Hon MAURICE WILLIAMSON (Minister for Building and Construction) : I raise a point of order, Mr Speaker. I have been fortunate in the last hour to have been in my office with the Miss Universe New Zealand contestants. They are in the gallery, and I think this House would like to acknowledge them being here today. [Interruption]

Mr SPEAKER: Order! The House will come to order. I am not sure how that is a point of order, but either way it seems a very pleasant visitation for the House to have. I think I recognise the Wellington representative among them—a good surf lifesaver.

Hon GERRY BROWNLEE (Minister for Canterbury Earthquake Recovery) : I rise to speak in favour of the Budget delivered by the Hon Bill English last Thursday, and, as a consequence, to speak against the amendment to that motion moved by Grant Robertson from the Labour Party. We have budgeted $360 million for teacher professional development, and Labour says no—$360 million to help teachers raise their professional standards so they can do a better job in the classroom, and Labour says no. The story that we have heard from the Opposition since last week, whether it is the Green Party, the New Zealand First Party, or the Labour Party, has consistently been “no” to the growth Budget that National put in front of the country last week. It is extraordinary, and quite unique in New Zealand’s history, that a Government can put up a Budget that frees up $4.4 billion of funding for new initiatives that will support front-line services throughout New Zealand, and that comes from savings through various activities of the Government, in areas that were, to say the least, questionable in the first place. I think the fact that there has been very little comment about where that money came from indicates how bad it had become over a long period of years: successive Budgets loading up different sorts of initiatives, with no particular result for the taxpayer or for individual New Zealanders.

So in a year where the Government has delivered effectively a zero Budget, it still has $4.4 billion worth of new spending initiatives in it. The record so far from that approach previously has been 27,000 more elective operations being performed in New Zealand, year on year and growing, because of our new approach of getting better value from Government services. We have 2,000 more nurses, 800 more doctors, and 1,000 fewer back-office positions in the health ministry. Those are good numbers, and they do represent progress in society. We have 600 more police on the beat. No wonder the incidence of offending is starting to fall and we are seeing some of the benefits from an intensive programme the police have had in crime reduction. National standards in reading, writing, and mathematics to raise achievements in schools will see great dividends for this country in the future. The support of those policies underlines the need that the Minister Hekia Parata has identified so well: to get quality into teaching, and therefore the need to support teachers in their work. So, as I say again, $360 million in this Budget for professional development, and our opponents say no.

There are 3,500 more early childhood places as a result of this Budget, and 48,000 rundown State houses will be upgraded as a result of this Budget. We get from the other side, constantly, all sorts of stories about the conditions that people have to live in, in various parts of the country, and all sorts of stories about living in squalor, living in poverty, etc., etc. We are going to fix 48,000 State houses this year, which is just a continuation of what has been going on, year after year under this Government, and Labour says: “No, that’s not a good idea.”

We have 12,000 more tertiary education places. That is equivalent to a whole new university full of students developed over the last 3 years and funded into the next 4 years by the current Government. That is a commitment to raising the educational profile of the entire New Zealand population.

Then we come to the Labour Party’s complete denial of the huge difficulty that the Christchurch earthquake places in front of not only people in that city but throughout this country, because of the type of nation we are, where we all like to support one another. It is a big commitment to take $5.5 billion, put it aside, and say we will be spending that over the next X number of years, plus all sorts of other expenditures that are likely to grow over that time, and to make that absolute commitment that we are there right to the end. And what did Labour do? Well, Labour came out, firstly, with a question last week suggesting that we had not actually spent that. Utter rubbish! Those people who have received their red zone settlements and those people who can see the Stronger Christchurch Infrastructure Rebuild Team—or SCIRT—working know that that money is being spent. And throughout the city in the Greater Christchurch area there is massive evidence of the activity that will lead to recovery.

What does Labour say? We have the wrong structure in place—we should have had a State-owned enterprise running it, according to their spokesman. Well, a State-owned enterprise generally has the capacity to earn its own revenue. There is no capacity for the Government to earn revenue out of this particular exercise. Then there is the suggestion that it should be a Crown entity of some sort. Well, that would require a committee of the great and good, appointed by the Labour Party, to somehow superintend activities between the people who need the attention and the Minister who is responsible for the money. That would lead to a degree of tension and controversy that people in Christchurch at the moment simply do not need.

The Government stands alongside people in Christchurch, and on 27 July another milestone will be achieved, when the Government is able to finally approve the redevelopment programme for the central business district. That will be a day when we will see a lot of people make big commitments, or begin to make big commitments, to that rebuild of Christchurch.

The other thing that is surprising in this Budget is the apparent lack of worry from the other side of the House about New Zealand’s financial situation, and absolutely no recognition that there is throughout the world a crisis going on. New Zealand’s economy is 1 percent of the world’s economy. We are like a little leaf on a large, tumultuous ocean that is being battered by a hurricane. We are keeping our head up as a nation—no question about that—in quite a remarkable way. But for there to be a denial that the turmoil in the rest of the world’s economic activity is somehow not going to affect New Zealand is, I think, an abdication of any chance of ever leading this country to any sort of economic better position.

We, on the other hand, have recognised that there was a necessity to nurse New Zealand through those worst years. From the end of 2007 right through 2008 we were in recession. No question about that. The previous Government did not recognise that in the 2008 Budget. We have kept the worst effects of what could have been a very disastrous economic downturn for New Zealand at bay by responsibly engaging in Government activity that has maintained our economic activity. But there is a time when, simply, there is a necessity to recognise how costly that is, to get a track back to some sort of surplus position, and to start reducing debt. And that is what Mr English has done in this Budget, and he should be congratulated on that. To suggest as, Mr Robertson did, when he moved the amendment to the motion, that—

Hon Steven Joyce: Shearer.

Hon GERRY BROWNLEE: Sorry?

Hon Steven Joyce: It was Shearer, I think.

Hon GERRY BROWNLEE: I was sure it was Mr Robertson, but I could be wrong on that. It really does not matter. What the Labour Party members have said is that they do not support that concept. They do not support the idea of having a balanced Budget. They do not support the idea of making sure that you do create an opportunity for new initiatives to occur in your economy by shifting around the money the Government currently spends, to ensure it is in places where it matters, and they have no concept of the need to reduce debt as a nation. Those things indicate that this is an Opposition that has no intention of being a Government and is quite contented to sit around criticising everything that everyone else does. It has a single answer in response to any initiative that a Government puts up. That single answer, that single response, is always no. I predict that that will be the answer that voters give this crowd next time they get the opportunity—no.

Hon DAVID PARKER (Labour) : John Key and the National Party always blame Christchurch or Greece for New Zealand’s problems. Greece and Europe have had problems. Outside of Greece and Europe, average growth in the world has been 1.5 percent per annum for the period since National has been in Government. Over that same period New Zealand has grown under 1 percent—not 1 percent per annum, but 1 percent in 3 years. The 53,000 people who last year went to Australia did not go to Australia because of Greece’s problems; they went to Australia because of New Zealand’s problems. It is time that the Government fronted up and addressed some of the difficult issues and some of the hard choices that have to be made. All Governments have choices. This Government has choices. This Government will not make the choices that we need in New Zealand, and that workers in New Zealand and businesses in New Zealand need for the Government to grow the economy, to grow our exports, and to grow our wages.

Indeed, Fran O’Sullivan said after this Budget that the “problem is that there is no clear economic growth agenda.” About 10 other commentators said the same thing. I am sure they have been speaking to each other, but I am also sure that they had independently come to that same conclusion, because this Budget does not have any economic growth agenda. That is why we continue to fall behind the rest of the world, outside of Europe, and that is why this Government ought not to be able to use Greece as an excuse any longer.

National members say this Budget is not their fault, but I think this Budget has exposed them. It has exposed them for their own negligence. Can anyone believe that this Government got it so wrong in respect of intermediates? Is that just not incompetence? Is that not just negligence? Did no one around that Cabinet table ask a question? Did the Minister of Finance, who previously said that dropping class sizes made educational outcomes worse, not ask a question? Did the Prime Minister not ask a question? The star of National’s front bench, the up and rising Hekia Parata—future leader of the National Party until last week—obviously did not ask the question. The negligence of the National Party, its incompetence, is further exposed by that debacle that it is now backtracking on.

The Budget exposed them as having a lack of vision—a lack of vision. Is there anything in that that would give New Zealanders hope as to why they would want to put their forces behind the New Zealand economy rather than leave for Australia?

Hon Phil Goff: No.

Hon DAVID PARKER: No. A complete lack of vision—a drab Budget is how some people have described it, and they are right. I return to the point that has been made by so many. They are exposed as having an inadequate plan to grow our economy.

Even their handling of the public relations around this has been a debacle. They started skiting about the fact that it was a zero Budget. Just weeks ago they were saying that a zero Budget is a good thing. Then when everyone in New Zealand turned round and said that a zero Budget is a sign of failure, in the week before the Budget they changed their own rhetoric and they denied it was a zero Budget. They said: “We are spending more money. It is not a zero Budget.” They had been saying until then that it was a zero Budget. They changed their mind last week and it is not a zero Budget. The problem is that it is a zero Budget when it comes to ideas to grow our economy.

In the face of 53,000 people leaving for Australia in the last year, you would expect that they would be doing something, showing some vision, and tackling some of the problems that needed to be tackled. But do you know what? National members put off limits virtually any big step they could take. We have proposed quite a few, and I am going to address them later. But they have put them all off the agenda. Their canvas is so flat and devoid of colour; it is a white-out over there. They cannot see anything for the clouds, and John Key keeps hopping from cloud to cloud. Our very glib Prime Minister performed like a circus master in the House last week—

Hon Members: More like a clown.

Hon DAVID PARKER: More like a clown, my colleagues say. He was entertaining his trained seals around the back, and he chucked them another sardine and they clapped their flaps together and had a round of applause. The very glib contributions of the Prime Minister had no substance. He even had the audacity to say that New Zealand’s exports are growing. He had said it a few days earlier. His problem was that on the very day of his Budget speech, Statistics New Zealand said that export goods had dropped by $800 million, an incredible 17 percent drop year on year. It was not, as he said in question time today, a monthly figure. That was the annual figure for the year to April. Export goods were down by $800 million, compared with the year before. He pretends our export sector is recovering, when his own Budget shows in the forecast that from here to the end of the projection period exports increase at only half the rate of imports. We have already got a current account deficit. We already do not cover the cost of our imports and interest by our exports, and his own Budget shows that for every year under his projection period, out to 2016, it gets worse and the rate of growth of imports is twice as high as it is of exports.

He then pretends that it is all Christchurch. The Labour Party checked with Treasury officials when we were in the lock-up. There was another glib statement in the Budget document, saying that a significant part of the current account deficit relates to Christchurch. So we checked. At no year is Christchurch more than about 1 percent per annum of the current account deficit. You go out those 3 years and you get a current account deficit of up to 6.8 percent per annum of GDP. It is less than 1 percent, so if it was not for Christchurch, we would still have a current account deficit growing to 5.8 percent. Our current account deficit is becoming out of control again. We are returning to old patterns. We have got residential-led growth, rather than export-led growth. The Government has no plan to address that problem.

Let us reflect on what is the central plan of this Government’s agenda for these 3 years in Government. It is to sell our assets. It is to sell our power companies. Not only does that make the Government deficit worse, to the tune of about $100 million per annum, but it does not change the economy; it does not grow our economy. Changing who owns what already exists does not grow our economy. We do not get extra exports. Over time it will actually increase our current account deficits, with those profits flowing to overseas people. It does not grow the output of our economy.

Why is this? Why is National wedded to following this same course, which is not cutting the mustard? It is because it is a conservative party. Conservative parties around the world trim expenditure, they fiddle with the fiscals, but they never address the fundamental changes that are needed. It is always progressive parties that change things. That is the fundamental difference in New Zealand and overseas between conservative parties and progressive parties. Conservative parties are basically happy with the status quo. They actually want to protect the status quo, because the people who support them have assets that are held up in value by the status quo, at least in the short term. They are not willing to make the progressive changes that progressive parties are willing to make. History shows this time and again in New Zealand. It is the Labour Party that makes the substantial economic changes. The National Party is conservative, and it just fiddles. I say to National that if you change nothing, nothing changes. It is a truism—if you change nothing, nothing changes. That is why National has not rebalanced the economy.

New Zealand needs pro-growth tax reform. We need a capital gains tax for a neutral investment signal. We also need it to address some of the inequities in New Zealand and the widening gap between the rich and the poor. We need a research and development tax credit. We need pro-growth savings reform, expanding KiwiSaver to a universal scheme. All of those are off the agenda from National. Not only that, National pretends that superannuation is not a problem. Today the Minister of Finance did not even know that by the end of his projection period, superannuation every month will cost more than total education will cost. This is another example of negligence on the Government’s part. All Governments have choices. This Government has them too. The reason that we do not have export growth and wage growth coming at us down the track is that this Government will not make the right choices, and if it changes nothing, nothing will change. Just let us not let the Government blame Greece.

Hon Dr JONATHAN COLEMAN (Minister of Defence) : If that was the intellectual engine room of the Labour Party, all I can tell you is that that party is in deep trouble. All that was, was a 10-minute personal attack on the Prime Minister. I was really waiting to hear something of substance at the end. Do you know, the one idea that came out of that was the capital gains tax. So Labour’s idea about how to get growth into this economy is to slap another tax on hard-working New Zealanders. The problem for them is they actually took that to the last election and it was roundly rejected. It was completely rejected. David Parker is driving their thinktank approach and that is all he can come up with. He said if you do not change anything, nothing changes. Well, what they need is a change of front bench, because unless they get some people there with some ideas and some drive—some people who appeal to the average New Zealander—we are not going to hear much more from them. We are going to see more and more editorials from the co-leader of the Greens, the real Leader of the Opposition, Russel Norman.

This is a great Budget. It is a great Budget for the times, and it has been well received by the people of New Zealand. To produce a Budget like this in a time of international economic turmoil is a great achievement on the part of the Minister of Finance, Bill English, and the Prime Minister. I think it shows that the country’s finances are in very sound hands. What has been delivered here is over $4 billion of new expenditure over 4 years, which is going to pay for the vital services and infrastructure that New Zealanders need and want. I defy Labour to tell us what it would have done. What it would have done is borrow more money.

Phil Twyford: Rubbish.

Hon Dr JONATHAN COLEMAN: Phil Twyford says “Rubbish.”—it would not have borrowed more money. But at the same time it would not have gone for a mixed-ownership model. Well, you cannot do both. You cannot fund the new infrastructure that New Zealand needs if you do not either do what we are doing, which is go for that mixed-ownership model and free up $5 billion to $7 billion of new money, or borrow money. We know what Labour would do. It would borrow. Where would that lead us? It would lead us down the track of Greece, Spain, Portugal, and Ireland. That is true. Mr Parker denied that the Christchurch earthquake had any effect on Government finance. He said to stop using it as an excuse. Well, I can tell you that it is a miracle that the Government’s finances are in such good shape, considering what we have had to deal with over the past few years. And to think that there is new money going into health! There is $1.5 billion over 4 years—$1.5 billion. There is $33 million of new funding going into cancer treatment, and there are 500 more operations a week under this Government. You can see that those members have fallen silent because they have no answer to that.

Today Tony Ryall, the Minister of Health, announced the new emergency department statistics: 93 percent of patients being seen within 6 hours in emergency departments. It was very, very bad under the Labour Government. We took action and now it is much, much better. I mean, look at the economy: 3 percent growth for the next 4 years, 60,000 jobs created over the last 2 years, and 154,000 new jobs to be created over the next 4 years—major achievements there. One of the key things, though, is a $197 million surplus for 2014-15. That is a huge turn-round in the face of a very difficult fiscal environment.

There is new money for education: $512 million over 4 years. It is interesting to see that those members will not agree with the $59.8 million investment into teacher quality. They are happy for things to just continue as they have. If you look at it, teacher numbers have gone up 12.5 percent over the past few years, and school rolls have gone up 2.5 percent. But attainment and intellectual achievement—the way our kids are going—have actually plateaued. And they over there have no answer. They were very happy for things to just continue on as they always had. So under this Government there are 27,000 more elective operations, 2,000 more nurses, 800 more doctors, and 1,000 fewer back-office positions. The health situation has been majorly turned round. There are 600 more police on the beat on the streets of New Zealand. There are 3,500 more early childhood education places. Forty-eight thousand State houses have been upgraded, and there are 12,000 more tertiary education places under this Government. So you can see there is major progress, major achievement going on. There are 41,000 more homes that are warmer and drier through the Warm Up New Zealand: Heat Smart programme. In terms of welfare reform, we are actually focusing on dealing with that huge iceberg—

Hon Member: Yawn!

