PETER BROWN (Deputy Leader—NZ First) : This debate was broken off into urgency so that the Government could push through the Future Directions (Working for Families) Bill. New Zealand First supported that bill, principally because we believe there are a number of families in this country that are suffering and need some financial help. However, we did not agree with the process. We believe that the bill should have been sent to a select committee, where it could have been examined in detail, and, in all probability, it could have been implemented a good deal earlier. But nevertheless we supported the bill, although we have reservations about whether the Government has done its homework correctly.

Jill Pettis: Oh, Peter!

PETER BROWN: The Government has been known not to do its homework, and I think the Holidays Bill was a good example—although it did go to a select committee.

However, some of the concerns we have about this Budget are significant. A principal one revolves around the elderly in this country—the people who fought for this country in the war. Very recently the Prime Minister and a number of other people went across to Monte Cassino to commemorate the battles over there. Subsequently, the Prime Minister went to Normandy to commemorate the D-Day battles during the Second World War. Many of the elderly, many of those folk who actually fought in the war, are now suffering some financial hardship. Many of them are in rest homes, and the rest home organisation was recently before the select committee to explain how hard up its members are and how financially pressured the industry is right now. One has to infer that it will have to cut costs. Rest homes have not been reimbursed for the holidays legislation. They have not been reimbursed for the cost of giving employees the extra holidays that the Holidays Act demands—something between 2 percent and 3 percent. The Government has passed the legislation and withholds the funding for the rest home people.

The elderly in this country will face some significant financial demands on them very shortly. The price of electricity is likely to go up by quite some degree. Motoring, a small pleasure, is likely to cost a good deal more, and that will affect transport costs. On top of that, this Government is about to implement legislation that will stop those elderly from being able to have a smoke at an RSA club. That is absolutely disgraceful.

Another concern we have about this Budget is that it has not identified at all—and I know that my colleague has spoken on this—the need this country has for more police officers. We have approximately 180 police officers per 100,000 of population, and that is a very low ratio. Ireland, I think, has a figure in excess of 300 officers per 100,000 of population, and the difference is that our violent crime is going up—

Hon Judith Tizard: It is not.

PETER BROWN: The Minister over there shakes her head. It has gone up 13 or 14 percent since this Government came into office, whilst in Ireland it is going down. We are very concerned about policing in this country. Almost daily the police are given an extra task. We heard the Minister of Immigration, in answering a question this very afternoon, say that the police would take care of the issue. It weighs heavily with New Zealand First that we are not looking after our police force, which we demand should look after us.

We are concerned that there was nothing in this Budget to address and assist the shipping industry. The shipping industry in this country is in dire straits—and that is not a piece of water! The shipping industry in this country is suffering. We have the ridiculous situation that section 198, I think it is, of the Maritime Transport Act allows a foreign vessel, which can come from anywhere, to go to any port in this country to pick up coastal cargo, but a New Zealand - operated vessel that is chartered has to get a permit. If a New Zealand company charters a vessel manned by New Zealanders, and wants it to go off the beaten track a little bit to pick up cargo, it has to get a permit. Sometimes that takes weeks, if not months. Yet a foreign operator can come down here and cruise into any port whatsoever. But has the Government done anything about it? Not a brass razoo—nothing. The Government implemented a shipping industry review, I think 4 years ago, which said that New Zealand shipping needs some assistance. In 4 years it has done nothing. I think it is shameful that the Government has not addressed the problems of the shipping industry. It has not done one thing at all.

I hope the Government recognises that New Zealand First is a non-aligned political party. Because we are critical of the Government does not mean we will not, or will, be in coalition with Labour after the next election. I tell the members over there that we will let the voters speak before we make up our minds.

I heard the other day on the Linda Clark show, Nine To Noon, the new leader of ACT, Rodney Hide, espousing his view. On the same programme was Dr Brash. Dr Brash and Mr Hide—it has a certain Robert Louis Stevenson ring about it; both profess to be economic whizz-kids, so I am expecting them to come up with Treasure Island! But what do I hear from Mr Hide? That he is no longer the perk-buster! I want him to go out on a high. I want him to address one more perk, and I will tell him what it is. I want him to tell this House and the country what it cost those ACT people to fly around the country, stay in their accommodation, and use their taxi chits; I want him to tell us the cost of that one perk. Then he can go out on a high. I urge Mr Hide to do just that—to tell the country what it cost for the ACT party to appoint its new leader.

I want to tell the National Party members, who say they could not go into coalition with us because of Mr Peters or something else—

Katherine Rich: Who said that?

PETER BROWN: Don Brash made some such comment. I tell him that we will not go into coalition with anybody who wants our troops fighting in Iraq without the appropriate UN resolution. So National members will have to rethink their position.

However, having said that, I am quite encouraged by what Don Brash said, and I have here the transcript of what he said. He was talking about road funding, which is close to my heart: “What we are saying is at this stage we should be funding a part of our capital expenditure on hospitals, and schools, and prisons, and roads.” That is what he said. He must be aware that road funding comes from road-user charges, petrol taxes, and registration; None of it comes from the tax take that is taken from the general public. That was said in a debate he was having with Linda Clark on the tax rate in this country. So it encourages me, despite what Mr Williamson said, to think that a National Party Government would refund back to the motorists the excise tax that it robs them of.

MIKE WARD (Green) : During the recent adjournment I popped into my local supermarket on a number of occasions for a little retail therapy. I enjoy shopping for food. I particularly enjoy shopping for New Zealand food. I “buy local” because my money is much more likely to find its way back into the pockets of other New Zealanders. Also, I buy local food because buying fresh, local, and in season produce reduces the energy content in my food and helps to lessen my contribution to global warming. My tastes are not particularly exotic, and provided that I steer clear of processed food it is not too difficult to find local alternatives, although it pays to ask where stuff comes from, because, although some produce comes with little stickers on it telling us where it is grown, without those stickers the garlic, oranges, tomatoes, or capsicums could come from just about anywhere, and frequently do.

Once I move a little way away from the fresh produce, however, and into the cans, bottles, pottles, plastics, and packets, “buying local” becomes much more difficult. Not only is the country of origin, local or foreign—if it is there at all—in the fine print, but there is frequently precious little indication of where stuff comes from, and precious little local stuff. Although it distresses me greatly to see local companies moving their manufacturing off shore, whatever their products may be, it particularly distresses me that in a nation with a reputation as a food producer, overwhelmingly, the products on our supermarket shelves are imported or made from imported content. Familiar brands are no guarantee of local product. Wattie’s, Oak, Sealord’s, and many other New Zealand brands can, and frequently do, come from somewhere else. Although I may not agree with the arguments for manufacturing appliances, motorcars, and dinner sets somewhere else in the world, I cannot accept any rationale for supermarket shelves in a food-producing nation having little or no local product and such an overwhelming array of foreign fodder.

Nor can I understand why Governments would collude with producers who wish to hide where their products are made. I understand that a Government that has gone as far down the free-trade road as this one is not about to stop people from buying imports. I do not disagree with that. However, I am surprised at the Government’s reluctance to indulge in a little old-fashioned encouragement and make some attempt to market the notion that buying New Zealand products can be synonymous with buying quality. As well as it being one way of increasing incomes and employment levels in New Zealand, it is also something that all New Zealanders could so easily contribute to.

Sourcing more of our needs locally is also an important step in reducing our contribution to global warming. This Government is to be commended for its willingness to sign up to the Kyoto Protocol, and for embracing transport reform, but the Kyoto Protocol and transport reform alone, as important as they are, will not secure my grandchildren’s future. Although New Zealand is probably as well placed as any country in the world to survive the perils of the 21st century, we ought not to settle for mere survival, or fail to do all we can to avoid a likely doubling, and possibly quadrupling, in carbon dioxide levels this century, or the consequential weather extremes, sea-level rises, water and food shortages, or desertification and inundation. It is our behaviour and the behaviour of people like us that threaten not merely our future but the very capacity of the planet to sustain life.

Although the Government is not silent on these issues, very modest budgetary and legislative measures—like a campaign to persuade us to spend more of our money on local products; like waste legislation that puts teeth into the Government’s waste strategy—would enhance the quality of our own lives and improve our economic performance, improve the quality of our environment, and set an example to the rest of the world. Are these measures inconsistent with the Government’s intentions? I would not have thought so, but I fear that by the time Governments have begun to take the necessary steps to avoid disaster, the changes will already be irreversible. Can a country with a mere 4 million people make a difference on a planet with 6 billion people and growing? It will certainly make a positive difference for New Zealanders, and our children and grandchildren will not thank us for doing nothing.

NANDOR TANCZOS (Green) : I would first like to acknowledge some of the good things in this Budget for, in particular, students. I want to draw attention to the moves by the Government to raise the parental income threshold, which has not been adjusted since the student loan scheme was introduced in the early 1990s. I congratulate the Hon Steve Maharey on introducing that parental income threshold adjustment, and on the fact that from now on it will be inflation-adjusted.

But there are other changes in relation to students that we in the Green Party are not so happy about—in particular, the removal of the provision that treats married people as having independent circumstances from their parents. We understand that this was an attempt by the Government to address the issue of discrimination on the basis of marital status, but we believe that it was a roundabout, back-to-front way of addressing the problem. In fact, the real discrimination, as we see when we look at the student allowances, is actually the discrimination against people under the age of 25. There is an assumption that they are not independent of their parents. That age-limit is totally anomalous in terms of any legislation or regulation that I can think of.

The other recent issue that has arisen has been in relation to the fees of international students. For example, I understand that a Waikato University graduate student who enrolled in 2001 for 4 years is currently affected by an increase of more than 50 percent due to fee increases, inflation, and other factors, according to Sandy Pushpangalam, the President of the Waikato Student Union. The Greens have been warning the Government about an increasing reliance on international students since the passing of the Tertiary Education Reform Bill. We believe that it is a real problem, because it is putting increasing pressure on institutions, resources, placements, and things like that. Although some may say it is a good idea to raise the fees of international students, the real problem is that it is simply unfair that international students who come to this country to study have absolutely no certainty about what the cost of their study will be over the course of their degree, or whatever their qualification is.

So the New Zealand University Students Association is running a campaign on grandparenting. This is something that we strongly support, and we urge the Government to look seriously at this issue, because it must be seen as fair that students who come to study in this country should have some certainty about the cost of their full term of study. We accept that fees can rise for new students, but people who are here need to have some certainty, and we hope the Government might listen to that concern.

The Greens have been saying that we do need more investment generally in the tertiary education sector. We believe that staff salaries are not comparable with international levels, and that will be an increasing problem for this country. There is increasing pressure on the resources, as I have already mentioned.

Also, the issue that we like to highlight again and again is the issue of the student allowance, because we know, from going around the country and talking to people, that the student loan scheme is impacting on this country significantly. Rural communities are telling us that it is becoming harder and harder to find professionals to practice in their areas, because people cannot pay the high fees that those professionals need in order to pay off their student loans. We know about the brain drain. Young people have always left this country to get some overseas experience, but it seems that more and more of them are going overseas and fewer and fewer of them are coming back.

We know that it is becoming harder for young people to start up a business, because of the impact of the student loan scheme on their getting credit. We know that young people are finding it hard to raise mortgages. The Real Estate Institute says that the number of New Zealanders owning a home has gone down from 73 percent to 65 percent in recent years. We suspect that the student loan scheme affects fertility; childless couples will become the most common family unit within the next 3 years, according to Statistics New Zealand. Dr Ian Pool has described the punitive loans scheme as “probably the most anti-natalist measure ever put into legislation by a New Zealand Government”.

That is something that we should be taking seriously. It is not just a problem for students; it is a problem for our whole country. When we consider that student debt is now reaching $7 billion—over half of that borrowed just to pay for living costs—we believe that the way to begin to address it is to introduce a universal student allowance scheme. The other thing about the student loan scheme is that students are paying 7 percent interest on their loans; this is far too high. We say that the Government must commit itself to a universal student allowance.

Hon TREVOR MALLARD (Minister of Education) : I would like to make some general comments about the Budget, but first I think it is incumbent on members when they are speaking to make sure that what they say has some relationship with the facts. I will take the last comment made by Nandor Tanczos to start with—students do not pay 7 percent interest. The member should wake up, breathe the fresh air, read the papers, notice what happened 4 years ago, and catch up with the facts and then he might be taken a bit more seriously in this House.

I will comment first of all on the beginning of this debate and say how disappointed I was in the first Budget contribution from the Leader of the Opposition. I would have thought that in an area of so-called strength—economic policy—we would have had a delivery that had belief, resolve, information, and some facts behind it. What did we have? We had a tired old delivery from a ditherer who really supported the Budget but knew he could not quite say so. He sort of knew that the form was to oppose the Budget, even if he believed in it, but he could not even put his heart into opposing it.

What did he do after that? He wandered off to the United States. He told them that the nuclear policy would be gone by lunchtime, he thought.

Simon Power: Come on!

Hon TREVOR MALLARD: Maybe he did not say that, but he will not say what he said. Did he dither again? The only question I have is this: which of National’s policies comes first, its industrial relations policy, or its pro-nuclear policy? The importance of the ordering, for a lot of New Zealanders, is vital.

Hon Paul Swain: Gone by lunchtime.

Hon TREVOR MALLARD: If he abolishes lunchtime, he will never get around to doing the other policy. That is what I understand the current debate is—National is not really dithering about the nuclear policy, it is industrial relations. Will National abolish lunchtime, or not? That is what we on this side of the House want to know. One of the National members shakes his head, and one of them nods. That just shows the divided National Party. There are three National Party members in the House—one shaking his head, one nodding, and one looking stupid. What an approach from the National Party. Mr Assistant Speaker, I will make it quite clear that I did not count you in that group at all, because I would not bring you into the debate.

Then, after the Leader of the Opposition had 2 weeks off to prepare for his first question back after the adjournment—about question No. 3 yesterday—he went to sleep. He was asleep in the House for the third question. He did not take the call. He needed the puppeteer Mr McCully in behind him to pull his strings—

Simon Power: Come on! That’s against the Standing Orders.

Hon TREVOR MALLARD: No, it is not. One can refer to members being advised and led by other members, and he was led along on a string by Mr McCully the puppeteer.

The ASSISTANT SPEAKER (Hon Clem Simich): No.

Hon TREVOR MALLARD: There is a long history in this House of not being allowed to accuse people outside the House of manipulating members, but it is quite clear, and anyone who has seen television can see, that the Leader of the Opposition is a puppet on Mr McCully’s string.

The ASSISTANT SPEAKER (Hon Clem Simich): I understand that, but I think it is a disparaging remark to call a member of the House a puppeteer. Please continue.

Hon TREVOR MALLARD: I would have thought it would be more disparaging to call someone a puppet, rather than a puppeteer. But I will move along and say that maybe there needs to be a ring through his nose so that the Leader of the Opposition can be led in a way that is a bit better. One thing that Dr Brash has to know is that if he is to perform in this House, he has to stay awake—at least until he has asked his question. I think that is a vital approach. For the first 10 or 15 minutes of question time it is incumbent on the Leader of the Opposition not to go to sleep. He might find it boring. He could have a siesta after his lunch before he comes down to the House. He could have a snooze and get some advice from other members of the House as to appropriate times of the day to sleep so that he can be in peak performance condition to come down here.

We have to keep on writing notes up every time National changes its leadership, and I do not think we want to do it anymore. We are quite happy with the Leader of the Opposition that we have at the moment. We do not want the leader to change, and we would like to give him some advice in this area—when one comes down to the House, even if one has not been involved oneself, one should have a look at the Order Paper to see whether one has a question. And if one does have a question—

Hon Richard Prebble: Did he know he had a question?

Hon TREVOR MALLARD: I do not know whether he knew he had a question. It depends on whether Richard Long wrote it or whether he did—I do not know. But in this case, one should look at the bit of paper and if it says “Question No. 3 Dr Don Brash”, one stands up and asks it when the Speaker says: “Question No. 3, the honourable Dr Brash.” It is a pretty simple lesson. He does not need Sandie Shaw to tell him how to act in that particular circumstance. It is a great song, and I hear that Sandie Shaw’s song, sung with no shoes on, will be the theme song for the National Party at the next election campaign. In fact, if those members do not play it, we will at a number of their meetings, I am sure.

I do want to say a little bit more about the Budget and how it is good for families. It is good for families and good for the economy. It is a fiscally prudent Budget. It is one where a lot of care has been taken. I think it is fair to say that the Minister of Finance looked carefully at the money available for spending without increasing debt, and he made some calls in that area to get the money to where it was needed the most. This has been done in a number of ways, including improvements to early childhood education, about which I will say some more.

Tertiary education will become more affordable, benefiting more than 36,000 students. I know that the National Party voted against that and did not want it to happen, but it will happen. We have doubled the number of publicly funded major hip and knee replacement operations. Again, mainly because the National Party hates older people, its members voted against extra operations for older people. When we get on the hustings again next year, we will remind Grey Power and the senior citizens groups that National members opposed extra hip and knee replacement operations. That is the approach of the National Party. That is fair enough; those members do not care about old people, they are not their priority, and those members do not think older people should have their operations, but I wish they would stand up and say so.

I want to make just one comment about early childhood education. I want to thank Sue Thorne for her support of the increases in the childcare subsidy and in the number of working families eligible to get it, and I want to thank the Dominion Post for its glowing editorial on that area. The average private sector early childhood centre receives $140,000 extra over 4 years as a result of this Budget; the average community centre receives only $50,000. I know that there is unevenness there and that I am being criticised by community centres for not giving them as much on average as we are giving to the private sector centres, but I think it is quite a well-balanced package and that what will happen is there will be a lot more people with real choice as to whether they work. This is a good Budget.

KATHERINE RICH (National) : I will concentrate my Budget speech on Vote Child, Youth and Family Services, and the half a billion dollars that this country spends on the Department of Child, Youth and Family Services in a given year.

This department has been in the news constantly in the last 12 months. I am not suggesting that running the department is an easy task or that solutions are easily implemented, but I will say that this Government has not managed the department well, and in the last 12 months we have seen the Minister struggling with the job and making mistakes regularly. There have been some high-profile problems and mistakes. One that members will remember was the Minister releasing over a thousand names, locations, and caregivers of over 1,000 children in the department’s care. That was just one mistake—

Hon Trevor Mallard: I raise a point of order, Mr Speaker. This has been subject to a personal explanation in the House. The member is now doubting the Minister’s word, which was given to this House as part of the personal explanation. That is a breach of the Standing Orders.

KATHERINE RICH: Speaking to the point of order, I was not doubting what the Minister had said, but I think it is a statement of fact to say that the information surrounding the names, locations, and caregivers of over 1,000 children in the department’s care was released. That is a statement of fact.

The ASSISTANT SPEAKER (Hon Clem Simich): The Minister took it as an inference referring to him. A personal explanation has been made, so we will move on.

KATHERINE RICH: Making changes to the Department of Child, Youth and Family Services is not just about pouring more money into the department; it is about providing a clear vision for the department, and that is where this Minister has failed. Over a period of time a pattern has developed in the way Ruth Dyson has handled her portfolio. The pattern is one of deceit, mismanagement, and—I suggest—cover-ups. An issue was raised by my learned colleague Deborah Coddington—

Hon Trevor Mallard: I raise a point of order, Mr Speaker. To say that a Government is following a pattern of deceit is a reflection on all members of the Government, and is clearly out of order.

The ASSISTANT SPEAKER (Hon Clem Simich): I thought the member was referring to the department. Were you referring to any member in this House?

KATHERINE RICH: I was referring to the Minister.

The ASSISTANT SPEAKER (Hon Clem Simich): I will simply ask you to withdraw that comment, please.

KATHERINE RICH: I withdraw that comment. What I will lay out over the course of my speech is something that relates to that statement. I think that what we are seeing is a pattern of mismanagement and cover-ups, and I think that is a debating point. It is not a breach of the Standing Orders, I would have thought, and I seek your clarification.

The ASSISTANT SPEAKER (Hon Clem Simich): No, that is fine. You may proceed along those lines, but words like “deceit” you will not use.

KATHERINE RICH: An issue was raised by Deborah Coddington relating to the Glenelg Health Camp. Ms Coddington was concerned about some interventionist medical procedures that were conducted on some of the children in that health camp during the years 1983 to 1985, so she started to do quite a bit of homework on that subject. Those girls were examined without their parents’ consent, and they were extensive and invasive examinations. The Minister was repeatedly asked questions about that particular case, and repeatedly she has either refused to answer those questions or, in a rather cute fashion, has been technically correct in some of her answers, but somewhat economical with the truth.

Hon Trevor Mallard: I raise a point of order, Mr Speaker. One cannot accuse a member of being economical with the truth.

The ASSISTANT SPEAKER (Hon Clem Simich): No. It is tantamount to accusing the member of lying, so please withdraw.

KATHERINE RICH: Regardless of the fact that that statement has been used a number of times in this House, I withdraw.

The ASSISTANT SPEAKER (Hon Clem Simich): Just withdraw.

KATHERINE RICH: I withdraw. The Minister has not been forthcoming with the full information relating to the Glenelg Health Camp. Ms Coddington did her homework on the subject. She made Official Information Act requests and asked questions. From Annette King, she was given documents from only 1993 onwards. Funny that, because allegations were raised about this case, starting from at least 1989.

When I asked a question of the Minister, the Minister came back and said the question would take quite a bit of collation and answering, and she refused to do so. She would not ask the department the question because, frankly, I suspect she did not want to know the answer. It is quite a compact subject and would have been on the file, and—as far as I know—the department does not keep its files in Antarctica, even when they are archived. They are easy to get at and refer to. But the Minister did not want the department to do the work, because she knew it would uncover the fact that her own colleagues had an involvement in this sorry tale.

Ms Coddington also made an Official Information Act request of Ruth Dyson on 16 March, seeking documents relating to Glenelg. To date, she has had no response to that request at all. As far as the Government is concerned, the Glenelg complaints did not exist prior to 1993, and Ministers have done all they can to point the finger at National during its time in Government. [Interruption] Ruth Dyson stood in this House and told members that.

On 20 May I asked the Minister some questions. She went back and said that she would at least look at the archives this time, but that was 1 month ago, and still we have had no answer to any questions relating to the Glenelg Health Camp. I stood in this House and asked the Minister when the former Department of Social Welfare and its Minister first became aware of the allegations regarding medical examinations without parental consent of children at the Glenelg Health Camp. It was a pretty straightforward question I would have thought.

The Minister looked smug and said: “According to the available files, …” it was in National’s time. I then asked another question about whether any recommendations had been received by the former Department of Social Welfare about the ethics of carrying out these internal examinations on girls without parental consent having been received. The Minister said: “… despite extensive searching of the available records …”, there was nothing.

I then asked a further question about whether the former department and Minister had considered any recommendations that allegations that staff presumed that every child had been sexually abused should be investigated. The Minister said: “The only record of correspondence … that has been made available to me …” was a letter from—surprise, surprise—a National MP in 1993. The Minister firmly stated: “I have checked the file.”, and she stuck by her assertion that the first allegation was when National received the complaint in 1993. Apparently, as far as it was aware, the Labour Government had nothing to do with the Glenelg Health Camp.

On this side of the House, we think those carefully worded answers about seeing records that were “made available” are an attempt to hide the real situation. The Minister has tried to be cunning, when she should have told the real story. She might argue that her answers are technically correct, but they are not totally correct, because Labour was in Government when those first allegations were made. I can only conclude that she is covering up for her senior colleagues, because guess who was the Minister of Social Welfare at the time the first allegations were made?

Opposition Members: Who?

KATHERINE RICH: Dr Michael Cullen. And guess who was the Minister of Health at the time those allegations were made?

Opposition Members: Who?

KATHERINE RICH: Helen Clark. At the time when overly zealous Christchurch health workers were diagnosing sexual abuse all over the place, two key people in Parliament—the Minister’s own colleagues—were in charge. The Minister knows full well that the first complaint did not come in 1993 to a National Party Minister, but to a former Minister of Social Welfare, Dr Michael Cullen, and no amount of mealy-mouthed duplicity will get the Minister off the hook. National does not believe that the Minister—

Hon Trevor Mallard: I raise a point of order, Mr Speaker. The word “duplicitous” has been ruled out of order on a number of occasions in this House, and my view is that the expression the member used is so close to that as to be the same.

