labour members and the National members! The Minister of Finance has delivered a forward-looking Budget. It is a Budget that is well suited to the current economic climate; it is a Budget for all New Zealanders. Labour members cannot handle it. They are so blinkered by bitterness and partisanship that all they can do is criticise and moan. They are as inherently negative in Opposition as they were in Government. I have a message for members opposite. I say they should rejoice that National has picked up the ball after 9 years of failure. They should rejoice that we no longer have a Minister of Finance who is a charlatan. They should rejoice that the country is back on track.

As my most excellent colleague from Coromandel, Sandra Goudie, said in this House recently, Helen Clark and Michael Cullen duped the country by proclaiming themselves to be competent, conservative managers of the economy, but in reality they oversaw a litany of failures. They spent while the going was good, and failed to prepare for tough economic times. However, Labour has no solutions now. Its only proposal is to spend, spend, and spend. Labour’s only solution to rising debt is to put more on the credit card. Kiwis are worrying about making ends meet, and all Phil Goff can do is promise billions of dollars of additional spending. This is not the time for extravagance; it is a time for fiscal prudence, common sense, and maturity.

Labour members cannot work out why they lost the election. Well, I will tell them why.

Hon David Carter: I’ll tell them.

Hon CHRISTOPHER FINLAYSON: I say to David Carter to leave it to me; I will tell them. Labour members are elitist and they are out of touch with the worries of ordinary New Zealanders. Not even a trip to Blackball with Phil Goff and a half-pint of Mac’s Sassy Red could reconnect current Labour members with the once-proud tradition of that party. It is a shadow of its former self. It is bereft of ideas, bereft of leadership, and bereft of purpose. [Interruption]

Hon Darren Hughes: I don’t say stupid things like that.

Hon CHRISTOPHER FINLAYSON: All I can say about Mr Hughes is that I can understand why he is so bitter today. It is because in two elections he has gone from rising star to has-been. Today he has seen Nathan Guy sworn in as a Minister of the Crown. Mr Hughes will rot in Opposition while Mr Guy enjoys a distinguished ministerial career. My best advice to Mr Hughes is to retire now and go back to primary school.

I say to Mr Hughes that there is so much good news in this Budget that one does not know where to begin, but I will start with the arts portfolio. I am really pleased to be the Minister for Arts, Culture and Heritage in a Government that actually cares about the arts; all that Helen Clark ever did was leech off the arts sector. Key artistic and cultural organisations get a boost of $10.5 million over the next 4 years. Creative New Zealand will receive an additional $1.7 million a year. That extra money will support music, dance, and theatre companies so that they can continue to provide New Zealanders with cultural experiences. The Royal New Zealand Ballet will receive an extra $3.4 million over the next 4 years. This funding will help to protect one of New Zealand’s most valuable cultural assets during the economic downturn.

Hon Darren Hughes: Will the Minister be performing?

Hon CHRISTOPHER FINLAYSON: For the benefit of Mr Hughes, let me tell the House that one of the things I have noticed is that Labour members do not turn up to arts functions any more. I think that the free tickets have probably dried up and it would be beyond their wit to actually pay for a ticket. Labour members spent the first half of the year scaremongering about National cutting funding for the arts. What a nasty shock it must have been when the Minister of Finance actually gave the arts an eight-figure boost!

Stuart Nash: What about regional museums?

Hon CHRISTOPHER FINLAYSON: What was Labour’s response to this? Steve Chadwick accused the Government of slashing the regional museums budget by $20 million, and I heard Mr Nash say something similar in an interjection just a few seconds ago. It would be a good headline, except that Steve Chadwick was wrong. If she had read the Budget carefully she would have seen in black and white that a largely unused one-off appropriation that she and her colleagues signed off on had returned to baseline. But I do not want to dwell too much on that mistake, as one should never ascribe to malice that which can adequately be explained by incompetence; there is a lot of incompetence when it comes to the new arts spokesperson for the Labour Party. I received a copy of a letter that she has written to various interest groups. This is the way that she signed off a letter on 21 May. Members should listen to this: “I look forward to hearing from you on behalf of your sector, organisation or personal commitment to the Arts, Culture and Heritage.” That is a letter from the new spokesperson for the Labour Party on arts, culture, and heritage. She cannot even write in English. We are doing great things in the arts, and we can be very proud of what, under the guidance of our inspired Minister of Finance, we are continuing to do.

This Government is also delivering in the area of Treaty negotiations. The Budget includes an extra $22.4 million over the next 4 years.

Paul Quinn: How much?

Hon CHRISTOPHER FINLAYSON: I say that it is $22.4 million, for Mr Quinn’s benefit. It will help us achieve our goal of settling all historical Treaty of Waitangi claims by 2014. Labour members have gone quiet now because they are ashamed of their record in Government, and so they should be. The extra money will allow the Office of Treaty Settlements to conduct more negotiations faster. It will provide additional resources for extra facilitation, and mediation assistance to claimant groups. Meeting that settlement goal is positive for New Zealand, and it will do great things for the local economy.