Hon Dr JONATHAN COLEMAN: Look, Labour members laugh about this. They yawn about it. They do not care. They were happy for things to continue as they ever did. But the fact is we are identifying the tough issues and we are tackling them.

I just want to speak briefly about defence. We are very proud, I think—right across the House, actually—of the New Zealand Defence Force and the work that our men and women do overseas. There is a very concerted programme going on to achieve savings of $350 million to $400 million over the next few years, which is going to be reinvested back into the capabilities that the New Zealand Defence Force needs. I can say it is very pleasing that that vote has been retained. But the fact is we are going to be able to fund more and more of the capabilities that our men and women need to succeed at the front line over the coming years. Of course, our men and women are coming to the end of their time in Afghanistan; the SAS has done an excellent job over the time it has been representing us there. New Zealand was also represented very well overseas in East Timor and in the Regional Assistance Mission to the Solomon Islands. Our men and women in the New Zealand Defence Force deserve excellent support, and this Government is determined that they get that. You can see that in the capabilities that we are going to be funding over the next few years. It is quite an achievement in a tight fiscal environment to be able to maintain that vote, and to achieve the savings and reinvest those savings back into the capabilities that are required.

It was very interesting, though, listening to David Shearer’s reply to the Prime Minister’s Budget speech a couple of days ago. I was looking at David Shearer during the Prime Minister’s speech, and it was quite evident that he was taking no notes, which I thought was interesting. I have never seen that from a Leader of the Opposition before. But what was quite evident is that he had not listened to the speech at all. He had a pre-prepared message. He was not going to think on his feet. He was not going to rebut the arguments. The fact is that this is a party, the Labour Party, that is not interested in rebutting the arguments, because, frankly, it knows it has lost them. It lost them long ago. It lost them at the ballot box in 2011, and it is continuing to lose the arguments here in this Chamber and in the public domain.

So really it is quite irrefutable. This Budget is the right one for the times. But not only that, we have managed to get that $4 billion of savings, $4 billion pulled together from areas where wasteful and ineffective spending was going on, to actually fund the things New Zealanders want: the health, the education, the policing, the growth in the economy, the investment in ultra-fast broadband, the investment in science—major investment in science going on—research and development, and innovation. Steven Joyce is doing a great job in pulling that all together. So for Labour to try to make out that there is no path to the future, well, I can tell you, that just does not stack up when you look at the facts. I can tell you if Labour had given this Budget you would have seen more buying of votes, more borrowing, but at the same time a decline in our international credit reputation, a decline in our international reputation, and Labour knows that—those members know that.

I want to hear the next Labour speaker get up and actually tell us their plan for balancing the books, because they say they could balance the books, but, frankly, I do not believe it. Frankly, the public of New Zealand does not believe it. What the public of New Zealand does believe is that John Key is the right man to be running the economy of New Zealand. He is the person with the record. His sound stewardship is getting this country going in the right direction, and that is the actual fact. We are on track for surplus in 2014-15. We have got a whole lot of new spending, $4.4 billion over 4 years. It is all working well. It is getting us going in the right direction, and, most important, the public of New Zealand are confident that we are going in the right direction. This is a Budget that has their support, and I fully support it. Kia ora.

Hon CLAYTON COSGROVE (Labour) : The member who has just resumed his seat, the Hon Dr Jonathan Coleman, talked about the fact that he did not want to tax “hard-working New Zealanders”. Well, I know we are not supposed to refer to the gallery, but I suspect there are a few hard-working New Zealanders who are just leaving the gallery now. They are the age of cleaners—you know, cleaning out the butcher shop—paper boys, and paper girls. They are doing those after-school jobs, earning 45 bucks or less per week, and I would consider those young people are hard-working New Zealanders. I would consider, like most of their parents would, that that is the ethos they actually want to instil in their kids: to get a job not just for the pocket money but to get those work ethics, such as turning up on time, contributing, etc, etc. Actually, was that not the sort of entrepreneurship that the “brighter future” of these guys over here in the Government promised? Was it not supposed to be encouraging entrepreneurship, encouraging people into getting off their backsides and getting a job?

That member, the Minister of Defence, is the man who is responsible for sacking Defence Force staff. I am told, and it has been reported in the media, that the cost of sacking them is more than their salaries. He stood up and said: “I do not want to tax hard-working New Zealanders.” Well, in this tinkering, spin, little Budget, which deals with none of the big issues, the first piece of legislation that we addressed of course last week was to tax every dollar that those hard-working young New Zealanders will earn doing their paper rounds, doing the cleaning, and those sorts of things. But he does not consider them hard-working New Zealanders.

As I said last week in a speech, for many of those young kids it used to be a bit of pocket money. It used to be 45 bucks a week to maybe go to the movies or go out with the mates, or whatever. Now, for many of those hard-working young New Zealanders, the 45 bucks a week that he is going to cream the tax off is not pocket money any more, not in South Auckland, parts of Christchurch, parts of New Zealand. Actually, what the 45 bucks a week is, is a contribution to the family budget, forced on them because the family have to make ends meet. He talks about the great plan that National has. Well, let us go through it. We have already dealt with the sort of mean-spirited, pickpocket-like measure in the Budget taxing the paper boys. That is the first thing, and that is going to generate a massive 14 million bucks over 4 years. What a huge amount of money that is in the scheme of things! That is the big issue that that member, the Minister of Defence, said his Government is dealing with.

Then, on the other side of the generational divide, we had the sort of mean-spirited, scrimp away, have-a-crack-at-elderly rest home care, and the asset testing around that. We know the record of the National Government, yea, unto the Middle Ages, in respect of its conduct with elderly New Zealanders, who are some of the most vulnerable, going back to the Muldoon days, coming forward to the Bolger days, and now this Government does it again. So we carve a little bit off the paper boys, we nip a bit out of the old folks, and then the other big, great part of the plan or mosaic is, of course, flogging off assets—State-owned assets that give an 18.5 percent return, as opposed to a debt-servicing cost, of around 4 percent. If you are in business, you would label the great “Maestro” and his ilk as nuts.

And they talk about borrowing. They talk about borrowing $300 million a week, or has that member forgotten what he passed in his own previous Budget? It is $300 million a week in the middle of the global financial crisis, not to fund capital, or hospitals, or schools, or the things that are critical to growing a nation, but of course to provide an across-the-board tax cut where his mates and his ilk—the top few percent—get the vast majority. So that is the great plan: kick the paper boys in the guts, kneecap the old folks, give your mates a big tax cut, borrow and hope, and then, because you have got no money and no plan to grow the economy, borrow $300 million a week. That is the grand plan. Then you bundle in increasing class sizes. Does anybody in this Chamber believe that parents will believe that their kids are going to get a better education if class sizes increase? If you can find a parent in this country who believes their kids are going to get a better start in life as the class sizes increase, then put up the ante, I say to that side.

Then the next step in the Budget, of course, we know, is cutting teachers. Hekia Parata—I agree with Trevor Mallard—had a damned good shot at becoming the next leader of the National Party. Now there is hope for Mr Coleman, of course, after she blew apart in the last 24 hours because of—

Phil Twyford: He looks good.

Hon CLAYTON COSGROVE: He looks good? Yeah, well, I would not say that. Her promise, of course, in the Budget—

Hon Trevor Mallard: Leave the cigar out of it.

Hon CLAYTON COSGROVE: Well, he is blowing smoke up all sorts of places, is he not? Hekia Parata, of course, in her own budget said that schools could lose around six to eight teachers. Then suddenly she comes back into the Chamber and says: “Oh no, intermediate schools, I guarantee, will lose only up to two teachers over 3 years.” A big backdown, and the Budget is only a week old. So we have got increasing class sizes, we have got cutting teachers, and we know that exports are down, even though Mr Key thinks they are up because he cannot read the latest Statistics New Zealand information.

Then we have Paula Bennett’s legacy: 50,000 more on the scrap heap of unemployment, and nothing done about that, and 53,000 Kiwis leaving our shores every year, over 1,000 a week, when Mr Key promised he would get that down. That is the report card of the National Government, and their grand plan talks about asset sales, kneecapping kids and old folks, and tinkering around the edges. Like David Shearer, I will concede that the money provided around the science and innovation area is good stuff. But it is not good enough; they should never have reversed the research and development tax credit, which our Government, in Government, put in place. But I have to say, to be fair, let us call it as it is: it is good stuff. But the problem National members have is that they try to scrutinise us. The great “Maestro” forgets that he is in Government, he gets a quarter of a million bucks a year and a BMW, he has a warrant, and he is responsible for this Budget. It is incumbent upon that member and his Cabinet and his caucus to convince New Zealanders that this is the right course of action.

Actually, if you read the papers, people are bored with this. They know there is no plan. The Government is under fire from the business community in Auckland, who know there is no business strategy to grow our entrepreneurial sector, to grow jobs, and to grow exports. There is nothing in this Budget at all to do that, and the great diversion is to ask what other people would do. Well, here is the problem, Mr Coleman, I say through you, Mr Assistant Speaker. In Government, the problem is that if you want the warrant, the BMW, the big, fat salary, and the cigar, you have actually got to be accountable for your Government and your Budget. They have a plan that flicks a few dollars—a lot of dollars—off the old folks, a few dollars off the youngest and most vulnerable, and flogs off our assets needlessly. And with their own logic they have not been able to sell that one to the public; 80 percent of New Zealanders say “We do not want our assets sold.” So as the old “Smokeball” over there grins away, his head sort of nodding, that is the problem he has got when 80 percent of his own constituency do not agree with asset sales because, first, they know it is illogical, and, second, the Government has not even been able to make the case for it. In fact its advice to the community has been contradictory.

So that is the grand plan for New Zealand. That is the grand plan: a bit of spin, a bit of smoke, and a bit of tinkering around the edges. That is the grand plan for New Zealand and that is where it ends with this Government. That is where it ends with this Government. The brighter future, the innovation, and encouraging our entrepreneurship—I thought we wanted to do that for the really young. I thought we wanted to embed those in the mind-set of our youngest kids at school so they had the work habits as they grew up. But oh, no, not with “Uncle Scrooge” over there, old “Goldfinger”, and the rest of his people. That is not innovation; that is not the brighter future. They have sold out New Zealand. This is not a Budget of hope; this is a Budget of despair and surrender from the National Government.

Hon KATE WILKINSON (Minister of Labour) : Can I say that it is a great pleasure for me to stand and support Budget 2012. I do not have a lot of notes, because I was hoping that I would have something sensible to rebut from the former member of Parliament for Waimakariri, but all we got was nasty, negative name-calling.

This Budget is a good Budget, this Budget is a sensible Budget, this Budget is a pragmatic Budget, and this Budget is a sensible, realistic Budget. Families in New Zealand know that times are tough. The Labour Party does not know that times are tough. We know that times are tough. We know that we need a Budget that will stimulate jobs. Mr Cosgrove actually said there was nothing in this Budget to grow jobs, so I will come back to jobs in a minute, but we do need a Budget to stimulate jobs, we need a Budget to deliver better services for our families, and we need a Budget that is on track for a surplus in 2014-15. And that is what we have got, because National is aspirational, and we have a plan to actually build a brighter future for all New Zealanders.

We have said time and time again what the priorities are, and I will repeat them because the other side has a slight lack of memory. The first is to responsibly manage our Government finances, and we are doing that through the able work of both our Prime Minister and the Minister of Finance. Next is to build a more competitive and productive economy. That actually means more jobs. That does not mean to say that growth in government is growth in the economy. Growth in the economy is different from just growth in government, and we are concentrating on more jobs. Then there is delivering public services, and, finally, rebuilding Christchurch and Canterbury, which have gone through some horrific shocks and shakes.

I want to talk a bit about jobs, because although Mr Cosgrove says there is nothing to grow jobs in this Budget, I say that in the past 2 years we have created 60,000 jobs. That is not bad in difficult economic times—60,000 jobs. I ask what the Labour Government would have done had it been in Government. Well, I can tell you. It would have opposed the 90-day job trial. That trial period has been really successful: 80 percent of employers would not have taken somebody on if it was not for that 90-day trial. It has been credited with creating 13,000 new jobs—13,000 new jobs. Labour would repeal it, costing 13,000 new jobs. That policy is designed to give businesses confidence, not to take away confidence, which is what the Labour Opposition would do. It is to give businesses confidence to take on people that they might not otherwise take on, to take on those at the edges of the market, whether they are young, whether they are old, or whether they are new to this country. And it is working, because it is credited with creating 13,000 jobs. The Labour Party if it was in power would repeal it, and that would be the cost.

The Labour Party opposed the Hobbit law. The Hobbit law created 3,000 jobs. Every time we have an incentive or a project or a plan to create jobs, Labour members oppose it. They are Hobbit haters, as our Prime Minister likes to say. They are Hobbit haters. That law created 3,000 jobs. Each one of those jobs is a person. Each one of those jobs involves a worker, and those workers have families. Labour is not the party of workers, because it would have jeopardised 3,000 jobs, just like that—3,000 jobs plus the 13,000 jobs from the 90-day trial. It is adding up.

Labour members are opposing the convention centre. That is another 900 jobs—900 jobs on top of the 3,000 jobs, on top of the 13,000 jobs, which they would jeopardise. On top of that, they would arbitrarily and unsustainably raise the minimum wage to $15 an hour. That is 5,000 jobs that they would put in jeopardy. They oppose the convention centre. When it is up and running it will create another 800 jobs.

I could go on and on. That party is not the party of workers. When we add it up—13,000 jobs, plus 3,000 jobs, plus 5,000 jobs, plus 900 jobs, plus 800 jobs—that is a lot of jobs. In times of economic recession, in challenging times, each of those jobs is precious, and we want to make sure that our New Zealanders get those jobs, have those jobs, and do not have them stolen from them by the Labour Party.

Its employment relations legislation in itself would take us back 30 years. It would cost even more jobs. We are now in a climate of fair and flexible employment, and it is working, but every piece of employment legislation and every employment improvement that we suggest, those members oppose. They even opposed a piece of legislation that actually had the same wording about secret ballots for strikes as in their Labour Party union mates’ constitution. They even opposed that.

But, talking about jobs, I want to talk about workplace safety, because it is important that we actually link—and we all have a duty to link—productivity with workplace safety. The two go hand in hand, and it is really important that one is not deemed to be a trade-off for the other. I am very proud to have shepherded through a huge investment in workplace safety: $37 million over the next 4 years, and that is on top of the $1.5 million for the High Hazards Unit—

Hon Trevor Mallard: That is the Minister who stopped the work on mining inspections.

Hon KATE WILKINSON: And they scoff. Mr Mallard is scoffing. Well, can I tell you what Labour’s record was? Labour cut funding for health and safety in four of its nine Budgets. It cut health and safety funding in four of its nine Budgets. Our Budget, on the other hand, has a 20 percent increase in funding for health and safety. Under National, health and safety spending has gone up by more than 40 percent—more than 40 percent. What did Labour do? Labour cut it in four of its nine Budgets.

When Labour came to power, the inspectorate was 163. It had 163 health and safety inspectors. Labour ran it down to 141. With National’s extra investment in health and safety, because we realise and appreciate and acknowledge that it is such a priority, that inspectorate will be increased to 180. Whereas Labour reduced it and ran it down from 163 down to 141, we will increase it to 180. That shows our commitment to workplace safety. Actually, the other side does not really know where it is coming from in terms of this issue. I have got two comments about our improvements to workplace safety. One of them says: “The least the government could have done was to wait until the Royal Commission on Pike River Mine reports back in September,”. That was from Darien Fenton. The other comment was: “We don’t need to wait for the Royal Commission’s decision.” That was from Andrew Little. I would suggest that they really should put their politics aside and work with us on workplace safety.

Can I say that I actually congratulate the Council of Trade Unions on being active on the Workplace Health and Safety Council, and also on being part of the forum, the task force, that I have announced, which is going to have a look at the workplace health and safety in employment legislation.