John Carter: If the member had referred directly to a member, then the Minister who raised the point of order would be correct, but it was a general comment that has been accepted on many occasions, and it should be allowed to stand.

The ASSISTANT SPEAKER (Hon Clem Simich): I thank the member for raising that. Mr Carter is quite correct—that is the way I take it.

KATHERINE RICH: National does not believe that the Minister is not aware that the first complaint was well before 1993. We do not believe that the Minister is not aware that the first complaints were handled by her own colleague Dr Michael Cullen, and we do not believe that she has not been told of, or at least had hinted to her, Labour’s involvement in this sorry tale. It does not make sense. Allegations were made about children treated between 1983 and 1986, and the Minister did not check to see whether Labour had any involvement while in Government? Come on, that just does not make sense!

The Minister has some explaining to do. After first telling Opposition members that she was not prepared to get the Department of Child, Youth and Family Services even to look at it, she has now had it at least look over the archives. But it is now 1 month down the track since we had the answer to that written question, and still we have not had our questions answered. One cannot say that the Minister has not had enough time to look at the files—it was 1 month ago.

We know that Ruth Dyson is covering up for her colleagues. She knows full well the Labour Government received those first complaints. She knows full well it was the Minister of Social Welfare, Dr Michael Cullen, who received those first complaints. How she cannot have asked for a full brief on the Glenelg Health Camp case is impossible to imagine. No Minister being asked questions in this House about the Glenelg Health Camp in the last few months or so would have stepped in without asking for a full brief.

She may think she is being particularly clever with her answers by saying that she has looked at available files. Time and again she has said that she has extensively checked the files, and checked records that are on those files. If she has done that, she will know that the first complaint was not in 1993, under a National Government, but in 1989, when two of her senior colleagues were in charge of quite significant portfolios. She does not want to answer those questions, because she knows now that she has painted herself into a corner, and that she will have to backtrack from previous comments she has made in this House.

LYNNE PILLAY (Labour—Waitakere) : I have a message for all New Zealanders: they are better off under a Labour-led Government. This is a Government that delivers, that is committed to growth, that is committed to providing the best start in life for our younger citizens, and that is committed to creating job opportunities through training, apprenticeships, and support for businesses. It is committed to investing big time in health right across the spectrum, and is committed to fairness and opportunity for workers through fairer labour laws, fairer health and safety laws, and paid parental leave. It is committed to safer and affordable housing, to safer communities, and to security for our citizens in retirement. This Budget will take New Zealand ahead. It is good for families, and good for the economy. It is a Budget based on growth and opportunity, and it will assist New Zealanders into work and make work pay. Budget 2004 helps low and middle income families by lifting family support and family tax credits, by changing the abatement levels for family income assistance, and by replacing the child tax credit with a large in-work payment for working families. It is about providing fairness and security to low to middle income families, and enabling them to provide the best opportunity for their children’s start in life.

This Budget includes extra investments in education and health. There are big improvements for childcare—the rates of subsidy will increase significantly, with many more families now being eligible for the subsidies. There has been another dramatic improvement in early childhood education, with another $365 million to be invested over 4 years. Labour is continuing to make tertiary education more affordable. From next year we will spend another $110 million on student support, which will benefit 36,000 students. We will double the number of knee and hip operations. There will be more State houses, and better living standards for New Zealand families. Half a billion dollars will be spent over the next 4 years on strengthening our already good economic performance. The spending on economic development, tourism, research, and trade promotion has increased by over 25 percent since this Government took office, as opposed to the hands-off, laissez-faire approach of the previous Government. Industry training, Modern Apprenticeships, and expansions to the Gateway programme are all increasing under this Government—another major success story. The scrapping of the Apprenticeship Act by National, and the drop in skill levels for over a decade, was a crime.

This Budget is affordable and fiscally responsible. Under this Government, we will have another guaranteed $2.1 billion go into the Superannuation Fund, which will look after those of us who are 50 now—something that members on the Opposition side of the House cannot guarantee.

Simon Power: Surely not! You’re not 50!

LYNNE PILLAY: I know many members on the Opposition side of the House are 50, but there are a few over here on the Government side, as well. We know, as a Government, that investing in people pays, and that is what we are intent on doing. If what we are delivering for low to middle income earners was done under National’s tax-cut regime, we would have a taxation regime of 9.5c in the dollar. That is even less than ACT’s crazy policy. The question is this: what would go under National? What would get cut? Would it be health, education, superannuation, training, housing, or law and order? The answer is that it would be the lot. The greatest investment that we are making is in people, and when our families package is fully in force, more than a whopping 60 percent of working families will be an average of $66 a week better off.

Over its two terms, this Government has focused on providing long-term guaranteed funding that provides a strong and an effective public health service. All up, nearly $10 billion will be spent on health in the coming year. That is a whopping 20 percent of our total Government spending. We will not go back to the 1990s, when the care of New Zealand was handed over to the free market and Kiwis’ health suffered. That philosophy has not worked anywhere else in the world, and it certainly will not work in New Zealand. Affordable primary health-care is growing all the time. At the moment, one in four Kiwis gets cheaper health-care as a result of that. That number will continue to grow. From October 2003, all 6 to 17-year-olds enrolled in primary health organisations in New Zealand were funded to receive reduced-cost health-care, and from 1 July that will be extended to over-65-year-olds enrolled in primary health organisations. They will get low-cost health-care and will pay only $3 for prescriptions. That is good news. As well, twice as many hip and knee replacement operations will be performed in the next 4 years. That will enable over 9,000 New Zealanders each year to regain their physical independence. Once again, that is an example of investing in people, and of how that pays and is to the benefit of all New Zealanders.

We are also continuing to fight P. We are allocating another $39 million over the next 4 years, including another police team to bust P labs. Let us wait, because there is more! In terms of family violence, we are setting aside nearly $15 million over 4 years for the creation of four family safety teams, which will provide a collaborative approach to dealing with family violence issues.

We have heard the bleating from the Opposition side of the House and the silly claims, like the tired old dancing Cossacks routine. That is so old-fashioned. It did not strike a nerve; it struck a sense of humour. I like a party that can laugh at itself and at its tired old ideas—a party that can dredge up the tired old dancing Cossacks routine and present it as if it is somehow credible. We know that National’s credibility is zilch, in terms of ordinary New Zealanders. We know that the claims that those members will deliver on a lower tax-rate regime are simply untrue. We know that cutting spending on training and apprenticeships, and cutting support for workers, did not pay off. We know that that party is floundering, and that it is going back in time with its leader. National is being led to the sad, old rhetoric of the past; it cannot help itself. It has not presented one new idea—not one! It has not presented any policy. Why? Because it does not have any. Every time that National members murmur a bit of policy, they get a reaction to it from the populace and they think: “Yeech! That doesn’t look too good. We’ll back off, and we’ll change our minds.” National members may laugh, but they are panicking.

This Government is delivering. We are delivering to all New Zealanders. We are proud to do so, and we are not a joke.

SIMON POWER (National—Rangitikei) : I must say it is very odd for the member who is resuming her seat to finish her Budget speech by saying that the party she belongs to is really not a joke. The Labour Party says it is really not a joke, as one of its members finishes one of the more powerful contributions to this Budget debate. What a flop this Budget was! New Zealanders all around the place are asking us about the Budget, and saying they do not know anything about it. At the Feilding sales, farmers have been coming up to me and asking when the Budget is due, and I have been telling the local folk not to worry, because the Government is about to spend $21 million on telling them what it did—or tried to do. I have told people they will get a postcard very shortly in their mailbox, with a nice smiling picture of Helen Clark and Trevor Mallard on the front, telling them—

Hon Trevor Mallard: No, I won’t be on it.

SIMON POWER: No, I say to the Minister, I would not be on it, either. This is an absolute flop of a Budget, and the Government is spending $21 million on publicity. This Budget was to be the circuit-breaker. It was to be thing that would make the difference between Labour languishing in the polls, behind the leadership of Don Brash, and projecting itself back into the game. What happened? Nothing! Not a blip! There was not one single response in the polls—not even a blip on the landscape.

This Budget has been a complete flop. There was $6 billion at stake, by way of a surplus, and for the fifth year I have sat and listened to a Budget in which not one word of thanks went to the people who provided that surplus. The farmers and exporters of New Zealand did not get one word of thanks from Michael Cullen. I have sat on the Opposition side of the House and listened for the fifth time to that Minister of Finance deliver a Budget, without even having the courtesy to thank the hard-working farmers and exporters who provided the Minister with the ability to redistribute their taxation dollars in what is clearly an attempt to buy support. The hard-working farmers of New Zealand actually provide wealth, jobs, and boosts to the economy, unlike the 19,000 extra State-sector public servants we see piled into the Wellington area. The State sector is now the biggest commercial tenant in Wellington, and there are 19,000 more people in the Public Service Association. What is more, there are 324 peoplein the Tertiary Education Commission, and the Ministry of Education is overflowing with people. The Ministry of Health is overflowing with bureaucrats. I tell members that we need fewer grey suits in Wellington, and more people who will go out and create wealth and jobs, and make a real contribution to this economy.

I turn now to defence, where I want to make some comments about the recent deployment of Kiwi troops to Afghanistan. I was absolutely appalled to read on the front page of last Saturday’s Dominion Post that: “Kiwi troops were rushed to Afghanistan not knowing what their job was, and had poor maps, equipment, training and communications.” The report went on to state: “From the start it was not clear what the mission was.” The report stated further—and this is the most telling comment in the article—“Political decisions were made before all options were explored.” We all know what that means. It means that those troops were deployed in order to cover up for the complete debacle the Prime Minister got this country into by her rash statements about US presidents, and what could or would have occurred had another particular candidate won the presidential election. But the newspaper report also went on to state that there were problems with reconnaissance, planning, communications, logistics, training, and equipment— that coming from a Prime Minister who is quite happy to parade around the world, to attend commemorative wreath-laying ceremonies willy-nilly, but who is not even getting in behind and resourcing the people who allow those types of commemorations to occur in the first place. This Budget showed a reduction in capital spending, and in respect of defence spending. The Minister of Defence and the Prime Minister should back up their world travel and their commemoration-attending rhetoric by properly resourcing our defence forces, before they are deployed to cover up for messes that the Prime Minister had made in her own foreign policy gaffes.

One fascinating thing did come out of this Budget, and it was that the days of the so-called triangulation of the political landscape in New Zealand are all over. What the Budget did was to realign the Labour Party back to its roots, as a party of redistribution. It is a party that churns taxpayers’ own money, and then pretends to hand it back to them as if it were a gift from the Government. It is interesting that 60 percent of the people polled in this country preferred a taxation cut, rather than Michael Cullen writing out a cheque on their own money, and giving it back to them in a way that makes them feel particularly reliant on the Government. In fact, Budget day was a sad day for the Government. On the night of the Budget, Government members returned to this House after the Holmes poll had shown that only 20 percent of New Zealanders believed that the Budget was a success—only one in five. That just happens to coincide with the number of families that actually got anything out of the Budget—about 20 percent, about one in five. The other four out of five families, or 80 percent, said there was nothing in the Budget for them. They said they just happened to be the people who had provided the taxation income that produced the money for Michael Cullen to splash around.

National is about aspiration, ambition, and less government. It is not about more government, or about having 19,000 more bureaucrats in Wellington. The National Party is about letting people get on with their lives, not about creating middle-class welfare dependency. If the Government did believe so passionately in its Working for Families package, why did it wait? Why did it not simply just put the package in place, and get on with it? Members on the Opposition side of the House, of course, saw the same thing with the 4 weeks’ annual leave provision, as well. There is no conviction behind those policy statements from members on the Government benches. All that the Government is doing is creating an environment whereby an election would trigger those policies coming into effect. We on the Opposition side of the House say that is cheap, cynical politics. If Government members had the courage of their convictions, those packages would be coming into place in year one, not over 4 years, or in 2007. What happened to the target of the Minister of Education and the Prime Minister to have New Zealand back in the top half of the OECD? That has gone; it is finished. That is the end of that. Apparently we cannot win elections by promising to return to the top half of the OECD, as Dr Cullen has found out. So what did he do? He decided he would use the hard-earned taxation dollars of the agricultural and farming exporters of this country to redistribute some wealth around the place and buy off some more votes, over a 4-year period, after the 2005 election.

What does the Budget really mean? My colleague John Key has done some outstanding work in revealing to the New Zealand public exactly what is going on. A family on $38,000 will get a net income of $42,860, compared with a family on a gross income of $60,000, which will net $45,236 and end up with only $2,300 more in the pocket than the family on $38,000. That begs the question of what the point is of working harder. What is the point of being more ambitious? What is the point of having aspirations to better oneself and one’s family, if this Government cripples one at the first hurdle by saying that there will be no benefit in working hard? This Budget is a flop. The Government’s policies are flopping in the polls. National will be ready in 2005.

HELEN DUNCAN (Labour) : Budget 2004 is a great Budget. This Budget will take New Zealand forward. This Budget is good for families, and it is good for the economy. I can tell Simon Power that all New Zealanders benefit from this Budget, because this is a good Budget, economically. It is a prudent Budget and a fiscally sound Budget, and every New Zealander benefits now and will continue to benefit from the sound, prudent fiscal management of this Government. The economy has never been in better shape. The Opposition knows that; so does the country.

This Budget is all about growth and opportunity. It provides half a billion dollars for growth and opportunity—that is right. That is what New Zealand wants to hear. This Budget is about getting New Zealanders into work, and making that work pay. New Zealand knows that the National-led Government, in its 9 years in office, was not interested in getting New Zealanders into work. There was hugely high unemployment. It was not interested in making work pay, because wage rates went down and down through the 1990s, and the working people of New Zealand know all about that.

This Budget is about getting New Zealanders into work, and making that work pay. It provides for lifting family support and the family tax credit. It improves abatement levels for family income assistance, and it replaces the child tax credit with a large in-work payment for working families. These are all things that will benefit the families of New Zealand. I am proud to say that this Budget is about richer communities, not about richer individuals.

This Budget makes significant extra investments in education, health, and housing. I will mention just a few highlights: there are improvements to childcare; tertiary education is more affordable, benefiting more than 36,000 students; there are double the number of publicly funded major hip and knee replacement operations; and extra assistance for housing will mean another 1,054 State houses next year and improvements to a further 856. These are issues that this Labour Government believes in and cares about.

What would the National Party do? It is rather hard to know, because it does not have a lot of policy. The only policy the National Party talks about is tax cuts. Do tax cuts work better? Well, cutting individual taxes spreads the money too thinly. The ones who benefit the most are the ones who are the most well off. The higher one’s income, the more one benefits from tax cuts. Of course, the Opposition knows all about that. It looks after its mates who are the ones who are all well off.

The Working for Families package beats tax cuts any day of the week. The Working for Families package will boost the income of working families more than any tax-cut package ever could. People talk about the polls asking people whether they would rather have a tax cut or whether they would rather have extra family assistance, and they say that people always opt for the tax cuts. I want to know whether they are asked whether they would rather have $38 in tax cuts, or $155 in income assistance, and then see what sort of an answer would be given, and it would not be the $38. The Working for Families package boosts the income of working families. Tax cuts are not the solution for working families struggling to raise their children. Tax cuts are a blunt instrument and put the most cash back in the pockets of those who need it the least.

I shall give an example. A two-parent, single-income family with four children that earns $55,000 will gain an extra $150 per week from the Working for Families package. Tax rates would have to reduce to a flat rate of 9.5c in the dollar to boost that family’s income by the same level. I challenge the National Opposition to tell New Zealanders that it will reduce the tax rate to 9.5c in the dollar, because we know that it will not. Often families do not pay enough tax for tax cuts even to deliver equivalent benefits that the Working for Families package will deliver. This Budget is not about rewarding rich mates, as the Opposition wants to do. It is about providing fairness and security for low and middle income New Zealand families.

The Budget provides for significant extra investments in education and health. It makes big improvements in childcare. The rates of subsidy will increase significantly, and many more families will be eligible for that subsidy. As well, the Budget also signals another dramatic improvement in early childhood education, investing another $365 million over 4 years. Education is a big winner from Budget 2004. Provision is made for an extra $206 million over 4 years for primary and secondary education in the Budget. There is an extra $365 million over 4 years for early childhood education. This Government is delivering on its commitment to lift education standards for all young New Zealanders, by injecting extra funding of $2 billion over 4 years into education, bringing total spending to $9.2 billion by 2007-08.

Our commitment to the compulsory education sector continues, with extra funding of $206 million over 4 years, which includes an extra $92 million over 4 years for schools’ operational grants. Between 1999 and next year, an additional $226 million in operational funding alone will go to schools to assist them to deliver quality education for their students. In real terms, that is a per-student funding increase of 10 percent.

The Budget is a landmark Budget about educating young Kiwi kids. As I said before, we are investing new funding of $365 million over the next 4 years in early childhood education, bringing the total annual funding, by 2007-08, to approximately $660 million. That is a real commitment to those young children, who are the future of New Zealand and where the research proves that the investment will do the most good. From the middle of 2007, 3 and 4-year-old children will be entitled to 20 hours free attendance per week at a community-based early childhood education service. That is a significant step; it is fantastic. It is about extending the tradition of free early childhood education from kindergartens to other community-based centres. We have had that free early childhood education in the kindergarten sector, but not in the other community-based centres, and I am absolutely delighted with that. Having been a worker in education, I know that that investment in those very young children will yield the greatest return.

Budget 2004 marks the start of a new era for early childhood education in New Zealand. It is the first major change in funding for early childhood education since 1989. This major new investment means that by 2008 this Government will have increased its investment in early childhood education by 79 percent since 1999. That is a real indication of the commitment this Government has to the youth of New Zealand and to our New Zealand families. We really care about education, and providing a quality education for all New Zealanders and all New Zealand families. Budget 2004 is a great Budget for the working families of New Zealand, and I am proud to be associated with it.

BRENT CATCHPOLE (NZ First) : I am proud to take a call on behalf of New Zealand First on this Budget. I shall touch on three main topics—namely, housing, biosecurity, and internal affairs. The Government stated that the key priorities within Vote Housing were to “increase the supply of state housing particularly in Auckland”; to “finalise and implement a New Zealand Housing Strategy, review the Residential Tenancies Act 1986, continue to meet housing needs in rural areas, and continue to improve the state housing stock.” I shall look at those points a little more closely.

Firstly, I shall look at increasing the supply of State housing, particularly in Auckland. The Budget states that in 2004 and 2005 the capital injection will include a further $30 million to acquire additional State houses in Auckland. That is commendable, we need it, but it is not enough. The population drift to Auckland, combined with the open-door, unchecked immigration policy of this Labour Government, continues to outstrip all the efforts to cater for Auckland’s housing needs. The increasing pressure and demand in Auckland places huge demands on the housing stock of Housing New Zealand, and that flows over into rental properties, pushing up both the cost and rental of houses.

The second point is to “finalise and implement a New Zealand Housing Strategy”. I want to know what that actually means. Does it mean, like most Labour policies and promises, with regard to policy statements, that “we will get around to beginning a study into housing needs soon”? That is what the Government has done in most of the other policies when it has come out with such vague and open-ended statements. It should get on with it now. New Zealand First says to get on with it now. The Government’s housing policy is desperately in need of upgrading, and New Zealand certainly needs much-improved housing stock.

The third point is a review of the Residential Tenancies Act. The Government should not bother tinkering with that Act; it should just get on with the rewrite. I know that the Minister has put out a statement that he intends to begin a review, commencing on 1 July, of the Residential Tenancies Act. Here we go, again. The Government is about to commence another review soon, and that is another example of allowing legislation that is before the House to drift on. Why bother with the amendment—just get on with the complete review and get it over with.

Let us look at the fourth issue: “continue to meet housing needs in rural areas”. The Budget states: “The Corporation”—that is Housing New Zealand—“also works with communities to ensure that their housing needs are understood and the most effective intervention is used to meet them and that this can be sustainable over time. These interventions funded through capital contributions are essential elements in meeting Government housing priorities and goals.”

Again, the effort in this area is not meeting the real needs of the rural areas, which is just adding to the urban drift, mainly into Auckland, compounding the pressure on low-cost housing in the Auckland and Manukau City areas. Auckland City housing is reaching a desperate situation. An example of the failings of this Labour Government is in the rural area of the far north, another area that the Government has forgotten, where there are 20,000—and I will say that again: there are 20,000—substandard dwelling houses that people are living in. The new Building Bill that is before the House at the moment has the potential to force local councils to review their situation and to ensure that those dwelling houses are substantially upgraded, or evict the occupants. [Interruption]

This is not a desirable outcome and needs to be addressed urgently. Clayton Cosgrove does not care about these people. His comments show that this Government, and he in particular, does not care about the desperate plight of those people in the far north—in the rural areas that the Government claims it wants to help. He does not give a damn about those people. Clayton Cosgrove can keep on not caring, because soon we will be taking his seat on that side of the House.

Let us look at the fifth point: “continue to improve the state housing stock”. This is a huge ask on any Government, now or in the future. This is compounded by the need to ensure current housing stock is up to standard to provide the necessary comfort and needs of the tenants, plus to rebuild the housing stock depleted so savagely by the National Party when it was in Government. National simply sold the stock to property investors, instead of offering the houses to the tenants with assistance to help them buy the house, which would have reduced the demand on Housing New Zealand stocks. Less than 20 percent were offered to the tenants. That is a disgrace.

R Doug Woolerton: Some of their members bought a few.

BRENT CATCHPOLE: Yes, there we go. Where was the sense in that, other than to buy favour with the property investors, many of whom live overseas? Labour and National are guilty of this because they have both continued to sell off New Zealand’s assets. Labour does not like to be lumped in with National, but Labour is guilty as charged because it continues to sell off New Zealand’s assets to foreign ownership.

Why has the Government made no-go zones? Why are there blacklisted areas for beneficiaries, when keeping them in places like Auckland, a high-cost, high-rent, and high-demand area, seems ludicrous? Many of these no-go zones have Housing New Zealand stock empty and available. It seems daft to me, so why create these no-go zones? It is better to have them in areas where there is low cost and low cost-of-living for people.

I would like to quickly touch on biosecurity. The Government has provided significant funds to prevent pests and disease entering our borders, through both policy advice and inspection methods, particularly in relation to sea containers. This is not only desirable but also necessary to reduce the number of breaches. I would like to point out that this Government allocated $90 million to eradicate the painted apple moth in Auckland. However, the programme and the allocation of funds to monitor the health effects of the people residing in the spray zones was woeful, inadequate, and even non-existent for most of the spray period. How does the Government know whether there were any health effects on those people? It does not know, and it does not care. Funding does not appear to be set aside in this Budget for the ongoing checks and inspection of the health regime of those people, because this Government has wiped its hands of them. It is a disgrace.

Let us look at the internal affairs side of things, and in particular the establishment of the Weathertight Homes Resolution Service. This was done in December 2002. There have been around 2,000 claims, and as of 10 June this year 1,848 are currently active. Eight hundred and seventeen have received assessment reports, and only 103 have been resolved. Some determinations are woeful.

Hon MARK GOSCHE (Labour—Maungakiekie) : I apologise for almost missing my call, but I had been put to sleep by the droning coming from the opposite side. It is a proud day for me to stand in this House to speak in this Budget debate. One of the local newspapers in the southern part of my electorate, the Manukau Courier, had the headline: “Jobless finding work”, and stated that the number of Manukau City people on unemployment benefits had dropped 33 percent since 2001. There has been a 33 percent drop in unemployment in one of the parts of Auckland that has been hardest hit by economic reform over the last 20 years!

Manukau City is proud to announce that it has had economic growth of 5.7 percent in the year 2003. That has led to unemployment in Ōtara dropping by 40 percent, and in Māngere it has dropped by 39 percent. It has seen “European unemployment”, as the article describes it, drop by 42 percent. Unemployment amongst Pacific peoples has dropped by 40 percent and amongst Māori by 22 percent. We still have work to do, but this Budget delivers on the growth in the economy to those people who are out there working, and working hard.

