Hansard and Journals
- Debate resumed from 2 June on the Appropriation (2010/11 Estimates) Bill.
Dr PAUL HUTCHISON (National—Hunua) : Talofa lava. Fa‘afetai tele lava. It gives me great pleasure to speak in this appropriation debate following the Budget. There is absolutely no doubt that the Prime Minister, John Key, and the Minister of Finance, Bill English, deserve huge congratulations on a very well-researched, very well-thought-out, highly balanced, and forward-looking Budget. It was very impressive that within the first few hours of this Budget being announced, the Employers and Manufacturers Association said that this was the fairest Budget for years. It was refreshing to hear Bernard Hickey say: “This is the most comprehensive and coherent reform of New Zealand’s taxation system in more than 25 years. It goes a long way to tilting the economy back towards productive investment and away from property investment.”
It is highly relevant that the three new major spending initiatives are in health, in education, and in science and innovation. The new funding in health amounts to over $2 billion over the next 4 years, $512 million of which is in this financial year. That amounts to the biggest increase in health expenditure as a percentage of GDP in the history of New Zealand. It points to this Government’s focus on ensuring that health services in New Zealand are kept up.
Yesterday I heard Kevin Hague from the Greens saying he wanted there to be more spending on health and for there to be more tax. He said that the socio-economic determinants of health were very important, and that the poor are particularly badly affected—and he is absolutely right. But Labour and the Greens differ from this progressive National Government in that Labour and the Greens would take away money from successful people, would curb incentives, and would redistribute that money, whereas this progressive National Government wants everybody to benefit from increased economic growth.
Mr Hague should take note of Singapore. It is a tiny country the size of Lake Taupō, with 4 million people, to which we gave aid 40 years ago. It now has a per-capita income that is 1½ times ours. The significant thing is that Singapore invests 3.5 percent of GDP in health, both public and private, compared with our 8 percent, but Singaporeans live longer than us and their infant mortality is less than half of ours. It is absolutely clear in that society that Singaporeans have benefited from sustained economic growth. They hugely value individual responsibility, incentives, and self-improvement.
Those are vital ingredients for a healthy society, and are quite different from the Green and Labour philosophies of redistribution and State dependence.
National’s investment in health includes an extra $93 million for disability support services, which is good, and an extra $59.5 million to boost National’s record in improving elective surgery. It is great to hear that there will be 12,000 more elective surgeries in the next year, following Labour’s record of absolutely abysmal productivity in the field of health. When Labour came into power in 1999 and whipped up the personal tax rate from 33c to 39c, it severely distorted incentives in New Zealand. In 1999 there were in the order of 35,000 loss adjusting companies. They quadrupled in the succeeding years, so that by 2009 there were 130,000. That is just how bad the distortionary effect of Labour was right from the beginning. But it gets worse than that.
Hon David Cunliffe: How many now?
Dr PAUL HUTCHISON: There are 130,000. Labour called for a taxation report, and the Mcleod Tax Review was delivered. It was highly thoughtful, but Labour totally ignored it. That is in stark contrast to National’s response when it called for a taxation report about the previous year. The Tax Working Group report said that the current system is “incoherent, unfair, lacks integrity, unduly discourages work participation and biases investment decisions.” This Budget encompasses the main recommendations of that very timely and well-thought-out taxation report. But Labour ignored not only the McLeod Tax Review but also the Knowledge Wave Trust recommendations from 2002, which described the missing billion-dollar investment in science and innovation. For 9 years over the period of the Labour Government, public investment in science and innovation remained static at about 0.54 percent of GDP, below the OECD average of about 0.68 percent. But, worse than that, private investment in science and research and development, which increased slightly from about 0.45 percent to 0.5 percent of GDP, is one-third of the OECD average of investment in those areas. We know that countries with consistent economic growth and consistent investment in science and innovation—countries that are about the same size as us—have consistently shown higher economic growth than New Zealand.