In all Labour’s 9 years of office, it tinkered with the legislation three times. In 2002 Labour had the chance to reform it; it tinkered. In 2004 it had the chance to reform it; it tinkered. In 2006 it again had the chance to reform it, and it tinkered. National is going to reform the health and safety legislation. We have invested another $37 million over the next 4 years, in these tough economic times, because we place a priority on workplace safety. We are looking at the health and safety legislation that has been in force for 20 years now. We think it is a timely review, with the Pike River commission of inquiry due to report back in September, and with the events of the Canterbury earthquake. It is timely that we have a comprehensive review to make sure that our health and safety regime is fit for purpose, and where it is not, we can make improvements. But what does Labour do? It opposes it.

I just remind the House that our official rate for workplace incidents is appalling. It is 4.1 fatalities per 100,000 workers. That is twice the rate of Australia or the UK. We lose nearly a person a week. The Labour Party can scoff at that, but it is serious. When we know that every worker who goes to work in the morning comes home safely at night, without injury, we will know we have made a difference, and $37 million over 4 years will make a huge difference.

GARETH HUGHES (Green) : Kia ora, Mr Speaker. Ngā mihi nui ki a koutou. It is a privilege to take a call on the Budget debate. This is a Budget that has been called so many names in the last week—the “paper boy Budget”, the “paper girl Budget”, the “nickel-and-dime Budget”, and the “black” Budget. It has been called a zero Budget, not just because of the zero new spending and the $8 billion deficit but because of that zero hope and zero compassion for those 200,000 Kiwi kids growing up in poverty, and zero plans for how we are going to boost our economy.

We heard it from the Prime Minister, we heard it from the Minister of Finance, and now we have heard it again from the Minister of Conservation—the absence of the recognition that our economy depends on our environment. I cannot believe that we had the conservation Minister not use the word “conservation” or “environment” once in her speech. Our economy depends on the environment. This is why our valuable “clean, green” brand has been costed as worth over $20 billion to our gross domestic product. This recognition is what is lacking.

The Budget could also be called the “drill it, mine it, frack it, cut it, sell it Budget”, because these are the only planks this Government has for economic development—to drill it, to mine it, to frack it, to cut it, and to sell it. I would like to touch on three of its planks, to dig more holes and dig more wells across New Zealand, as the only plans they have got. I would like to look at the costs associated with these policies and the economic impacts, and to say that it is just not worth it. It is not worth it for New Zealand.

We are exporting a bit of oil at the moment. We exported just over $2 billion worth in the last financial year. Obviously, it is important: we need to be exporting, and we need to be earning foreign exchange. We are doing so well because the price of oil is so high, but let us look at the flip side. We are importing more than $8.3 billion of oil in return. We are not even getting a third of the way to self-sufficiency. Looking forward, this is a major strategic risk. That $8 billion fuel bill is already 16 percent of our imports, and is our single biggest import. Every US$1 price rise in the price of a barrel of oil wipes $40 million to $60 million off New Zealand’s gross domestic product.

Facing those big strategic risks, governments, councils, and militaries all around the world are getting together and developing oil reduction plans. But our Government has got no plan to even start planning to reduce our dependency on oil. Instead, what it does have is a plan to increase our dependency on oil and look at production. We are addicted to oil. This Government somehow found in an austerity zero Budget $14 billion to borrow to throw at these uneconomic roads of national significance. All this is going to do is increase our dependency on oil.

The second leg of its plan is to drill it, mine it, and frack it. This brings huge risks to New Zealand. The only way we could be a net oil exporter, as the energy and resources Minister grandly proclaimed in the briefing to the incoming energy and resources Minister, is to drill deep—very, very deep. We are talking as much as 3 kilometres down. As we have seen recently, for the permits being given off the coast of Wellington, Christchurch, and Otago, this Government did not even bother to consult with the people or the councils in those regions. The drilling could be between 1 kilometre and 3 kilometres deep, and this brings a huge risk. What we are talking about are exploratory wells this summer, and when you look at America with the Deepwater Horizon oil spill, which was another exploratory well, we see that it came with a massive environmental cost and a $40 billion clean-up.

New Zealand has nowhere near the level of capability to deal with a spill. This Government could not even deal with the Rena oil spill, a spill of a couple of hundred tonnes on the coast of the Bay of Plenty. This is why New Zealanders are so concerned about this Government’s risky deep-sea oil drilling plan; it is because oil on our beaches is not academic any more. Kiwis can see it, they can touch it, they can smell it, and they do not want it on our beaches. They do not want to risk it, especially when the economics do not stack up.

What we know from the Government’s deep-sea oil plans is that there will be hardly any jobs, hardly any taxes, and hardly any royalties, and we know that the profits are going to go offshore. So Kiwis could be facing 100 percent of the environmental risks for 5 percent of the value of the oil. We have been rated as having the fourth-lowest Government take—that is, royalties plus taxes—of any oil-producing nation in the world. This Government is selling us far too cheap. When you add on the pages of tax exemptions foreign oil companies can access in New Zealand, when you look at the tens of millions of dollars this Government is throwing at them, picking winners in an absolutely unsustainable field, you can see that there are going to be hardly any royalties and hardly any taxes, and there will be hardly any jobs.

We know that in Taranaki it has the lowest employment rate per percentage of GDP of any sector of the Taranaki economy. We know that last year the oil industry successfully lobbied the National Government to get foreign oil workers put on the immigration skills shortage list, so that they can expedite foreign workers to work on foreign-owned, foreign-controlled oil rigs, yet we are the ones facing the cost. We are the ones facing the environmental risks. We are going to see hardly any jobs, hardly any taxes, and hardly any royalties, and we know that the profits—100 percent—will go offshore.

So a spill would bring such considerable risk to our economy that it does not stack up. A spill would destroy that valuable “clean, green” brand. A spill would be catastrophic for our fisheries and aquaculture industries. A spill would also mean that it is the taxpayer coming to pick up the tab. This is what we have seen happen with the Rena. Last week the Government appropriated $35 million, and previous Minister for the Environment Nick Smith reckons we could be looking at a $130 million bill. Because this Government sat on its hands and refused to sign up to the 1996 bunker convention, and refused to update the Resource Management Act, and is still carrying over the woefully inadequate penalties to the new Exclusive Economic Zone and Continental Shelf (Environmental Effects) Bill, it is still sitting on its hands and is quite happy for the taxpayer to pick up the tab.

This is the big problem in the Budget: it gives $14 billion for new motorways, tens of millions of dollars to clean up oil off our beaches, $1.7 billion to throw at and subsidise polluters over the next 3 years through the emissions trading scheme, and $2 billion for tax cuts for the wealthiest Kiwis. But the maths are mad, and are not in New Zealand’s interests. There is no hope, no vision, no compassion, and no plan going forward.

That is why the Green Party is proposing concrete, realistic solutions that are going to benefit our environment and benefit our economy. Probably the best example of a benefit—and, to give the Government credit, it is good to be working with it on this scheme—is the Warm Up New Zealand: Heat Smart home insulation scheme. Our economic experts have calculated that we have seen $1.2 billion in direct benefits from that scheme, since it has been running. So there are some win-win opportunities out there. We wish the Government would grab the rest of them. Instead of selling State assets, we should be driving these companies to export.

The global renewable energy market could be a $100 billion global market place in the next few years. If we got just 1 percent of that in exporting our renewable, exporting our geothermal, and exporting our hydro experienced expertise and technologies, we could be providing tens of thousands of jobs that would deliver hundreds of millions of dollars of economic benefits, to the advantage of New Zealand. It would provide good, Kiwi jobs and provide high-waged jobs. We would not need to see all those numbers of Kiwis—who could fill Eden Park—fleeing over the Ditch every year.

So there are solutions out there. We are going to keep proposing them until the Government gets the right idea. We are not holding our breath, because the Government’s only plan for the economy is to drill it, mine it, frack it, cut it, or sell it, and that is no plan for New Zealand. Kia ora.

TODD McCLAY (National—Rotorua) : It is a pleasure to rise so early in this debate and speak on what was an excellent Budget. Can I congratulate our Minister of Finance, Bill English, on delivering another Budget for New Zealanders—a Budget for the times. It is a Budget for New Zealand and a Budget for New Zealanders. It is not for Greece—before the members opposite start talking about the policies they would bring to this country. It is not a Budget for the eurozone, and, of course, the challenges they are facing. It is not for the USA or other parts of the world. It is a Budget that invests in New Zealanders; a Budget for the future. This is, of course, a Government for the future and of the future.

I say that not just because of the way members opposite talk about their policies, as if those 9 years in Government, all that long time ago, were the best of times, but because New Zealanders woke up and said they were not the best of times. The spin came from members opposite—but it was not the best of times. This Budget is a Budget for the times, as I said, and I commend Bill English. Can I say to our Prime Minister, John Key, the New Zealand public not only trusts him but they voted for him in record numbers to continue to lead this country towards a brighter future.

The problem we have—and I say to my colleagues on this side of the House that we must be extremely cautious—is that we must ensure that when we have had a number of terms in Government we do not end up like members opposite, who still, after 3 years, are not listening to the public. They think the public will wake up and realise that they got it wrong, and that those years—all that time ago—were a good time for them here in New Zealand and that they made a mistake and should change their vote.

Well, it was not a mistake. They made a clear and conscious choice as to who they wanted to govern this country. They had an opportunity to reflect upon that at the election last year, and they moved forward with that in giving Prime Minister John Key the biggest vote any party has ever had under MMP—second time in a row. That is quite some accomplishment.

What is the Budget going to do? Well, it focuses on four key areas that I believe are extremely important to New Zealanders. The first is responsibly managing Government finances. Can I say to the members opposite, who last week voted against legislation that will save $347 million over 4 years—money to reinvest in our economy, to grow productivity, to put more money into schools, and to back New Zealanders—that, actually, the point they were making when they decided to vote against that legislation was that we should instead borrow that money.

Members opposite should just look at the newspapers and cast their minds all the way across the sea to Greece and other parts of Europe. They will see the great problems they have over there because they have not fronted up to their responsibility on their issues. They have not fronted up to the changes they made. If you keep borrowing, sooner or later you have to pay it back. Well, if members opposite want to keep borrowing, it is the New Zealand public that will have to pay it back.

Secondly, this Budget is about building a more competitive and productive economy. That means taking taxpayers’ resources and spending them better for a better return on behalf of taxpayers. I think that the New Zealand taxpayer, after 9 years of a Labour Government, has a lot to look forward to over the next 2 or 3 years of this Government, including responsible spending of taxpayers’ money in building a more competitive and productive economy, and delivering better public services.

I am going to talk about a couple of these areas in a moment, but can I recognise the unbelievably committed and focused job that our Minister of Health, Tony Ryall, has done. This is not just about those 9 years under Labour where it increased the spending significantly. I recognise that members opposite when in Government increased the health spend significantly.

Somebody told me the other day they thought that Labour had almost doubled the health spend. That is commendable—it almost doubled it. But productivity in health—productivity is not mums and dads receiving letters saying that they cannot see their doctor this week or that they are not going to get their operations—did not increase by the same amount. Productivity—people being treated by the health system by our hard-working and excellent doctors and nurses—did not increase by the same amount. It did not almost double; at best it probably went up 10 percent over that period of time.

Every single week our newspapers in Rotorua are full of praise of the Lakes District Health Board. The papers are focusing on the great work that the board is doing, because last year there were more operations in the Rotorua Hospital than in any year before. Under Labour we were just told they needed more money; that is what they needed to do these operations. We found if you backed doctors and backed nurses, and you get more doctors and nurses, then more people are treated and more people get better.

Who would have thought that it is not just about money; it is about doctors and nurses in the health service. Tony Ryall has done a fantastic job. He has delivered more money to health so that we can do more, and has backed doctors and nurses so that they can get on with the task and do the job that New Zealanders want them to do.

The next point of this four-point plan is the rebuilding of Christchurch. Just over the weekend there were more earthquakes in Christchurch. Can I say that it is hard for us in the rest of the country to know what the people of Christchurch have gone through, but I say to the people of Christchurch that this Government is supporting them and this Government is continuing to make sure that the rebuilding of the city and of their region is a priority. That is very much what this Government focused on during the past 3 years and will be focusing on in the coming 3 years. We will be lifting economic achievement and doing more for New Zealanders.

Christchurch was New Zealand’s second-largest city. A year or two ago it passed the size of Wellington. It was New Zealand’s fastest-growing city, and it was not growth based upon wasteful Government spending, which New Zealanders got used to over 9 years, but growth based on productivity. It was productive growth—people producing things and getting on in manufacturing or selling them and taking that money back into their businesses, reinvesting it, and growing employment.

Had it not been for the earthquakes, can I say to New Zealanders I think that our country would be in a very different position, and the books may look quite different. But it is a commitment that the Government has made and a commitment that New Zealanders in my electorate tell me they want us to honour—that is, to support the people of Christchurch, to rebuild their city, and, at the same time, to help rebuild our economy.

The next area is finance. We want to get the Government’s books back to surplus by 2014-15. I have heard almost every member opposite—at least from the Labour Party—say that that is not important. Labour has its own plans and would borrow a bit more and would get back to surplus in a few years in the future. Well, one need only look back a couple of years ago at countries like Greece, and they were saying similar things.

The members opposite are not fit to run this country. We cannot forever borrow and spend more than we earn. That is what they are happy to do on the opposite side of this Chamber. So this Budget, which was delivered by the able Bill English, gets us back to surplus by 2014-15. Members opposite will say that that is a modest surplus and only an odd hundred million dollars here or there. But can I say that when you are borrowing money, as this Government has had to in order to take the sharper edges off the recession, a few hundred million dollars here or there becomes very important. When we add up all of the promises that the Labour Party has made over the years of the recession—a few hundred million dollars here, $20 million over there—all the promises and commitments, well, it is not just a few hundred million dollars.

This economy and the Government’s books will be back to surplus, which is projected by Treasury to be by 2014-15. That means we can stop borrowing, we can start investing more in New Zealanders, and we can start lowering our debt levels. Of course, our debt levels will peak around 30 percent of GDP. When we came to office they were spiralling. They were forecast to spiral out of sight for the next 20 or 30 years; we have turned that round.

I want to finish, if I may, in a moment, by talking about education. A $511.9 million investment has been made in children in this country—an admirable investment. Our hard-working Minister of Education, Hekia Parata, has done a very good job to make sure that as a Government we are doing the right things. We will invest in children and we will invest in teachers. Our teachers do a very good job on our behalf. I entrust four of my children to teachers to help educate them every day. We will take some of this money—almost $60 million—and invest it in these teachers so that they can continue to do a good job, and that together we can raise educational standards.

Members opposite are right when they say that this is all about the children, and we must make sure we do everything we can for those children. But the last 9 years of a Labour Government, when it spent money on education that did not raise achievement, was a good trial, but that is all it was—a trial. It did not succeed, and if we want to raise achievement, we must do things differently, and I commend Hekia Parata for her hard work and focus in this area.

To members opposite I say that if you keep doing what you have always done, then do not be surprised by the same outcome. Can I ask only one thing of you, and I do this genuinely: please keep doing what you have always done, and in the next 3 years we will work hard in the third term of the National Government. Thank you.

Mr DEPUTY SPEAKER: Before I call Tracey Martin, this is to be a split call, and New Zealand First can determine what proportion of the call goes each way.

TRACEY MARTIN (NZ First) : Excuse me, Mr Speaker. Are you able to ring the bell at 5 minutes?

Mr DEPUTY SPEAKER: If that is what you would like: 5 minutes or 4 minutes?

TRACEY MARTIN: Four minutes, with a minute to go. Kia ora. Thank you, Mr Speaker. New Zealand First believes that education is a critical social and economic investment. If you listened to the spin put out by the National Government, you could be forgiven for believing that it actually thought the same thing.

But just before I get into addressing just a few—just a few, because I have only 5 minutes to address these things—of the areas of concern that this seemingly innocuous but, quite frankly, dangerously sly Budget has within it, I want to send out a message of support to Dr The Rt Hon Lockwood Smith. I can only imagine the distress that Dr Smith is feeling right now as he watches his own party apply a wraparound death grip to the teaching of technologies in New Zealand schools. Some of you will not know what this document is that I am holding up. This is The New Zealand Curriculum. It is supported by this other document I am holding up, which is on the teaching of te reo inside mainstream English-medium schools.