I am working very hard to fix the shameful record of the previous Government. Michael Cullen’s frantic year in the role of Minister for Treaty of Waitangi Negotiations did not make up for the lack of action on the part of his predecessors. Mark Burton and Margaret Wilson should be disgusted with themselves. Their legacy is a blot on the entire Treaty settlements process in our country. In Helen Clark’s 9 years at the helm, she was never as engaged in Treaty settlements as John Key is. When we signed three agreements in principle with Te Tau Ihu iwi earlier this year, someone commented to me that it was the first time a Prime Minister had come to a signing of an agreement in principle since the 1990s. I met with a group in Palmerston North recently. The last time it had a meeting with a Minister for Treaty of Waitangi Negotiations, it was with Doug Graham in late 1999. Thereafter, there was nothing. Those former Ministers’ record is atrocious and they stand condemned for their shameful behaviour in this portfolio. We will remedy the wrong.

Never before has there been such a comparison between members of National and Labour. We are positive; they are negative. We are forward-looking; they are visionless. We stand for aspiration; they stand for envy. We stand for ambition; they stand for mediocrity. What a hopeless bunch! This Budget has been a resounding success. It is a prudent, responsible Budget for difficult times, and all one can say to Bill English is: “Well done.”

HEKIA PARATA (National) Tēnā koe e te Mana Whakawā. Huri noa i te Whare i tēnei pō, tēnā koutou, kia ora tātou katoa.

[Greetings to you, Mr Assistant Speaker, and to you collectively throughout the House this evening, greetings to us all.]

I am delighted to stand and to follow the honourable Minister.

Hon Member: You should be!

HEKIA PARATA: I am delighted, and I know that I will not be able to reach the height that he was able to achieve in his address to us this evening. Nevertheless I will do my best, in honour of the resoundingly successful Budget that this Minister of Finance has delivered to Aotearoa New Zealand. He has navigated through the difficult circumstances of an extremely tough recession by recognising that a number of factors had to be balanced in the delivery of this Budget. We had to focus on how we might soften the sharp edges of the recession for the most vulnerable people in New Zealand, while investing in sustainable growth to support the jobs that are necessary for the future of New Zealand. We also needed to ensure that the debt burden that will be carried by this country is sufficiently lightweight, in the circumstances, to continue to attract the international regard that this country relies on. The first response we received after the delivery of this Budget was the assurance that it had indeed met those three requirements.

This Budget reflects the experience, the subtle touch, and the deft analysis of a finance Minister who understands what is required by New Zealand. He understands that there can be increases in a number of areas of the Budget, but, unlike the Opposition, he understands that they are required to be funded not simply in the year that we are operating, but also in the years ahead of us. We are as concerned for this generation as we are for the generations that follow, and commentators on this Budget have seen the wisdom of the way that this Minister of Finance has put together those requirements. What response did we get from the Opposition in a time of vulnerability, and in a time when people are concerned about their jobs, their livelihoods, and the long-term prospects of their families? What did we get? We got scaremongering about superannuation instead. The Opposition was scaremongering in relation to the most vulnerable sector of our society: the older people of New Zealand. Instead of joining with this Government, respecting the wise construction of this Budget, and showing New Zealanders that at this time they could trust in leadership from this Parliament, the Labour Party gave us mischief-making and the low muckraking of members opposite.

We have had to spend time instead reassuring superannuitants that they can rely on getting their pension. We have been able to assure educationalists that when we talk about raising the standards of literacy and numeracy in our country, their schools will be supported to do so. We have indicated, as the Minister for Treaty of Waitangi Negotiations indicated, that we are prepared to back our commitments by ensuring that we fund them. We do not have some pie-in-the-sky idea—

The ASSISTANT SPEAKER (Eric Roy): I am sorry to interrupt the member, but the time has come for the Minister of Finance to speak in reply.

Hon BILL ENGLISH (Minister of Finance) It is only the Standing Orders that prevent me from graciously yielding to the member, in order for her to continue her outstanding description of my qualities and those of the Budget.

Hon David Parker: I raise a point of order, Mr Speaker. My understanding is that the Standing Orders do not prevent the Minister from yielding to the previous speaker, and we have no objection to him doing so.

The ASSISTANT SPEAKER (Eric Roy): That is not really a point of order.

Hon David Parker: It is very much so a point of order. The Hon Bill English said that the Standing Orders prevented him from yielding to the previous speaker, Hekia Parata. I seek your ruling as to whether that is correct.

The ASSISTANT SPEAKER (Eric Roy): In theory, I guess the member is right, but the member cannot seek for someone else to yield. In that respect, the Hon Bill English has the call.