This Budget is a Budget for families, and I am looking forward to the election next year and to seeing and hearing all the politicians in this place running around talking about family values and about looking after families. Here is a Budget that does just that. How does it do it? It states that this Government recognises that the hardest time in people’s lives is when they are in families with young kids, and all the costs that go with that. We know that that is a time when people find it hard to meet mortgage payments, or to pay the rent as they save to buy a house. Every single member in this House has been a beneficiary of Government benefits in his or her growing-up period. Not a single member here is young enough not to have known something about that. We used to get a family benefit. The National Party and ACT would have us believe that because our parents received a family benefit at an age when their children were young and needed assistance, we would all become beneficiaries and bludgers. That is absolute nonsense. Not one person in New Zealand will put his or her hand up and say that he or she is a beneficiary or a bludger and that they do not know how to work hard because of that very, very important policy prevalent in New Zealand for many, many years under all sorts of different Governments.

The Budget we are debating here today is good for all New Zealanders. Whether or not they are getting a big lump of money in their pockets as a result of the family support packages, all will benefit from it. We will benefit from it because we are part of a wider community. We will see the young families in our communities prosper instead of struggle. They will be able to pay their rent and meet their mortgage payments. Parents will be able to give their kids a decent feed and put clothes on them. Every member of our community can celebrate that.

One of the other interesting comments made in the Manukau Courier article is that job vacancies in Manukau are hard to fill because of a skills gap. What an indictment it is on the National Government of the 1990s that it forgot to train people for the workforce. National members say they are business friendly, but they forgot all about that. They had mad Bill Birch saying: “We don’t need apprenticeships any more.” So we do not have enough people to build houses any more, or to do the plumbing or the drainlaying. Apprenticeships did not happen because the market forces decided they would; they happened because there was a supportive Government and a system that supported them. Let us look at the Budget. It provides for an additional 500 places on the Modern Apprenticeships scheme. That is on top of the 6,500 modern apprenticeships we achieved by 31 March this year. We would like to do more, but the infrastructure out there is just not able to cope with more. So, to a degree, the Government is hamstrung by the ruination that the National Party wreaked upon industry training and apprenticeships in the 1990s. But we are getting there, and we have other good and excellent programmes.

I want to congratulate the Minister of Education, the Hon Trevor Mallard, who is sitting in the House today. His moves in education over the last 4½ years are magnificent. They are welcome in my electorate, and they are welcome throughout the country. Why? Because every single family in New Zealand will benefit from that extra $206 million going into operational funding and the primary and secondary education system. That means that schools in my electorate can get on and do the job—and they do it regardless of how much the families of the kids in those classrooms earn. It is not dependent on wealth; it is about giving resources to schools, and I am proud to be part of a Government that is spending money where it is needed. For a long time the early childhood sector has been worse than the Cinderella of the education system. For a long, long time educational theory has said that children will not succeed if they do not get a decent start at early childhood level.

Every single member of this House should celebrate the fact that the Minister got $365 million for the early childhood sector. It is shameful that those parties on the other side are voting against early childhood education getting $365 million more. They should explain to the parents of New Zealand families why they are so miserable that they will vote against early childhood education getting that money. It has to go into that area so that kids do not come out at the other end of the education system without a qualification. They are still doing that in far too great a number. We are still picking up the pieces of not having an investment in early childhood education. It is beyond belief that any political party would have the stupidity to actually vote against this measure alone in the Budget; it is such a good measure. That total funding in 2011-2012 will reach $750 million. It should have been there some time ago, but it is happening, it is necessary, and it will pay enormous dividends amongst the people of my electorate where early childhood education has not been a factor for far too many children. I am absolutely pleased that the Minister of Education has been able to get that level of money into that area, and long may it last.

Tertiary education is a big issue. Have we heard speakers on the other side say why they are going to deny, by their vote—well, they will not, but they would if they could get their way—the extra $110 million for student support for the low to middle income families who will actually be able to say that they can afford their young people getting a tertiary education because they will get access to the allowances. Why are National and ACT against that? Why are they voting against this measure for young people from low and middle income families? I would like to ask John Key, who came from one of those families, why he is voting to deny people in those same circumstances a tertiary education. He is the finance spokesperson for the National Party. Why is he voting against low to middle income families being able to give their children a chance to have a tertiary education by having access to a student allowance? We are looking forward to hearing from the National Party as to why it is against education spending for low and middle income families. Why do National members say they should not get it?

As far as housing is concerned, let us remember that when the Labour Party left power in 1990 there were 70,000 State houses in this country. That lot over there sold 13,000 of them and replaced only 2,000, which meant a net loss of 11,000. It is a bit rich that Opposition members say there is a housing shortage for low-income families. We are building more. We are fixing up the ones that did not get maintained. We are increasing the accommodation supplement to families who are not in State housing. This Government is investing well over a billion dollars a year in helping families to afford their housing and accommodation.

Lastly, I refer to transport. There has not been a peep out of that lot over there on transport. Let us look at what we are doing in Auckland alone: we have “Spaghetti Junction”; Grafton Gully has been built on; there is the Greenhithe Deviation—[Interruption] Mr Sowry should listen to this. If the member ever visits Auckland, he will see how many bulldozers there are now in Puhinui, and more are on the way. He should come up to Auckland and see a whole lot more of the projects that will be under way over the next 10 years. We are keeping Mayor Banks, Mayor Curtis, and company very happy with what we are doing, and we are making sure there is a public transport system. Back in 1955 when I was born, 100 million passenger trips were taken in Auckland. At the moment, because of that lot over there, the number is only 51 million.

Hon ROGER SOWRY (National) : That was the member of Parliament who is responsible for the Holidays Act, which the Minister is now struggling to fix up. Mark Gosche chaired the select committee and he made an absolute hash of the holidays legislation. It has been the biggest disaster in legislative terms that this Government has implemented in the last 2 years, and that member—that former Minister—oversaw that piece of legislation. The legislation is a shambles, and Cabinet is now having to fix up the whole mess around the holidays legislation.

Hon Trevor Mallard: What’s it like to be beaten by Darren Hughes?

Hon ROGER SOWRY: I say to the member who is about to leave the Chamber that I hope the Minister sends the holidays legislation back to the select committee. I hope that that member sits on the committee, and this time listens to businesses who come before the committee and tell us what sort of extra costs there are and what a shambles that piece of legislation is.

At this stage, I want to pay tribute to one Cabinet Minister, and that is the Hon John Tamihere. He has been going around the small-business sector and saying that the Government got it wrong. He is saying: “We got it wrong. I wish I had been able to convince my colleagues. It is a mess. I can’t fix it. You have to see the lady upstairs.” At least he is saying the right things. I am not sure whether he is talking about Heather Simpson or Helen Clark, but he is at least saying: “See the lady upstairs and she will fix it.” The business community knows that John Tamihere is at least admitting that the Labour Government got it wrong. I bet he does not say that in his Budget speech, but he is saying it to business people all over the country.

This Budget is a real disappointment. There are so many opportunities and so few were taken. Labour has talked up this Budget all over the country. It talked about the spend-up of billions of dollars—the money that was going to go everywhere, spread like confetti. But in fact it is not the money that is spread like confetti; it is the spin and the publicity. One in five households get something out of this Budget, but the Government deems it necessary to spend $21 million telling people how good it is with its spending. That is absolutely outrageous. It should not be able to get away with that sort of spending.

I want to comment on a couple of things that are not in the Budget. The first thing that is not in the Budget is anything for infrastructure in the energy sector. The whole Budget was read and there was not one word on the energy sector. I was in Timaru last week, and when I booked into the motel, there on the door in the bathroom was a sign. It stated—and I will paraphrase it: “Dear Customer, Transpower have informed us that there may be power cuts at very short notice.”—it is about 40 degrees below in Timaru at this time of the year.—“These will occur between 5.00 and 7.30. Please bear with us. We will try to make such occasions as much fun as possible. For example, candles will be burning in the bar and restaurant area. We will have a fun event like a barbecue.”

Well, I have to say that in Timaru in the middle of winter, not too many tourists front up for the barbecue. It is the sort of sign that one expects to see in Tonga, not in Timaru. That is what we have in this country because this Government has run down the infrastructure—driven it down.

Hon Member: It is warmer in Tonga!

Hon ROGER SOWRY: It is certainly warmer in Tonga. In this Budget there is nothing for infrastructure at all, not a brass razoo. We will see real problems, particularly in the electricity sector, because the Government refuses to show leadership in generation, refuses to show leadership around the Resource Management Act changes that need to be made to have Transpower upgrade the lines, refuses to spend the money to allow Transpower to invest in upgrading the lines, refuses to tell the industry what the carbon tax will be, and therefore is denying this country a long-term, secure energy generation option into the future. That is a tragedy, and businesses will leave this country because of it.

If that were not enough, this Budget does nothing for industry. When Heinz-Wattie appeared before the Industrial Relations Committee, its people told the members of Parliament who were listening—and there is a difference, because the Labour members were sneering—that if they had known that this Labour Government was going to introduce legislation like this, they would not have unbolted the machinery from Australia and brought it to New Zealand to increase their production in Hawke’s Bay.

So we asked them if they had told their local MP. Had they been into Rick Barker, fought through his workload, found an appointment with that busy, busy man who was signing off JP appointments, and told him that the company would not invest in his electorate, given those rules? They said: “Yes”. What did Rick Barker say? He said those decisions were made upstairs.

It is the same with John Tamihere. The Holidays Act is a mess and he giggles away and says: “Ha! ha! I’m sorry, I should have been stronger, but you know, you have to see the ladies upstairs.” What sort of courage is displayed when members of the executive will not take responsibility for their own decisions? Why will they not take responsibility?

John Key: “Swainy and the boys”

Hon ROGER SOWRY: That is right—“Swainy and the boys” being done over by the girls upstairs, and they will not take responsibility for it. What sort of Cabinet have we got when they will not do that?

There is nothing in this Budget for business, at all. There is nothing to make the economy grow. There is nothing to create extra jobs. There is nothing for employment. But even worse than that, there is nothing for hard-working families. Because if a hard-working family in Wellington that has two kids and earns $38,000 a year gross income—the sort of family I used to think Labour cared about—increases its income from $38,000 to $60,000, $22,000 extra in income, it will get $2,300 of that in the hand. Earn $22,000 more, take the promotion, go from being the primary school teacher to the principal, and one will get $2,000 extra!

Hon Mark Burton: Oh dear!

Hon ROGER SOWRY: The Labour Cabinet Minister—I forget his name—but the guy from Taupo, goes: “Oh dear!” He does not care. It is so long since he was on $60,000 that he does not care. But this Budget puts welfare into middle New Zealand families, and it drives the incentive to work harder out of those families. How can Labour be proud of that?

DIANNE YATES (Labour—Hamilton East) : Kia ora. It was very interesting to hear that negative speech. I think when people have very little to say in this House they get louder and louder. It does worry me when I hear empty vessels making a lot of noise.

It is absolute rubbish to say that Labour is doing nothing for business and nothing for farmers. I have heard people on the other side say that, and actually, if one looks back at the history of New Zealand farmers in this country, one finds that they have always done better under Labour. Those members should go and have a look because they are showing their ignorance of history. Farmers have always done better under Labour, and there is plenty of evidence to show that. If you do not believe me, read Mr Keith Sinclair, read Michael King, and read any New Zealand history book that you might like to get hold of.

The ASSISTANT SPEAKER (H V Ross Robertson): Please do not bring the Speaker into the debate.

DIANNE YATES: Sorry, did I say “you”? I am terribly sorry. If the members opposite would like to read a little history, they would find that that was the case. When National was last in power it did very little for farmers. I come from Hamilton, which is in the centre of a dairy-farming area. I cannot think of one constructive thing that National did for farmers in those 9 years. When I look around Hamilton now, I see the Waikato Innovation Park, which came through Labour. I see research being done for farmers that came through Labour. I see a 25 percent increase in money going into our area and going into economic development, and that came through Labour. I would like to see the members opposite stand up and enumerate all the things that they supposedly did when they were in power, because I think Mr Sowry will end up seeing that they did nothing, nothing, nothing.

I go around my local schools, and since we have been in power I see the schools looking really, really good. I see the schools with new coats of paint and new buildings. I see new grants going into those schools. I see operation grants that have increased. I see new shade screens. I see schools in, particularly, poorer areas looking good. I see kids in those schools getting good test results and working very, very well indeed. I thank Michael Cullen and Trevor Mallard for putting the money into our schools, because it is actually working.

I thank Jim Anderton for the money that has gone into the Waikato Innovation Park, and the ideas and the growth that are coming out of our city. I am afraid that I do have ideas. Talking of ideas, I heard Lindsay Tisch, of all people, get up in the House and say that Labour thought so little of business that it did not give any Queen’s Birthday awards to business people. What a load of rubbish! I congratulate Bill McArthur of MacArthur Engineering in Hamilton on getting a Queen’s Birthday honour. He is a business person. What about Ossie James? His actual business is in Lindsay Tisch’s electorate, and Lindsay Tisch said that business people did not get any awards. Where has Lindsay Tisch been? He should take off his glasses. I congratulate Ossie James. Bill Garland from Lindsay Tisch’s electorate got a Queen’s Birthday award, and I congratulate him. Where on earth has Mr Tisch been? He does not seem to read even the newspaper in his local area. Those are business people in our Waikato area who have received Queen’s Birthday awards.

People have also received research grants for their businesses. The Budget provides for another $212 million over 4 years to go into research, science, and technology. That is a 45 percent increase since Labour came into office.

Let us look at apprenticeships. There are now about 6,500 apprentices. When I go door to door, talking to business people in my electorate, what do they say they need? They say they need trained staff. There are now about 6,500 apprentices, and another 500 people will be going into apprenticeships as fast as we can get them there. National has a lot to answer for in terms of the training of young people, and training people for jobs and for industry. After 9 years of a National Government we had a great shortage of apprentices.

I shall refer to the Waikato business awards. I congratulate C F Reese Plumbing on its expansion, on the work it is doing, and on the apprentices it is taking on. Excellent work is being done there. In fact, the top business was a pharmaceutical research laboratory, Stockguard Laboratories. I congratulate that business on the work it is doing. I also congratulate the Government on the work it is doing in supporting those businesses—businesses that in turn support our major industry, our farming industry.

What do we hear from National members? Tax cuts, tax cuts, and more tax cuts. That means those members have not read any economics books for about 20 years. There is no evidence to show that tax cuts improve the economy. All that those members have to do is to look at the history of the United States and their own history to see that that is not good economics.

Also, while we are talking about industry training, I want to mention that the Hamilton careers expo this year is extremely successful. It is on this week. Young people are going through it, looking at new careers, new possibilities, and new opportunities in training. It is the best careers expo the city has had. The parents, the young people, and the people who are displaying—[Interruption]

Those members opposite are rowdy, and they have nothing to say. I would like David Carter to come back and take another call. Last night he got up and said he would talk about National’s vision, and for 10 minutes all that he did was moan, whinge, and groan. I did not hear about one bit of vision from the National Party. Its leader, Dr Brash, is always talking about ideas. He takes a step forward, then goes back. He says he is pro-nuclear, then he says that, no, National is not going to have any policy. What is its policy? There is to be no policy until after the election—no policy on anything. There is a lot of whingeing coming out of the National Party but no policy. There is nothing to hang on to; there is just negativity. I know it is hard to be in Opposition and feel that one’s main job is to be negative. But people are asking for policy. Labour is giving it to them and bringing it on; it is actually happening.

I heard the member opposite talk about infrastructure. He should go from Hamilton to Auckland to see how much money we are putting into the four-laning between those two cities. For years and years we have been waiting for that, and now the people in Hamilton and Huntly are seeing it happen. Recently, 14 MPs came down from Auckland to Huntly and Hamilton, looking at matters to do with energy, looking at the infrastructure, looking at the new roads, and saying: “My goodness, isn’t that road coming along fine.” I thank the previous Minister of Transport, Mark Gosche, for putting money into that four-laning, which is actually happening. The people in my electorate are extremely pleased and very glad about that.

We are also very glad that about $200 million is going into our hospitals, both in Waikato and in Thames. It is long overdue. Members opposite let Thames Hospital run down. Waikato Hospital, the biggest hospital in the country, is also to get a boost, enabling many of those old, run-down buildings to be renovated. The whole process will be extremely good.

I also want to talk just a little about what is happening in terms of operations. When I was in Opposition, people on accident compensation or the sickness benefit were coming into my office every day because they could not get their hip operations. I say to Annette King that I am very grateful for the money that is going into that area.

Also, I acknowledge the Minister of Tourism, because money is going into tourism, into cultural tourism, and into arts and culture generally.

I finish by paying a tribute to Judith Tizard, the Associate Minister for Arts, Culture and Heritage, with a little bit of rap:

One of the things that I want to say

Is that some of our olds will be happy to bop all the day.

Because of the Budget orthopaedic operations,

Hip ops will now give them their freedom and new sensations.

The ASSISTANT SPEAKER (H V Ross Robertson): Just before I call the next member, I would like to inform honourable members that the Green Party has decided to split its 10-minute speech into two 5-minute speeches.

KEITH LOCKE (Green) : I want to address whether this Budget will give New Zealanders a greater sense of security. In one sense it will. Significant financial assistance is to go to poorer people to make them feel more secure, and that is good. But do we not also have a duty to help make poorer people throughout the world feel more secure? The Budget fails to meet their needs, by giving only $15 million a year extra in overseas development assistance, which only keeps up with inflation. New Zealand’s aid spending has increased from only 0.23 percent to 0.24 percent of gross national income (GNI), which is a far cry from the longstanding international standard of 0.7 percent of GNI.

The Government is spending extra money on international security; it is just that the money is going in largely the wrong direction—to increase the intelligence and military capacity of the rich Western countries to keep in check rebellion in the poorer countries. Iraq is a case in point. Iraqis have rebelled in one way or another since the Americans occupied their country and asserted control over their economy. The New Zealand response has not been all bad, in that we have given some reconstruction assistance post the war. But New Zealand has also legitimised the US occupation force—much to the express pleasure of the Bush administration—by embedding our army engineers in a British military unit. In addition, New Zealand has put a frigate and an Orion in the Gulf as part of an American-led Western effort to assert dominance over the seas around the Arabian peninsula. Of course, our Government says that the frigate and the Orion are there to fight terrorism—not that they have discovered any terrorists, or are ever likely to—and it uses the same anti-terrorist excuse for sending our SAS, at considerable expense, to fight with American forces in Afghanistan. Actually, it is exactly the American policies in Iraq and Afghanistan and towards the Israel-Palestine situation that are, unfortunately, producing a terrorist response. Of course, no sane person would support in any way the terrorist acts against innocent people that have occurred in some Islamic countries recently. But by operating alongside the American military in the Middle East, New Zealand is actually contributing to the terrorist problem rather than being part of a solution.

Instead of providing more overseas aid, which would be being part of a solution, the Budget increases spending on fighting what the Government calls international terrorism. In fact, it is just the opposite. The budgets of the Security Intelligence Service and the Government Communications Security Bureau have gone up by a whopping 28 percent. The police get an extra $14.8 million to form dedicated national security teams to counter terrorism. Three million dollars a year is being dedicated to a Pacific Security Fund as part of a silly campaign to have the island nations waste scarce resources on anti-terrorist measures, when the chances of any one finding a terrorist amongst the coconut palms is virtually zilch.

There is also a smorgasbord of so-called security measures that the Government is spending money on, allegedly to make things tougher for international terrorists, but in reality, and mainly, undermining our civil liberties and privacy. These include granting the police and intelligence agencies new surveillance powers to intercept our emails, to hack into our computers, to put biometric identifiers on our passports, and, in relation to passports, even to give the State the power to take away our passports on vague national security grounds. The Government is adapting to the mean-spirited, anti-foreigner paranoia so promoted by Winston Peters. The latest example is its putting traffic police on tracking down overstayers—a move likely to lead to racial targeting, and to the antagonism of ethnic communities towards the police, which will only make it more difficult to solve real crimes.

Ahmed Zaoui is the most prominent victim of anti-foreign sentiment. Mr Zaoui’s case shows how extra spending on intelligence services can produce exactly the wrong result. The Algerian Government has branded its democratic opponents, including Mr Zaoui, as terrorists. The French Government, with big interests in Algerian oil, supports the repressive Algerian Government and has helped smear Mr Zaoui internationally. Our small SIS does not like to buck its big brothers overseas, including the French intelligence service, so it wants to do the French service’s bidding and get rid of Mr Zaoui. Instead of New Zealand contributing to the democratisation and development of Algeria, and thereby reducing the danger of terrorism, it is in effect helping the Algerian generals and French oil interests by detaining Mr Zaoui for what is now 18 months. The Green Party says this is not the way to a more secure New Zealand and a more secure and just world.

SUE KEDGLEY (Green) : The Green Party was particularly pleased when the Government set up a pay equity task force. Then, when it released the pay equity task force recommendations and said that it was committed to setting up an office to take seriously the issue of pay equity in New Zealand, we were absolutely delighted. So when we picked up the Budget, we looked for signs that the Government was taking a lead in implementing pay equity in New Zealand—in particular, in the State sector. We looked carefully for the provisions for money to be set aside to introduce pay equity in the State sector, and in particular for a pay equity settlement for nurses. But alas, we could find nothing except a very odd little sentence on upcoming bargaining rounds in the health sector, which could result in increases that could decrease the operating balances of the district health boards. It stated that the risk had been updated and the Minister of Finance had yet to fully consider the quantum of that risk. The question we ask is what does that gobbledygook mean? Is it in some way a hint that the Government will be looking at a pay equity settlement for nurses, or is it not? Let the Government come clean and tell us whether or not it will set aside funding for a pay equity settlement for nurses, and whether it will provide leadership by providing pay equity in the State sector.

We all know that nursing shortages are at the heart of the crisis in the health sector. We know that nurses are stretched to breaking point; we read it in the headlines daily. We know that they are leaving the profession in droves. We know we are short of about a thousand nurses, and that literally hundreds of thousands of dollars are spent on trying to recruit nurses from all around the world to fill the vacancies caused by nurses leaving the profession in droves. The nursing shortage is at crisis point; it is at the heart of the crisis in the health sector. We look to the Government to make good on its commitment to doing something about pay equity in the State sector, by negotiating a pay equity settlement with nurses. We sincerely hope that if the Government does sit down to negotiate with nurses, it will not try to do as it has done in other areas and spread the settlement over many years, with an implicit election bribe that if nurses want pay equity, they will have to vote for the Government and pay equity will be slowly introduced over a number of years. I do not think that the nurses would accept that. As we know, they are highly focused on finally demanding proper wages and a proper pay equity settlement.

I will turn now to food safety. There was nothing in the Budget, unfortunately, to address the issues of concern that ordinary New Zealanders have about our food supply. We all know that there are hundreds of GE ingredients in our food and none of them are labelled in the supermarket. There is no provision, though, in the Budget for even monitoring GE food, to see whether there are illegal or undeclared GE ingredients in our food. The Minister confirmed that the Government has no intention of doing any monitoring of that, nor does it have any intention of introducing proper GE labelling, despite the fact that there is overwhelming consumer support and demand for it. There is no provision for country-of-origin labelling. It is quite bizarre that a Government that presents itself as being democratic and open is actually denying our right to know what is in the food that we eat. It opposes an international forum’s mandatory country-of-origin labelling. That seems quite bizarre. Neither is there provision in the Budget for the monitoring of antibiotic-resistant bacteria in our food, or for stopping antibiotics that we know are significant in human medicine being fed to literally millions of factory-farmed animals, despite the fact that Government officials warned well over 5 years ago that feeding antibiotics that are significant to human medicine, such as the macrolides, is causing resistance in humans and is risking human health.

Hon JOHN TAMIHERE (Minister of Youth Affairs) : Before I begin my speech, I want to acknowledge one thing to you, Mr Assitant Speaker Robertson. I understand that your daughter, Lisa Marie, rode in her first race at Cambridge today, and came in a very creditable third on Jack Frost. I offer my congratulations. Not only is it a great day for Mr Speaker in regard to his daughter’s contribution to the family’s mana, but it is a great day for the Government. It is a great day for New Zealand, and it is a great day to celebrate a great Budget.