Dr Smith was a very hands-on Minister of Education back in the 1990s, and it was in 1993 that he demanded—demanded—that the technologies be included as a compulsory learning area in our curriculum. This document was reviewed with wide consultation in 2006. It was scheduled for full implementation in February 2010. Part of the consultation, particularly around the technologies inside this document, was with the Royal Society of New Zealand and the Institution of Professional Engineers. This is a highly regarded—both nationally and internationally—and recognised document. Other countries come to study this document. But since 2008 and the re-election of a National Government, this document and our schools have been under attack. First, we had national standards, a flawed system of markers given precedence over this curriculum by a Minister of Education who on every level refused to consult, communicate, or interact with those on the front line of educational delivery. From the last two Budgets $14.75 million has been spent on the marketing and spinning of national standards to the New Zealand public, in an attempt to convince the New Zealand public that this Government actually cares about their children and their children’s education. In this Budget, the 2012 Budget, there is a further $13.9 million, taking the spend on national standards to over $28 million by the end of the 2014 financial year.

Here we have a Government and a Minister of Education that talk the talk but have not got the faintest idea how to walk the walk. This Minister says on the one hand the Government is going to invest in 21st century learning environments, and in the next breath argues for 1970s class sizes. Here we have a Minister who talks about the one in five, speaks about our most vulnerable, and then allows her ministry to spend over $28 million on paperwork that never needed to be done. Not a single dollar of that $28 million will touch a child, and yet this same amount of money could have provided close to 9,000 identified 6-year-olds with reading recovery, or the same amount could have provided 1,690,000 teacher-aide hours in the classroom, supporting those children.

But let us just skip now to this increase of $511 million that is apparently inside this Budget. How much of that money is going to be spent on designing a league tables website? How much of that money is going to be paid to Catherine Isaac and her team while they work on an internationally suspect charter schools programme for New Zealand? How much of that $511 million will never touch a single decile 1, decile 2, or decile 3 child in this country? We do not know yet, because the Minister actually does not even know. The Minister does not know, she does not understand the teacher ratios, she has not received good advice, and our rural schools are dying because of this Budget, yet this Government will say, much like National did in the 1990s: “A little pain now, for some more gain later. Wait, New Zealand. Trust us—we know what we’re doing.” You do not, and that was obvious from today’s question time.

The Minister has no idea and the Prime Minister has no idea how teacher to student ratios work. But even if she did, why do they not apply to Māori-medium schools? Why are Māori-medium schools keeping the ratios across the board, and yet mainstream English-medium schools are being affected in this way? What about all the Māori and Pasifika students who are inside our mainstream schools now? Are they just going to have their technologies set aside—the very people whom the Minister said she is overly concerned about? The Minister needs to gain further advice. She needs to send her Secretary for Education out into the New Zealand schools, and out into the rural schools, not just the brand new, flashy ones where they can cut a ribbon. They need to go and talk to the staff, so that the Minister and her Secretary for Education can actually find out what Treasury’s suggested cuts will do for those students. Thank you.

Le’aufa’amulia ASENATI LOLE-TAYLOR (NZ First) : Talofa lava, malo le soifua ma le lagi e mama, Mr Speaker. Fa’afetai mo le avanoa. Thank you for the opportunity to speak, and to acknowledge Samoan Language Week. [Interruption] I hope that the member David Bennett is learning some Samoan this week.

National’s Budget reforms should be given a theme of money-shuffling. That is what this is all about, and that is what this Budget is all about. It is called money-shuffling. The Government’s Budget is simply money-shuffling. Last Thursday we heard how it was taxing the young boys and young girls doing paper deliveries, and then on Friday we heard how it was collecting from the senior citizens in their residential care. Sometimes I wonder whether those are what you call “senior moments”—a Government having senior moments.

As New Zealand First’s spokesperson on social policy and welfare, what better area can I begin with than to look at what National has done to enable the welfare reform of Minister for Social Development, Paula Bennett. One of the steps National has taken is to cut $155 million from youth services. These services were established with the aim of getting youth and the unemployed into work. Instead, what has the Government done? It has gone and cut from there and channelled the money into the new package of welfare reform. Part of this new reform includes $55 million over 4 years, fundamentally for Work and Income staff to assist people into jobs. Fancy that! I have trouble understanding how this will be implemented, when this reform will not necessarily create new jobs. Does the National Government propose that we get jobs from the air? How will this, and how will they, assist people in finding jobs, when many of these unemployed people need training?

It is no myth that finding a job in New Zealand is hard. But New Zealanders have a right to know what this reform will do, when we are investing $55 million into it. Simply saying that it invests in Work and Income staff and establishing a board to oversee the changes is not enough. New Zealand First has been asking the same question for quite some time: where are the jobs? Where are the jobs? National proposes to create 3,000 placements for school-leavers, but how long will this last? How long? What we have is a cycle of training up or giving short-term placements to youth in order to ship them off to Australia. We are simply supporting a mass exodus. No doubt our increasing export from New Zealand is qualified students who simply cannot find work here in New Zealand.

Bill English estimates that unemployment will decrease by 2015 due to an injection of funding into Christchurch and other sectors to create jobs. Yes, there is nothing wrong with injecting funding, but there is something very wrong in relying too much on the hope that Christchurch will be able to boom back from heavy destruction and resolve our unemployment rates. Maybe Bill English is suggesting that school-leavers will become fund managers for KiwiSaver or auditors for the Inland Revenue Department. I believe that that is what he is looking for. Or does he expect them—

Mr DEPUTY SPEAKER: Order! The member’s time has expired.

PHIL TWYFORD (Labour—Te Atatū) : Labour opposes this Appropriation (2012/13 Estimates) Bill.

Chris Auchinvole: No, Phil!

PHIL TWYFORD: Yes, it is true. Yes, it is true: we are opposing this bloody hopeless, nit-picking, penny-pinching Budget. The poor members on the other side of the House have been subject to all sorts of criticism over the last few days. They have upset the paper boys, they have upset aspiring postgraduate students, they have upset elderly people looking at going into residential care, and, worse than that, they have been criticised and lambasted by every respectable financial and economic commentator in this country.

But there is one group that the pundits forgot. There is one set of organisations that are the beneficiaries of this Budget, and they have not been given the recognition they deserve. That group is Western Australian mining companies. They are thrilled by this Budget. They have never seen a better Budget from a New Zealand Government. The Western Australian mining companies are over here recruiting as we speak, holding public meetings in places like Kaitāia and Kaikohe. Their public meetings are overflowing with skilled New Zealand workers looking to go and work in the Western Australian desert in goldmines and so on. This Budget is the best thing that has ever happened to them, because the flow of skilled workers across the Tasman to Western Australian mines will be speeded up by this National Budget.

It is, as we have been saying, a zero ideas Budget, and what is amazing about it is that for four Budgets in a row now Bill English has stepped up on Budget day and made the most remarkable promises about economic growth and about job growth, and he has consistently failed to deliver. Year after year he has made claims that Treasury has put into his hands of so many jobs being created and so much economic growth, and every year he has failed to deliver. Last year he promised 4 percent growth, and in this Budget he has scaled that down to 2.6 percent. Last week he said that exports were rising, whereas the House now knows that statistics show that exports fell by almost 17 percent last year. Last year he promised growth in real wages, and this year we have seen growth peak at just 1.6 percent and then decline.

In this House I represent the people of Te Atatū. We want jobs and we want growth in west Auckland. This Government has offered absolutely nothing to the people of my electorate in terms of hope that this economy will get back into growth, and nothing to make them believe that there is any realistic prospect of more jobs being created. West Auckland is the happy home of a boatbuilding industry that has been very successful in recent years, and yet under this Government’s economic stewardship we have seen one of the major superyacht builders internationally lose a major contract, which led to 50 workers being made redundant—50 workers. Since then we have seen another boatbuilder go into receivership. The owners and managers of that business have gone off to Australia. Why? Because under this Government the exchange rate punishes exporters, and members on that side of the House refused to do anything about it.

Well, Labour has produced a very clear and credible alternative budget over the last few days. We have heard my colleague David Parker laying out what Labour would do. We would introduce pro-growth tax reform that would not only make everyone pay their fair share in tax but also encourage more productive investment. I am talking about the capital gains tax. We would increase savings through a universal KiwiSaver scheme. We would re-establish the research and development tax credit scheme that National has decimated over the last few years, and, perhaps most important, we would adjust monetary policy so that it actually takes into account the need for jobs, exports, and overall economic development. But, no, National does not want to hear any of that. What has it given the nation in the last few days? A penny-pinching, pathetic, beige Budget that does nothing to address the big structural challenges facing our economy.

I want to talk about school class sizes, because this is one of the most interesting aspects of this Budget. John Key, when asked on Friday how many schools would be affected by the Government’s change to class sizes, said that one or two schools would be affected. Well, what do we know? Now we know that every intermediate school in the country is going to be affected by job cuts, and that class sizes are going to go up dramatically. In my electorate of Te Atatū there are three intermediate schools: one of them was set to lose eight teachers, and the other two were set to lose six teachers each. They have been distraught over the weekend. They have been absolutely distraught. The Minister of Education comes to the House today and says that no more than two teachers will be lost by an intermediate school—two teachers—and she makes that claim for just the next 3 years. Well, I have got news for the Minister. One of the intermediate schools just down the road from where I live has 20 teachers. If it is going to lose two teachers, as the Minister seems to be saying, that is a 10 percent reduction in its staffing—a 10 percent reduction in its staffing. That is an outrage. After the next 3 years, what is going to happen? Will the rest of the job cuts come through? That is my question, and I ask members on that side of the House to get up and explain that policy.

There is a deep, dark secret in this Budget. While the Government has been nickel-and-diming postgraduate students, the elderly, and the paper boys, the big, deep, dark secret is that National’s spending on its roads of national significance is bloated and out of control. Billions of dollars under this Budget continue to be misspent. That is low-value spending, by the Government’s own data. These motorway projects were hand-picked by Steven Joyce when he was the Minister of Transport, most of them even before any kind of cost-benefit analysis had been done about the economic value of those projects. It is a huge amount of money—$14 billion over the next 10 years—poured down a rat-hole in many cases. It is poor-value expenditure, and when this Minister of Finance was asked in the House recently about that, the best he could say was: “Well, we campaigned on it, and we won the election, and that’s why we are going to continue doing it.” That is an extraordinary thing for a Minister of Finance to say to justify billions of dollars of expenditure on poor-value, gold-plated motorway projects. And when he is asked to explain it in the House, the best he can come up with is: “We campaigned on it, and we won an election.”

At a time of austerity, when everybody else in the country is being asked to pull their belts in a notch, Gerry Brownlee’s bloated roads of national significance are out there stealing the lunch of every other category of transport spending. From the far north to Southland, every local council is screaming that they do not have enough money to maintain their roads. Local roads are being squeezed of the resources that they need to be properly repaired. Milk tankers and logging trucks are tearing up those roads. National members opposite who represent rural electorates will be very aware that their councils simply do not have the money, because National’s roads of national significance have been gobbling up all of the budget. If it is not a road of national significance, there is a moratorium on new State highway projects around the country. It is virtually impossible to get a new State highway project done unless it is a road of national significance—unless Steven Joyce has personally hand-picked it.

I want to finish on what is the crowning glory of National’s economic plan under this Budget. I am talking, of course, about asset sales. I want to note one particular thing that I think was one of the most depressing aspects of National’s Budget last week, and that is the so-called Future Investment Fund. National is selling off assets that the mums and dads of New Zealand already own and that deliver a damn good dividend to the New Zealand taxpayer every year. It is selling them off. And what is it going to do with the proceeds? It is going to put them into a fund—a Future Investment Fund—that Bill English conceded last week is a notional fund. So National is selling real assets, which we and our forebears sweated blood to build, and it is going to put the proceeds into a notional fund. KPMG, the accountancy firm, criticised the Future Investment Fund for using the cash merely to fund existing commitments. It said that the fund was for things the Government had already committed to. That is a sham, and that is why we oppose this Government’s Budget.

DAVID BENNETT (National—Hamilton East) : It is a great pleasure to speak in regard to the Budget, and a great Budget it is. It is a Budget that is going to be good for New Zealand, and good for our voters and our constituents as they realise that we are building a more competitive and productive economy, which is quite different from the Opposition on the other side of the House.

I would like to start by congratulating Phil Twyford, as that was probably his best ever speech. Everybody has left the Chamber, and there is nobody left now. It is great to see Phil on form again here today. Phil did mention a few things that I think we should draw attention to: the deep, dark secret of the Budget that is the roads of national significance. I would like to see Phil and his mates come to Hamilton and tell the people of the Waikato that the deep, dark secret of this Budget is the roads of national significance, and that Labour will not fund them. Will Phil come to Hamilton and say that he will not fund the Waikato Expressway? Will you do that, Phil?

Phil Twyford: Any time, Mr Bennett, any time.

DAVID BENNETT: Any time. Well, that is the best news Tim Macindoe and David Bennett could hear, because that guarantees us the next election if Phil Twyford comes to Hamilton and says what he said in this House, that he will not fund the Waikato Expressway. The Labour Party will not fund the Waikato Expressway. Thank you, Phil Twyford. I knew you were here for a reason. I knew we could count on you to give us that advice. And Phil—are you the spokesperson on transport for the Labour Party? Are you? Are you the transport spokesperson? Yes, he is. We have got a winner. Phil Twyford is the winner. He is the Labour Party spokesperson on transport, and he has said in this House today that Labour will not fund the Waikato Expressway. I look forward to ringing the Waikato Times when I leave this room and telling them that the great vision of the Labour Party transport spokesperson, Phil Twyford, for the people of Hamilton is that they will not get that investment. Thank you, Phil. Thank you, Phil. Tim, I think you are going to have to thank Phil after I have finished here, as well.

It is good to see Labour members making policy on the hoof, which is really unusual for them. They are making good, sound policy on the hoof as well, which is very unusual for them. And they are making policy where they have thought through the implications, because the implications are what this Budget is about. The implications for when you invest in infrastructure are that you build a stronger economy. When you have that infrastructure there, cities like Hamilton can take advantage of their links to Auckland and Tauranga. They can grow, and they can become more successful. Phil Twyford shakes his head in this House. Well, Phil, come to Hamilton, talk to our Regional Land Transport Committee, and ask it what its priority has been for the last generation. For a generation, what has been the priority? The committee has wanted one thing: the completion of the Waikato Expressway. Phil Twyford today has denied the people of the Waikato the one thing they have wanted for 30 years—30 years of waiting, and we have finally got it. Then today the Labour Party tried to dash that hope, and that is very sad for you, Phil, your party, and any potential candidates you have in the Waikato at the next election. I think you need to take stock of your party and what it is about.

The other thing that was interesting is that Phil went on and attacked the Future Investment Fund. That was great, was it not? One of the things that the Future Investment Fund is investing in is an organisation called KiwiRail. KiwiRail is the dear favourite of the Labour Party. The Green Party prays to KiwiRail every night, and the Mana Party is loving KiwiRail, as well. The Opposition sees KiwiRail as the great saviour of the New Zealand economy.

Hone Harawira: Sell it! Sell it!

DAVID BENNETT: Now the Mana Party wants to sell it. Well, if you make a bid for it, then you are quite entitled to it. The Green Party and the Labour Party will come into this House day after day and say that we need to invest in public transport, and that we need to have all these rail connections throughout New Zealand for public transport. They will have no limit on what they ask for, and they will never look at it objectively; they look at it believing that public transport rail is the answer. And when we invest in KiwiRail, when we put money into KiwiRail, like we are in this Budget, what do we get? We get criticism. The Opposition does not want to invest in KiwiRail, and yet it wants KiwiRail to be the answer for all our public transport issues. That just does not make sense. You cannot have a solution without investing in that solution. I implore Opposition members to look at what they say when they talk about things like KiwiRail, and work out that you need to put some money in there. We are doing that. We are actually doing what is required to build that company into the beast that they all want in order to achieve the goals that they talk about.

The Labour Party forgets that we have had a major recession—a recession that this country was in before the rest of the world, due to the policies of the previous Labour Government. Labour members forget that—

Chris Hipkins: That’s not what Bill English said.

DAVID BENNETT: What did you say?

Chris Hipkins: That’s not what Bill English said.

DAVID BENNETT: So you disagree? Labour members now disagree that they put New Zealand into recession before the rest of the world. Well, they should have a look at the growth figures.

Hon Phil Goff: The Government accounts were in the black.

DAVID BENNETT: There is Mr Phil Goff saying that they did not do that. They did do that. They put New Zealand into recession before the rest of the world. The Labour Government was a world leader. It was a world leader at putting a country into recession before the rest of the world. It put this country into recession before the rest of the world, and we have had to pick up the pieces. We have had to pick up the pieces of a recessionary economy. We have had to pick up the pieces of Budget deficits going into the future, which my good colleague from Rotorua Todd McClay talked about. He talked about how the New Zealand economy was facing years of large deficits as a result of the previous Labour Government’s policies of buying elections. The previous Labour Government put this country into recession. We had to come and take it out of recession. We have had to rebuild Christchurch, we have had to invest in the future of New Zealand infrastructure, and we have had to invest, more important, in the future of the New Zealand people.