I acknowledge that Pete Hodgson, who was the Minister of Research, Science and Technology in the previous Labour Government, had some worthwhile initiatives. He initiated the Venture Investment Fund, he initiated the Centres of Research Excellence Fund, with Steve Maharey, and he promoted the commercialisation centres attached to our universities. But the Labour Government failed, because it was not until its eighth year that it brought in the so-called Fast Forward Fund and the taxation credits, but they were poorly thought out and were far too late.
It is highly significant that National has focused on increased investment in science and innovation in the early stages of a long and progressive Government. It is highly significant that Prime Minister John Key has said that science and innovation will be at the centre of the new National Government. It is highly significant that the Government is investing in science and research and development its third-largest appropriation of new money. It is the key to driving New Zealand’s economy and the key to economic diversification. It is all about high-value, low-volume exports and the enhancement of New Zealand’s human capability. This has come about by the efforts of hundreds, if not thousands, of scientists throughout New Zealand over a long period of time. I pay tribute to the Royal Society of New Zealand, the Crown research institutes, the universities and private institutes, and a whole variety of individuals such as Professor James Watson, Neville Jordan, Sir Peter Gluckman, Professor Dianne McCarthy, and many, many others.
Budget 2010 is a great start for science and innovation, but it is only a start. Indeed, it is igniting our true potential.
Hon DARREN HUGHES (Labour) : In 50 years of New Zealand television, Paul Hutchison was the warm-up guy for every live studio audience at Avalon studio! Members saw the way he invigorated the House with that contribution, and Igniting the Future was the name of the report he was referring to! He talked about the 39c rate of income tax. With the exception of the Hon Maurice Williamson, whom I see is in the Chamber, hanging around in the Jurassic Park - sort of way that he does, every National member here came into Parliament after the 39c tax rate came into being. If taking on a job where one has to pay tax at the highest rate is a massive disincentive to hard work—although that is always an oxymoron with National—then I ask why any of those members came to Parliament, if it was such a terrible thing for their labours in that particular respect.
If this Budget was to be judged on spin, slogans, and politics, then of course the Budget gets a pass mark. But if this Budget was meant to be about the economy and about trying to fix the wage problem in New Zealand so that people get to take home more money each week based on the work they do rather than on the taxes they pay, then this Budget was an absolute failure. It was big on spin and big on slogans, but there was nothing in it for the real economic challenges that the country faces.
The Minister of Finance said today that having a job was an important thing. He should know; he has lost several of them. But one of things about the Budget documents is they show that in 5 years’ time, the unemployment rate will be twice as high as it was when this National Government took office. In 5 years the unemployment rate will be twice as high as it was when National inherited the Treasury benches, and there is nothing at all in the Budget to address that matter.
Of course, when National first became the Government, it decided it would have the Job Summit. It was to be a “do-fest”, not a talkfest. It ended up being a doofus “do-fest”, because one could say that doofuses were about the only things that came from it. We found out this week that only 150 metres a week has been added to the cycleway in a country that is—how many thousands of kilometres long is this country? It must be 4,000 kilometres or 5,000 kilometres long, or something; I do not know.
Hon Trevor Mallard: Not that long.
Hon DARREN HUGHES: It is not quite as long as that, but the 150 metres a week we are adding to the cycleway will not be the way to get people back into jobs if we are relying on it to do that. But that was typical of the Prime Minister.
Hon David Cunliffe: It will be finished in the 23rd century.
Hon DARREN HUGHES: By that time this National Government will certainly be a footnote in history. No one on the other side of the House will still be here or still in Government at that point.
This Budget under-delivered on all of the key things that the National Government said it was interested in. Sure, there were tax cuts, and the size of the tax cuts made some people happy. But what does that matter when the Government is borrowing all the money for those tax cuts? It might as well have been $2,000, $3,000, or $4,000 a week of tax cuts if all we are doing is borrowing for them, and there is no plan to pay back any of that debt.