Obviously, Budgets are not just about budgeting—Budgets are about ideas. Budgets are about bringing ideas to fruition, and setting out a vision and a platform for the benefit of all Kiwis up and down this great country. Not only must we have ideas, but also the capability, capacity, acumen, and ability to make those ideas happen. I acknowledge the prowess of the members on the front bench of this Government—they are formidable. When they stride into this House, they dominate the Opposition. Not only does the Budget set a platform heading into 2005, 2006, 2007, 2008, 2009, and 2010, but this Labour-led Government sets out a vision for a decade—a whole vision of going forward. We do not know what the Opposition stands for—we do not know who will champion the issues that will take New Zealand forward, and we do not know what the capacity is on the Opposition benches—but we do know how dominant, credible, and significant this Government’s front bench is. I acknowledge those members because they have done a marvellous job.

Let us look at the front bench of this Government. Leading off is Dr Michael Cullen—versus “Don Key” on the Opposition side of the House, of course. Dr Cullen is probably the finest Minister of Finance this country has ever seen. Why do I say that? What evidence is there for that? We rate our great All Blacks on the points they score, and we rate our great bowlers on the wickets they have taken. When we look at the numbers presented by this Minister of Finance in his fifth Budget, we see we have to be gobsmacked. The Government has been prudent, but more particularly, Dr Cullen’s fiscal management has presented one of the most prudent Budgets, yet again. Gross debt is forecast to drop to 21.8 percent of gross domestic product by 2007-08. When we came into Government, it stood at 33 percentage points. That reduction is a huge boon to Kiwis out there. There is huge headspace and room to move, in terms of the ability to take on debt in the event of any unforeseen circumstances—a wonderful result.

This Minister of Finance has produced surpluses of above $5 billion, in terms of the forecasts. Under his stewardship on behalf of this Government, we have seen the New Zealand economy grow by over 15 percentage points in the last 4½ years. What more evidence do Kiwis need that this Labour-led Government is not just great for the country and for business, but that Labour is actually the only party in this House with the capability, capacity, integrity, and credibility to keep New Zealand on line? This is a Government for all Kiwis, not just for the few elite, rich people whom Dr Brash and John Key represent in this House.

Moving on to Mr Anderton, he is ably responded to from the Opposition by one Phil Heatley. Phil Heatley will have to excuse us, because even the security guards around here do not know him. I do not know whether any constituents in Whangarei have heard of him, either, but rumour has it that he comes from up that way somewhere. The reality is that Mr Anderton came into this Government with a commitment to identifying and acknowledging the regional economies. They are the powerhouses of our economy, and he has brought them together. When that member walks into this House, no one can dominate him on economic development at a regional level.

Let us turn to Mr Maharey versus Ms Rich. As Minister for Social Development and Employment, Steve Maharey has overseen the creation of 193,000 new jobs in the 4 years since the Labour-led Government was elected. In that time, as Associate Minister of Education (Tertiary Education), he has recalibrated the whole tertiary sector, by ensuring that now we look for quality—world-class quality, not just national quality—and by linking that quality with relevance to our industry and commerce. What do members on the Opposition side of the House have? We must ask that question of the Opposition. Those members have no policy, no vision, and no alternative Budget—and no capability, even if they had any of those things. Those are the questions the constituency will have to ask itself.

I wanted to move on to acknowledge further members on our front bench. I could go right through to the back-benchers, who are wonderful to a person. I will turn to Mr Phil Goff. Who is versus Mr Phil Goff on the Opposition benches? Dr Wayne Mapp. The beautiful thing about Dr Wayne Mapp and the great thing about this Parliament is that it has taken him away from Auckland University and the infliction of some of the worst lectures I have ever been a party to at the school of business at that university. Rather than harping on about getting tough on crime, Phil Goff as Minister of Justice has toughened up the criminal justice system in a manner that Tony Ryall could only dream of, in terms of the types of searches he enjoys when he goes to visit our corrections facilities. As Minister of Foreign Affairs and Trade, Phil Goff has also been a significant performer on the world stage, and has placed us there accordingly.

And let us look at the Minister of Health. Annette King has been simply superb in the health portfolio; everyone knows that. She strides into this House and absolutely dominates the Opposition—so much so that those members will not even ask the Minister of Health a question. Under Jenny Shipley’s watch, the health portfolio was a death wish in terms of a politician’s career. This Minister, Annette King, has made it one of the safest and most secure portfolios in any Government in the English-speaking world, and she has to be acknowledged accordingly.

Let us look at the redoubtable member who looks after the agricultural sector in this country, Mr Jim Sutton. As Minister for Trade Negotiations, he has progressed free-trade agreements with China and Thailand, and put us well ahead of the queue in the world’s rankings. Just entertaining free-trade agreements with China has stimulated huge interest externally in what is going on in New Zealand, and he has been great for our exporters. When Jim Sutton walks into this House the Opposition will not even ask him a question on agricultural issues, such is his prowess in the agricultural sector. But it is not only that. The agricultural sector used to be the homeland and heartland of the Tory party—but no longer. Under this Government, we have delivered more per capita into that particular sector than any other Government has in the last 20 years, and Jim Sutton must take a significant commendation for that.

In taking a look at what we are doing in education, I could say a lot about Mr Mallard’s capacity and capability, but the members on the Opposition side of the House are quaking in their boots just at the mention of Mr Mallard. There is also Mr Hodgson, and so on and so forth.

It would be remiss of me not to acknowledge the rise and rise, but very quick fall, of Rodney Philip Hide. I want to congratulate him on—off his own vote—winning the leadership of ACT. I just want to say thank God someone trusted him and voted for him—and it was Rodney Hide, so that is how he got there. He got up there as Rodney Philip Hide. Anyway, the beauty of the ACT party is that half its members want to be the leader. Looking at the picture of them in the Dominion Post, we saw it was like the Village of the Damned. Those members were there, dumbstruck. They were asking themselves what the hell had happened because they had got Rodney Hide. Rodney Hide has obviously been a wonderful inspiration to the creative directors of Shrek. He is ably supported by Muriel Newman, so we have there Rodney Hide and Muriel Newman—we call them “Bubble’’ and “Squeak” around the House, kindly and fondly.

Kiwis’ worst nightmare would have to be a Government led by Don Brash, with a finance Minister called Mr “20 Percent” Rodney Hide. Now, if that is not scary and frightening, I do not know what is, and if being associated with a party like ACT does not lead the National Party down the gurgler, I do not know what would. So I say to Kiwis out there that they should listen hard, as they have their future in their hands. They have just heard all the great things that have been delivered, and will continue to have delivered, by this Government, so I hope they do not put that in jeopardy by thinking they can trust the likes of the Opposition.

Hon TONY RYALL (National—Bay of Plenty) : I think that that speech indicates why that Minister, who cannot even take himself seriously during this important debate on the Budget, is not taken seriously, even by his own colleagues. When Ministers of the Crown give speeches surrounded by friends chortling away, the Minister must finally realise that no one takes him seriously. He is considered a fool.

That is the Minister who told the people of New Zealand that a third of the foreshore was privately owned, when for a month he had had a report that said a very small proportion of 1 percent was privately owned, and even the Prime Minister refused to defend that Minister’s deception in the House during question time. He did not say one word on that; nor did he comment on any of the portfolio responsibilities he has in this House, but he gave a humorous speech that had his colleagues chortling away, thus giving him the regard with which this side of the House views him.

The investment in law and order in this Budget owes more to the National Opposition than it does to the Labour Government, because the only reason this Government has moved on any of the pressing issues facing crime in this country today is the relentless campaign the National Opposition has waged since the last Budget to identify the running down of our justice system by the Government. I will look at a couple of areas in this Budget where the National Opposition is responsible for this Government facing up to its responsibilities.

The first is the scourge of the drug methamphetamine. We have been highlighting week after week the massive and unchecked increase of that drug, its grasp on communities and people up and down the country, and the fact that this Government has not been doing enough. Over a year ago, we highlighted the delays being faced by the Institute of Environmental Science and Research in the testing of methamphetamine samples. We focused this Parliament’s attention on the fact that the institute had been pleading with the Government to give it additional financial resources, and we focused this House’s attention on the fact that the Commissioner of Police told Parliament’s Law and Order Committee this time last year that there would be a delay of over 1 year before those tests would be analysed by the institute.

The Government’s response was that it had given the institute enough money. Then earlier this year we released information that showed that there is now a 2-year delay in getting the testing of methamphetamine samples before the institute. Only then, through our campaign, coupled with the criticism of some of the most senior judges in New Zealand, could we get the Government to act. It was this Opposition, last year and the year before, that talked about the unchecked involvement of criminal gangs in methamphetamine. We talked about the underfunding of police intelligence systems and undercover operations, and the fact that the proceeds of crimes legislation was failing to meet the needs of the community in smashing drug-dealing gangs.

So what did the Government do in the Budget? It took every single suggestion that the National Party had made in the last year and finally financed them in the Budget. We are seeing an investment in clandestine laboratory teams. At last, the Government is investing in a national intelligence centre to focus on targeting drug-dealing gangs, and on the use of interception technology in relation to them. At last, the Government is investing more in the Institute of Environmental Science and Research, the institute that tests methamphetamine drugs. The Government is doing exactly what National told it to do a year ago. Finally, after 4 years of National asking the Minister of Justice, he has promised that amendments to the proceeds of crime legislation will be passed by Christmas. The only reason we have action on methamphetamine in this country today is the National Opposition.

Last year, National raised the issue of the massive delays in the justice system in terms of our courts. We warned the Government that delays before the courts would see convicted drug dealers and other dangerous criminals walk free, simply because the Government was not sufficiently resourcing the criminal justice system to ensure the convictions of those before the courts. We raised the issue of the desperate cash crisis before the courts, and the fact that the number of cases waiting before the courts was up 32 percent since the change of Government. We talked about the anguish that that was causing victims, who were at risk of violence, and defendants, who could not clear their names if innocent or begin their sentences if found guilty.

We talked about the need for more judges. We told the Government about the desperate need for new recording technology in the court. I refer members to the press release of the National Party, entitled “Government admits courts’ cash crisis”, where we said to the Government: “National says we need more judges, better use of technology to beat the backlog in our courts, and better case management practices.” So what was announced in the Budget? After a year of the National Party pounding the Government in question time and in the media, the Government has announced more judges, better use of technology to beat the backlog in our courts, and better case management practices. The Government said that every suggestion the National Party made last year to fix the backlog in our courts was unnecessary, but finally, in the face of the irrefutable and unrelenting increase in waiting times before the nation’s courts, the Government has acted.

National has some more advice for the Government today, which is to take the advice of the police commissioner—and the suggestion that the National Party made at a parliamentary select committee today—to give police the new number plate photographic technology to target car conversion and the criminal element who are driving in motor vehicles. In Britain there are speed camera - like devices that can take photos of the number plates of vehicles, analyse them immediately within the computer database, and then alert the police to the status of a stolen vehicle. That vehicle can be pursued, or the criminal driving that vehicle can be apprehended.

We know that car conversion and car burglary in this country are out of control. In the city of Wellington there have never been more cars stolen each week than there are now. Under the Labour Government there are now, I think, over 4,000 extra cars per year being stolen in New Zealand communities. Next to having one’s house burgled, having one’s car stolen is a real worry for ordinary New Zealanders. National is telling the Government that a further increase in car conversion figures is on the way, according to official police statistics, and that it should bring this technology from Britain to enable the police to target those who are driving stolen vehicles.

This Budget is all about the Government—the hard men of the Labour Party. Mr Goff is the man who built a career on being the tough man on law and order, but he wanted to decriminalise some sexual activity between 12-year-olds. That is really tough! Mr Hawkins is the Minister of Police who is scared to show his face anywhere in this country, and he is the most forgettable Minister of Police we have had in years. Only now is Labour accepting that law and order in this Budget owes more to the National Party than it does to the Labour Party in Government.

Hon PAREKURA HOROMIA (Minister of Māori Affairs) : Greetings to all of those who have taken the time to come to the House to understand more about how great this Budget is for Māori people. It is one of the best in 20 years, and, if we analyse it and break it down, we will understand that better. I rise to commend this Government and the Minister of Finance for what is an excellent Budget for Māori. It is the best I have seen for many years, and it is the best since Labour has been in power. This Labour Government has made a clear commitment to accelerate the advancement of Māori, and this Budget will assist working Māori to provide more opportunities for their whānau, unlike past Governments that focused on the gloom and doom.

Up and down this country I have been talking about shifting the profile of Māori. This Government has done that ever since it started its term in office. Forecasts for the next 50 years show that although New Zealand’s population generally is ageing—

Opposition Member: What about closing the gaps!

Hon PAREKURA HOROMIA: —we will close the gaps, and we have been closing the gaps—Māori and Pacific populations will remain relatively youthful. Whether or not we like it, by the year 2021 one in five people aged 15 to 39 will have Māori in them, and that will be great for them. The demographic trends of Māori, in comparison with New Zealand’s population, highlight the importance of why we need to mobilise our young people. This Government recognises that for New Zealand to prosper and progress, all individuals and groups—and especially Māori—have to reach their fullest potential. Providing opportunities for Māori is what this Budget is about—simply that. There is no namby-pamby stuff, as offered by the last National Government. Whether in enterprise or in social endeavours, Māori strive to participate and succeed as Māori. That captures our desire to participate and succeed in New Zealand and globally.

In relation to Māori, Budget 2004 is aimed at enhancing all the Māori successes that the Government, alongside them, has helped them create. There are numerous situations. The last speaker would have us believe that every Māori needs to be locked up in jail, or that all Māori belong there. I say to him that Labour will cut Māori inmate figures in half. It is simple logic. As Māori, we need to stop going to prison. We need to get on with our businesses. People do steal cars, but more cars were stolen when that member was the Minister of Justice and his colleague sitting next to him was the Minister of Social Welfare. That is what happened, and we have built on to some great programmes. People would steal cars, steal dogs, and steal dishes. Heaps of people were doing that in his time, and what did his Government do about it? Nothing—not one iota! What has the great George Hawkins done? He has lowered crime figures and built up staff numbers, and that is what this Budget is about. It is about improving the services and processes to make sure that Māori people get on and do a lot better.

I talked to some young women from Tikipunga—[Interruption] If the member wants to talk about that incident, we will talk about it. The thing is that the member knows about it because he was the Minister responsible for it at that time. Tell me about those issues in the centre of Horowhenua—

The ASSISTANT SPEAKER (H V Ross Robertson): I am sorry to interrupt the Minister but I say to members that the Minister is making a hard-hitting speech, and, of course, some interjections can be expected, but not so much as to drown out another speaker. The Speaker will not allow a member to be drowned out.

Hon PAREKURA HOROMIA: Today I had the privilege of listening to some up-and-coming young Māori from Tikipunga. There are thousands of them down at the Queens Wharf Events Centre where 30 teams are in a national kapahaka competition. I will tell members what these young wāhine told me when I asked them what they wanted to do. They are in the sixth and seventh form. One wants to a lawyer and another wants to get into art and design. They are very clear in their minds as to where they are going. So despite all the nonsense and pontification from high-necked, low-ranged people who do not want Māori to get on, they will get on and do it. I have a lot of faith that Māori will get into that.

Over the next 4 years, $2 billion will be injected into education. That is where Māori need to go. We are not fluffing around. We have two differences, both at the social and enterprise end. Māori are on their way to being the business owners and the business managers. From July 2007 more funds will be made available to ensure that Māori participate in early childhood education. In relation to primary health organisations and health development, there are 23,000 Māori over the age of 65 years who will benefit from that.

This is a kind, caring Government, but we are strong and vigorous enough to ensure that we do not let people melt away on the benefit or on the make-believe schemes and programmes led by those members opposite. This is about us going forward. We are not afraid to front those people of our own who want to make mischief and who want to make believe they are not on Government contracts, or whatever else, and who are leading elite, soft lifestyles. We want to make sure that Māori are working, that they are better educated, and that they do own the businesses. There are issues around skills development. Next year, 500 places will be added to the Modern Apprenticeships scheme, which will bring the total number of people on the scheme up to 8,000, and a fair percentage of that number are Māori.

Māori do want to work. They do want to get on with life, but they have to have help and guidance from our people. There have been a whole lot of adjustments. My parents came from families that averaged 18 or 19 people in the family. I come from families that average 10 to 11 people. Now the average Māori family is 2.3. It is about the same size as the average Pākehā family. It is just that we have a lot of gas in us—and we ain’t going to slip over or stumble; we ain’t going to be cornered by rednecked, rabid upsetting people who think they know better for us. We are on the way. We are well educated.

In the fisheries area, Māori control and run nearly 41 percent of that asset. So do not tell us that we are not adding to this economy. Do not tell us that we are not trying. The good thing about this Budget is that it will help to progress and accelerate us in that area. In the sense of those enterprises, we are starting to turn the corner and to do our bit. We are the biggest single stock owners and meat exporters in this country. That is great stuff. Do not talk about all the flip-flop; talk about what we are doing well. The member for Rangitikei knows that. He knows that this has been the best year for farmers in nearly 30 years and that half of farmers will shift over and join the Labour Party. We know they want to do that. They are receiving the best prices they have ever had, and this Budget will ensure that that projection is out for another 4 or 5 years. Opposition members cannot hide from that. They know that people are receiving the best prices for their fish and for their sheep, and it is because of this Government.

The key planks in relation to Māori succeeding in partnership with this Government are some simple things, and the proof is in the pudding. Māori unemployment is now at 9.4 percent. It is at the lowest rate in 24 years. Who did that? We did it, and, yes, I believe we could halve that rate again in the next 7 years, because Māori want to go to work. We are creating an environment in the economy for small business. Minister Tamihere, who spoke in this debate before me, has put a lot of effort into that and they love him in the small-business area. They want him to be there. At the end of the day, 43,000 more Māori are now in work than when that lot on the other side were running things. As I said, in the Māori business facilitation area, 4,000 Māori are in business doing their thing who were not there when Labour came to office.

I tell the members opposite who want to keep on making out that all Māori are criminals and people who do not want to do things, that we care for our kids and we care for our whānau—we are no different from Pākehā. This Budget will make sure that we advance ourselves totally and professionally. We will be hanging on to all the opportunities that are there. We want to show an example to our young ones, like the wāhine from Tikipunga who are here today. We want to show them that we will not be rolled over. We will not listen to inventive statistics like those from the member who was prattling on about cars being stolen. We will not get into that. We will not have leadership changes such as the one that has just happened in this House, whereby people get in by one vote. I see that the deputy leader of ACT is here. She knows that this is the best Budget she has ever known, because she tries to have a social conscience. She understands it and she believes in it. In her new role, like the leader who promised statesmanship at a better level, she will support this Government. We know that.

Georgina Beyer: Muriel Newman should be leader.

Hon PAREKURA HOROMIA: We know that Muriel Newman should have been leader rather than that other bloke. We know that there are a thousand members who signed up and voted eight times to get him in. We know all about that caper. I tell members opposite: “Time’s up fellas.” The Labour Party is here with this Budget and we will be doing it for a lot more years, because we have no intention of moving on. With the effort they are putting in, we are sure they cannot move us on.

I tell the member for Rangitikei that he should read the detail. He knows what we did for his people, and he knows that most of those farmers want to move over to us. It is very important that those members opposite read the detail and do not make outlandish statements that are mistruths about why we should be connecting to other countries just for the sake of it, or to put our hands on our hearts, on our chests, and make believe we are Americans and not New Zealanders. We are Māori New Zealanders, and we are here to carry on.

Hon BRIAN DONNELLY (NZ First) : The previous speaker, the Minister of Māori Affairs, stated that this was a good Budget for Māori. I want to ask him one thing: what is in this Budget for kōhanga reo? I have read the details and in fact it has ended up with the differential being greater than it has been before. We have read the details and I want to point that out.

I was out of the country when the Budget speech was delivered, so I did not catch up with the details for a few days. In fact, Martin Gallagher provided me with the details. I was not surprised that the Government used the opportunity of this Budget to create some bribes for voters. Let us face it—no party could really honestly claim that it would not do the same thing if it were in the present Government’s shoes. Neither was there any surprise that the target was, basically, the large mass of lowly paid workers.

I have often made the statement that Labour is no longer the party for workers, it is the party for non-workers, and maybe Labour has been listening to me, as it did over the National Certificate of Educational Achievement cost cuts to parents. However, what has been incredible about this Budget is its absolutely cynical approach to bribery. I mean bribery for votes; I certainly do not mean any corrupt bribery. Instead of budgeting for some specific goodies—baby bonuses and things like that—to flow directly from the Budget, the Government has stretched its bribes out over 3 years. In the first year its targeted groups get just a little titbit, just a taster, then there will be a little bit more around election time, then the next thing will come on in 2006 and 2007. The message to people out there is: “If you don’t vote for us they will take all these goodies off you.” That is cynical, and I say to the Government that the public is not that gullible. It can see through such cynical vote-buying Budgets.

I also say to the Government that when it comes to the next election Labour will not be the only party that believes that low-paid workers—the Kiwi battlers—are deserving of some social largesse at last. It is the group that has sacrificed most since the days of Roger Douglas and received the least benefit from New Zealand’s economic reforms. New Zealand First has been advocating for this group for years. For example, which group has been a voice for casualised labour? It has been New Zealand First, largely led by our deputy leader, Peter Brown.

Hon Harry Duynhoven: Who?

Hon BRIAN DONNELLY: OK, the member is following in unison with Peter Brown. We accept that there are followers and leaders. In this particular case I make the proposition that it is Peter Brown who has led the way. The Budget also demonstrates the justification of another of New Zealand First’s policy positions—that is, a universal tertiary student allowance. The biggest factor in the burgeoning student debt, which this Government has done nothing to allay—indeed, it has grown faster under this regime than it would have under National—is student loans for living allowances. Moreover, it is in this area where the greatest injustices can be found, with the entitlement, or non-entitlement, to an allowance being based upon parental income. We well know how some people can hide their income.

This Budget certainly demonstrates a recognition that a problem exists, but it goes only a short way towards remediation. By increasing the parental income threshold an extra 12,000 students will be able to access the full living allowance, and 28,000 will be able to access a partial allowance. The cost, I might remind members, is $283 million over 4 years, which is not a huge amount on an annual basis. If Bill Birch was able to budget for a universal allowance policy, then why cannot Michael Cullen do the same? But there is a “robbing Peter to pay Paul” approach in this tertiary policy, because it is to be partially funded by a change of policy towards married students. I hope United Future members are listening to this. At the moment, married students—that is, people under 25—are assessed on their own joint marital income when determining whether they are entitled to a student living allowance. In the future, following this Budget, a married student will be assessed on his or her joint parental income until the age of 25.

I wonder how many parents listening to this debate—parents who hand over their children at the altar in solemn matrimony—realise that this Government still considers them to be financially responsible for their children until they have turned 25. That is what this Government is saying. A 13-year-old, for example, can be given the morning-after pill, with the support of a State agency—the school—without a parent having even to be informed. But that same parent is considered to be financially responsible, even if his or her child is married, until the age of 25. I need only think back to my own circumstances—I would certainly have been disadvantaged under this new policy that the Budget introduces. New Zealand First will continue to press for a universal student allowance. We believe it is abhorrent that the one group in this country that has to borrow to put a meal on the table during the period when income earning is impossible is tertiary students.

The Minister has stated—he stated to the select committee this morning, for example—that a certain amount has been set aside in contingencies for settling teacher contract settlements, and anything left over will go into staffing improvements. He has not yet resolved the issues around the G3 question, which arose out of the last pay round. Members need to realise that the claim and all the conflict in 2001 and 2002 was about pay parity within the compulsory sector. The G3+ was a mechanism to break it. It has in fact led to injustices and anomalies within the secondary teachers sector, so that people with technical teaching skills—and Harry Duynhoven would certainly be interested in this—whom we need more of and who are competed for in the private sector, do not get access to the G3+. Yet others who have degrees for which there may not be any large private sector competition, do. The other problem is that it creates a whole lot of anomalies in all the crossover points, for example, between full primary schools and schools that cover forms 1 to 7, and they certainly have not been fixed. I believe that the Minister has to ensure he has a strategy this time to be able to sort out those tensions within the sector without having to pour in huge amounts of money, as he did last time, and give in at the last minute because an election was coming up.