We have done that in our education and health spending. I want to see Phil Twyford come to Hamilton and have a look at that great new beautiful hospital that is in the electorate of my good friend Tim Macindoe. That investment of $400 million in rebuilding that hospital, which will serve the purposes of the Waikato, Bay of Plenty, and other regions, is important for the future of our people. We are giving them that solid health care that they require and demand from a Government. We are giving them the standards in education that people require and demand. We are giving them the investment in other areas, such as law and order, that people want to see as the result of a good Government.

Broadband is another example. When Mr Twyford comes to Hamilton to talk to the ratepayers and citizens of Hamilton to defend his action of not progressing with the Waikato Expressway, I want to see him walk down the streets, where you see these orange corner stands where they are putting in the broadband in Hamilton. Hamilton was the first city to get broadband in New Zealand. It is being put in there now under the good work of the constituent MPs, and it is in the best interests of this country to make that investment.

Kris Faafoi: Shameless!

DAVID BENNETT: “Shameless!” you may say, but we deliver for our constituencies, Mr Faafoi—something that I am sure you will seek to do at some stage of your political career. That is happening on the ground. Our residents see that. Hamilton has even decided to change its vision as a city. It is looking at a technologically fast forward vision, you could say—

Hon Craig Foss: Tron.

DAVID BENNETT: Tron. The city of the future will be the most linked city of the future, and we will be head of the pack.

Jacinda Ardern: With not a train in sight.

DAVID BENNETT: What was that, Miss Ardern?

Jacinda Ardern: With not a train in sight.

DAVID BENNETT: Miss Ardern wants a train to Auckland. See, look at this: on the one hand, Mr Twyford does not want to invest in KiwiRail, yet Miss Jacinda Ardern comes in here and wants the train to Auckland. Maybe, Jacinda, you need to take this back to Phil, your spokesperson on transport. Remember, you have campaigned two elections in a row on having a train from Hamilton to Auckland, which is worth about $2 million, and we have campaigned two elections in a row on having an expressway to Auckland, which is worth about $2 billion, and guess what the people of Hamilton want.

Chris Auchinvole: What do they want?

DAVID BENNETT: They want the expressway.

TIM MACINDOE (National—Hamilton West) : I am delighted to stand and follow my good friend and colleague the member for Hamilton East. I am going to pick up on one of his themes, which is a vitally important one, and that is the shameful record of the previous Government, which pushed this country into recession. I want to reiterate the point that he has just made, because he is absolutely right that the people of Hamilton have demanded the completion of the Waikato Expressway for a very long time, and the Labour Party transport spokesperson being on record saying that Labour is not committed to it will be devastating for the people of the Waikato.

Perhaps even more than the three that preceded it, the fourth Budget delivered by the current Government highlighted both the gravity of the fiscal environment in which we are operating and the importance of our sound and careful strategy to manage the New Zealand economy back into surplus. In recent times one other point has become abundantly clear to my constituents and to the more responsible media and economic commentators, and that is the growing understanding of how appalling the previous Government’s record of economic mismanagement was during the 9 years of the Clark-Cullen-Parker-Cunliffe regime. That is not just a political point, and nor is it trite or cheap, because, reflecting now on the previous Government’s shameful record of huge and reckless increases in Government spending while it made little or no provision for paying for it, it is clear that all the Ministers in that former Clark Government—including the leader of New Zealand First, I should add, who now feigns concern about debt and the need to boost our country’s exports—have shackled our economy and imperilled our children’s future. For 5 years under their stewardship, if one could call it that, Labour Ministers allowed Government spending to rise at twice the rate of revenue. At any time such a policy would be foolhardy and unsustainable, but to continue on that path as economic storm clouds were brewing at home and throughout the global economy—

Todd McClay: I saw those storm clouds brewing.

TIM MACINDOE: —you did indeed, Mr McClay—as was clearly the case in the final term of the last Government, the Clark Government, was reckless and utterly shameful. So when former Ministers from “Planet Labour” stood in this House last week to attack the Budget and to speak of the Government’s supposed meanness and lack of imagination, as several attempted to do, I saw red in more ways than one. No one is fooled—none but the most one-eyed, dyed-in-the-wool Labour Party activist could continue to defend the indefensible. Labour caused the lion’s share of New Zealand’s current economic difficulties, yet not one member of the party opposite has had the integrity, yet, to admit it or the humility to stand and apologise for it. Not one of them.

Again, today, we have heard more unadulterated claptrap from this week’s Labour finance spokesman, David Parker, deflecting the blame and ignoring the triple challenges posed by the global financial crisis, the magnitude of the Canterbury earthquakes, and the continuing impact of Labour’s reckless and unfunded escalation of public spending. Yet today Mr Parker opined that “if you change nothing, nothing changes”. The same party that derides National’s attempts to rein in Government spending and mistakes a zero Budget for a recipe for zero growth and that attacks significant programmes to deliver better public services, to fund the reconstruction of Christchurch, to improve our tax system, and to promote the creation of new and sustainable jobs hopes it can spin the line that nothing is changing. The evidence that things are changing is overwhelming and all around us.

Andrew Little: They are on the benches opposite.

TIM MACINDOE: We have had growth, Mr Little, in every quarter since Bill English delivered a Budget. In fact, the last period of no growth was the last quarter bequeathed to us by the outgoing Labour Government.

We have constantly reprioritised spending, as a Government, towards the things that work, and we also have a firm focus on results, not just inputs. It is the Labour Party’s view that you just throw money at things, you have no accountability, and you make no attempt to measure whether things work. You just say: “Throw more money at the problem.” and you borrow it from overseas. The members opposite say: “Let’s tax and tax and tax, and spend and spend and spend, and somehow we will fix everything.” Well, what we are doing is making a difference, despite the fact that we are not increasing overall Government spending.

Notwithstanding Mr Twyford’s bizarre assertions a few minutes ago, the facts show that the number of people on benefits fell by more than 21,000 in February this year alone. That included 5,651 fewer people on unemployment benefits, which is a 9 percent drop in that month alone—a fantastic effort. Then the following month, to show it was not a fluke, we saw a further 8,000 people cancel their benefits, because they had found work. I congratulate each and every one of those 8,000 people, and I wish them well. I know that finding work is the best thing for them and for their families, and I trust that it will see a significant increase in their living standards.

I stand 100 percent behind the priorities that our Government has outlined for this term. Let us be reminded of those four priorities. We have committed ourselves to responsible management of the Government’s finances in order to return the Government’s books to surplus by 2014-15. Nobody underestimates how challenging that is. Each time—as we saw again, tragically, last week—there is another earthquake in Christchurch, it becomes harder, but we remain on track. Well done, Bill English. Well done, everybody who is managing a ministerial portfolio in these tight times.

Our second priority is to continue building a more competitive and productive economy—not one where you just throw money at low-quality areas, but one where investment is made in sustainable jobs and in growing a productive economy.

Our third priority, which I am going to come back to in a few minutes, is delivering better public services. I am passionate about that goal, which is why I will talk about it a bit more in a few minutes.

But of course the final one, as I have just mentioned, is that commitment, which remains ongoing, to the rebuild of Christchurch. Nobody should underestimate how challenging that is. I am sure our hearts go out to everybody in that city at the moment, as they continue to be shaken. It is a traumatic and devastating time for all of them, and we stand 100 percent behind them. They need that commitment, and I am glad that we have made it to them.

Earlier this year the Prime Minister announced 10 new results-driven goals for the Public Service, and they are hugely important. It is a pity that they did not get more coverage through the media, but I guess that tells you a little bit about media priorities. But those 10 commitments are very important. They are challenging and they are things that we are prepared to put on the record and be judged on over the next 3 to 5 years.

The first, of course, is the reduction in long-term welfare dependency. It is hugely important for generations of future New Zealanders.

The second is to see more young children, particularly Māori and Pasifika children, in early childhood education. We have made great strides in the last 3 years in this area. We are committed to achieving more, and I am delighted to see it happening.

The third is an important health objective, and that is continuing to see an increase in the rates of immunisation for young children. That is happening again. The records are out. In fact, I saw in the papers today further results from the district health boards around the country, and I congratulate them. They are all making major strides in that direction.

The fourth is to see a significant reduction in the number of assaults on our nation’s children. I am sure every member of this House welcomes that objective. I am sure we are all determined to see it happen. I thank those who contributed to the green paper and who have put forward ideas. I thank those who are working in this crucially important area, and I am going to do everything I can as an MP to support their efforts.

The fifth is to see more young people coming through our education system with significant levels of achievement. We know that pretty much the benchmark now is National Certificate of Educational Achievement level 2. It is a huge jump from even a generation ago. Therefore, what we are doing is putting a major investment into the programmes available, seeing them go through school and into tertiary education. We are determined to achieve that outcome, and we know that it is the quality of teaching that makes a huge difference. We are funding that. We are backing our teachers. We believe in them. I back them. I am a former teacher myself, and I thank them for what they are doing.

The sixth is to see a more skilled workforce, with an increase in the number of people coming through with advanced trade qualifications because they need them in order to secure employment.

The next is a reduction in the crime rate. It is not just total crime. It is youth crime that is such a major problem in our country, and it is violent crime. As we reduce crime, and we are seeing that happen, we know that that is going to make a huge difference to the lives of all New Zealanders.

The final one that I am going to mention today is a reduction in the rate of reoffending, which is something I am passionately committed to.

Hon DAMIEN O’CONNOR (Labour—West Coast - Tasman) : After that speech, I am going to have a talk to my colleague Phil Twyford and say that we do need the Hamilton expressway, because that member clearly needs to get out of Hamilton more often and into the real world. He is kidding himself with most of the facts or most of the claims he made in that speech.

The Budget was next to useless. It was a failed and failing Budget from a Government that is doing the same, failing. In fact, there will be many comments made on the Budget, but perhaps one of the best I have seen is one that said it was so bad that even the Queensland fruit fly would want to go back home. I think that is true. The 50,000 people who are now going to Australia every year are helping this Government. They are certainly reducing the unemployment figures; no doubt about that. But the sad fact is they are leaving because they have no hope for the future in this country, and that is a sad indictment on 4 years of a National Government, on four Budgets that have failed to deliver any vision whatsoever for this country.

What it has done is costed everything and valued nothing—costed every single thing, nickel and dime everything, even to the point of squeezing paper boys. Look back at the people we are talking about. These are young boys and girls up and down this country who often get up early in the morning, come rain, hail, or shine, get on their bikes and go out and deliver papers to people who get out of bed, and there is the paper at the front door. Their work ethic, their commitment to the job, is one that inspires every New Zealander who appreciates getting their paper in the morning. What has Bill English done? The mean-spirited, failing Minister of Finance has said: “We will take tax off them.”, because probably once a year they would look forward to a tax refund of about 200 bucks.

I lived out in the country, so I could not do it, but I can remember talking to friends who would get that money and that was a huge bonus—the inspiration for a year’s commitment. Bill English has scuttled them. And why? Well, because in 2009 the Government gave billions of dollars in tax cuts to the most wealthy in this country. The Government cut $13 million from Adult and Community Education at a time when it knew there were going to be people put on the unemployment scrap heap. The Government knew there were going to be people who needed to upskill and find some inspiration. No, the Government chopped it, for $13 million, and gave billions of dollars to people who probably, for the most part, did not even notice the increase in their income.

Andrew Little: Didn’t need it.

Hon DAMIEN O’CONNOR: They did not need it. They did not need it, and then of course, to top it off, National increased GST, which is the most regressive tax, arguably, that we have. The more people have to spend to live, the more GST they pay.

Hon Maurice Williamson: Who brought it in, in the first place? Who then increased it?

Hon DAMIEN O’CONNOR: Bill English and Mr Williamson there, because he is one of them—that member over there had to bring in a whole swag of Miss New Zealand entrants to try to find some inspiration, because he got nothing from the Budget. I hope it perked you up a little bit, Mr Williamson.

Can I say that there are a couple of areas that I would like to focus on. They are quite weighty documents, I have to say. Thanks to the help of my colleagues, and we all worked through our own parts, I ended up, having read through the primary industries one—and I will go back to that—being notified about the economic development and infrastructure section, which is an oxymoron from the National Government, I have to say. I went through the area of energy and found a line item that has decreased that epitomises this Government and everything it stands for—that is, a whole lot of promises and no delivery. John Key promised that money would not be an issue and that everything that could be done would be done to get the 29 miners out of Pike River.

Chris Auchinvole: And he did.

Hon DAMIEN O’CONNOR: No, he did not. Mr Auchinvole might—that is an absolute lie. Can I say, to back up what the Government has done, it has cut the $5 million—

Chris Auchinvole: I raise a point of order, Mr Speaker. I am surprised, and I do not wish to engage in the indelicate nature of the way that the member is speaking, but I do not take being called a liar.

Mr DEPUTY SPEAKER: I did listen very, very carefully. The member who was speaking, Mr O’Connor, said that that is a lie. He did not accuse the member of being a liar. It is a fine point. I just advise the member not to take those liberties because it does bring disorder. I am not upholding it, but I am not commending the member for the way he spoke, either.

Hon DAMIEN O’CONNOR: I do appreciate the Standing Orders and the fine line. But some things are untrue, and I have to say them in that way. I am not accusing anyone. I am saying that if anyone claims that everything was done, then that is a lie because it has not been. The $5 million that has been allocated for the recovery of the Pike River miners has been chopped from the energy budget, and that now is left to Solid Energy, perhaps—or who else, we do not know, perhaps a trust that the Government is trying to set up—to try to fund the recovery. Where is John Key’s commitment? Where is National’s commitment? They made a song and dance about it at the time. I have to say a lot of people hung their hopes on that. I welcomed that commitment. But like so many other things, promises of jobs, promises of economic growth, and promises of growth and innovation, the National Government has simply not delivered.

Well, the previous member got up and said there was growth in every quarter. It is more likely there was a quarter of the growth in every quarter, because, of every single figure that John Key or Bill English have put up in terms of job numbers and job creation, none of those targets have been met. I suggest that none of the targets in this Budget will be met either. It is a zero Budget—a zero Budget—because National did not want to make any promises. It wanted to have estimates and forecasts, but no promises, because it has not delivered—it has not delivered—on any promises to this.

The four objectives could be summarised in one word: sell, sell, sell, sell. Four State-owned enterprises—sell them. Why? Because John Key and this Government have promised their mates on the New Zealand Exchange that they will deliver them a bundle of toys so they can go and play with them. The Government will give its mates some shares to trade—blue-chip shares, so they will hang around for a wee while. But we know that ultimately every one of those State-owned enterprises and all of those mums and dads’ shares—in fact, the promise to have mums and dads at the front of the queue is also a lie. It is a lie because it cannot be delivered, and the Government has stated so very quietly—very quietly. It cannot deliver on the promise that mums and dads will be at the front of the queue. That is a lie, and it should be stated in this House because we have an obligation as the Opposition to identify the untruths, the failed promises, and the failed commitments of this Government. We have got a plan going forward, and it needs growth in the primary sectors.

We have seen in the next lot of documents in the primary sector cutbacks to biosecurity funding. In a number of areas we have seen cutbacks. Can I say that I am horrified at $6.8 million in so-called cost savings in biosecurity policy. We then have a $5 million reduction in domestic biosecurity surveillance. The very system that picked up the Queensland fruit fly is going to be cut. And this is the Government that claims it has a vision. Actually, I do not know whether it has claimed that. Perhaps that is a lie. I do not want to say that. I do not think it has ever claimed to have a vision. I do not think it has ever done that. It says it has a plan. Well, the plan is about selling State-owned enterprises, it is about squeezing teachers at schools, it is about trying to break unions and dumb down labour policy, and it is about robbing kids who deliver papers. I am sure that every MP when they are at home over the holidays, whether it is raining or sunny—and they are going to take the tax back from them.

There are no words too strong to describe the injustices and the unfairness that this Budget as a continuation of current Government policies has delivered. There is no hope; there is no vision. The Labour Party will develop policies that will offer at the next election—

Chris Auchinvole: When?

Nikki Kaye: When?

Hon DAMIEN O’CONNOR: We have plenty of time, because at the moment—

Mr DEPUTY SPEAKER: Order! The time has expired. [Interruption] Order! I have cautioned the member.