Hon Tau Henare: That’s irresponsible.
Hon DARREN HUGHES: As Tau Henare says, it is irresponsible. He is the one who crashed the XT network on his BlackBerry cellphone, so quick was he to get to the website to find out what he would get from the tax cuts. That was his contribution—he could not wait to find out what he would get.
There have been no ideas in any of the speeches made by members opposite on how to get the people in this country back into jobs or on how to make sure that the people who are in work are paid more in wages so that they can take home more money each week. You know, if wages went up by just 50c an hour, people would earn more from that than they will from the tax cuts that National gave in the Budget—50c an hour. Most members opposite would walk past 50c in the corridor if they saw it. They would think it was such a piddly amount that they would not even bother to collect it. But, in actual fact, a wage rise of 50c an hour would deliver to working people far more money to take home and spend on raising their families.
What happened after the Budget? There was great excitement among all the commentators. I watched the Budget coverage and all the commentators were pretty happy about it. Do members know why that was? Those people were pleased because they were getting a tax cut. For the third year in a row, people in New Zealand who earn over $100,000 have had a tax cut. For the third year in a row, people on over 100 grand have got a tax cut. That is a huge amount of money sloshing around for those in the commentator classes and for the members of Parliament over there. No wonder they were so happy about it, because it was all about them. If there is one thing we know about the Prime Minister, it is that he likes the show being all about him.
People were pretty pleased with the Budget, but when they had more of a chance to look through it, the opinion polls came back and showed that 37 percent of people thought they would be better off personally—37 percent. That means that 63 percent of people in the country do not think that they will be better off as a result of the Budget because it did not actually affect them in the way that it had been sold to them.
Paul Quinn: They said the country would be better off.
Hon DARREN HUGHES: Paul Quinn says that if people think their neighbours might be better off when they are not, that makes it OK. He had really better come and sit on the Labour side of the House if that is how in tune he is with the philosophy of his Government. When it came to individual choice, when it came to personal responsibility about the Budget, only 37 percent of people thought that they would be better off.
The Budget is all smoke and mirrors. Every dollar given away in tax cuts is borrowed, which means that someone else has to pay it back. We know what National thinks about savings in terms of KiwiSaver and the New Zealand Superannuation Fund, because it has cut its way into those, just as it did in the 1970s and 1980s in New Zealand when it cut the savings for the future. National members never govern for the future; they govern for tomorrow morning’s Dominion Post headline. That is what they govern for. They govern for that because they think that it is $1.50 well spent, because there are photos of them smiling away in the Dominion Post the following day.
I ask where is the Government’s plan for 5, 10, or 20 years down the path. There is nothing in the Budget for that, not a single thing. Let me give members opposite an example. I laughed when I heard Paul Hutchison say that members opposite were a progressive National Government. There is nothing progressive about those people. They are reactionary on everything. You know, they put up the tax on cigarettes the other day.
Hon Tau Henare: Same old words.
Hon DARREN HUGHES: Mr Henare should listen to this. The tax on cigarettes went up the other day. It was a National Government initiative to charge more for tobacco. Do members know how long it took National to decide that was a good idea? It took 10 years to decide whether that would be its policy, and now it has socked the policy to people as one of the other increases in the cost of living that this Budget has put in place.
GST has gone up. National promised that that would not happen, yet we will see GST go up. Power prices will go up with the cost of the emissions trading scheme. People will pay more for fees in early childhood education. Where was that in National’s manifesto? It is broken promise after broken promise after broken promise. Finally, sooner or later, the smile-and-wave routine of the Prime Minister will not be able to cover for all the broken promises.
National members who clapped and cheered during the Prime Minister’s speech on the Budget gave us the most undignified spectacle we have ever seen. The Prime Minister was giving a rallying speech to his caucus, not realising that he was on television trying to explain National’s single biggest policy of the year to the country. It was all a competition amongst the backbenchers as to who could whoop and cheer the loudest. Members should save that stuff for the caucus room.