The issues around pay parity create a major problem in the early childhood sector. It has to be recognised that this Budget puts a lot of extra money into the early childhood sector. But no one seems to be asking the question about how that money is to be used, and whether it will have the impact of increasing or improving the quality of early childhood education. People need to understand that the largest proportion—almost 90 percent—of that additional money will go into teachers’ salaries. It will go into maintaining that large albatross around the neck of the early childhood sector, which is pay parity. It is overlaying a pay structure that was developed for the secondary service, where there is a viable private sector competitive base, and laying that structure across the early childhood sector, to which it does not seem to bear any resemblance.

The comment I made at the beginning about kōhanga reo is seen within some of the issues around the rates that are paid. Kōhanga reo, for example, are paid on rate 2, and they have a 2.4 percent adjustment. Rate 3, which is much greater, is paid out only to kindergartens, and that is because kindergartens have to have most of their money going into paying teachers’ salaries—not into better staffing ratios, not into better capital improvements, but into teachers’ salaries. They are to get a 6.55 percent increase. The question has to be asked: what is the justification for creating an even further bigger differential between the funding of the different services?

The point I am making is that, whilst the Government can rightfully crow about a lot of additional money going into the early childhood sector, no one has really asked what this will do in terms of improving quality education. Will it create more accommodation, for example, particularly in areas where there are not enough facilities to meet all the needs of parents? No, it will not. Will it be used, for example, to create better teacher-student ratios? No, it will not. A large proportion of all this money is going, purely and simply, into fulfilling a doctrinal position, a piece of emotive rhetoric, that came around before the 1999 election, of having exactly—and I mean exactly—the same pay structure for early childhood teachers as for secondary teachers. There is no research justification for that.

Hon HARRY DUYNHOVEN (Minister of State) : I will begin my speech by taking an unusual approach. I congratulate Mitsubishi Motors New Zealand on its announcement, just made, that it will cover the complete cost, for those who are having repairs carried out, of all Mitsubishi motor vehicles, whether they have been imported as used vehicles or sold new by Mitsubishi Motors in New Zealand.

Mitsubishi Motors has taken it on itself to honour what any responsible manufacturer would do, and is paying for the complete cost of repairs, both parts and labour, irrespective of whether the vehicle was sold new or imported into New Zealand as a used vehicle. I am delighted with that, having had what one might call a fairly robust meeting in my office today, for about an hour over lunch, with the chief executive of Mitsubishi Motors. I congratulate the company on taking a very strong stand.

What does that have to do with the Budget? The Budget includes the Land Transport Safety Authority, and I want to convey considerable thanks to the authority for the huge work it has done in the last few days to try to manage all the issues surrounding the school buses, the trucks, and now the cars it has rightly recalled because of the safety issues involved. I thank Mitsubishi Motors for the very strong stand it has now taken. That should give considerable relief, particularly to those folk on lower incomes whose motor vehicles might be affected by this safety recall.

This Budget is a very good Budget for New Zealand. I appreciate the comments of Mr Donnelly, who brought me into the debate. I think there is good reason why he should have mentioned one or two of the very good initiatives that the Labour-led Government has taken in this Budget. I particularly want to look at the whole issue of where we go in the future. I am sure Mr Donnelly will agree that any Budget should look to the future.

We begin with education. A considerable amount of budgetary money has gone into an increase in education funding. I want to look particularly at young children. Mr Donnelly made some points about that issue, but $365 million over the next 4 years going into early childhood education—new funding—is a considerable amount.

I have young children. Three years ago, my wife was heavily involved in fund-raising for the kindergarten that is a few hundred metres up the road from our home. Our children were fortunate enough to go to that kindergarten. There is no doubt that kindergartens need additional funding. If children are given a good start in life, their education is assured. They need that good start. I am very concerned that we have competent, professional, well-paid, content people to provide a very good beginning for our young people. Our young people deserve a Government that looks ahead and invests in their future.

It was interesting that the former Associate Minister of Education remembered my former life as a technical teacher, and before that, as an electrician. Both those areas of technical teaching, and particularly the skills training area of apprenticeships, are vital for our children and to New Zealand’s future. One of the reasons why the G3+ issue the member mentioned is so important is because there is a shortage of tradespeople in this country, and that is a real problem. We have a real problem in that National, and Opposition parties in general, do not believe in the apprenticeship system.

The member can jump up and down a little if he wants to, but the truth is quite simple. Labour has already succeeded in reaching the target of 6,000 Modern Apprenticeships. In fact, we have already passed that target by more than 500 in the first quarter of this year. We are well ahead of the June target of 6,000 Modern Apprenticeships, and that is part of a goal to get all 15 to 19-year-olds engaged in appropriate education, training, or work by 2007.

I was absolutely delighted to be part of the policy of the Modern Apprenticeships scheme, and I thank the Minister, Steven Maharey, for his huge work in getting that programme in place so quickly. I was absolutely delighted when the Modern Apprenticeships scheme was written into our policy, because I had put a huge amount of effort into that scheme in this Parliament over a long time. For many years I was the only person with a trades certificate in this Parliament, which was a disgrace.

Mita Ririnui: That makes two of us.

Hon HARRY DUYNHOVEN: There are more than two of us! Mr Ririnui reminds me that he also has a trades certificate. I am very glad that he and others with trade certificates have joined us. Why is that important? The people with trade qualifications are the people who produce things for the economy. They get in and do things. They have welcomed this policy in spades. They are delighted that we have re-energised apprenticeships in this country. This morning as I was walking to work a vehicle drove past painted with information on trade training and apprenticeships. That is something we have not seen in this country for a decade.

What did National have to say about the Modern Apprenticeships scheme? National said it was pathetic, just like the scheme that was behind it, and the sooner it got rid of it the better. Every tradesperson in this country, and everyone who employs skilled people in this country, should remember that. We are well ahead of targets. We are being thanked for that, not only by tradespeople in this country, but by businesses that recognise that without those skilled people our country would grind to a halt.

That is one of the reasons why the former Minister said, rightly, that the issue of technical teachers in our schools is important. Having been a technical teacher, I know that the kids who so often aspire to be tradespeople really look up to their technical teachers and take a lot of cognisance of, and are influenced by, what they say. Those folk have often been people like them and their parents. Technical teachers have done a marvellous job in keeping kids who might not have been very interested in school enthused about their subjects and their work, and given them a little bit of optimism for their future.

Former students often come up to me and say: “Hey Mr D, thanks for what you did. I’m doing this now.” I am really delighted to find out what they are doing, and always like hearing from them. What I find really impressive is how much enthusiasm those young folk have when they have often started life with relatively low-skills, but have built up their skills through the years. Those folk have such enthusiasm for life, business, and getting on in the world. Many of them turn into some of our best entrepreneurs and ambassadors in terms of trade and development overseas.

We need to ensure that we continue what this Government is doing. That is why the next election is so vitally important. We have given a $57 million boost to getting young people into education, training, and work, and to ensure that all those 15 to 19-year-olds kickstart their working lives with a very good beginning. This package includes a new youth transition service and personalised career planning for secondary school students. In my day, that was only a dream. It just did not happen. The expansion of the Gateway programme and the Modern Apprenticeships scheme I have already mentioned will make a huge difference to the future of this country.

We have to give our kids a good start in the pre - primary school area, a good start to primary school, and numeracy and literacy programmes that ensure that every kid is included. What is that film slogan: “ Leave no one behind.”? This country cannot afford to leave young people out. Those four programmes will ensure that those at the upper end of our secondary schools get that good start in their working life, irrespective of their background and socio-economic group. When historians look back in 30 or 40 years’ time, the expansion of the Gateway programme will be seen to be one of the crucial programmes in making a difference to the social development of this country.

Regional initiatives have started, such as, for example, the cadet initiatives offered by the New Plymouth District Council in partnership with the Government. Recently I was privileged to be at the awards programme where young people kicked off and celebrated their working lives. Those sorts of things are vitally and absolutely important, and are properly funded in this Budget. I am delighted with it.

Dr MURIEL NEWMAN (Deputy Leader—ACT) : It is my privilege to speak on behalf of the ACT party in this 2004 Budget debate. But I have to say this Budget makes me really ashamed to be a New Zealander. I see in this Budget that the Labour Government is sacrificing the country’s progress and its future with a tax-and-spend Budget that is a blatant attempt to buy votes for the next election. That is a disgrace. This Budget exposes Labour’s aim to turn hundreds of thousands of working families with children into beneficiaries, and that is absolutely contemptible. Colin James described this Budget as “a milestone in a Labour-led journey back towards the social democratic world that New Zealand left behind in 1984”. Labour is taking New Zealand back to the future with a massive tax and spend. It is the biggest redistribution of wealth that New Zealand has seen since 1972.

All the commentators are saying that it simply marks the beginning of Labour’s election spend-up. It is using taxpayers’ money to bribe voters for the next election. If that is not the case, I ask this question: why will the benefits for families on welfare not come in until next year—election year—and why will the benefits for families who are working not come in until the year after? Members can just see the electioneering pamphlets; they will be all about encouraging people to vote for Labour so that it can put $100, $50, or whatever, into their pockets.

The worse thing about this Budget is that the $21 million that Labour will be spending to promote this Budget will be weaved in with its own party propaganda and spin doctoring. That is an absolute disgrace. It is despicable and dishonest. Labour is putting its own party propaganda in with $21 million of taxpayers’ money. That $21 million is the biggest spend-up ever, as I understand it, by a Government on propaganda ahead of an election.

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

Dr MURIEL NEWMAN : The people of New Zealand simply cannot trust a Labour Government when it uses $21 million of taxpayers’ money and weaves it in with its own spending to create a propaganda package. That is being very dishonest. The reason for it is that the driving force for Labour is winning power. It is not about the good of the country. If this Government actually cared about the good of the country, this would not be a tax-and-spend Budget; it would be a growth Budget. The first thing the Government would do is lower taxes. A recent poll showed that 66 percent of New Zealanders wanted to see lower taxes rather than the Government giving handouts. Therefore, we should have a 20c low tax rate, giving back the surplus to the families who earned it.

This should also be a Budget focused on welfare reform—a Budget that reforms welfare rather than growing welfare. Struggling families need a Government that is committed to lifting living standards; just like a rising tide lifts all boats, so a rising standard of living lifts opportunities for all families, rather than locking families into an endless struggle as this Government is doing. No Government, no country, has become wealthy through redistribution, and that is what Labour is doing in this Budget.

It is just outrageous that the Government is also damaging the very social fabric of New Zealand. It is putting in place a poverty trap for working families; not those families going from welfare to work, but ordinary, working families who are trying to better themselves. Labour is destroying the very incentive that allows families to get ahead. Normally, the harder people work, the more they make and the better off they are, and that is the incentive to carry on trying to improve their situation. But under this Budget, if a family with two children that is on the accommodation supplement and is earning $25,000 a year doubles its income so that it earns $50,000, it will get less than $100 a week in extra income. Under Labour that family will face a 90c abatement regime, where for every extra dollar it earns it gets to keep 10c. That is despicable. Labour is destroying the very incentive to get ahead, to go for promotion, or to get another job. We are locking into this country a whole vision, if one likes, of mediocrity where the employment ladder has been destroyed by a Labour Government.

What is really interesting is that Labour is turning its back on its very loyal support base. Working families traditionally have been Labour’s supporters. The Labour Government is corrupting that employment ladder. This is a bad moment for New Zealand because Labour is turning its back on working families, and it is condemning this country to Third World status.

Labour collected $6 billion more in taxes than it needs—that is, it had a $6 billion surplus. Labour overtaxed struggling working families. It has spent $2.4 billion in this Budget. In creating 300,000 families dependent on Government handouts—that is, 150,000 working families and 150,000 beneficiary families—all that this Government is doing is holding back New Zealand. This Government is locking this country into a low-wage economy, and we will end up with a mediocre future because of Labour. I ask the Government members sitting over there what they think a working family who is struggling to get by would rather see: would those family members rather see the money given back to them so that they can budget it and spend it on things to make their family do better, or would they rather it were given to the politicians in Wellington so that they can spend it on the America’s Cup, and can spend $21 million to try to promote this Budget? What do those members think those working families would rather see? It is very clear that working families would rather keep more of what they earn.

If Labour was serious in saying it wants to help people move from welfare to work, the other thing it should be doing is not giving out more handouts but bringing in a proper programme of welfare reform. Research from around the world shows one thing: when an economy is booming and the number of people who are on the welfare rolls is increasing, that has nothing to do with society or the economy, but has everything to do with poor welfare policies from the Government of the day. That is the situation we have now. We have employers around New Zealand calling out for workers. They cannot get people to fill skilled and unskilled jobs. We now have 350,000 people on the welfare rolls, and families and children locked into the poverty of welfare dependency, and that is because this Government is so short-sighted it cannot see that a good programme of welfare reform could give those families the opportunity to become independent of the State, to earn a good living, and to have a decent life for themselves. That would then remove taxpayers from the trap that they are in, where they are locked into paying high taxes for people on welfare who actually could be working and would rather be working.

This Government is failing on all counts. It is failing because it should have given the Budget surplus back to those families who earned it. It is failing because this Budget lacks vision to help New Zealand to climb up to being a First World country. It is failing because it will not improve the standard of living, because this Government believes in redistribution of wealth, which locks economies into poor performance and families into poor performance. It has also failed because this should have been a welfare reform Budget, not a welfare Budget locking more families into dependency. It is a very sad day for New Zealand when we sit here and see Labour taking out the traditional way of families to get ahead, which is to work hard and gain benefits for themselves.

MITA RIRINUI (Labour—Waiariki) : I want to reflect on the opening comments made by the previous speaker. Those few words make one wonder what goes on in the daily lives of some people. She said she was “ashamed to be a New Zealander”. How about that? Here we are, a thriving, growing little nation at the bottom of the Pacific with everything to live for. We are a country of nation builders, and she is ashamed to be one of us. Well, see you later!

When this Government took office in 1999 we made a promise to run the economy in a responsible way. “Budget Heartland 2004” is good for our people because it provides a boost to the weekly incomes of thousands of New Zealand families. This is a Budget for working families, who make a valuable contribution to this country’s infrastructure. It seeks to reward those families who are trying to make a go of it. Two-thirds of the money in the Budget goes to working-class families.

The National Party’s answer to our Budget is to provide tax cuts for the rich, and it has made that very clear. It is also clear that those who will benefit from our Budget are the people whom Don Brash, and Rodney Hide and his buddies, would ignore. Brash and Hide want to give those who earn $60,000 a year a tax break that would net them an extra $81 every week. The bulk of my constituents earn less than $38,000 a year, and under an administration led by Brash and Hide they would get nothing. For people who earn $40,000, Brash would deliver a mammoth $1.15 extra per week. That is the great Brash economy.

Madam DEPUTY SPEAKER: The member must always remember to refer to members by their correct title.

MITA RIRINUI: I am sorry; excuse me, Madam Speaker. Budget 2004 will ensure that a two-child family on a modest wage of $30,000 is $40 a week better off from 1 April next year. This increases to nearly $95 by 1 April 2006, and to $115 by 1 April 2007. Members should remember that that same family would get no assistance from Dr Brash’s administration.

While Māori are not specifically targeted, anecdotal evidence shows that Māori families feature highly in the socio-economic group that has been targeted for extra assistance. Te PuniKōkiri will put aside $14 million over the next 4 years in an effort to strengthen whānau-based research, and sporting and cultural activity, along with enterprise development. In addition, about 28,000 families and 33,000 children will benefit from increases to childcare assistance, with average gains of $23 a week per child from 2005. About 95,000 households will receive increases, averaging $19 a week, in the accommodation supplement in 2005 and 2006. These increases represent the biggest offensive in the war against child poverty in decades. This Government loves families—

Jim Peters: Not up my way.

Pita Paraone: No.

MITA RIRINUI: —as we have shown in the far north, as those two members will testify to. [Interruption] They want to hear it again. This comes on top of $31 million of Ministry of Social Development funding to help families in difficulty, including funding for Māori service providers, as the two members will appreciate.

The voluntary community sector has been allocated $3.4 million—notice all the millions—for a national entity to act as a focal point for community, voluntary, and Māori organisations, and to oversee projects. Is that not wonderful?

Budget 2004 rewards those who are making an effort to upskill themselves. There will be more than 1,000 young Māori involved in job training via the Modern Apprenticeships programme by next year. This is significant because in a few years’ time these young Māori will be an integral part of the workforce, building infrastructure.

In the area of Māori business, if Aotearoa were made up totally of Māori, it would be the fourth-most entrepreneurial nation in the world, according to the Global Entrepreneurship Monitor report. This is particularly relevant given the $10 million boost that Te PuniKōkiri has earmarked to assist Māori into business. The sum of $8 million will help Māori build Māori business networks. The growth and innovation framework provides the opportunity for regional development funding, as I am sure the two members will also appreciate. The Māori economy contributes $700 million, which equates to 7.4 percent of New Zealand’s total agricultural output, while 10 percent of our forest holdings are controlled by Māori. These figures show that Māori make a significant and valuable contribution to the economy, and Budget 2004 will further assist that expansion. Another big project is the hui taumata that will run at the end of this year. The sum of $750,000 will be invested in a national summit, which will formulate a blueprint for Māori development over the next 20 years.

Jim Peters: Not another one! No, no, no!

MITA RIRINUI: That member will not be here. Education is another priority for this Government, as always. It is committed to lifting educational standards for all young New Zealanders by injecting extra funding of $2 billion over 4 years into education, bringing total spending to $9.2 billion by 2007-08. I am sure the young people who are here tonight will appreciate that. Kura kaupapa Māori can apply for more funding to upgrade facilities, given the $347 million pot that is available for facility upgrades of schools and early childhood education organisations. I recall the contribution from Mr Brian Donnelly of New Zealand First before the dinner break. He asked what is in the Budget for kōhanga reo. Well, he has just been advised. The sum of $4 million has been allocated over 4 years to strengthen use of Māori language in whānau and communities. This is on top of hundreds of thousands of dollars in baseline funding for education. Early childhood education will receive $365 million over the next 4 years. This will fund free early childhood education, and lift quality and participation rates. Part of the Working for Families package will inject more than $118 million to help low and middle income families with childcare costs. Kōhanga reo—once again, I point this out for Mr Brian Donnelly—around the country will welcome this announcement.

I move now to the subject of health. The median age for the Māori demographic is 22. By 2010 one in five people aged between 15 and 39 will be Māori. It is vital that we plan ahead to ensure that a large part of the workforce is more aware of health issues. This Government remains committed to funding organisations that deliver high-quality, targeted health services to those people who require more assistance. Māori health providers will have increased opportunities to bid for health contracts that deliver to their communities. The vast majority of New Zealanders—that is, 3.1 million people—are now in primary health organisations, and $3 prescription fees have been extended to people over the age of 65 who are enrolled in primary health organisations. This makes primary health care for Māori more affordable and thus more effective.

In the area of tourism, additional resources will be allocated to expand the current Māori Regional Tourism Programme. I note that the Tāmaki brothers are currently in my home town of Tauranga promoting Māori tourism. This Labour Government recognises that the Māori tourism industry is growing quickly, and it is important that we assist the industry to develop in a positive and sustainable way. The Māori Regional Tourism Programme is a package that offers more assistance to regional Māori tourism organisations as well as the national body. I congratulate the Minister of Tourism as well as the Associate Minister of Tourism on these initiatives. The programme assists regional organisations to develop business plans, enhance the quality of Māori tourism in the regions, promote the interests of Māori tourism within key organisations, and strengthen relationships with existing regional tourism organisations. More than 2 million people visited New Zealand last year, spending about $6.4 billion in the process. Māori want a larger share of the pie, and this package will assist them to achieve their desired results.

There has been a commitment to expanding the capacity of the Māori Land Court. We want to advise the House that the Māori Land Court will receive $23 million over 4 years to implement the Māori freehold land registration project, to ensure that Māori land is correctly recorded on land title systems. This will ensure that, potentially, hundreds of thousands of hectares are available to raise capital for investment. I am sure the member Pita Paraone, with all his land, will be more than happy to hear that.

Hon BILL ENGLISH (National—Clutha-Southland) : I am pleased that member referred to my colleague Pita Paraone, because he makes Pita Paraone look like a statesman and an orator by comparison with what we just heard. It is no wonder that everyone thinks he or she can start a Māori party and beat Labour at the next election. It is no wonder, at all. In fact, even Georgina te Heuheu had a think about it.

John Carter: Maurice did too.

Hon BILL ENGLISH: Did he? Well, Maurice could possibly do better than all of them. Maybe that will be where the real election is.

The attitude of the member who has just resumed his seat signifies the attitude of the whole Labour Government. He spent his whole speech telling us essentially that if members give money to people, then they will support them. He talked about promoting and facilitating, and liaising, which means getting on planes and going to conferences and seminars—because now about half the civil service does nothing but that—and he has wrongly concluded that that is what will get support for the Government.

This was Dr Cullen’s Budget, for what is fast becoming Dr Cullen’s Government. He is by far the most prominent figure in the Government. He is now the man who does all the work, takes all the heat, comes up with all the ideas, and makes all the risky decisions, while his leader flies around the country avoiding anything serious if she possibly can.

I am sure that Dr Cullen, when he trots out of this building at night, has this question in the back of his mind: why is it that he has to do all the work? Why is it that it is now his job to win the next election, and Helen Clark is still on the ninth floor of the Beehive? I ask Government members: “Where is Helen Clark’s hand in this Budget?”. It is nowhere. There is no sign of the Prime Minister giving direction. There is no sign of her unique personal vision in this Budget. This Budget is what Dr Cullen said he was going to do 3 or 4 years ago, and now he has done it. That actually makes Helen Clark superfluous, except for ceremonial military occasions. If I were a brave man I would make the assertion that she is the most qualified person New Zealand has ever had to take on the job of Governor-General.

Opposition Members: Ha, ha!

Hon BILL ENGLISH: She is. There has never been a more assiduous ceremonial public figure than Helen Clark when she is in the country. If she does not get that job, well, she will get some United Nations job. [Interruption] The serious point for that new Minister is that, if the Government does not have direction he will not be in Cabinet for long. He will get to the election and lose the status he loves so much.

This Budget misjudged the people of New Zealand. I will give Dr Cullen credit. He made the call, but it turned out that he got it wrong, and he got it wrong for the very simple reason that people resent the fact that they are taxed so highly, so that he can give it back to them. When we were talking about tax cuts in the late 1990s, there was serious political debate that if we cut taxes it means we have to cut spending, and people made a choice about that. They did not want spending cut, so they did not support tax cuts. But now they do not have to face that choice. They have now realised, after 5 or 6 years of very large surpluses, that Dr Cullen and Labour have been building up those surpluses for political reasons—so that they can now give them back. That is why they did it. People who earned that tax-paid money resent the fact that that is what it is used for. They do not mind it being used for health, or for education, but they do not like it being used for Labour’s political purposes.

What has now happened is that the Government has one single motto—spend. That is it. We have had a lot of discussion in this debate about the quality of the Working for Families package. I will remark on that briefly. We now have major distortions in our tax system, where the low tax rates are, by any measure, quite low—20c in the dollar, up to $38,000. That is low by any standard. We now have large tax credits offsetting those relatively low tax rates. That part of the tax system is working fine—well, not too badly; there are marginal tax rate problems, but the rate is at about the level it ought to be. The real problem now is that our middle tax rates cut in too low. So when we compare a family on $40,000 with a family on $60,000, the answer of course is not to take down the family on $40,000 who are getting large tax credits, the answer is to lift the net income of those people who are earning higher incomes. This is in order to rebalance the progressive tax system, because it is now out of balance.

But I just want to look at the spending side of the Budget, because I do not think nearly enough attention is being paid to the way this Government is spending money, outside of the family tax credits. I refer just to my own portfolio. I recently had a leaf through the estimates early one morning and I want to tell members about one or two items I found in the education estimates. The Government is going to spend $15 million to introduce quality assurance arrangements in adult community education.

John Carter: What?