CHRIS AUCHINVOLE (National) : Normally I say what a pleasure it is to follow on from a previous speaker, but I am afraid on this occasion I do not intend to say that, because I was very disappointed in the depths to which that member, Damien O’Connor, went in seeking to make some sort of a snide personal point. I am very disappointed. I had thought better of him; I am sure his family did too. However, we get disappointed in life.

But I rise to speak in favour of the Appropriation (2012/13 Estimates) Bill—the Budget delivered by this Government for the brighter future that this Budget and the Government seeks to protect, particularly from the sort of criticism that we have been hearing from the other side of the House. Let us not be misled: we do have to protect the future from that sort of needless, senseless, groundless criticism. It needs to be protected from an Opposition party whose scant regard for our future prosperity was manifest in its own period in Government—and its scant regard for the future prosperity of our children and grandchildren. Our need to protect them from that party is confused and of concern, because we do not know why it is adopting the approach it is taking.

Those members sit on the cross benches, on the Opposition benches, as sirens singing for our nation to shipwreck, but this is a tune we are glad to change. And goodness me, the singing sirens—what an astonishing performance we have had—

Hon Maurice Williamson: You think they look like sirens?

CHRIS AUCHINVOLE: Well, some of them—it requires, the Hon Maurice Williamson, a little bit of imagination, I would agree. I would agree, especially when you hear the Hon Clayton Cosgrove singing. Goodness me. And then from New Zealand First—oh, such hand-wringing, such an end of the world, such accusations. One only has to look back a little bit over the years in Parliament to wonder at such sounds coming from New Zealand First, of all parties.

Andrew Little: Tell us about the Budget.

CHRIS AUCHINVOLE: You want to talk about the Budget? I am very happy to do that, and I will do it for Mr Little because I know he is keen to see New Zealand’s future develop. This Budget, Andrew, promotes economic growth. It forecasts growth at about 3 percent over the next 4 years. That is higher than Europe, at 0.5 percent; higher than the UK, at just over 1 percent; higher than Japan, at 1.5 percent; and higher than the US and Canada, at 2 percent. We are expected to have around the same growth rate as Australia—about 3 percent.

The Green Party, represented by Gareth Hughes’ speech, spoke of the Budget as not promoting growth. He could not be “wronger”! Responsibly managing Government finances in testing times and keeping the Government on track for surplus in 2014-15 is the task of this Budget. Our move towards surplus safeguards our international credibility and helps, for instance, to keep our interest rates lower for longer. Did Labour do that? No. It takes the pressure off the exchange rate. I will say that again: it takes the pressure off the exchange rate. Did Labour do that? Oh no. It reduces future finance costs. I will say that bit again: it reduces future finance costs. Did Labour do that? Oh no. Labour members have gone wonderfully quiet.

This Budget has been received positively by Standard and Poor’s, Fitch Ratings, and Moody’s. It is not just National who says it is a good idea; the people who measure these things say it is. This represents a huge turn-round, given the impacts of the 2008 recession, the global financial crisis, and—wait for it—the thing that in Labour-land never happened, the Canterbury earthquakes. The growth is based on strong fundamentals and our sound economic and financial institutions, rather than the money-burning fiscal irrationality of Labour—and we all had to endure that.

The Labour Opposition proposes a capital gains tax on all businesses, the reason—the only reason I have heard from it—being that other people do it, as if that makes it perfect in every way. It proposes the cancellation of a successful 90-day trial period, which would put 60,000 jobs created in the past 2 years at serious risk. Do you want to talk about that a little bit longer? Do you want to talk about that? Where do we hear criticism of that 90-day trial period? Thank you, Mr Speaker, I am sure you want to talk about it, but does the Labour Opposition want to talk about it?

Andrew Little: Yes.

CHRIS AUCHINVOLE: Oh, I am sure you do—except that it has worked. It gets into work people who would not get to work otherwise. Oh yes!

The Labour Opposition proposed extra transport charges and lifting interest rates by borrowing billions more, which would have put at risk the positive economic growth this nation has enjoyed in nine of the past 10 quarters under this Government. Do you want me to say that bit again? Nine of the past 10 quarters under this Government. The Labour Opposition proposes minimum wage increases that would cost thousands of jobs. The Labour Opposition has shown that it has the wrong recipe for building a more competitive international economy.

Why is that? Why is it? I am sure those members are well-meaning people, except for the previous speaker; I do not think he meant well at all. But normally Labour speakers mean well, so why is it that they get it horribly wrong? It is because they are trying to answer their trade union masters rather than the economic reality. We all know about self-seeking trade unionists, and how they lurk in the Opposition benches, lurking there.

This Budget maintains our commitment to rebuilding Christchurch. Almost $1.6 billion of the $5.5 billion Canterbury Earthquake Recovery Fund was spent in 2010-11. Most of the remaining funding is expected to be spent by 2015. But Cantabrians are not the only ones who will be supported through hard times. We will keep protecting vulnerable New Zealanders through Working for Families, New Zealand superannuation, and welfare benefits. I was remarkably proud of the Prime Minister when we realised that we had gone into recession during Labour’s last term and he said: “We must support the vulnerable. We must support those who are on benefits and entitlements.” And he has done that—he has done that. We will continue to support people to help themselves, investing $287.5 million on education and training. This is an investment in the people and the future of New Zealand.

Another vital role of this Budget is to ensure that the great work that has been done in the health field is continued. Let us remember that the Hon Tony Ryall was a spokesperson on health, an attack politician on that side of the House. He did a wonderful job in speaking about the frailties, the infirmities, and the need for change in health. He then made that transformation of becoming a very effective Minister of Health—let us be honest about it, all party politics aside; he is an outstanding Minister—and then he got a second term as health Minister. So it is amazing. Over 4 years we will commit almost $1.5 billion extra to our public health service. This will develop far more operations. This will continue to support the growth in health services.

Just to finalise, this Budget allows the Government to reprioritise $65 million in operating expenditure over the next 4 years, as well as—what is it—$73 billion in Government expenditure overall, contributing to 33,100 offenders accessing drug and alcohol treatment in prisons, 7,855 more rehabilitation places, 2,950 more prisoners in education and training, 7,500 prisoners in community offender support to find real jobs, 41,100 more rehabilitation places for community offenders, and 6,000 more integration support programme places. This Budget allows the Government to take the vital steps in addressing prisoner reoffending.

These steps in health, in law and order, in the rebuilding of Christchurch, and in every other field of government will build the brighter future that we campaigned on, that we have protected, and that we on this side of the House are so proud of. This Budget invests in New Zealand’s future. It will stimulate new jobs and deliver better services for families, while keeping the Government on track to surplus in 2014-15. I encourage those on the cross benches and those on the Opposition benches to join us and say: “Well done, Mr English, and well done, Mr John Key’s National-led Government.” Thank you.

CATHERINE DELAHUNTY (Green) : Talofa lava, Mr Speaker. I would like to acknowledge Samoan Language Week. I cannot say well done. We are living in an Orwellian universe now where bad news is good news, especially in education. The title of my education budget speech is “The labyrinth descends into ruin”, on an education budget labyrinth that is now disintegrating by the hour like a train wreck. Who knows? Maybe by 6 o’clock tonight staff cuts will be only one teacher per school. And the working party? Who knows? Just so long as the working party is not going to be led by Catherine Isaac or Paula Rebstock, because we have seen what that means.

Enough wasting of money on national standards moderation tools for the non-national standards, and enough wasting of money on the bizarre experiment of charter schools, which has failed overseas. We need to think really seriously about what is going on in education, and, unfortunately, the changes in this Budget are a maze in which many are wandering and finding strange things in dark corners. It takes a while, but it comes out in the end.

One positive area I am going to mention in the maze, which has shown some light, is Enviroschools, Te Aho Tū Roa. It is a wonderful initiative established by the Green Party in 2002 and then cut by the National Government, and now restored by the advocacy of the Māori Party to the tune of $7 million. I say good on the Māori Party, because we need Enviroschools more than ever as the planet faces the worst crisis it has ever known. It is a small beam of hope in the darkness that is the maze of educational confusion from this Budget.

But what about the grimmer and bigger picture in education? What about early childhood education? The freeze on the 20 free hours subsidy is an attack on families and whānau—nothing less. The centres and the families are contacting us and telling us in words of one syllable that people cannot afford to pay more on their fees for early childhood education. The rate of inflation makes this an effective cut to the subsidy and it is not fair. It is going to cost everyone in the long term. Early childhood is supposed to be the most important time in our children’s lives. The advisory groups on early childhood education have come up with some good ideas to improve early childhood education, but the whole process is getting undermined because people simply cannot pay the fee increases built into this Budget. I ask the Government to please not do this to families just because you can; it is too important. The Government will respond by saying that extra money is going into targeting Pasifika and tangata whenua children. That would be great if it was on top of universalism, because what really makes a difference is when you acknowledge that the poverty and inequity that is absolutely endemic in this country is across the board. It is not geographically or sectorally tidied up into some particular places; it is right across this country. That struggle is across many, many areas and it needs to be recognised through universalism, with additional targeting of funding. The Government has failed to understand that, because it does not grasp the concept of universalism, and also because it does not want to spend the money.

So let us talk about another disaster in the Budget, which is the compulsory sector. In schools the essence of the Government’s rhetoric has been the long tail of underachievement in addressing disadvantage. So what has the Budget done? It has delivered bad news, and even today has backed down, calling it good news because of the public relations disaster. I personally spent all weekend replying to emails and calls from families and from teachers saying: “What on earth are we going to do without these teachers? What is going to happen to our children?”. In primary and intermediate schools this is a disaster, and the labyrinth that I referred to is collapsing further into ruin.

The new funding formula for schools will do a number of extremely destructive things. Increasing class sizes in years 2 to 8—whose terrible idea was that to save money? I bet it was Treasury’s. I bet it was Treasury officials, those experts on education, persuading the Ministry of Education and the Minister that it would save the country when, even in its narrow monetarist terms, it will end up costing us. That is what happens when you let Treasury officials call the shots on something that they clearly do not understand, at all. Primary and intermediate schools are fighting hard now to keep class sizes at around 23, because it works. We all know it works. That is why the rich send their kids to private schools. Because they have small classes. Why does the Government not just admit that? Why does it not admit that it does not think everyone deserves it? But the diversity of children and the need for one-to-one attention to engage students with learning is a core plank for every decent school, unless, of course, you believe in rote learning, or unless you think that lecturing is education for our children.

The other day I visited a school that is fighting to keep class sizes down by bringing in extra funding from international students, and the principal had just come back from overseas doing this. It was not because he wanted to, but because without that money, it cannot meet its target of 23 per class. I went into a classroom of 6-year-olds who are now looking at an increase in their class size. The 6-year-olds in that classroom are so diverse that there are six different reading groups amongst what is now 23 students. The teacher said to me: “Please don’t give us one more child, because the diversity of need means I cannot do justice to those six different reading groups of needs within a class of 23.” That is the reality of a community where children experience dyslexia, special needs, and a whole range of learning needs where English is a second language. If you understand what is actually going on in the demographics of schools, you would never do this to our children. You would never consider it. However, what we are going to look at is a decline in quality. Small classes are quality classes unless you are a charismatic lecturer at a university—and any student can tell you that not many of them actually exist.

Technology teachers are the front line for the axe. We might lose up to 1,350. It is confusing, as the Prime Minister said in the paper this morning, and well he might. He is confused, we are confused, the Minister is confused—everyone is confused because the formula was not thought through. I want to quote from a woman, who gave me permission to quote her, called Sally French. She said today: “My daughter, a highly qualified art teacher with a fine arts degree with distinction and postgraduate diploma and 12 years’ teaching experience finds herself redundant with 1,100 others, and, yes, this is personal for me.” This family is extremely shocked and undermined, but the Government and Treasury just think these are numbers. What is technology actually teaching? It is a broad field including practical skills and the arts, including te reo Māori, which is an obligation under Te Tiriti. It is about hands-on learning and it is about specialist teaching. Specialist teaching as well includes remedial reading, which the Government, if it cared about literacy, would be doing nothing to undermine. So there are many contradictions in what is happening.

Another one is the bizarre outcome of bad planning and lack of coherence in the education section of the Budget around cutting postgraduate allowances whilst stating that teachers will now need a postgraduate qualification. How bizarre is that? On the one hand, postgraduates must find a way to study for a master’s qualification with no money, and, on the other hand, if they do not achieve this qualification, they will not be able to teach. Can they not even talk to each other before they write the Budget? The maximum amount that can be borrowed now is $172.51 a week.

However, there has been good news in the Budget—good news for Wanganui Collegiate School. It has received $2.9 million over the last 3 years and a new commitment to this private school, which is failing. Private sector education, of course, deserves the cash—apparently! So let us bail out failing private schools and cut quality public education. That is what is hidden in the rhetoric maze, and, people, this is bad news. It is bad news for students, teachers, and the country, but it is good news for Treasury and its little numbers, and good for Wanganui Collegiate School.

However, the Green Party is inspired about education and educational leaders in Aotearoa, as well as others such as Pasi Sahlberg, Finland’s director of education, who has shown the world that great results come from a commitment to equity, leading to achievement. Does the National Government know what equity means in education? It is the reason that Finland is at the top of the Programme for International Student Assessment poll. Equity—that is what leads to good achievement for all our children, and it is highly successful, despite the uninformed doubts expressed by Gerry Brownlee about Finland. The tragedy is that without equity in our communities we will never achieve equity in our schools. But to undermine that by cutting teacher numbers and increasing class sizes at this time in our history and at this time in our crisis around employment is a downright disgrace. The tragedy of the failed Budget appropriation on education is that someone will have to then turn round to get teachers back into the profession and to reduce class sizes again and fix the damage—and what a waste of time and lives that is. At a time when education must be the basis for liberation for all, we are now talking about narrowing privilege. We are now talking about increasing the privilege of the few, and protecting the few, despite the many.

The cuts to adult community education, lifelong learning, and many other things need to be talked about. The maze is unfolding, but I just want to say thank you very much, Mr Speaker. The Budget has failed us and our children.

NIKKI KAYE (National—Auckland Central) : I am very pleased to speak in this Budget debate. The first thing I want to talk about is courage, in relation to the Budget. Last night I heard a speech about courage. When we think about courage we think about accepting reality, and accepting the situations in New Zealand that may not be things we are proud of, but also about making the hard calls for New Zealand. And what I can tell you about this Budget is that we are not only accepting the reality about our place in the world and some of the issues that we have had in the past but also implementing policy that means that many young people in New Zealand will actually have a future. We are making the hard calls for New Zealand that we need to make. I want to talk about some of those today.

I also want to say that there is a clear contrast in this House. There is a clear contrast in this House between us and Opposition members, whose strategy around this Budget is to deny, oppose, and hope, compared with us making hard decisions. They have denied the situation that they left us in with regard to our economic situation, and we are addressing this within the Budget. They have opposed many economic issues that we are proposing within this Budget, and they are hoping that everything will be OK.

I want to address just some of the issues and some of the initiatives that we have in this Budget that mean we have a real economic plan for this country. The first thing I want to talk about, as chair of the Education and Science Committee, is our tertiary education system and the changes that we are making. We acknowledge that we have one of the most generous tertiary support systems in the world, and if we want many of our young people to have a future and to have high-paying jobs, we have to shift expenditure into research funds in areas like science and technology. We have announced a $326 million initiative in this Budget around research and technology. We have also announced a number of changes to the student loan system. What that is about is freeing up funds so that we can invest more in research in our tertiary system. What that means is that rather than people coming out of university with high debts that they will never be able to pay off because they will never be able to get the high-paying jobs in research and innovation, we are saying that we need to spend that money on research within our tertiary institutions. We also need to make sure that we are spending that money in those areas like agriculture—and some of those other areas might be digital media—so that we actually can create industries that have high-paying jobs.

Compare that with the Opposition members, who, firstly, have opposed everything from labour law changes to tax reform changes, to mixed ownership changes, and to investment in infrastructure. When you look at the rest of our economic plan, which, again, is highlighted in initiatives in this Budget, you see that we also focus on massive investment in infrastructure. We acknowledge that if we want our country to be better, then we not only have to shift funds within our tertiary education system but also have to invest in infrastructure. You will see that that is reflected in this Budget, whether it is in our $1.5 billion Broadband Investment Fund, whether it is in our roads of national significance, which are about ensuring that goods get to market quicker, or whether it is in the tax reform changes that we are making.