Hon BILL ENGLISH: I think that that is typical of the quality of the contribution the Opposition has made to the Budget debate. I would like to be standing here saying that in the absence of Dr Cullen, the level of contribution from the Labour Party has continued with the same insight, acid wit, and vigour that he maintained, but I have to say, somewhat disappointingly, that that is not the case. In fact, we have in the Dominion Post today probably the best description of Labour’s efforts in its first 6 months in Opposition, and in the Budget debate. On the top of the editorial is the heading “Labour soiled by its own muck”. For all the Labour Party’s clever politicking, all it has achieved is to remind the public about the dirty-tricks Labour Party. It was the party, when in Government, that took us all through last year with Owen Glenn. It was the previous Government that passed the Electoral Finance Act, and then spent the last dying gasps of its life clinging to Winston Peters, who had broken every rule in the Electoral Finance Act. It is the dirty-tricks Labour Party, whose former MP is on trial in a court today, having been defended by Labour’s previous illustrious leader for about 2 years, and by the now front-bench spokesperson on finance when he was the Minister of Immigration, who oversaw the whole scam. Today this is just one small reminder to them that they have not changed, they have not apologised, and they have not contributed anything that matters, but they have taken up a lot of time in Parliament just because they are the Opposition—“Labour soiled by its own muck”.

When will those members realise that the public has rejected their mix of dirty, clever politics, reckless economic management, and political correctness? I thought there were only two elements, but there are actually three: dirty, clever politics; reckless economic management; and an overdose of political correctness. Actually, I know the answer to the question. Well, they are never going to apologise until they remember one thing, which is that they lost the election. We can tell from here in the House that they still think there is some kind of visual aberration. Perhaps there is just a large video screen with a mirror in it that means they are on the Opposition side of the House and we are on this side. But Labour lost the election, and that was—I ask members to listen to this—before New Zealanders really understood how important economic management was going to be. Imagine if we had had the election in March when they really knew it would matter. David Cunliffe would have lost his seat. He almost did even in the good times under apparently the best political leader the country has ever seen, who actually got thrashed by the least experienced leader the country has ever had. John Key thrashed Helen Clark, and again David Cunliffe almost lost his seat.

Hon Darren Hughes: Most unsuccessful man in politics! Worst leader in a hundred years, Bill English.

Hon BILL ENGLISH: Well, who is winning now?

The Budget was a measured response to difficult circumstances. The fact is that the global recession has come on top of an economy that was already in recession, and it was already in recession because of the mismanagement of the previous Government. It is a myth that all our problems started in September last year; that is not correct. The fact is that under the previous Government the growth in our economy had become particularly unbalanced. It was driven in the first place by excessive borrowing in the household sector, and in the second place by excessive Government spending. We need to shift the balance of this economy from borrowing, consumption, and reckless Government spending, to investment, exports, and careful Government spending. The Budget does not complete that job; the Budget only starts that job.

There are a number of key features to the Budget that I think are important to re-emphasise. The Government had two objectives. One was to protect people from the sharpest edges of recession. I know that that has disappointed Labour members; they would rather see hundreds of thousands of people suffer so that a political point could be made to justify all their pre-election scaremongering. That is another reason they are losing public support. Many of the people who voted for them now realise that the things Labour members said about National were wrong—dead wrong. We have protected the most vulnerable, as my colleagues have pointed out. We have maintained entitlements across the board and we have maintained, and in fact increased, public spending. We have increased the investment in infrastructure; at the same time we have set out to enforce long-term fiscal control. So in the short term the Government is maintaining spending through the bottom of the recession—that is, we are preserving and supporting jobs while we put in place the first steps on the long road to recovery. The second part of the equation is just as important: the Government must gear up so that this economy can come out of the recession at some speed.

One of the measures the public are going to apply to the recession is the number of people unemployed. They do not really apply the measure of GDP; they know the economy is getting better when their jobs are secure and when the unemployment number is coming down. We are willing to do almost anything to offer to people who have lost their jobs the hope that they will get another one, and they can get another one only on the day that a business is confident enough to invest a bit more and employ another person. There is no other way. We can do what we can to keep people connected to the world of work, to give them the opportunity to get the skills they will need for a recovering economy, but in the end it is business, the tradable sector of the economy, that will provide sustainable jobs. So our longer-term programme is going to be focused on an improved investment environment, less red tape, better infrastructure, and a much more responsive Government.

The Budget debate has been a disappointment, because Opposition members have had so little to contribute. They seem to be the last 27—how many is it; 32, or something—people in New Zealand who seem to believe that nothing has changed, and that every civil servant is doing a very effective job, which is not right, and that every public dollar they put in a year ago is being used well, which is simply not the case.

This is a common-sense and balanced Budget, and it is important to note that the New Zealand public have reacted to it in a very pragmatic way. They know that times are tough; they know that the Government has had to make some decisions that will help to put us on the long-term road to prosperity.

I thank our coalition partners who have supported the Government through this Budget process, and who are demonstrating to the public that the Government has the confidence of the House. I look forward to working with them on the next Budget.

The ASSISTANT SPEAKER (Eric Roy): The question is that the amendment in the name of the Hon Phil Goff be agreed to.

Hon GERRY BROWNLEE (Leader of the House) The House has made very good progress this evening on a range of things. We are literally a few minutes away from the time at which the House is scheduled to rise; accordingly, I seek leave for the House to rise early at this point.

Mr DEPUTY SPEAKER: Leave is sought for that purpose. Is there any objection? There is no objection.