Hon BILL ENGLISH: It is $15 million to bring in quality assurance arrangements in adult community education. Here is another one. The Government wants to enhance the capability of polytechs to engage with business and industry. Well, that seems like a pretty harmless objective. That warms one’s heart. Do members know how much money the Government wants to spend on enhancing the capability of polytechs to engage with business and industry? It means going to meetings with them.

John Carter: How much?

Hon BILL ENGLISH: It is $21 million to enhance the ability of polytech staff to go to meetings. I wish I was joking, but I am not.

Here is another one. The Government will increase the operational funding of the Tertiary Education Commission by $9 million. It will now cost $45 million per year to run that commission. It is the biggest waste of time in town, and that is saying something when Labour is running. The Tertiary Education Commission is the worst bureaucracy in this city—a city of rotten bureaucracies. It will now cost $45 million per year to run. Do members know what the increase in operational funding per year for schools is? It is half that amount. The whole school sector, the parents and the teachers, gets $23 million a year, and the Tertiary Education Commission, which does nothing but go to meetings, liaise, and enhance, gets $45 million a year. I can tot up $100 million in my portfolio that we could get rid of tomorrow. [Interruption] Imagine how far it would go in that member’s electorate towards lifting the achievement of children who need the best opportunity that an education system can give them.

This House has heard a lot in the last few months about community funding, where the Government blew out $80 million and did not even know it had happened. The Government’s response to that has been absolutely pathetic. I have submitted parliamentary questions, the answers to which contradicted each other. One answer said the Government will cap enrolments in community funding because last year there were 250,000 enrolments, and the other answer said the Government will not cap it. There is actually no one in charge of the hundreds of millions of dollars of our expenditure who knows what he or she is doing. I hope that the House will debate this Government’s spending very thoroughly over the next 6 months.

PITA PARAONE (NZ First) :Tēnā koe, tēnā koutou. This Budget has been described as a large one, and I suppose $2.4 billion in spending during the next year, rising to $3.8 billion by 2007-08, can rightly be described as a large Budget. But that comes as no surprise because this Budget really is one to bribe constituents. It is described as being one of working for families, but its description goes on to say “when fully in place.” Therein for me lies the rub, particularly as most, if not all, those low to middle income families intended to benefit from this Budget will not do so until 3 years down the track. If their plight is so needy—and Government would have us believe that it is—then why is the benefit not kicking in immediately? Families will have to wait the full 3 years before they get the benefit of this Budget. I know that one or two of my caucus colleagues who have already spoken in this debate on another day inquired why those families have to wait so long. I do not accept the response given by both Government and United Future spokespersons that day, and I still do not.

There is a saying that where there is a will, there is a way. And the way was for the Minister of Finance to go back and do the numbers again. When it comes to increasing taxes, this Government can certainly find the way to ensure that that increase takes effect within a 24-hour period. However, with the way things are now, all working New Zealanders will have paid for this so-called increased spending by the time the full effects intended by this Budget actually kick in. The present surplus will not have been touched in any way. In fact, I would be bold enough to say that it will be even greater than it is now after the 3-year period.

It is no secret that many of the families regarded as beinglow and middle income families are in fact Māori families. I want to focus on that particular group in our society. Recent reports indicate that homeownership is becoming more like a pipe dream to that same group of families. That is shameful in New Zealand in 2004. Shelter is a basic need and right, but in this country the ability to buy one’s own home is rapidly becoming a privilege. Well under half of Māori families are living in their own homes, compared with 72 percent of the rest of the community. That is shameful. I can recall in the 1950s, in the 1960s, in the 1970s, and even in the 1980s, in the days of the former Department of Māori Affairs, Governments of the day could guarantee that each year 500 of the families under the responsibility of that department would move into their own homes and gain homeownership. Perhaps the time has come to revert to that programme.

I note from the Budget notes on Vote Māori Affairs that nothing seems to be there for kōhanga reo—and that is in spite of the utterings of the member for Waiariki. Perhaps the reason the words “kōhanga reo” are not mentioned in this document is that the Government has put aside $21 million to promote its Budget. I also suggest that in relation to a number of the families involved, who have been described as low and middle income families, I can understand why the Government has to put aside $21 million to promote its Budget. A great number of those families will not avail themselves of what it promises.

I note that funding has been made available for a hui taumata. Might I suggest that those funds could be better utilised in the areas of social and economic development, and that the hui will be an opportunity for those who attend to tell this Government only what is already known.

Jill Pettis: Will the member answer a question? Why did his former colleagues vote for market rents?

PITA PARAONE: Why would Māoris want to vote for a Māori party? Given that the emergence of the new political party is clearly born from the frustrations of Māori with this Government, I would have thought that the need for a hui taumata would be the last thing the Government would want.

Another programme that has been budgeted for is local-level solutions. I would be very interested to know just what local-level solutions are, but I do know that they were a Budget item in the last financial year. I also know that that same budgetary item was underspent by hundreds of thousands of dollars. If that is the case, why do we have another Budget item for that activity?

Mahara Okeroa: It’s your fault.

PITA PARAONE: That member across the way should know. Although he accuses me of being part of the responsibility for that under-expenditure, he knows very well that he, in Government, is more responsible than I am.

The Minister of Māori Affairs has waxed lyrical on the value of this Budget to Māori. I say that Māori and other New Zealanders have been misled. It also came as quite a surprise to me to be watching the Marae programme on Television New Zealand on 30 May, where the Minister was interviewed. He was asked about the amount in the Budget that had been allocated to his portfolio, and I was really surprised by his response. He said that it was actually more than he expected. So what did he ask for? Obviously he must have asked for less, and if he asked for less, is that how important he feels his portfolio is? That has to be the question.

Jill Pettis: The member has obviously never been in Budget negotiations.

PITA PARAONE: The member is quite right, but I can assure her that I would have done a better job than the present Minister of Māori Affairs.

In the statement of intent for Te PuniKōkiri there is a programme called “Māori Succeeding as Māori”. I wonder whether a Government member could take a call and explain to us what is meant by “Māori succeeding as Māori”. It is all very well to have these slogans and catch phrases, but if they do not produce or mean anything, then why have them? More important, why allocate funds to a programme that quite clearly is not understood by the people it is aimed at?

Jim Peters: Another high-sounding nothing!

PITA PARAONE: It really is another high-sounding nothing, as my colleague says.

At the end of the day, I do not believe that this Budget has delivered to Māori in the way that the Minister and the Government are leading us to believe. I suggest that those Māori members over there ought to have some concern about the emergence of the Māori party, because if they had obtained the required budget to see their people develop socially and economically in the way they want, there would be no need for the emergence of a Māori party. Tēnā koe.

MAHARA OKEROA (Labour—Te Tai Tonga) : Ā, tēnā koe, Madam Speaker, i a koe e whakahaeretiaingāāhuatanga o te Whare nei.

[Greetings to you, Madam Speaker, for the manner in which you are carrying out the functions of this House.]

I will attempt to answer some of those questions. However, I will answer them in the context of my speech. We all know that this is a very significant time for Māori. It is time for the Matariki, Puanga, me ngāwhetū katoa kei rungai a Ranginui e tūnei.

[the Pleiades, for Rigel, and for all the stars in the Mighty Sky Father above, that stand before us.]

It is a time when Māori embrace and celebrate all that is tikanga Māori and Māoritanga. Matariki essentially is a time for new beginnings, a time to make fresh starts, and a time to reflect on what the past year has brought us and what the future holds. They are the signs of the Matariki. They are the signs—and Ngāti Wai and Ngāti Hine know that—that our old people celebrated. Māori can embrace the new year with the knowledge that the Labour Party is helping whānau to grow, to strengthen, and to succeed through the initiatives that Budget 2004 has brought about.

Budget 2004 will give Māori the support they need to succeed as Māori. That was a key question asked by the honourable member opposite: “What does it do?”. It benefits Māori financially. Initiatives will help to preserve Māoritanga for the future. Budget initiatives will give Māori the opportunity to improve whānau well-being, kia ora aingā uri e haere tonu mai. [so that coming generations will survive]

Supporting Māori families, giving Māori children a good start, and enabling Māori to succeed as Māori is what Budget 2004 offers to our people—Tai Tokerau ki Te Upoko-o-te-Ika whaka whiti anō Te Moana Rau Kawakawa ki Te Wai Pounamu.

[from North Auckland to Wellington and across the Rau Kawakawa sea to the South Island.]

My colleagues have pointed out what support Budget 2004 will give to Māori. What is important to me is the overall impact this Budget will have on everyday Māori families. We need to take a step back and look at the positive effects this Budget will have at the grass roots level.

I will introduce us hypothetically to a “typical” Māori family that is found in many regions all over Aotearoa. I shall call them the Ropati family. In a four-bedroom State house live Mere and Hone, the parents of three children: Tama, who is 18; Erena, who is 10; and Hata, who is two. They also have their koro and kuia with them. Their names are Koro and Kuia Ropati. They have retired and are now living with their children and their mokopuna. Budget 2004 will have a positive impact on the lifestyles of everyone in that whānau.

What does this Budget do? Let us look at the parents. Hone and Mere have a weekly combined income of about $650 a week—not much to raise three children on. But because of our Working for Families initiative, introduced in Budget 2004, they will reap the benefit of an extra $125 by 2007. This is a big deal to Hone and Mere. To put it in perspective, it is like a week’s worth of groceries, school books for their children, or paying the registration on their waka.

Pita Paraone: You can’t believe that!

MAHARA OKEROA: We believe it. We do not only believe it, we are committed to it. Hone is a keen entrepreneur. He is full of ideas and he wants to leave his cleaning job to start a Māori tourism business. Hone went along to a hui that was hosted by John Tamihere and Dover Samuels and picked up the real essence of why he should be there. He had no previous business experience and no idea how he would get his business off the ground. Budget 2004 is providing more funding to the Māori Business Facilitation Service, and this service will give Hone the support and advice that he needs to get his business up. Kia ora mai te RōpūReipa. This is just a simple example of how Budget 2004 will help Māori succeed as Māori.

Tama is 18 years old and is the oldest son of Hone and Mere. Tama is deciding whether to go to university next year. Because of the changes brought about by the 2004 Budget, Tama is now entitled to a student allowance, which will mean he will not have to borrow so much money, making life after university so much brighter. Tama now has more educational opportunities and further educational funding through industry training schemes and Modern Apprenticeships. What does it do? It gives Tama choices.

The youngest children of Mere and Hone—Erena and Hata—have something in common with their kuia and koro, and that is that they will all benefit from the new Māori primary health organisation that is opening in their rohe—in their home town. Erena and Hata are both under the age of 18. They will receive free health care through their local primary health organisation and pay the minimal amount of $3 for their prescriptions. It is good for Māori health and easy on the wallet. From 1 July, Koro and Kuia Ropati will also receive cheaper health care and $3 prescriptions, giving them no excuses not to go to the tākuta.

Now we get into this other matter. Māori, along with other people, suffer from hip problems and need more operations because they have been outstanding on the rugby field playing for the Māori All Blacks, and the All Blacks. Koro Ropati was a famous rugby player but the years have not been kind to old Koro Ropati, and his local Māori district health board provider has informed him that he will have to undergo a hip replacement if he wants his mobility. Budget 2004 is very good news for Koro. We need to look after our old people. They have a right to be with us in a family. That honourable member opposite, Pita Paraone, will note that, political bias aside, this side of the House has supported Ngāti Hine in their quest for iwi status during the fisheries select committee. Why did we do that? We did that on principle.

Pita Paraone: I raise a point of order, Madam Speaker. I am not quite sure whether it is normal practice to suggest that the help that one member gives to the tribe of a member from the opposite side of the House should be a consideration for debate, given—

Madam DEPUTY SPEAKER: I remind members that there will be silence during points of order.

Pita Paraone: Thank you Madam Speaker. This is an issue that is of concern to me. The comment suggests that if I continue to have a contrary view, the support that that member and his Government may give to my tribe may be withdrawn.

Madam DEPUTY SPEAKER: There is no point of order there. That is a point of debate and I clearly heard it that way.

MAHARA OKEROA: What I wanted to point out to the rest of the House is that we are trying to help Māori succeed as Māori, ahakoa te rohe. [regardless of area] That is what we are about. We are not about trying—we make sure that Māori succeed as Māori and that is a very key point that I put to the House.

So Budget 2004 has nothing but a positive effect on Māori—better education, cheaper health-care, business start-up support, and more money in pockets. All these benefits improve whānau well-being, which is an important tikanga of Māoriwhānau.

So what is wrong with this Budget? I cannot see what is wrong with this Budget with regard to the wave of criticism that is mounted upon it. I think that the Hon Michael Cullen and the front bench need to be acknowledged fully for the work they have done in moving Aotearoa forward, not only for Māori, but for everyone who lives in Aotearoa.

LARRY BALDOCK (United Future) : I rise to speak in this debate on behalf of United Future, and to welcome this family-focused Budget. When I first came into this House our leader, Peter Dunne, made me aware that in the 2002 Budget speech there was not a single mention of the family. But now all we are hearing about is family, family, family. It is music to my ears that this Parliament is concerned about families in New Zealand. In fact, it would be a fabulous exercise to take the Hansard of the debate, when it is finally posted on the website, and see how many times “family” is mentioned compared with previous years.

Strangely enough, there are still young parties outside this Parliament that are saying that if they are elected next year, they will make families the centre of Government. It is a shame people from those parties are not sitting up in the gallery throughout this debate and realising that we in this Parliament are definitely concerned about the plight of families in New Zealand. There is still a long, long way to go and much still needs to be done for families in this country, but it is tremendous to hear every party speaking in this debate about families. Of course, in United Future we are far too modest to claim—

Jill Pettis: Some speak with forked tongues.

LARRY BALDOCK: Well, perhaps. We in United Future are far too modest to claim all the credit, because we know that many members in this House are concerned about families. What is happening in this debate is that Opposition parties are arguing about the delivery of assistance for families, and that debate may be a healthy one. We may not ourselves be comfortable with the entire package that has been presented for delivery of assistance for New Zealand families, but at least we will see some much needed assistance going to them. I look forward to the day when this House has the same debate about marriage in this country, because if we do not begin to focus on marriage in the same way that we are focusing on families, we will not be building the kinds of families New Zealand needs. We will not see the statistics that are so deplorable in our country being reversed and taking the proper direction, so that children grow up in more stable family homes and are cared for in the way they ought to be.

So far in this debate, there has been a great deal of discussion about tax cuts. Some have said that there should be equality, that we should have tax cuts for everybody, and that that is the only fair way of delivering assistance. But to me, that is ridiculous. This Parliament ought to be discriminating in the way it delivers assistance, and that assistance should go to families. Families are the ones who have been forgotten for so long and who should be given assistance before others in this nation. If there were an abundant supply of funds, the Government could deliver them to everybody, but, with the resources it has, it must focus its attention on those who are most in need.

The argument about discrimination is absurd, in my opinion. In this country we ought always to discriminate on the basis of families and on the basis of marriage, because that is the right thing to do. There are good reasons why we discriminate. Only the negative kind of discrimination should be outlawed in this country, not the positive kind that is of benefit not only to those who receive it but also to society as a whole. We should not put those who marry and embark on raising a family on an equal plane with all other adults, or with all other forms of relationships. I am sure we will have more of that discussion next week when the House begins to discuss the introduction of the Civil Union Bill.

If we are to have tax cuts in this country, then let us first of all talk about tax cuts in the form of income splitting for married couples. Let us also talk about free education, not double taxation for parents who want a choice about where they send their children to be educated. Let us not see headlines like in the Dominion Post this morning, stating:“The rising cost of free education”. That is occurring more and more around our country as parents have to scrape their pennies together in order to meet the costs of sending their children to our so-called free education schools. Let us talk about removing GST from rates, so families can get some relief in their rate expenses as they seek to own their own homes and begin to develop an equity base in order to provide for their families in the future. Taking GST off rates is a tax cut that really does make sense—not the sort of lunacy of the 20 percent, or the 20c, across the board tax cut. Such a measure would be targeted at those who should be getting assistance, and United Future will continue to promote that. Let us pay for a greater percentage of the Government’s contribution to the building of local roads around our country so that councils have less of a burden in the building of those roads and are therefore able to reduce the rates they have to charge on property owners around the country. Those sorts of tax cuts would make sense, then, if there is still a surplus, it might be time to discuss a more equal distribution in the form of general income taxes. But we must first of all target the areas of need in our society.

In this Budget I welcome the doubling of the allocation to the Energy Efficiency and Conservation Authority. That is something that United Future put forward in its Budget bid so that more finance would be available to give grants to those who want to install solar heating into their homes. This is something that I believe is still tremendously underfunded. We welcome the fact that the funding has been increased from $200,000 to $400,000, but it is still only a drop in the bucket of what we need to do if we are to make efficient use of our energy in this country. Solar heating should be installed in all new homes and refitted into existing homes as much as possible, and the Government does need to step in with some interest-free assistance to enable families to do that. If there is a limitation in the capacity right now in the industry to supply sufficient units, then I hope the Government will send a very strong signal very soon that it will begin to invest in the industry so that it will be able to handle an increase in the amount budgeted next year and so that we can make real progress in that regard.

One other area that I will touch on—unless Madam Speaker is about to rise to her feet—is the issue of the money spent on trying to eradicate possums from this country. Something in the order of $40 million is being spent on trying to get rid of possums, yet on today’s market rates, the cost of possum fur increased to something like $75 a kilo. We have a resource in this country, with 60 million possums, of something around $300 million to $400 million. It is just ludicrous that we are funding 1080 poison programmes to get rid of possums, when there are hunters all over the country who are able to go in and harvest them as a resource and assist in their eradication. I hope there will be greater cooperation with the Department of Conservation, the regional councils around the country, and the animal health boards so that we can make the most of this resource, while still seeking to eradicate that awful pest and others that exist alongside it in our biodiversity struggles.

JUDITH COLLINS (National—Clevedon) : This Budget is supposed to be called Working for Families. Well, one could not find a bigger joke. What a sad, sad indictment on Working for Families, because the only people working for families in this Budget is someone else’s family working for someone else’s family. That is what this is all about. As the National Party’s spokesperson on families, I thought maybe there would be something here for families, but I have to say it was a very disappointing Budget. It is a Budget that did not understand that one of the things that families do, when mums and dads are together with their kids, is to teach the kids about working. Parents teach their kids about responsibility and about not taking handouts from the Government and taxpayers unless they absolutely have to. They teach their kids that they have to go to school, get qualifications, and try to take the pay rise with the responsibility that goes with it. They do not say to their children: “Don’t take a pay rise, because you might have to do a bit more, and you will lose a bit of the benefit.”

But that is what this Budget is all about. It is a Budget that says to someone who is earning $60,000—a one-income, two-parent family with two children—“Actually, you’re a bit of a mug really, to be working harder. You’re a bit of a mug to be getting extra qualifications, because if you got just $38,000 a year, at the end of the day you would lose only $2,376.” That is exactly what this Budget states. What happened when the National Party deputy spokesperson on finance pointed this out to the Hon Steve Maharey? What did he say?

John Key: So what!

JUDITH COLLINS: He said, “So what!”. And what did Helen Clark say about this, when it was pointed out to her? She said—

John Key: They’ll act irrationally.

JUDITH COLLINS: “They’ll act irrationally.” Well, they certainly will. What they will do is be like everyone else. They will sit around and say that they are obviously mugs to work the extra hours, get the extra qualifications, and pay 90c in the dollar in marginal tax rates. Or there is the extreme example—actually, not that extreme—of someone who also happens to be paying off a student loan, as a lot of people on $60,000 a year would be. Those people pay 99.2c in the dollar at their highest marginal tax rate. Why even bother? Those people can hang out for the next National Government next year, or they can get rid of this Government even sooner. All they need to do is take out United Future. Those members should sort it out too, and just leave. Come over to the other side, I say to Larry Baldock, and stop hanging out with those guys. If one lies down with dogs, one gets up with fleas.

One thing I was worried about was the fact that early childhood education is one of the biggest expenses for young families. It is incredibly important that young children in our country get early childhood education. When the Government announced that it would provide all this extra money for early childhood education and that every child aged 3 or 4 years old would have free education, I thought that was fantastic, except when I looked at the fine print and realised that it applied only to children at the community-owned centres—that is, the kindergartens, the kōhanga reo, and those sorts of centres. Those centres are the only ones the policy applies to. The New Zealand Herald did not even pick that up. It got it wrong, and later had to make a correction. In my electorate there are areas where people cannot get kindergartens even started, because the Minister has told them that their decile rating is too high. Those people are being told to pay extra taxes to pay for other children to go to pre-school, but their children cannot afford to go. They cannot afford to go because their parents are being taxed to death by this Government, which does not care one ounce for families. All the Government does is to spend other people’s money to try to make it feel a bit better about it. It is an absolute disgrace.

Sixty percent of the children in early childhood education are in private centres. I can tell the Government that the cost of that to their parents is huge. Often it is between about $8,000 and $10,000 per year. That is what parents are paying. So for a lot of mothers, in particular, that means they are working for about $2,000 in the hand per year. Under this Government—under these new rules—they may as well not even bother, as they will probably get less than that. It would cost them to work. That is what this Government is doing for them. Yet the Government says constantly that it is trying to get more women involved in the workforce—doing what? It is not helping women to get into the workforce. All it is doing is helping women to go out and work for nothing—effectively, as slave labour—and to make a decision to not work, or to not look after their children. That is what this Government is all about.

These guys just do not care. Government members do not care about the ordinary working families that currently pay their wages. What is even worse is that the Government is turning a whole lot of good New Zealanders into people who have to take a handout. These are people who have survived and have supported themselves. [Interruption] Clayton Cosgrove’s constituents are being picked on, because they want to be able to support their own families. People in this country do not want to have to take handouts. This Budget is all about turning good New Zealanders—people who are proud and independent—into beneficiaries, and, unfortunately, United Future is supporting the Government in this.

I think it is a disgrace that the only parties that voted against this Budget were National and ACT. All the other parties in this Parliament rolled over, and said: “Tickle my tummy and make all these people beneficiaries.”

Jim Peters: We haven’t done it yet.

JUDITH COLLINS: Well, those parties have said they will support it. That is what they did. Let us see where those parties go in the end. The only parties that have been staunch against this nonsense are National and ACT, and I say good on them. This Government has stood around and turned some more people into beneficiaries. This has to have been the biggest beige Budget ever. What a disappointment—a beige Budget. When I look at a Budget, I like to wonder what sort of colour to give it. This is a beige Budget, and it is so boring. After the first flurry of newspaper reporters all writing the wrong things, as they did on that first day after the Budget announcement—all obviously having read Steve Maharey’s press releases and having got them wrong—they stopped writing about the Budget. The reason is that the polls told us that the people of New Zealand thought this was a giant yawn of a Budget—a beige Budget.

The best thing this Budget does is to give people an extra takeaway meal per week. That is all it does for families. That is all it says to New Zealand. It says to New Zealanders that all the Government needs to do is to give them an extra $20 per week in the next 2 years—and I ask Mr Key whether that is right—if they are lucky, and that that will help them out. Having taken a billion and a half dollars in extra taxes, what will the Government do? It will give an extra 20 bucks in the hand to some people. For the people who are struggling away, for the people who are taking two jobs and getting lumbered with secondary tax, and for the people who are trying to cope on one income, what does the Budget do for them? Nothing much. Four out of five families get nothing out of this Budget. It is the biggest waste of money one could ever come across. Does the Budget do anything to help business? Does it do one thing for business? The only businesses that may possibly benefit are The Warehouse and Restaurant Brands New Zealand. They are the only businesses that might benefit.

The Budget was a cynical vote-buy. Why does the Government not just give people an extra voucher? That is about all this Budget is. Nowhere in this Budget is there anything to help people to get a bit of aspiration. Nowhere does it give people an incentive to get out there and work hard. Nowhere does it give people an incentive to get some extra education. Nowhere does it help people to get some extra trade certificates. Nowhere does it do that. Instead, it gives us a whole lot of nonsense about how everyone can now have free pre-school education. The trouble is that there are not enough places for children. Many people tell me that if they can even get their child into a kindergarten, it is a miracle. Having said that, what hours are available?