In this Budget there is $1.36 billion that is coming out of revenue around closing up tax loopholes, and what that is saying to New Zealanders is that we believe in fairness, and we believe that if we really want to have a future for our young people we need not only to reform our tax system but also to invest in infrastructure, to ensure we reprioritise in areas like science and innovation, and to make changes within our education system. It comes back to the point that I made before, which is that if we want to have a country that has a future, we need to make sure that we do not allow one in five kids to leave our education system not being able to read and write properly. That is actually appalling.

Now I want to cover just a few initiatives within this Budget with regard to education. What we are saying is that we acknowledge that there is a very difficult financial situation not only in New Zealand but also around the world. If we want to be secure, we have to have zero Budgets, we have to make sure we reduce debt, and we have to pay our own way in the world. The way we do that is that we have to reprioritise expenditure. So what we are saying is that we know that New Zealanders in their own homes understand the situation and that they have to make choices. Some of the choices we are making in education are to say that we know that if we invest more in teacher training and professional development, then we can actually raise the level of achievement more.

I want to give you an example of a place that I visited recently—the Best Pacific Institute of Education. In the Budget there were 3,000 additional places in the Youth Guarantee scheme, and I am incredibly proud of that. I want to tell you about these kids. A number of these children—and some of them came through our education system in the last 12 years, if members opposite want to crow about hearing about people who are poor—came out of our education system not being able to read and write. No one in this House should be proud of that. I am proud that through our Youth Guarantee system we are giving them a future. We are giving 3,000 more places within our Youth Guarantee system, to say to those kids that the Government will ensure that they get some basic National Certificate of Educational Achievement qualifications, because, actually, we did not do our job in our education system before that. That is the kind of initiative in this Budget that is about creating a future where young people leave our education system actually being able to read and write, and being able to go into professions that have high-paying jobs.

I want to touch on that again. Again, you are seeing a very clear contrast between this side of the House and the other, whether it is in National’s investment in infrastructure, whether it is in the reshuffling of funds in our tertiary education system, or whether it is in the huge package for science and innovation. I want to show you a graph here on science and innovation. This graph I am holding shows what we are spending on science and innovation. You can see it going up, regardless of the tax credit that the Labour Party talks about so much. We are clearly prioritising, in very difficult financial times, as a result of this Budget, and saying that, actually, if our country wants to earn more money, then we know that that is going to be in areas that are high tech. We know that we need to spend $160 million.

I want to address one of the initiatives that we have announced—the Advanced Technology Institute. That is a massive initiative to spend over $100 million on investing in good science and research that is going to enable our industries to sell high-value products to the rest of the world. Again, it is about priorities. On this side of the House we understand that with the incredible situation that has been happening around the world, with the fact that we went into recession before the rest of the world and were staring down the barrel of a decade of deficits, it is actually not OK to have a strategy to just deny that everything is happening, oppose everything, and hope everything will be OK. This Budget is about choices, whether they are in the education area, whether they are in the economic area, or whether they are in the health area. New Zealanders know that this Budget is about choices. There are hard calls to make, and it comes back to what I said before—it is about courage. It is about being able to stand up to New Zealanders and say that we do not have any blank cheques to write, and we have to get the money from somewhere.

What I can say is that I am confident—I am actually very confident—that when you look at where we have put the money, in various parts of the Budget, you see that we have prioritised areas like our most vulnerable, like the kids in the Youth Guarantee scheme, where there will be 3,000 more places as a result of the Budget. We have found $326 million for science innovation. This Budget is about creating a future for our young people. It is about ensuring that we earn our way in the world, ensuring that our young people have higher-paying jobs, and ensuring that they leave our schools actually being able to read and write. It also ensures that for those young people who came through the system under the last Labour Government and who cannot read or write, we will help them get back on their feet, and we will ensure that they can get into work. We know that not only their futures but also the futures of their children are dependent on our waking up and realising that the world has changed, that we have to make choices, and that some of those choices are hard, but they are about reprioritising expenditure. Every single line that you see within our Budget is about understanding that the world has changed, and making those choices. You can compare that with the Opposition approach of deny, oppose, and hope.

I came back to New Zealand to stand for Parliament. I was in London, working, and I came back to stand because I truly do believe that we have a great leader, and that we have principles within our party that actually recognise the economic situation that the world faces. We have prioritised to ensure that young people in New Zealand are going to have a future.

KRIS FAAFOI (Labour—Mana) : Thank you, Mr Speaker, very much for this chance to speak in the Budget debate. It is a pleasure, actually, to follow the previous speaker, Nikki Kaye. And talofa lava. I should acknowledge Samoan Language Week along with other members of this House. The previous speaker talked about courage and making the hard decisions in this Budget. I would like to congratulate the Government on making the hard decisions and having the courage to do so in the 2012 Budget. I would like to thank them and commend them for their courage in taking money off paper boys and paper girls to raise a miserly $14 million. This will affect 68,000 young people around the country. Congratulations to the National Party on its courage in doing that.

Tim Macindoe: I raise a point of order, Mr Speaker. By implication, the member is impugning the courage of the members on this side of the House. He cannot do that. That is outside the Standing Orders.

The ASSISTANT SPEAKER (Lindsay Tisch): The member needs to be careful. When one talks about the party, as the member did, that does imply members. So we will not do that again.

KRIS FAAFOI: Thank you, Mr Assistant Speaker. I do note your ruling, and I thank Mr Macindoe for making that point. I would also like to thank the Budget, I guess, for the courage that it took to crack down on some of our most vulnerable citizens by changing the way the asset threshold for residential care is calculated. I commend the Budget for that courageous move.

I also commend the Budget for its courageous move—and I hope the Government sticks to it—in its announcement to change the funding formula for teachers, which, in essence, means that hundreds of intermediate school teachers right around the country now face losing their jobs, and that tens or hundreds of thousands of children around our country will probably now find themselves in classrooms with lots more children. I commend the courage in the Budget for making these hard decisions, because these decisions are our ticket to prosperity. These Budget measures will mean that we are going to be on the road to prosperity.

I am reliably informed that at about 1 o’clock last Thursday a search and rescue team was convened. It had to be the best, because of the type of mission. The mission was going to be difficult. It was going to be a hard slog. It could have been a long mission, and it could have been a mission that may have finished with an unhappy ending. That search and rescue team was tasked with finding positive ideas within this Budget to address the fact that New Zealand has had the worst growth in 50 years. That search and rescue team was tasked with needing to turn round the fact that every year 52,000 Kiwis head to Australia because they think they are better off there. Every week 1,000 Kiwis think it is better for them to head to the Gold Coast than it is to stay here in New Zealand.

That search and rescue team was also tasked with finding a solution to the fact that 33,500 more children are living in benefit-dependent homes since the National Government took office. That search and rescue team was tasked with finding out why, and with finding a solution to the fact that unemployment has gone up by 52 percent since John Key became Prime Minister. Through a crackly transmission through a radio we heard: “I’m sorry, guys. We’ve come up with zero.” We were given a Budget with zero hope and zero ideas to face and tackle the serious problems that this country faces.

It is ironic that the previous speaker talked about courage in this Budget, because the measures in it do not contain any courage whatsoever. In this Budget there are none of the hard decisions that need to be made—none whatsoever. We asked that search and rescue team whether there was any sign of job creation and helping our exporters increase their exports and earn more. We were told: “No, sorry; there is zero sign of that.” We asked that search and rescue team whether there was any sign of helping Kiwis get the education they need and the opportunities they need to succeed in the 21st century. The message back was: “No, sorry; there is zero sign of that.” We asked that search and rescue team whether there were any policies in this Budget to grow incomes by investing in science, research, and development. The response was that there was some science but that it is much smaller than anticipated. So there is some sign of research and development hope in this Budget. We asked whether there was any sign of it becoming easier for Kiwis to save for their first home or save for their retirement. “No.” was the response back, “This is a zero Budget.” There is zero in that department in this Budget.

This weary and tired search and rescue team was then asked another question: “What did you see in this Budget? Tell us.” Well, like all search and rescue teams that go away on a long mission and find nothing, they suffer from a little bit of trauma and a little bit of stress. They might need counselling, because what they saw was horrific, harrowing, and, essentially, not very pretty. They saw 52,000 Kiwis heading to Australia every year—52,000 Kiwis heading to Australia every year. That is not good enough. There is no hope in this Budget for that to change—no hope. This is a Government that was worried when 35,000 were heading to Australia. This is a Government that was worried when 35,000 Kiwis were heading to Australia every year, and there is nothing in this Budget to turn that round—nothing in this Budget to turn that round.

What else did the search and rescue team see? They saw a Minister of Finance reaching into the pay packets of young children who deliver papers and pamphlets around our country, to get $14 million out of them—$14 million. That is one of the big ideas in this Budget. What else did the search and rescue team see? I mention again that the Budget is attacking the elderly in our community—170 people in the first year. The Government said this would save $14 million in the first year, or $16 million; I might stand corrected on that. This Government wants to change the calculation of the asset threshold for residential care. That is one of the big ideas in this Budget.

What else did the search and rescue team see? That tired old idea of asset sales—that is still there. As others have mentioned in this debate, the Government is still spouting off that line that mum and dad Kiwis will be at the front of the line. We have seen the legislation.

Andrew Little: It’s not in there.

KRIS FAAFOI: It is not in there. So any guarantee that this Government may give that the assets that Kiwis have paid for and built up over many generations, like our power companies and our airline, will stay in Kiwi hands is not worth the paper it is written on, or members’ breath when they speak about it. That promise is not mentioned anywhere in the Budget. The promise that these assets will stay here in New Zealand hands is one that the Government will not be able to keep.

Then we move on to our schools, because not even our children are safe. I challenge the Government to stick to its word, because today we have had a bit of a back-pedal in this area. If this move is so courageous and is such a hard decision, then the Government should undo its back-pedalling. Let us see how the parents react when their kids go to school and there are three, four, or maybe five more children in their classrooms. Let us see how the parents respond to that. Let us see how the teachers respond to that as well. One principal in my area of Mana is not very happy that he is potentially going to lose six staff from his school.

Tracey Martin: How many?

KRIS FAAFOI: Six staff from his school. I believe I heard the Prime Minister say that some schools might lose one or two teachers. So the homework was not done on this one. It does not look like the Prime Minister even read the papers. He said he had not seen that, and that he might do something about it. It is Tuesday today—4 or 5 days since the Budget was delivered—and there is some serious back-pedalling going on on the ninth floor of the Beehive. I can imagine that the pollsters and the focus groups were going mad from 2 o’clock on Thursday, and they came back with bad news for the Government: this is going down like a cup of cold sick. So here we go; the back-pedalling has started.

This is a Budget with zero hope for growth, and zero hope to turn round the dismal record that this Government has on unemployment, which has gone up 52 percent. This Budget has zero hope for the Kiwis who see the Gold Coast as a better option than New Zealand—52,000 Kiwis. This country is not a viable option for them any more. This is a zero Budget with zero hope.

MARK MITCHELL (National—Rodney) : I have not heard anything new from my colleague Mr Faafoi. They are still talking about paper boys. I knew this was a good Budget when all I could hear coming from the Labour benches was “paper boys” and “search and rescue”. Mr Shearer needs the number for search and rescue. It is about the mixed-ownership model. Mr Faafoi, we have limited capital in this country. We are a small country. The best thing we can do is take that capital and use it wisely—use it and invest it in other assets. We should grow other assets for the country, and grow other assets for our children. It is about the best use of that capital—a mixed-ownership model.

I tell Mr Faafoi that I am a parent as well. I have four kids. Three of them are in the public system and one of them is at an integrated school. I welcome the measures announced today by the Minister of Education, because I want to see quality teaching. I want to see an increase in the quality of teaching in our schools.

I hear a common theme emerging from the Opposition benches. They want the Prime Minister to deny the fact that our country has been impacted by the global financial crisis, the world recession, and the earthquake damage in Christchurch. This is exactly why Labour has been labelled “Planet Labour”. You would have to be living on another planet to say that none of these things has had a major impact or effect on our economy. I am proud of this National Government and that it has steered us, and will continue to steer us, through all these difficult times. I am thankful that we as a country are not being governed by a party that lives on another planet. Long-distance relationships are hard to manage at the best of times, but it must be proving difficult for Labour to connect with the people of this country from that sort of distance.

This Budget invests in New Zealand’s future. It will stimulate growth in new jobs, while still keeping us on track for a surplus in 2014-15. Getting back to surplus is a very important goal for us as a country. When we see other countries buckling and failing under huge debt, the last thing we should be thinking about is laying down more debt, which ultimately will have to be paid for by our children. We are one of the few developed countries that will not be increasing debt over these testing times.

I am pleased to report that for the people of Rodney our front-line health services have improved over the last 4 years. We are seeing more operations and shorter waiting-times. To continue with these great results, a further $1.5 billion is being committed over the next 4 years as a part of this Budget.

The Prime Minister spoke in the House last week and he talked about the Opposition and what it has been supporting in terms of our economic growth. He talked about the plan that we have for economic growth. I would like to just run through that list again, just to remind everyone. Let us look at some of the initiatives that Opposition members have said no to. Do they support the future intensification and development of our agricultural sector? No, they do not. They wanted to put the sector out of business, last time. Do they want more mining, or more oil and gas exploration? The answer is no. They get up and they complain about the amount of Kiwis heading to Australia. A lot of those people are going to work in the oil and gas sector in Australia—the mining sector. Australia has the will to develop that sector. When we develop the will to do it we will have a ready-made workforce of Kiwis wanting to come back and get involved in our own mining sector.

Do those members even want Australian companies moving jobs to New Zealand? No, they do not. Do they want welfare reform? No. Did they support the 90-day probation period for new employees?

Andrew Little: No.

MARK MITCHELL: No, you did not—you did not. They do not want to support businesses and employers and put them in a position to hire more employees. Do they support any of our labour market reforms?

Andrew Little: No.

MARK MITCHELL: No, you are right. Again, you do not want to support the private sector and businesses—the people who create jobs and employment. Do they support the $1.5 billion we put into ultra-fast broadband?

Hon Members: No.

MARK MITCHELL: No. All our entrepreneurs and our small businesses that are working remotely need ultra-fast broadband. Do they support foreign investment in New Zealand? No, they do not. Did they support the 3,000 jobs that came of making the two Hobbit movies? Why would Labour pick on hobbits?Why would it pick on hobbits? Does it want a less onerous emissions trading scheme?

Andrew Little: No.

MARK MITCHELL: No, it wants to increase it. It wants to put our farmers under more pressure. It wants to attack our primary industries. Do those members want the irrigation of the South Island or parts of the North Island? Do they support roads of national significance? I heard an invitation being extended by my colleagues Tim Macindoe and David Bennett for Mr Phil Twyford to come and speak about roads of national significance. I would like to extend that same invitation, because we have a road, the Pūhoi to Wellsford road, that is actually pretty significant for the people in Rodney and the people in Northland. I would welcome Mr Twyford coming up there, and we can arrange some meetings and he can tell everyone that this road is not important to the Labour Party.

Darien Fenton: Yes, that would be good.

MARK MITCHELL: I hear the Labour benches saying that that is good. Well, it is not good, actually. I will tell you what the Pūhoi to Wellsford road of national significance is all about. It is to enhance inter-regional and national economic growth and productivity. It is to improve movement of freight and people between Auckland and Northland. Northland has been under-serviced for ever, in terms of having a main State highway. It is to improve the connectivity between the medium to long-term growth areas in the northern Rodney area and to improve the reliability of the transport network through a more robust and safer route between Auckland and Northland.

For us to continue to grow as a country and continue to be competitive with our competitors overseas, we need to keep investing in our infrastructure. That is a no-brainer. The great thing about this Budget, and the great thing about this Government, is that we have kept that investment in infrastructure going even when we have been faced with very tough times. What this Government is doing is actually setting us up for competitive advantage with those markets that have not had the capital and have not had the money to invest in infrastructure.

The other thing in relation to the Pūhoi to Wellsford road is the fact that we have one of the highest fatality and serious injury accident rates in the country on that piece of road, and it comes down to a straight safety issue. So you would understand that the reception for Mr Twyford in Rodney and Northland would probably not be that welcoming when he arrives and refers to it as a “Holiday Highway”, and says that it is not important to the region.

Scott Simpson: Shameful.