When one is the Prime Minister of New Zealand, one should be able to give a dignified speech about one’s economic record. Instead, there was a bunch of corny one-liners, and the tragedy for National members is that they have to laugh and clap because they think corny jokes are funny. If they are trying to grease people up, then that is fair enough—one or two members over there are, I think, pretty good greasers; they would know what to do. But the rest of them actually think that those corny one-liners are funny. Meanwhile, the interests of the country are left to one side.
I turn now to the issue of asset sales. They were not promised during the election campaign. In fact, we were told there would never ever be a sale of Kiwibank—never ever. It reminded me of “no ifs, no buts, no maybes”. Members on that side of the House are genetic promise-breakers, and they were even able to do it on Kiwibank.
Let us look at Kiwibank, which every single mum and dad in the country owns. Bill English commented that mums and dads could have the chance to own it. I ask members to name a mum or a dad in this country who does not currently have an interest, as a citizen, in Kiwibank. Who are they? Who are the mums and dads who do not currently own Kiwibank? Oh, there is silence on that side of the House now, because those members know absolutely that these assets belong to the country.
National members opposed the creation of Kiwibank at the time, because they are not progressive people and they always oppose new ideas. How did Kiwibank work? The previous Labour Government put in $80 million 8 years ago. Today the bank has 800,000 customers and it is worth $800 million.
Kiwibank has worked. It is a success. It has proven its value, and every single New Zealander owns that success. The previous Labour Government was a Government that was ambitious for New Zealand. We started Kiwibank so that New Zealanders could own it. Then fees came down, which meant that mortgage rates for working families stayed lower. It meant that in rural areas, and in towns and communities around the country, bank branches were not closing; they were staying open because Kiwibank was in town. It is an example of a public asset that works hands down. We saw $80 million turned into $800,000 million in just 8 years.
Although the National Party campaigned on protecting public assets, now that it is in Government it has a secret agenda to sell those assets to what it calls “mum and dads”. Well, mums and dads already own Kiwibank, and that is why the Budget has gone down so unpopularly with the public.
People know that when it comes to the Budget affecting them personally, they have been ripped off, because whatever tax cut they have been given on a lower wage, the money for it is all being borrowed from overseas anyway, and they will have to pay it back as taxpayers down the generation. They know that the assets we all own together are being taken from us. They know that the cost of living—the thing that actually matters when they are in the supermarket queue—will go up. Those things will be hitting families all over the place.
People will pay higher GST, there will be higher costs for working families, and the Government does not care about that, because unemployment will still be twice as high in 5 years as it was when National took over. I support the motion of Phil Goff that there be no confidence in this Government.
PAUL QUINN (National) : Talofa lava, Mr Assistant Speaker. May it please the House, as it pleases my friends on this side of the aisle, that I can advise that reports of my resignation are an exaggeration. I know that Trevor Mallard will be disappointed in that and certainly others in the Opposition will be, but I am here to stay for a little longer.
Thursday, 20 May 2010 will go down in history as one of the great days in this House. We had presented to us a Budget that brought a seismic shift in the tax structure and the tax system of this country. We moved from a system that was unsustainable, lacked coherence, and lacked fairness and equity to a Budget that delivered what the people of New Zealand wanted. It was delivered by a Minister of Finance whom, I have no doubt, history will show as being one of the great finance Ministers that this country has ever seen. Of course, that was followed up by one of the great and endearing speeches that this House has heard. It was by the outstanding leader of this country, Prime Minister John Key. His speech tore to shreds the Leader of the Opposition, who floundered around trying to look for an argument, having had all his points destroyed, following the Budget’s presentation. I was humbled to be part of that momentous occasion on 20 May.