DONNA AWATERE HUATA (Independent) : I initially thought that this Budget lacked vision, but I was wrong. It has a vision, and I would say it is a grim vision. I would call this Budget a “grim reaper’s Budget”, because it is based on the most miserable view of human nature—that is, that ordinary people cannot make up their own minds and need bureaucrats and politicians to spend their money for them. It is a disappointing Budget, because at the end of the day all it does is sprinkle lollies around. But someone has to pay for it—someone has paid for it. I think what the Budget essentially does is spread its miserable view of human nature. It takes money from hard-working New Zealanders and just sprinkles it around. As the previous speaker said, it turns hard-working New Zealanders into welfare recipients. That is its tragedy.

I have to disagree with several of the Māori members on the other side of the House who called this a great Budget for Māori. When I look at what is happening in education, I certainly cannot agree with that statement, but I will have to contradict myself in a minute, because I want to pick out one of the best and one of the worst spends in this Budget, which are in education.

The $17 million increase given to the Education Review Office has to be one of the best spends—small though it might be—in this Budget. I think the Education Review Office shows what can be achieved when an organisation has excellent management. It was set up by a visionary leader, in a way that has achieved excellent outcomes, and that excellence has continued with the current leadership. I think that what the office has achieved in its ability to turn out high quality reviews setting guidance for schools, and in its ability to work under pressure and achieve at the rate it has in early childhood education—there were 1,300 reviews in the last year—is extraordinary, given the budget it has. The Education Review Office has almost reached the target of having every early childhood centre and every primary and secondary school reviewed within a 3-year cycle. The time frame in which it has been able to achieve that is, I think, nothing short of a miracle. I have to take my hat off to it for the fact that it is now venturing into this whole new idea of doing national reports on a cycle, and that it will achieve that in the next 3 years. So I believe that that extra $17 million the Education Review Office is getting is one of the best things in the Budget.

I also want to support the Government—having said that the Budget is a grim reaper’s Budget—in the idea that it will give more money to the early childhood education sector. If there is one sector in education that has never really been given the support it needs, it is early childhood education. Not just under Labour, but also under National when it was in office, early childhood education was always the poor relation, and all the money seemed to go into tertiary, primary, and secondary education. That is still happening, but at least this Budget is a nod in the direction of early childhood education, and I support that.

However, where the Government has gone completely awry is in supporting community education and in not giving the kind of support needed to private education. At the end of the day, it is private education providers that are in those areas where there are no kindergartens.

Jill Pettis: But we have.

DONNA AWATERE HUATA: I say to the member opposite that in Flaxmere, one of the poorest areas in this country, there is one kindergarten. There are a few community educators, but most of them are private educators.

The area that has fared worst in the Budget is, I have to say, the National Certificate of Educational Achievement (NCEA). An extra $17.8 million has been given to the NCEA. I cannot agree with that. NCEA is a complete shambles and, if anything, the events that have occurred at Cambridge High School are simply a metaphor for what is happening in other parts of the sector. I cannot believe that moderation can be as bad as it is. Even with school relationship managers appointed by the New Zealand Qualifications Authority going around crawling through schools, the shambolic situation was not picked up whereby a unit standard could be passed in 10 minutes and 35 unit standards could be gained in 3 hours. That is completely shambolic. Shame on this Government!

Hon DAVID CUNLIFFE (Minister of State) : I do not know about other members, but I really enjoyed the adjournment after the Budget. I had the opportunity to go and brief a whole lot of schools in my electorate of New Lynn. I was able to visit old folks’ homes like Crestwood and Pinesong, and tell them about how we are protecting superannuation by partial pre-funding. I was able to visit lots of family homes in Maioro Road, New Windsor. I met a young couple with two children, who will be $100 a week better off as a result of this Budget. I met a woman with seven children, whose husband died last year. She may be up to $200 a week better off because of this Budget. The lives of those people have been transformed. So I am happy to say that it was a great adjournment.

What a great honour it is to be debating this Budget. Why? Because it is a Budget that is true to this Government’s core values. It is a Budget that demonstrates our strengths as stewards of the economy. It is a Budget for getting Kiwis into work and for making work pay. It is a Budget that invests in the future of New Zealand. It is a Budget that makes sure that low and middle income families get the help they need. It is about a future that includes rather than excludes. It is about a future where we move up the value chain to create wealth for all New Zealanders.

This Budget is possible only because of the economic success of the last 3 years. The proof is that under National from 1990 to 1999, growth averaged a meagre 2.6 percent per annum—well below the OECD average. Since this Government has been in power, that growth rate has increased to an average of 3.4 percent per annum, which is well above the OECD average of only 1 percent. It is because of that growth that we have been able to keep such a strong fiscal position, with healthy surpluses at the same time that debt is falling. By 2007, for the first time since Vogel borrowed for the railways, New Zealand will be a net creditor nation—the first time in a century.

This Budget targets those people who really need it. National’s tax cuts would target those who would benefit as high-income earners. We do not apologise for thinking it is more important to look after children who need help. We do not apologise for looking after those who will put food on the table, thus benefiting more than those who will simply upgrade their hotel during a weekend in Queenstown.

That is why the Working for Families package boosts the income of working families more than any tax cut ever could. As Dr Cullen said in question time today, the $15.9 billion it would take to give the same tax cut to a family on $55,000 would be the same as all the spending on health, law and order, defence—we know how National loves that—transport, communications, primary health care, culture and heritage, recreation, housing, and community services. Eat that!

There is no need really to examine what Dr Brash has said about this Budget, because he has not said much. But let us look at what John Key said this morning at the Finance and Expenditure Committee. It was his big moment. The cameras were lined up. The Minister of Finance was there for an almost unlimited time of questioning. What did he ask? His lead question was: “How do you see debt trending in the medium term?”. The answer was: “Down, because we are good managers of the economy.” Well, I wish Mr Key better luck next week.

But let us turn to the arguments the National Party has put up in this debate. The first is that this Budget is too narrowly targeted. Too narrow for whom? Is it too narrow for the 60 percent of all families with kids, who will benefit over 4 years by an average of $66 a week? Is it too narrow for the Waihī family of six, featured in the Sunday Star-Times,who will benefit by $150 a week?

Georgina Beyer: How much?

Hon DAVID CUNLIFFE: By $150 a week. Is it too narrow for the 70 percent of New Zealand children who will be lifted above the poverty line they currently lie below? It is time the Opposition came clean. What they are really saying when they say the Budget is narrowly targeted is: “What about me? I earn over 100 grand and I want some, too.” If that is the argument, it is bankrupt. I know that we will be a three-term Government, because I know that New Zealanders are basically fair and decent people, and they will vote for a party that stands for the good values New Zealanders hold dear—that is, giving the ordinary bloke and blokess a fair go.

Georgina Beyer: Bloke and what?

Hon DAVID CUNLIFFE: Blokess—sort of like the member.

The Opposition says that this Government punishes the hard working. Let us look at that argument, which fails on a couple of grounds. The argument about marginal rates is essentially the same as it was under the tired old National Government of the 1990s. It is all about family support, and it does not matter at what income level the rate changes, because the marginal rate issue will be exactly the same. All we have done is give low-income families a break by lifting that level of change a little higher up the income table. The Budget specifically makes work pay by ensuring that people who are working will always, without exception, benefit by more than people who are on welfare.

But that does not worry the National Party, because what National members are really saying when they say that the Budget “punishes the hard-working”, is that it does not give a tax cut to the rich. Judith Collins calls those people “good New Zealanders”, and the implicit assumption is that if people are not rich, they are not good. Well, I have news for the National Party. It is not just the wealthy who are hard working; it is the ordinary mums and dads who live in my electorate of New Lynn, who go to work and work hard all day, and who need a hand to raise their families, put food on the table, and give their kids school books. Those are precisely the families that this Budget helps.

I kind of enjoyed the contribution by Muriel Newman.

Clayton Cosgrove: Who?

Hon DAVID CUNLIFFE: Muriel Newman. She was once a contender for the leadership of the ACT party, would members believe? She said—and I love this bit—that “$6 billion in tax is more surplus than needed.” What part does she not understand about the $2.1 billion we are putting aside to fund superannuation? I think it lays the fact bare—and ACT’s agenda is the same as the National Party’s agenda—that there is no security around that superannuation fund if the right ever gets back into office. It ignores the $2 billion that we are investing in infrastructure—repairing the infrastructure deficit we inherited from the 1990s. It ignores advances in health and education, and it ignores the need to keep our currency stable by supporting the Reserve Bank.

Brian Fallow got it right in the New Zealand Herald when he said: “… major tax cuts require one of three things—equally major spending cuts, a retreat from the debt target, (risking adverse market reaction and higher interest rates) or scrapping the Superannuation Fund.” So it is time the Opposition came clean and, rather than dithering, told us exactly which one of those three options it backs.

Mr Key said: “This is the largest Budget surplus that any Government in New Zealand history has had. It is over $6 billion, and it is an enormous opportunity to deliver relief.” Well, as I have said, there is no pot of gold. Dr Brash said, on the subject of taking on more debt: “Well, that’s certainly one option. Most Governments do borrow for capital expenditure, so it appears they haven’t written off the debt option.” On the superannuation fund, he said: “We haven’t reached a decision on that one.”, but surely senior citizens in all our electorates deserve to know. The reality is that any person who needs to rely on Government superannuation would be mad to vote for anything other than this Labour-led Government, because there is no security if that other lot ever gets into power.

I liked the argument that company tax cuts are needed because we are a high-tax economy. People should talk to Ralph Waters of Fletchers, who said he would rather invest in New Zealand any day because when we add up GST and sales tax, we see that the Australians are taxed way higher than us. Besides, there is absolutely no evidence that a cut in company taxes will, in and of itself, provide a significant growth stimulus. I give an example: in 1988 we cut the tax rate from 48c to 33c, and that was followed by some of the most miserable years New Zealand has ever had. In Australia, company tax rates are 4.5 percent of gross domestic product (GDP), but in New Zealand they are only 3.8 percent of GDP. So I ask any business that says it wants to go to Australia in order to pay less tax: “Which Australia are you talking about?”, because in the Australia I know, businesses pay more tax.

In summing up, let me say that the people in my electorate will benefit significantly from this Budget. It is a Budget that delivers on Labour’s promises. It is a Budget that is true to Labour’s core values. It is a Budget that I am proud to support.

PANSY WONG (National) : It was surprising to hear the Labour Associate Minister of Finance, the Hon David Cunliffe, speaking in such a defensive tone. It seems difficult for him to sing the praises of the Labour Budget and therefore he spent three-quarters of his time trying to defend it and attack us. I want to mention a coincidence. The member kept saying he has been pounding the streets of his New Lynn electorate. Incidentally, I was door-knocking in Herne Bay, Auckland Central, and came across a household in the name of David Cunliffe. I tell him that the Labour Budget received the thumbs down in Auckland Central, and that includes the people of New Lynn.

The Labour Government tried to label the $1.1 billion payout in the Budget as the Working for Families package. Sadly, the Budget is not working for the Labour Party. In fact, it has received the thumbs down. In all the after-Budget polls the majority of New Zealanders said: “We do not want a handout.” They aspire to have jobs and want to be self-sufficient. If the Budget is as good as Mr Cunliffe is trying to tell his electorate in New Lynn, but he lives in Herne Bay, why should the Labour Government bother to spend another $21 million to promote it? Let me ask my colleagues how many hip replacements they think we could buy with $21 million.

Simon Power: How many?

PANSY WONG: We could buy 1,600 hip replacements. Guess how many computers the Government could have purchased for schools.

Simon Power: How many?

PANSY WONG: It could have purchased 10,000 computers.

John Carter: Serious?

PANSY WONG: Yes, it could buy 10,000 computers for schools. Instead, the Government wasted the money on explaining the biggest spend-up Budget. If it was that good why should the Government need to spend $21 million to explain it?

I want to share with the House two other areas where the Labour Government always believes that throwing money at the problem is the answer. Let us examine some of the other money that the Government is throwing away, apart from the Working for Families package. This morning, at the Finance and Expenditure Committee, I asked the Minister of Finance what had happened to the much-trumpeted Export Credit Office. The office was set up 3 years ago. [Interruption] My learned colleague the Hon Lockwood Smith has asked me a good question. Three years ago the Hon Pete Hodgson said the setting up of the Export Credit Office was the saviour for small to medium sized exporters. It would sign up export credit insurance. I point out to my good colleagues that the Export Credit Office is not meant to cost the taxpayer a single cent. That is against the regulations of the World Trade Organization and the OECD. The setting up of an export credit office is not supposed to be subsidised by the New Zealand taxpayer. Can my colleagues guess how many export credit insurance contracts this office has signed up in 3 years?

Dr the Hon Lockwood Smith: A thousand?

PANSY WONG: It is zero—nothing. The office cost $3 million to set up but 3 years later there is not one contract. I said to the Minister of Finance this morning: “Excuse me, but the Minister, Peter Hodgson, assured us that small to medium sized exporters were waiting, queuing up, to use this office, so what business has it signed up? He looked at me and said: “But they do other things.” We said: “Minister, what other things do they do?”. He said: “Oh, you know, they open the doors for exporters.” So I reminded the Minister: “Don’t you think that is the job of Trade and Enterprise? Maybe that is the agency that should do it.” To the credit of the Hon Dr Michael Cullen, he said: “Pansy Wong, I think you have made a very good point.” I have to say the Export Credit Office is now on notice; so it should be. Why should the New Zealand taxpayer pay over $200,000 every year to an overseas agent to oversee this office, which has signed up no business?

But that is not all. The Minister of Education, the Hon Trevor Mallard, before he departed for China on another marketing trip to Asia for export education, announced that the Government will spend $40 million to promote export education. Of course, all the members of the House support export education. In 2003 it earned $2 billion revenue for New Zealand. It is the fifth-largest export industry. We support it.

Unfortunately, the Government has refused to value, and get serious about, the export education industry. Last Sunday another language school, the Paramount Institute of Auckland, fell through and 80 students had to be placed in other schools. In fact, a year ago a staff member of that institute rang the New Zealand Qualifications Authority and told them about the problem with the school. But the authority did nothing. We learnt the same thing about the Modern Age Institute of Learning. It was the largest language school and it failed last year, costing the taxpayers and other schools over a million dollars. Former staff members and other people alerted the New Zealand Qualifications Authority to the problem, but it did nothing.

There is not much point in the Minister travelling overseas, trumpeting that the Government will spend more money to promote export education, when the gatekeeper, the New Zealand Qualifications Authority, has not taken its task seriously.

No institution can enrol international students unless it is registered and accredited by the New Zealand Qualifications Authority. The authority is supposed to audit those institutions. The horror stories are being revealed every day. We read in the Central Leader of accusations about teachers in schools taking bribes, and students not having to turn up to classes. When both those schools were put into liquidation, it was found they had no money in their trust funds. We want to know how the gatekeeper, the New Zealand Qualifications Authority, conducted its audit and how it followed up any complaint. Why would the New Zealand taxpayer have the confidence to spend another $40 million to promote our export education industry overseas when the gatekeeper is not doing its job properly? If we are to return our export education to a credible state, it is important that the Labour Government supports an inquiry to make sure the gatekeeper, the New Zealand Qualifications Authority, is doing its job properly.

This Budget has a theme. It is about the Labour Government continuing to tax and spend, throwing money here and there. Unless Labour understands how businesses are run and understands what incentives are needed for people to work hard and aspire, the Budget will not achieve anything. It is a waste of $21 million to promote a Budget that is complicated and not working.

CLAYTON COSGROVE (Labour—Waimakariri) : I rise to support this Budget. I will start by picking up on a few things Pansy Wong said from the Opposition side of the House.

John Key: They’re worth repeating, because they’re really good.

CLAYTON COSGROVE: I knew that member had a sense of humour. Pansy Wong said that she had been out door-knocking in Auckland. As some of my colleagues said at the time, I ask her to please continue doing that. In fact, I beg her to doorknock in my electorate of Waimakariri, along with John Key, who, I am told, used to live in Papanui in a State house. I invite Pansy Wong to explain to my constituents in Hoani Street, and in Redwood and Papanui, National’s policy on taxation cuts—the only economy policy National has announced—which would give back to its leader $500 to $600 a week. I think a person on $39,000 would get around $40 a week, and a person who was earning under $39,000 would get zip. I invite Pansy Wong—

Hon John Tamihere: How much?

CLAYTON COSGROVE: Zero; nothing. Under National’s only economic policy, and under John Key’s and Dr Brash’s scenario, any person in New Zealand who is earning under $39,000 would get nothing. Any National member of Parliament is welcome to come to my electorate and explain that to my constituents who, like Mr Key, grew up in a State house.

John Key is an interesting bloke. He lived in Papanui. I am told by people who knew his family that he was brought up in a State house, and that his family was very hard-working, especially his mum. A lot of folk remember and admire her. That guy got assistance from the State through the provision of a State house, and I say good on him. He made good, and now he is a success. I am not envious of him; I admire and respect his success. If more New Zealanders could make the income he does, it would be a good thing. My problem is that if John Key’s family had Government assistance and help when they were down on their luck, and John Key made a wonderful success of his life—up until he joined the National Party—then why is he so mean-spirited that he is against this Government’s attempt to replicate that success by helping other hard-working families? I ask him that, and I hear no answer.

This package is about working families, and I know that the National Party hates hearing that. I have been here in the House for 5 years, and I can recall the National Party asking repeatedly when the Government would do something for middle New Zealand hard-working families. When Budgets came out in the past, I can recall that for years middle-class folk would say that they were either a couple of dollars just over the limit, or they were just getting squeezed, or they were just missing out on assistance. Dr Cullen’s Budget will deliver for over 300,000 working families. Members of the Opposition have called the Budget a welfare Budget. I invite Pansy Wong to talk to working families on $25,000, $45,000, and $55,000 who battle and work hard for every dollar they get, and to tell them that they are welfare recipients. I suspect that they would slam the door in her face. I invite the clucky member from up north over there on the Opposition benches to come to my electorate as well to explain that. Under this Budget the average increase for families will be around $100 a week in income. If families with children are in the $25,000 to $45,000 income bracket, they will get $100-plus a week. If families with children are on $55,000, they will get $150-plus a week. That is for hard-working people. For years those people have been saying that if someone is a beneficiary, it is not worth working. They have also been saying that if someone was just above the beneficiary line, then it was probably better if that person was encouraged to go on a benefit, because there was not a lot of difference in income. The Budget has opened up that gap. For hard-working, battling families that are working and looking after their kids, this Budget delivers.

But of course, the party across the aisle in the House is the party of privilege. I heard Judith Collins talk about “those people who shop in The Warehouse”. What a snob! Of course, one would not catch Judith Collins, in her mink coat and pearls, shopping in The Warehouse. She is more of a sort of Christian Dior, Yves St Laurent type of person.

Hon David Cunliffe: Louis Vuitton.

CLAYTON COSGROVE: One would not catch her shopping in The Warehouse with ordinary folk—not with ordinary, hard-working, battling Kiwis who take their kids there. No, she is a sort of Christian Dior type of girl. Maybe Lockwood Smith is as well; I do not know. Or maybe he is a bit of a Dolce and Gabbana type; I do not know.

Just as my colleague John Tamaheri digressed in his speech, so too I shall also focus on and congratulate Rodney Hide—as one does, out of tradition in this Parliament. That pains me. I never thought I would congratulate Rodney on anything apart from his resignation.

Hon Paul Swain: Spongy pud.

CLAYTON COSGROVE: I am just reflecting that interjection. I congratulate Rodney on his massive ascendancy to the leadership of ACT. Muriel Newman is now deputy, and Rodney Hide is leader. They are both extremes. In political terms, ACT has a lightweight and a super heavyweight; I would not be referring to anything else, of course. Rodney said that he will make himself over. I am told that the pollster Paul Heylen once said that about all one could do to make over a male politician was to give him a decent suit—we could do that; maybe two suits for Rodney Hide—a decent tie, which would be a big one for Rodney Hide, and maybe a decent shave and haircut. A haircut might be a bit tough for Rodney I know, but that is about all one could do to a politician. At the end of the day politicians have to be themselves, and they cannot hoodwink the people. We have all heard of an extreme makeover. I suspect that this will be the extreme makeover. I wonder whether the makeover extends to the things Rodney has talked about in his past. I refer to Vote: Serious Fraud, which gets funding of about $5.5 million. I wonder whether Rodney Hide, in his massive makeover, will actually come clean on his activities in Fiji. I wonder whether he will answer questions that he would not answer when he was not ACT’s leader, like who paid his airfares to the Investors International conference. I know that Rodney Hide hates it when I harp on about that, but I shall keep harping on about it until we get the answers.

I can see Stephen Franks there on the Opposition benches. I send my condolences to him, though I am glad Rodney got there.

The ASSISTANT SPEAKER (Hon Clem Simich): Please address members in the way they wish to be addressed.

CLAYTON COSGROVE: I give my apologies for that. With Mr Hide becoming ACT’s leader—and I know this is a wide debate—we over on the Government side of the House say that we have got the ACT leader we wanted. I think a better leader, intellectually, would have been Mr Franks, who is a man of substance. However, we got the ACT leader we wanted. I wonder whether the makeover of Rodney Hide will extend to his coming clean on a whole series of things. I wonder whether the makeover will extend to Mr Hide telling us who invited him to that conference in Fiji, because last week four people in Auckland were jailed for 3½ years for the Investors International scam. I wonder whether he will come clean, make himself over, and tell us why he did not go to the authorities when he found out it was a scam. I wonder whether he will make himself over and clean up the Deborah Coddington mess that we know still exists—and there is more to come. The makeover of Rodney Hide is a bit like the rice pudding theory: one can tear the skin off a rice pudding, but at the end of the day it is still a rice pudding. I look forward to this massive makeover. In fact, if it works for Mr Hide I might line up myself for one. People will see in ACT exactly what Mr Hide has portrayed all this time.

This is a good Budget. If we look at the appropriations we see there is $9.92 billion provided for health, plus additional money for education and $2.1 billion for the superannuitants. The Opposition asked what we have done for the old folks. We secured their superannuation from those people with fingers like Araldite over there on the Opposition benches who would stick their fingers into it and spend the lot. We are looking after folk. When people who are now 50 and 55 years of age retire they will get a pension under us, but they would not if the Opposition became the Government. Mr Tamihere was right when he said that the scariest scenario for this Parliament and for the people of New Zealand was Don Brash as Prime Minister, and Rodney Hide as Minister of Finance and Minister of State Owned Enterprises. At that point all the family silver—that is, New Zealand Post, Landcorp, and Air New Zealand—would be gone. The man who hates that scenario the most—because Rodney Hide declared he wanted to be the Minister of Finance—is Mr John Key. Mr John Key is out there polishing a big piece of lino for Rodney Hide, because we now have a bit of a split between those two potential coalition partners.

This is a good Budget, and it should be supported. In conclusion, I invite the National Party to give us its alternative Budget.

Dr the Hon LOCKWOOD SMITH (National—Rodney) : I know it is not easy when a member has to replace a man like the Rt Hon Mike Moore, the former member for Waimakariri. Mike Moore is a very fine New Zealander. I guess what distinguishes him from the current member for Waimakariri is that Mike Moore has a big heart. He is respected up and down this country, and right around the world. If that member continues to make speeches like that when this country faces important issues, he will never ever gain the respect of Mike Moore. As we speak to this Budget, I am reminded of previous Budgets Dr Cullen has been involved with. There are not many members in the House today who saw the one that comes to my mind. It was 1990, and the Hon David Caygill and the Hon Michael Cullen came into this Parliament to deliver the 1990 Budget—and in my mind right now I can just see them coming into the House. Michael Cullen was the Associate Minister of Finance. Do members know what the distinguishing feature of that Budget was? It was its dishonesty. Michael Cullen supported David Caygill, and they came into this Parliament and presented a Budget that claimed there would be a $79 million surplus. It was a big thing, because this country had not seen surpluses for a while. The only problem was that it was dishonest. When the books were opened after the election, we found what was growing into a $5 billion deficit.