The feedback on the Budget bears witness to its excellence. We have heard some figures from Opposition members, but what they have not told the House is that people care about others; they are not in it for themselves. The TV polls show that people by a clear majority thought the Budget was good. In fact, an overwhelming majority felt it was great for the country. All the newspapers polls show over 80 percent support. The New Zealand Business Council for Sustainable Development, that left-wing organisation from Labour’s own side, even had to concede there was 78 percent support for the tax changes. There is no poll that can demonstrate that this Budget was not good for this country. I pause for a moment and acknowledge the great support of Māori Party members for this Budget. They were glowing in their praise. In fact, Tariana Turia said in her speech that the Māori Party was in for the long haul, and that it was the path to success that mattered—not the short gains but the long-term vision. I offer my congratulations to the Māori Party because I think it should be congratulated in that respect.
We need to ask ourselves why this Budget has received overwhelming support. Let me tell members. Firstly, it allows people to make their own decisions about their own money. That is fundamental. They earned it; they can make the decisions about their own money. The Budget ensures that the very high-income people pay their fair share of taxes, and it brings balance to investment choices. That is why people overwhelmingly support it. How does the Budget do this? Well, 75 percent of the package is dedicated to the lowest two tax brackets; 75 percent of income earners will get to keep 82c in every extra dollar they earn. The average tax rate—not a figure that has been often shared—for these two income brackets will now be 15 percent. But Opposition members sit over there and say that the wealthiest gain the most. The first point is that the wealthiest actually pay the most tax, and in fact these tax changes have taken the figures back to 33 percent. They were 33 percent earlier, they went up to 39 percent in 1999-2000, and now they are back to 33 percent. That is where the rates are now. When we look at it in mathematical terms, and I know that is quite difficult for some in the Opposition, the biggest winners are those in the income bracket between $14,000 and $48,000, who receive the 17 percent reduction. Those in the nil to $14,000 bracket receive the 16 percent reduction in their tax. That is way ahead of the other income brackets. I know that is a bit difficult for Opposition members to comprehend, so I will give them a little example in Economics 101.
Simon Bridges: I raise a point of order, Mr Speaker. The member Carmel Sepuloni keeps holding up visual aids. My understanding of the Standing Orders is that that can be done only sparingly by a speaker.
The ASSISTANT SPEAKER (Eric Roy): I did not notice, but the member ought not to have been holding visual aids.
PAUL QUINN: Let me give members an example. Let us take, for instance, the example of the Biggest Loser match-up. We all know what the Biggest Loser match-up is—right? If I take my friend Tau Henare, I tell members that in doing the Biggest Loser match-up he has had a 7 percent reduction when the weigh-in came. In the red corner I have Parekura Horomia—OK? He had a 5 percent reduction—right? In relative turns Tau has won, because he has had the greatest level of reduction. But we all know that in absolute terms Parekura has won. But will we be jealous? Will we be envious?
Hon Members: No.
PAUL QUINN: Of course not. We will rejoice at the fact that in absolute terms, Parekura got more, because he had more to give. It is as simple as that—he had more to give.
Hon Darren Hughes: Absolute—ha, ha!
PAUL QUINN: I know that Darren Hughes is lost in all this, but it is actually pretty simple—all right? It is as I said.
Before I conclude I will just comment on the Greens’ contribution to this debate. We heard Russel Norman, the Greens’ male leader, say that New Zealanders want prosperity, and that economic growth is the basis for their increased opportunity. On the other side is Metiria Turei, who says that we New Zealanders like to think of ourselves as an egalitarian society where everyone gets a fair go. OK? But let me say that egalitarianism is not the same as mediocrity, and that is a fundamental issue. In fact, National is not about averaging down; it is about aspiring up. The Government’s responsibility—our responsibility as the Government—is to provide a safety net, yes, but a lifestyle—no. It is to give a hand up, yes, but to spoonfeed—no. That is the problem with the Green Party: it wants to average down; this side of the House wants to aspire up. Egalitarianism is about equality of opportunity; that is what it is about. It is important that we provide the tools for people to use, and that we show compassion and aspiration. It is about creating the environment where everyone—and in particular our youth—has every opportunity to achieve his or her potential. That is what is important, and that is what we are here to govern for. This Budget provides the greatest opportunity for all New Zealanders to be able to achieve their potential.
I will conclude, if I may, by reflecting on a visit last week to the Pinehaven School in Upper Hutt—
Simon Bridges: With the Prime Minister.
PAUL QUINN: —by the Prime Minister and me. The school was opening its new administration block, and it took the time to share with the Prime Minister its value statement. The value statement, about inspiring and looking up, was being achieved.
CHARLES CHAUVEL (Labour) : Policies that ensure a truly brighter future need to embrace economic, social, and environmental policy as equally important components, rather than as competing considerations. Two weeks ago Bill English stood opposite and gave a 45-minute speech about tax. But switching indirect for direct tax is not an economic policy. Throwing together spending and revenue assumptions based on growth projections that will just disappear if, God forbid, the global financial crisis is not truly over is not an economic policy either. Cuts in real terms to research and development spending, education, and health spending do not make for social policy.
Those were not the worse things about the Budget. Bill English proved last week that he and the Government in which he serves are truly anchored somewhere back in the 20th century when in his entire 45-minute speech he did not mention the environment even once. The Government’s rhetoric continues to set up the false distinction between the environment on the one hand and the economy on the other. We saw that as recently as this morning, in remarks made to the EDS conference in Auckland by the Minister for the Environment. The reality is that only by starting that transition to a lower-pollution economy now can we ensure ongoing prosperity in the future. The warning signs are there for anybody who cares to see them. We had the KPMG report last month, which warned that our farmers’ efficiency will be surpassed by those of developing countries like Uruguay in fewer than 5 years’ time if we do not provide farmers with the means and the encouragement to really innovate.
Many of our leading business people have already called on the Government to promote cleantech investment, but at the same time the Hamilton-based BioVittoria company can raise only $8 million on-shore of the $20 million it needs to commercialise its brilliant zero-calorie fruit-based sweetener. Those sorts of initiatives are the ones in which our future prosperity lies, but they cannot get funding on shore. Our trading partners are starting to build border tariff provisions into their domestic trade and climate change legislation to deal with imports from countries and jurisdictions that do not price greenhouse gases and carbon, or do not do so adequately. There is very high environmental awareness amongst inbound tourists and the purchasers of our goods in affluent off-shore markets. But 2 weeks ago Bill English turned a deaf ear to all those concerns and to all those signs.
Research and development to promote innovation, reduce primary production emissions, and support the cleantech industries we all know are the path to future sustainable prosperity should have been the priority in the Budget. But the Budget resulted in an almost complete absence of new business research and development spend. Why is that? It is because businesses will get assistance to conduct research and development through vouchers and grants—Government handouts, in other words. In comparison, the tax credit that the Labour-led Government put in place would have more than doubled New Zealand’s business research and development spend over its first 4 years. It would have provided a heavy incentive for businesses to invest in research and development, rather than just get the handouts that members opposite are so used to asking for from the Government. Predictions remain that that spending will just be static under this voucher policy put in place.
It was a massive missed opportunity to increase our business research and development spend, which is woeful when compared with other like-sized countries. National’s decision in 2008 to axe the 15 percent tax credit for research and development is one that we will live to regret at our leisure. Bill English was obsessed about the possibility of tax credits being gamed, but Treasury thought it could close those loopholes. That is exactly the approach that the Australians themselves took to research and development in their Budget only a couple of weeks ago—closing the loopholes, rather than cutting off the incentives through the tax system. That is why the Government should have kept the research and development tax credit system.