One may ask what similarity there is between the 1990 Budget and this Budget of Dr Cullen’s. I will not say that this Budget of Dr Cullen’s is dishonest, but what is similar in some ways to the 1990 Budget is that this Budget abandons principle, just as the 1990 Budget did. This Labour Government purported to have as one of its overriding objectives taking New Zealand back into the top half of the OECD. That was Helen Clark’s big claim in this Chamber only a couple of years back, yet this Budget abandons all pretensions of ever trying to achieve that. Instead, Dr Cullen has set out to use his surpluses to buy votes—surpluses generated through overtaxing New Zealanders. According to the OECD, since this Labour Government has been in office the average New Zealand worker has suffered the second-highest increase in income tax of any worker in the OECD—that is, in the whole of the developed world. The Government chose to use the Budget surpluses to buy votes. The question is whether that has worked. If we look at the polls in the papers, we can see that it looks as though the answer is no. There have been two polls: the Herald-DigiPoll and the Colmar Brunton poll. Both those polls report that 60 percent of New Zealanders—a far greater majority than those who agree with the Budget—would like to see taxation cuts. That is understandable, because people do not like going cap in hand to the Government to get back the money they earned. They would rather have respect shown to them by letting them keep the money they earned in the first place than have to go cap in hand to the Government, in order to try to get it back.

There is no question at all that low-income families needed help. The abatement thresholds for taxation credits have not been changed for years, and low-income families were suffering and needed help. However, the question is whether this Budget has delivered the help that the Government claims it has. I have sought through written questions details of the official taxation rates that people will face once the Working for Families package is in place, and they are very interesting. I have here the taxation rates faced by someone trying to be independent of the benefit system. After low-skilled people working for $10 an hour—people Labour is meant to care about—have worked 20 hours a week, they have earned $10,000 gross. Do members know what their taxation rate is, as they try to earn another $1—that is, people who are earning just $10,000 year independently of the State? Their taxation rate is not 33 percent and not 39 percent, but is 101.2 percent. That is the rate for low-skilled people who are earning $10 an hour and working 20 hours a week, trying to be independent of the State, and trying to care for a family with three children. And on the next $1 that they earn, the Government takes the lot. In fact, it takes more than the lot; it takes 101.2 percent. Those are not my figures; they are official Inland Revenue Department figures.

Do members know how many more hours the people who are on $10 an hour have to work in order to get their families another $1? We just heard the member for Waimakariri say how much Labour cared about working people. Can he tell me whether he thinks this is fair and reasonable? David Cunliffe should listen to this, too. He said that decent and fair people thought this Budget was good. Is it fair that people on $10 an hour should have to work 40 hours a week in order to get another $1 for their families? In going from 20 hours a week to 40 hours a week at $10 an hour, the taxation rate those people face for every dollar of the $10,000 of extra income that they earn is 101.2 percent. That is an outrage; it is a disgrace. A Government that had $6 billion dollars to spend on helping low-income people should be bloody well ashamed of itself for not doing something to help those hard-working families.

They are not the only ones who are affected. Let us take the example of a family that improves its lot in life and gets up into the middle-income level, with $65,000 of earned income. According to official Inland Revenue Department figures, if New Zealand families have three children they will face a taxation rate of 95.2 percent on between $60,000 and $65,000 of earned income. What is more, if we look at a family that is trying to improve its position from one of earning $10,000 of income a year, we see the lowest taxation rate it will pay, until it earns $90,000 a year, is 40 percent. Throughout the entire $10,000 to $90,000 income range, that family will earn no extra dollars of income where it pays less than a 40 percent taxation rate. Through most of the range, that family will pay 100 percent, 77 percent, 89 percent, and 95 percent taxation rates—and Labour says that is good for working people? It is a disgrace.

To me, the staggering thing is that Dr Cullen is so arrogant that he thinks there are no ways of solving the effective marginal taxation rate dilemma. That is a dilemma, and it is not just a problem in New Zealand. I have heard Dr Cullen say it is a problem in other countries with taxation credits. But if Dr Cullen is as smart as he thinks he is, and if David Cunliffe and Clayton Cosgrove are as smart as they think they are, they would know there are ways of designing a taxation system to deal with that problem. However, they are so stupidly arrogant that they lampoon cutting the taxation rates. I heard those members tonight. David Cunliffe said that if we cut the top taxation rate, all that we would do is to give huge benefits to high-income people. He ought to think that in this country there are people just a little more intelligent than he is, who can actually solve that problem by direct taxation cuts to low-income people, rather than have them come cap in hand to the Government.

This Budget is a disgrace in terms of what it does to working people.

DAVID PARKER (Labour—Otago) : I rise to speak in support of the Budget, and to support the motion moved by Dr Cullen, the Minister of Finance, who delivered this very good and very responsible Budget. The first thing I will do is respond to the main focus of the speech made by the Hon Dr Lockwood Smith, which was to criticise the marginal tax rates suffered by people who have children and who are in receipt of family support or other Government assistance. After listening to his speech, one would think this is something new. In fact, as most listeners will have learnt from listening to previous speeches from members on this side of the House, those marginal tax rates do not change one bit as a consequence of this Budget. It is just that the thresholds at which those abatement rates occur change because of the additional money going into them.

I know that under the Standing Orders I am not allowed to refer to the absence of members, and I note the large number of nodding heads of Opposition members who have come to the House tonight to listen to me and to listen to why this very good Budget was supported in terms of its Working for Families package, and not just by the Labour Government. The Budget was not supported just by us, it was supported by the Progressives, as well, and by United Future, the Greens, and New Zealand First. They were the parties that supported the Budget and the focus it gave to meeting the needs of New Zealand families in the low to middle income bracket.

The only two parties to vote against the Budget were ACT and National. The National Party, just a couple of months ago, was telling the nation that everything should be funded on the basis of need, not race. And when we have a Budget that is most clearly focused on need, National votes against it. National members say that paying additional income to families on low and middle incomes is a bribe. Yet they do not see the hypocrisy of that, when compared with the effect of tax cuts that give disproportionate benefits to higher earners.

Why did we think the need rested in families? I will come to that, but first of all I will record that we are in a strong financial position as a consequence of the Budget surplus that this Government has run for the last 5 years. We do not have to go back very far—only to the mid 1980s, when we came out of a long period of a National Government, under Mr Muldoon—to come to the time when Government debt as a proportion of gross domestic product (GDP) had ballooned to 70 percent. That meant that one in five of the tax dollars taken by the Government was spent on interest. We have reduced that. Indeed, the subsequent National Government did some OK work on that front as well, but by the time Labour came back into power in 1999, debt had dropped to 35 percent of GDP. We have debt down to 24.7 percent of GDP this year, and it is dropping towards 22 percent. Rather than one in five dollars being spent on interest, one dollar in twenty is now being spent on interest. The unemployment rate is down. It was at 7.4 percent when Labour took office, and it is now 4.6 percent. The growth rate was 2.6 percent per annum during the decade under National, in the 1990s, and it has been 3.4 percent on average over the last 3 years—well above the OECD average.

Why is it that we are focusing on families? During the 1980s and 1990s, low to middle income families did very poorly in New Zealand. Between 1986 and 1990, the incomes of the bottom 50 percent of households dropped in real terms—not a minority of 10 percent at the bottom, but half of all New Zealand households had a drop in their disposable incomes between 1986 and 1998. Indeed, the only section of the population to have a significant increase in disposable household income was the one top decile. That top decile increased their incomes by about 30 percent during the period 1986 to 1998, at a time when the incomes of the bottom 50 percent of households went backwards. The incomes of every household in the bottom 50 percent went backwards. The bottom 10 percent went backwards more proportionately than any other group. That was very hard for low to middle income families.

So against that background, we say unashamedly that when there is a growth dividend—more money available as a consequence of strong growth in the economy—we think it is appropriate to focus the rewards on the group that suffered during that period. We have the ability now to pass on this benefit to low and middle income families. What does that mean? This Budget focuses on families with children—300,000 low to middle income families with children; over 60 percent of all families with children. We know that they are the ones with the greatest need. Now, what does this Budget do for them? Low to middle income families on $25,000 to $45,000 per annum get an average $100 per week extra in their pockets. That is a lot of money for people in that situation.

Let us look at a couple of instances that were reported in the newspapers, in advance of the Budget. I refer to the family up north of two parents and four children, with one parent working, who earns $55,000 a year. That single-income family will be better off by $150 per week. What would be the flat tax rate required to deliver an equivalent benefit to that family? It would be a patently unaffordable flat tax rate of 9.5c in the dollar.

Darren Hughes: How much?

DAVID PARKER: It would be 9.5c in the dollar. To achieve that, Government services in education, health, and superannuation would have to be absolutely slashed.

Darren Hughes: What will happen to my schools?

DAVID PARKER: The schools in the member’s electorate would close. Either that, or the parents would be paying substantial private education fees.

Government Member: No hip operations!

DAVID PARKER: Indeed! This Budget doubles the number of hip operations funded by the Government. Rather than being doubled they would have to be slashed, probably by half.

When I was on the Finance and Expenditure Committee last year we heard some heartfelt submissions as to how some families were suffering. One of the ones I remember was someone who came to the select committee and said: “I’ve got the care of my grandchild. I didn’t want to be a grandparent with the full-time care of my grandchild, but I am. I get very little assistance from the Government, despite the fact that I am a low-income earner, and I am doing my best to raise this child, for the betterment of my grandchild and our community.”

Another person in a similar position was a lady called Maureen Dunn. Her story was reported on 28 May in the New Zealand Herald. She is aged 41, and has the care of her granddaughter aged 8. She earns $27,638 as a teacher, and with her various tax credits at the moment has an after-tax income of $509 a week. She does not get any family support. When this Budget fully comes into force, it will deliver this person, whose present income is $509 a week after tax, an extra $123 per week. That is a 25 percent increase in income—

Rod Donald: Why wait 2 more years?

DAVID PARKER: Yes, she has to wait 2 more years. That is the fiscally responsible thing to do, and we are fiscally responsible. I will give members another example—James and LosaLotulelei. These people were referred to in the New Zealand Herald, again on 28 May. They are both cleaners and both earning about $21,000 a year. At present their after-tax income is $652 a week plus what their parents, who are living with them, receive. Their income will go up by $125 a week by 2007 also.

I have heard talk of complaints that this is making beneficiaries of lots of people. Well, we used to have the universal family benefit. Did that turn everyone into idle beneficiaries, or somehow imbue them with a lack of a working ethic? It did not, and this provision will not either. One of the other reasons we should not be worried is that, under this Budget, every person who receives an increased entitlement receives more if he or she is in work. This Budget increases the gap between the earnings of beneficiaries who are out of work, and low to middle income people who are in work. So the argument that this somehow disincentivises people from working is just patently wrong.

I refer to the National Party position, which is very close to ACT’s position. All they can say is: “Well, we are not bridging the gap between the fortunes of Australian citizens and New Zealand citizens.” But I remind members of Parliament again that that gap grew during the 1990s, during the decade of National stewardship of this country’s economic performance, when Dr Brash was in charge of the Reserve Bank.

Hon GEORGINA TE HEUHEU (National) : The view that that minority Labour Government has of its fellow New Zealanders is absolutely disgusting. This 2004 Budget will go down in history as one of the most cynical election bribes ever, and that is without a doubt. The funny thing though is that it is not working. It is very, very weird, is it not? Members on the other side of the House are prepared to stand up and boast about how they are making life better for low to middle income workers in this country, and how they are helping 300 families, which is only a fraction of New Zealand families. They are prepared to stand up there and think they are doing a great thing for the world, but nobody out there in good old New Zealandland is convinced about it.

This Government deserves to be shown for what it is. Its members are the kinds of people who have, over the last 4 years, happily taken the taxes of hard-working New Zealanders, hoarded them away, and pretended that they are responsible for the surplus, when they are not. A lot of the basis of that surplus was laid in the 1990s. A lot of the money that Michael Cullen has been able to hoard away has come out of the pockets of those same low to middle income New Zealand families. In giving that money back to those hard-working families, the Government now has the gall to pretend that it is Santa Claus and should get the credit for it. It will not, and it knows that. This Government is on the back foot. It can see that. The Māori members who were here a minute ago know they are on the back foot, as well. They will lose their seats, and there is nothing surer than that. That is what they deserve, because they are party to the biggest election bribe ever. They are treating their fellow New Zealanders as being without wit or will to decide their own futures.

National has a far different view of our fellow New Zealanders. We see them as having the determination and desire to fend for themselves, to work hard for themselves, and to certainly expect the right supports from the Government of the day, but never to be dependent on it. When we are in Government, which is next year, we will make sure that we recognise those marvellous traits in New Zealanders, because New Zealanders ought to be celebrated, and they are not being celebrated at all in this Budget. This Budget treats them as if they have no aspirations, as if they are only fit to be dependent, and as if they are calling for handouts. Well, they are not.

When this Government goes out of power next year, that is exactly what they deserve. To treat fellow New Zealanders the way it is treating them is absolutely disgusting and cynical. I am happy to be on this side of the House voting with the National Party against this Budget. We are voting against it because of the way it treats New Zealanders, and because of the way it takes their money and then gives it back to them. This Government expects that it should get the rewards, when it should actually be the other way around.

In the House earlier, I listened to Mita Ririnui who, I think, was boasting of the phenomena we have right now of a segment of the Māori community that is making an increasingly visible, positive contribution to the New Zealand economy. Māori entrepreneurship and Māori enterprise have taken a big leap forward in the last decade. Again, the platform for that was laid in the 1990s under the National Government, not under this Government. For Mita Ririnui to boast about those achievements as if they belonged to this Government is again very cynical and dishonest. The only thing this Government has done for Māori is increase their dependency.

It can talk about bringing the unemployment rate down, but that is on the back of a buoyant economy, which is largely due to the 1990s and not to this Government, at all. The Government can talk about that, but, in reality, there are still far too many Māori families on benefits of one sort or another. Mita Ririnui will pay for his part in that in next year’s election, as well. Those Māori members are worried. Someone is passing them the minutes of every Māori Party meeting that is occurring, and they are looking at those with concern. They know they are on the skids.

I want to make some brief comments about the broadcasting portfolio. I see that Television New Zealand had a mixed year. I do not think that any of us are convinced about the way it is structured, in terms of delivering to New Zealanders programmes that tell us about ourselves. It has been loaded with a charter that is so broad as to be meaningless. Television New Zealand is kidding us that, day in and day out, it is delivering on it. It has received an increase in funding to deliver that charter—$15 million annually rising to $16 million next year, and to $17 million the year after. It does not deserve that increase. It has not proved at all that its efforts to present New Zealand to New Zealanders are in any way better or have more value than those of any of the other broadcasters in New Zealand.

Neither has Television New Zealand shown any responsibility about the way it has spent money. It has this underpinning of Government funding, and to my mind, daily shows a level of arrogance that I do not think New Zealanders deserve. Although I see that increase, I do not think it is justified. There is an increase in funding to New Zealand On Air, and that probably is justified.

National certainly supports the notion of independent and contestable funding for all broadcasters, but if this trend is to continue—whereby TVNZ can cry wolf to the Government and the Minister of the day and as a result somehow find itself in receipt of more taxpayer funding—then I do not think that is good enough for New Zealanders.

I want to make one other point in relation to arts and culture. Although we can all be pleased about the jobs and export dollars that our big-screen production is now bringing to New Zealand, I want to flag with the Prime Minister, who is also the Minister for Arts, Culture and Heritage, that this Budget contains no surety as to whether small-screen producers are to be properly nurtured. After all, big-screen production normally grows from small-screen production. We have a wealth of storytellers here in New Zealand who need to be nurtured and supported, because good New Zealand drama comes from our storytellers. I flag my concern that although it is proper to support large-screen production, it is also very important that we do not lose sight of where large-screen production—the big budget films—grows from. The Prime Minister needs to make proper provision for that.

LUAMANUVAO WINNIE LABAN (Labour—Mana) : Kia ora, talofa, and warm Pacific greetings to everyone. Budget 2004 is founded on a set of economic policies that are distinctly Labour, and is based on three core social democratic values: Labour believes in the innate quality of people; Labour believes that people are social beings who prefer living in families and communities rather than as isolated individuals; and Labour believes that people work best when they work together. As a consequence, Labour’s economic and social policies respect individuality and diversity, and they promote equality of opportunity and the right to participate fully in all activities.

Labour’s policies are aimed at ensuring that all people should be able to enjoy a fair share of the nation’s wealth. The top priority of our economic policies is a growing, job-rich economy. In the last two Budget debates I spoke at length about the many smart and successful businesses in Porirua City and up the Kapiti coast that were experiencing a period of economic growth and had benefited from this Government’s sound economic management. This Budget continues that steady economic growth in Mana and throughout New Zealand—growth that is broad-based and sustainable; growth that is the product of this Government’s fiscal management.

But economic growth is only part of the equation for Labour. Social policy is on the other side of the ledger. Income and social support should, in Labour’s view, expand only when there is the capacity to sustain them. Dr Michael Cullen’s careful fiscal management has allowed Labour to deliver a Budget that allows this Government to move more New Zealand families to share the benefits of economic growth. Budget 2004 is about preparing for the future. Budget 2004 makes significant investments in future generations.

Today I want to speak about the many families with working parents that are the big winners from Budget 2004. Budget 2004 has delivered and will continue to deliver for those who are in most need. More than 60 percent of working families will have gained considerable increases in income by the time the package is fully implemented in 2007. Working for Families, when fully in place, will benefit more than 300,000 families, delivering an average increase of around $100 a week in direct income assistance to families in the $25,000 to $45,000 bracket, and substantially reducing child poverty.

Over the days since the Budget was tabled I have talked with many families in Porirua and throughout my Mana electorate, and they are all very happy with the Budget. Many people have rung the 0800 number to find out their entitlements. Hundreds of families in Mana who bore the brunt of the harsh Budget cuts of 1991, and thousands of families throughout New Zealand who suffered from a neglect of family income, health, education, jobs, and housing, are now better off with Labour. Let us look at some examples of how families are better off.

Childcare assistance is being improved to support working families. Around 28,000 families and 33,000 children will benefit from increases to childcare assistance, with average gains of $23 a week per child from next year. Around 95,000 households will receive increases averaging $19 a week in their accommodation supplement in 2005-06. From October this year, pre-school and after-school childcare subsidy increases are also extended to families on higher incomes. Beneficiaries will no longer have their accommodation supplement reduced if they earn additional income, and working families can earn much more before their accommodation supplement is reduced.

A number of other initiatives will assist parents to balance work and family responsibilities. From December this year, most of those on the invalids benefit will be able to trial working more than 15 hours per week, without losing their benefit eligibility, to see if they can sustain employment. Overall, these increases represent the biggest push to eliminate child poverty that we have seen from any Government in 30 years.

The Budget announcements on education are part of the Government’s commitment to lift education standards and achievement, ensuring that every New Zealander can reach his or her full potential through a top-quality education system. The Budget also contains a landmark package to provide free early childhood education. We are investing new funding of more than $300 million in educating our little ones. This means that from mid-2007, 3 and 4-year-olds can have 20 hours a week at any community-based early childhood education centre, for free. Up until now this was available only at kindergartens. This Budget provides a great boost to early childhood education.

It also has plenty for the tertiary sector. This Budget recognises the pressures on tertiary students, with a $110 million package. Lower and upper parental income thresholds are significantly increased, meaning that more than 40,000 students can now receive full allowances or qualify for partial or higher allowances.

The Budget increase in school operational funding means that schools in the Wellington region are around 10 percent better off in real terms than they were in 1999. In 2005, schools in Mana, Ohariu-Belmont, Wellington, Rongotai, Levin, and Kapiti electorates are expected to receive $1.31 million more than last year and $8 million more than in 1999. That is about $80 more in real terms for each pupil in Wellington. Projected 2005 operational funding for schools in all those areas is about $51.7 million on top of other funding. Nationwide, the compulsory education sector will receive an extra $203 million over 4 years, including $92 million extra for schools’ operational funding.

Other educational initiatives in the Budget include ensuring quality learning environments in school and early childhood education property, with funding of, now, $347 million; lifting school achievements through the national qualifications framework and the National Certificate of Educational Achievement, which get an extra $17.8 million over 4 years; and training and helping our school boards, with new money of $1.3 million.

I also welcome Budget boosts to health funding, including the extra money for hip and knee operations in Wellington. I also am particularly pleased to see that the Government will invest $212 million of new funding in research, science, and technology over the next 4 years, to contribute to the continued economic growth of our region.

In summary, this Budget will take New Zealand ahead. It is good for families and good for the economy. It keeps the balance between economic and social investment, and it keeps the strong fiscal position. It is a Budget for growth and opportunity. It is a Budget for getting New Zealanders into work and making work pay. In conclusion, Budget 2004 is true to the core values of Labour. It is consistent with social democratic economic policy. Budget 2004 reflects the Government’s strong commitment to fairness. Budget 2004 will dramatically improve the lives and opportunities of thousands of people and our children in Mana and across New Zealand.

BILL GUDGEON (NZ First) : Liberal British educationalist John White illustrated, as quoted by Dr Rex Ahdar, the major philosophical chasm that separates the liberal State from traditional family values. To illustrate that chasm, Dr Ahdar quotes Mr John White on whether parents should be allowed to shape a child’s values, given the liberal belief that parents should simply deliver their child as a blank canvas to school, where appropriate values can be instilled by teachers. To all New Zealanders, I say beware. Amongst us in society, and, indeed, in the Western world, are those who think that the role of parenthood is to bring into this world children devoid of any responsibility as we know it—to have less responsibility, less freedom, or no freedom to exalt to a higher plateau of agency or moral views. In other words, there will be a direct relationship between the State and the child. Parents are to the side and perform a purely facilitative role in fostering future citizens.

New Zealand is a signatory to the United Nations Convention on the Rights of the Child, and every so often the New Zealand Government is required to report to it on progress being made on implementing United Nations policy in this country. The question that has been asked is what article 3 of the convention document is. Does this document require States to make traditional parental rights subservient to the State, in what it calls the best interests of the child? The review that the United Nations Convention on the Rights of the Child talked of has materialised, and is now before Parliament as the highly controversial Care of Children Bill. Where once upon a time educators imparted knowledge, now the Government pays them to impart values.

The two key roles of the Department of Child, Youth and Family Services are, one, to be a high-quality provider of services to children who need care and protection, or who have offended, and to support and assist families to keep their families safe; and, two, to facilitate and collaborate in the delivery of high-quality services to children and young people who are living in circumstances where they are at risk, or in need of care and protection, or committing offences. The question I ask is where are the parents and what are they doing. Too many people are evasive about this, because it strikes home to the core of where their responsibilities really lie. The total departmental appropriations are $409.379 million, which is broken down into such areas as policy advice and ministerial servicing, funding of community services, prevention services, care and protection services, youth justice services, adoption services, and the residential services strategy. All of this is the ambulance at the bottom of the cliff, picking up the pieces.

In the latest International Save the Children Alliance magazine, there are inserts about Save the Children Norway, Save the Children Cambodia, etc., but a reluctance to mention what and where the parents are. I am not advocating that we deny people humanitarian aid—I am all for that—but is there a possibility of a greater percentage of our younger generations being positive contributors? There are very many positive and excellent organisations throughout the world, with the International Save the Children Alliance being one of many that could do with much more funding than it already has.

Contributors to this Budget debate to date have talked about transport and roading costs, tax cuts, etc., and made accusations about the general public being baited with vote-catching promises. Let me say that if we take the family out of the equation, what do we have? Zero. Let us close the gate before the horse bolts, and not after, by putting parenting at the top of the agenda. New Zealand First will ensure, in the next Government, that the policies implemented next time round ensure growth and prosperity for all families throughout New Zealand. The New Zealand First Party advocates strong parental ties, with all siblings being encouraged to have a belief in their own potential and development, to be progressive in attitude and mind, to strive for the highest goals possible in whatever field they choose to be employed in, and to be leaders in their own right. A Government that does not advocate independence of the State would be opening the gate to becoming a participant with other Third World nations.

New Zealand First members believe that the talent and skills are in our party. Firstly, we have a leader of the calibre of Winston Peters. Secondly, we have Barbara Stewart as our health spokesperson. We have Ron Mark as our spokesperson for law and order, and Pita Paraone as our spokesperson for Māori affairs.

• Debate interrupted.