There is another absence of investment in the Budget in the cleantech area. Again, this contrasts poorly with the record across the Tasman last month. Australia, despite its much greater mineral wealth than here, recognised the importance of cleantech investment as a source of future prosperity by providing a decent amount of Government support for it. Some of our most innovative business leaders have been urging those members opposite—John Key, Bill English, and their colleagues—to recognise the urgent importance of future-proofing our economy by making a similar investment, and what a tragedy it is that those calls have been ignored.
The plain truth is that this Government has no sustainable vision for New Zealand’s future. Its actions show that its only strategy is to promote more intensive food production and more intensive minerals extraction by getting it out of the ground, shipping it offshore to be consumed, and hoping that that helps to fix the balance of payments deficit. On the way, the Government wants to shift as many costs as possible on to the taxpayer and away from polluters themselves as they intensify their production or their extraction. Never mind the environmental consequences or our international reputation. Never mind whether the allocation of risk is fair between taxpayers and offshore businesses. Never mind if the profits stay in New Zealand, to be invested in our future here.
If the Government was not willing to invest in new environmental initiatives, then at the very least it might have compensated for the cuts it made in last year’s Budget. The Budget documents contain no new initiatives to make up for the funds taken from Vote Environment or Vote Conservation last year. There is nothing to restore great initiatives like Enviroschools, which had its funding slashed. There is nothing to make up for cutting any encouragement for Government, accounting for one-third of this country’s economic activity, to work in a carbon-neutral way. It is instructive that all Kate Wilkinson’s press release about the Budget could do was trumpet the building of cycleways and walkways. She failed to mention that there is no new investment here. The Department of Conservation is expected to find funding for these initiatives out of its existing budget.
There is no new funding for conservation or for energy efficiency, outside of money already announced to meet the increased demand for home insulation by the Warm Up New Zealand scheme, which itself is a reworked version of Labour’s home insulation scheme. That was one of Labour’s first complementary measures to be funded from the emissions trading scheme we put in place. National has replaced that scheme with a taxpayer-funded initiative worth less than half of what Labour legislated for, with no guarantee of ongoing funding after 4 years. The Government needs to ensure that everyone has access to warmer, drier, healthier, and more energy-efficient homes, but there is no initiative in the Budget to ensure that this will happen. Adequate initiatives to encourage energy efficiency across the board, like truly smart meters accompanied by the availability of differential tariffs, are absent from the Budget.
I will give a final word on the evident lack of commitment in the Budget to fulfilling our country’s climate change obligations. There is no money budgeted to pay for New Zealand’s contribution to the mitigation and adaptation funds, which we agreed to contribute to at the Copenhagen conference. This contrasts with the A$200 million committed for that purpose in the Australian Budget on 12 May. Assuming New Zealand will need to make a comparable contribution on a pro rata population basis and on an exchange rate of 80c to the New Zealand dollar, there is just under $50 million missing from the Budget on this score. There is no provision made for the elevenfold increase in firms eligible for a free allocation of carbon credits. The Minister for Climate Change Issues has fudged the figures, but people will see through this. There is over $500 million carried forward to provide for the value of credits to foresters. Misleadingly, the Government described this as payments to plant trees. The new figures are said to be based on a 67 percent uptake in credits, rather than a previously forecast 50 percent uptake, but no explanation is given for the change in assumptions. There is no provision for the financial impact of the emissions trading scheme after 2012. The excuse is that there are no international obligations after 2012.
Hon Tau Henare: Boring.
CHARLES CHAUVEL: Mr Henare thinks it is boring to talk about climate change and sustainability. Does he not show the true colours of this Government? He should speak up more; the country needs to hear more of this. Let us hear his commitment to the environment. Let us hear what he really thinks about the planet. The more that member is caught out on telling the truth about this Budget and its lack of commitment, the better.
This was an irresponsible Budget. It has no vision for a brighter future for New Zealand. At the next election New Zealanders will give their verdict on it. I am very proud to support Phil Goff’s amendment to the motion to read the Appropriation (2010/11 Estimates) Bill a second time.