MARK MITCHELL: It is. I am running business forums in Rodney, and they are proving to be very popular. We have got a lot of our local businesses—big, small, and medium-sized businesses; exporters and local businesses—coming there, and what we are talking about is what this Government has done, and what we are doing, to help promote economic growth, not just in Rodney but in the whole country. Let me go through some of these things. Let me go through some of the things that this Government has done in relation to assisting growth for our businesses. Sorry, let me first cover what Labour proposes to do in terms of helping our businesses. It wants to implement a capital gains tax on all businesses. It wants a more than doubling of employer KiwiSaver costs—which is ridiculous—irrigation taxes, a minimum wage increase that would cost thousands of jobs, an acceleration of the 90-day trial period, and a return to 1970s industrial relations policies. It wants a wind-back of National’s ACC changes, meaning higher ACC levies, extra transport charges, and a lifting of interest rates caused by going out and borrowing billions of dollars. All that this would be is an anchor round the necks of our local businesses, whereas the National Government is looking at ways of reforming the labour laws, investing in infrastructure, and continuing to help and promote our business overseas. I take great pride in standing in support of this Budget. Thank you very much.

DARIEN FENTON (Labour) : Talofa lava, Mr Speaker. Thank you very much for the opportunity to have a call on Budget 2012. I think there is one thing we do agree with the Government on, which is that Governments are about choices and priorities. This side of the House just thinks National has got its choices and priorities all wrong. Labour’s view is that the Budget is about people, rather than people being about the Budget. You know, that side of the House thinks that the people serve the economy, not the other way round.

Budgets are where the rubber hits the road, and this Government has got it so wrong. Its priorities are wrong, and it shows: the worst growth in 50 years, more than 50,000 New Zealanders leaving our shores, a 52 percent increase in unemployment, and nearly more than 50,000 people on benefits under this Government. It has been in power for only 3 years and a bit, and what a track record. John Key has consistently overpromised and under-delivered. This year is no exception. Last year he promised 170,000 jobs. Where are they? Where are the jobs? This year the estimate has gone down. It has been cut by 16,000, and we are still waiting to see the jobs from last year. Last year he promised 4 percent growth. What has happened to that? That is now a 2.6 percent projection. He said that exports were rising. The latest statistics show that exports fell almost $800 million, or 17 percent in the last year. Last year he promised real growth in wages. This year we see it peak at just 1.6 percent and declining.

One of the most disappointing things about this Budget is the lack of focus on jobs and wages. The Government’s recipe is to tinker and hope, and it is all going to come right in the end. It reminds me of Mr Micawber. Remember him? Mr Micawber from David Copperfield, who was famous for saying: “Something will turn up.” Let us remember that Mr Micawber spent quite a lot of time in the debtors’ prison, actually, and perhaps the Government should think about that too.

Let us talk about jobs, because the Government has been talking about jobs—or the last speaker, Mark Mitchell, certainly did. Jobs from Australia: let us be honest about why those jobs are coming from Australia. They are coming from Australia because we have got a low-wage economy. They are coming from Australia because Mr English thinks low wages are a competitive advantage. Let us talk about The Hobbit jobs: 400 jobs at Weta Digital are coming from overseas. How is that helping New Zealand? Four hundred jobs—high-skilled, high-tech jobs. Of course, we will not have the teachers in the intermediate schools to even give those kids a hope. Even the Royal New Zealand Ballet is now looking to bring in people from overseas. For goodness sake! What about jobs?

This is the truth about this Government’s job recipe. The truth is, as we all know, that people are just giving up, because this is a no hope Budget, and they are heading overseas. Turning paper boys and paper girls upside down to get the money out of their pockets and robbing the pockets of older people for small change are the best ideas that the Government has been able to come up with, and this zero Budget will do nothing for low and middle income earners and their families. On the things that matter, that will really make a difference to those people, things like growth in the economy, jobs, incomes, and exports, this Budget offers nothing. The only idea this Government has is asset sales, and we all know how that is going down in the community: a big, fat bleurgh.

You know, the tragedy about this, though—and it is playing out in almost every family in New Zealand—is that people are realising that there is no hope under this National Government. Over the weekend there was a new baby born in my family—he was born to my nephew—which is something to celebrate, but this is a child whom I will probably never see. He was born in Vienna; he will be an Austrian citizen. The next generation of my family now live in Australia, in Geneva, and in San Francisco, and I cannot tell you how sad that makes me as a proud New Zealander, knowing that there are some of our family who will just not come home while we have this kind of Budget and this kind of no hope Budget.

The Government has made choices that make things worse. Let us talk about the tax cuts it gave to the rich. It has not apologised for that. It has put the country in a bind, and it should apologise for that, because following that, it hit lower-income families with a rise in GST—

Hon Maryan Street: And the paper boys.

DARIEN FENTON: —and the paper boys—and it has increased the minimum wage by paltry amounts. It keeps going back to failed ideas. We have heard some of the Government members today say that Labour had the cheek to oppose the 90-day trial period. I heard the Minister of Labour sort of shrieking her way through her speech, making outrageous claims that nobody can substantiate about how the 90-day trial period has created all these jobs. Is that the best the Government can do? No, actually, it is not, because National does not understand how you get better wages and productivity and decent work in this country. It is a narrow vision, and what we are going to see is more of it. That is what we are going to see: more employment law changes ahead, particularly around collective bargaining, and that is the one thing standing between raw managerial power and respect and fair treatment for workers. It will undermine collective bargaining. It is another thing that helps lift wages across the board, protect job conditions for all workers, and reduce inequality.

I would like the Minister of Labour, Kate Wilkinson, to front up to those rest home workers whom our very brave human rights commissioner talked about on the weekend. I would really like her to do that, and to tell the commissioner why they should be worse off because she is going to make changes to the labour law. Tell it to the cleaners who gathered last week to launch the Living Wage campaign along with 50 community organisations, including faith-based organisations that reminded us that we have a moral duty in this country to love thy neighbour, to look out for one another. But this Government does not do that. It does not do that. What did John Key say? He does not understand what a living wage is.

I am really looking forward to hearing what happens to the Minister of Labour when she goes off to the International Labour Organization conference next week, where they are actually going to be talking about fundamental principles and rights at work, like collective bargaining and like freedom of association. I think she can expect a pasting, and she deserves it. In fact, all of the ideas, all of the things that she has put forward in the paper that Cabinet has signed off, have been criticised by the Department of Labour, and they have been criticised by the International Labour Organization. We will be a pariah in the international community, after 10 years of being a leader and being able to hold our heads high about the way we treat workers.

The one thing I will support in this Budget is the increase in health and safety, even though we know it has been reprioritised from other areas. It is not new money. But I would also add to that and say that it is not going to solve the problem, because the Government does not believe in worker involvement in health and safety. It does not believe that workers are intelligent or trustworthy enough to be able to contribute their ideas about their own health and safety and how improvements can be made.

Kate Wilkinson puts all of her confidence and money into a chief executive officer forum—again, you know, where the bosses are essentially deciding what is good for workers. She has let the Pike River families down—in fact, John Key has let them down—with the cut in the Budget on that. She has cut the role of workers in health and safety. The Government has made workplaces more unsafe with the 90-day trial period, and if those members do not believe me, go and talk to a young worker at a workplace on a 90-day trial and ask them how safe they feel raising a health and safety issue. The Government can cry crocodile tears about health and safety, but it has no idea—no idea—about what this means. Bit by bit, this Government plans to gut our employment relations framework so the protections that workers in New Zealand have will be gone. This is a “zero ideas Budget”. It is short-sighted, it is petty, it is nasty, and, worst of all, it is going to mean we see more of our children crossing the Ditch and heading overseas.

PAUL GOLDSMITH (National) : This Budget is a sensible one. It takes a firm line on spending and invests in our future during difficult times. Like households all around New Zealand, this Government knows that it has to live within its means. That means paying down debt. It means going over all the spending and making sure that it makes good sense. It means looking for ways to get what we want for less, and also figuring out how to improve our income. That is what households are doing, and that is what this Government is doing, and no wonder this Budget has resonated so well.

I want to respond to a couple of canards that were heard from the other side. The first is that this is some sort of “do nothing” Budget. What a load of rubbish. This Government has stuck to a consistent line for the past few years of setting a path back to surplus. Consistency and stability are precious commodities in this world. True, it does not represent a radical departure. That is quite right, because a sensible direction was set out in 2010 in terms of the tax settings, and subsequently the focus on rebuilding Christchurch and delivering better public services has continued. It makes sense to continue such a line. This represents an evolution of that strategy, the wisdom of which is becoming more and more apparent with each passing month as we look around the world and see the situations that other countries have got themselves into.

We should also consider for a moment some of the other proposals from the other side. Labour’s solution to every problem seems to be a capital gains tax. It still is beyond me how taking more tax from small businesses, from farmers, and from other businesses can be some way of growing the economy. That is no way to grow the economy, as far as I can see. The Greens talk in a dreamlike manner about green industries, as if somehow they will magically arise and lift our living standards.

Well, the National Party is much more realistic about what it takes to grow an economy. It is about, at the end of the day, the additional jobs and economic growth that come from companies being successful. Companies are successful only if they beat the competition, and you beat international competition only if you deliver products that are either better or cheaper than the rivals. Ideally, they will be even better; they will be cheaper and better.

I can think of six drivers for business growth that we do not hear about much from the Opposition. It is about innovative ideas, it is about capital, it is about raw materials, and it is about skills, customers, and infrastructure. I want to go through each of these six in turn. If we start off with ideas—

Dr Megan Woods: Where are the technology teachers to teach the skills?

PAUL GOLDSMITH: Well, we will get there. We will start off with ideas. The innovation ideas reflect the genius of the people—young folk coming up with new apps or new products. The Government can help.

One area where the Government is making a significant investment is in research and innovation. It is going to be spending, over the next 4 years, $166 million on the Advanced Technology Institute, helping high-tech firms boost productivity, $60 million for the National Science Challenges, $100 million increasing the Performance-based Research Fund that is available to universities, and $59 million more for science and engineering tertiary courses. The Government cannot come up with all the ideas, but it can create an environment in the research and development area where this country will be producing more ideas that companies can draw on to be successful.

If we turn to capital, well, you know, we do have amongst the lowest interest rates that we have had for decades. It is helpful if you are trying to get access to capital, is it not, if you are not having to pay unreasonable amounts for that capital? Those low interest rates that companies have available to them are the direct result of consistent, stable, sensible economic policies that this Government has been driving over these last 4 years. Another area that is important in terms of capital is the mixed-ownership model, which will give a fillip to New Zealand’s capital markets, which have been thin and weak over the last past few decades. The Greens, of course, are protesting about this as usual. I see they are advertising on Student Job Search to pay people to go out and fill petitions.

Todd McClay: Using taxpayers’ money.

PAUL GOLDSMITH: I am not sure about that, but it would be interesting to know. Contrast the National Party’s approach to getting access to more capital with that of the other side, and what you will find is an inward-looking opposition to any foreign investment. Members opposite are opposed to that—especially if it is Chinese, if you are dealing with New Zealand First—and turning inwards. That, to me, is no recipe for growth. National understands that successful companies need access to capital.

What about raw materials? Well, this Government recognises that New Zealand has rich resources on its land and throughout its vast exclusive economic zone. Labour and the Greens do not want to do anything with it; they do not want to touch it. They prefer to export our next generation to Australia to help them make use of its natural resources. Well, that does not seem to make good sense to me. If we talk about primary industries as well, growing production through irrigation and intensification is the sort of thing we need to do to make a better living in this world, and that is what this National Government has been focusing on. So what have we got here? We have got successful businesses having greater access to ideas, to capital, and to raw materials.

Before we close at 6 o’clock I can talk about skills and education. We all want our kids to leave school with the knowledge and skills they need to reach their potential in the 21st century. In education our focus is on increasing student achievement, not just on pouring more and more teachers over the line without focusing on the result. Over the next 4 years we will be committing $511.9 million in the Budget towards new early childhood education and schooling initiatives, as well as another $59 million invested in teacher quality to support professional development for teachers and principals. We are ticking off that one.

Then if we move to customers, customers are all about market access and free trade, and, thankfully, the Labour Party—notwithstanding Mr Shearer’s anti - foreign investment rhetoric—still believes that actually having access to international markets through free trade is an important thing. I have no confidence whatsoever that the Green Party would be at all interested in maintaining New Zealand’s open access to international markets. It seems to be against trade, but on that score—

The ASSISTANT SPEAKER (Lindsay Tisch): I am sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break.

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

PAUL GOLDSMITH: I was talking about how this Budget is a sensible one, has taken a firm line on spending, and has invested in our future during difficult times. I talked about the National Party’s understanding of what really were the drivers of economic growth, and that came down to having companies that are successful internationally making money and beating the competition. I talked about what they needed for success, which is access to good ideas, access to good, strong capital flows, and access to raw materials, primary industry, skills, and customers. We talked about market access and the fact that, thankfully, Labour—notwithstanding Mr Shearer’s anti - foreign investment rhetoric—still believes that market access is an important thing, and that there has been a measure of bipartisanship in the House on that subject. I was not so sure about the Greens.

The final area that I think is obviously clearly important for economic growth is good, sensible investment in infrastructure. Here we are talking about electricity transmission, the ultra-fast broadband building and construction, and transport—roads for a start. In Auckland, where I come from, lives have been transformed by the second Manukau Harbour crossing by the Victoria Park Tunnel, relieving pinch points in Auckland’s arterial road network. The Greens and the Labour Party tend to oppose everything that we do on the roads. They are in the thrall of public transport at the expense of everything else, even when there is a very poor return. We saw in the New Zealand Herald this morning yet another story of only a handful of commuters using the $81 million rail line to Manukau. That is how the State can spend your money if it is in the wrong hands. This Budget, it seems to me, is continuing a sensible line, which the Government has outlined since it came to office in 2008, showing stability and sensible management at a time of difficulties.

The other thing I just wanted to mention was the canard that we hear time and time again that the National Party has simply given tax cuts to the rich. This has been a line that the Greens have used time and again, when it is factually incorrect when you look at the numbers. That is what happens when you look at only two out of the 13 components of the 2010 tax package. Mr Norman tends to pick out personal tax cuts and GST and ignore all the other parts, such as changes to depreciation, loss attributing qualifying companies, and thin capitalisation rules. I suppose it is because they are not quite sure how they work, but depreciation changes alone raised $1 billion in extra revenue each year, mostly affecting high-income earners. When you look at the 2010 tax changes, overall the burden of that has been borne very evenly across all income groups. This is a very sensible Budget that we have brought here, and I fully support it. Thank you very much.

Dr KENNEDY GRAHAM (Green) : This 2012 Budget is the miser’s Budget. It picks up the kids, hangs them upside down, then empties the coins out of their pockets, with a view to pretending we are on-target for a wafer-thin surplus in the year promised. Not only is this small-minded, it is a distraction. It is a distraction because it deceives us into focusing on the near irrelevant, forgetting the essentials and ignoring what is critical. What has not been recognised amidst all the rhetoric and hyperbole in this debate is what this Budget will not be known for—what it has omitted. What the Minister should be doing with his Budget Policy Statement in these difficult times is this: first, explain the global ecological economic context to the New Zealand public; second, analyse what the international community is doing about the global problems that beset us all, all 200 national economies; and, third, offer a prescriptive macroeconomic policy in the Budget Policy Statement, supported by the estimates, which reflects the mix of national prudence with which the Minister is instinctively well endowed with some creativity on what policy prescription New Zealand can offer to help ameliorate the global problem, something of which the entire Cabinet seems to be devoid.

The first requirement is to recognise the ecological overshoot of the current global population. With a footprint of 2.7 hectares per person and an earth share of 1.8 hectares, we record an overshoot of just on 50 percent. That means we need one and a half planets to sustain our current global population on the basis of contemporary technology. That is the first sobering global fact the Budget needs to address, but this Budget is silent on that.

The second sobering global fact is that the human population is increasing, barring tipping points, by an additional 29 percent, from 7 billion to 9 billion, by 2050. The global population will have grown from 2 billion at my birth to 9 billion at the death of my children, from 2 billion to 9 billion within two human lifetimes. That unprecedented event has enormous implications for New Zealand’s economy, yet this currency trader Budget completely disregards it—not a word.

The third global fact—not so much sobering as alarming—is the onset of serious climate change. Let us put things in context. The international community has now had 20 years since adopting the framework convention to ensure that global emissions peak and commence the downward emissions path to a low-carbon economy. In 1992 global carbon equivalent emissions were 44 gigatonnes; today they are 56, an increase of 28 percent. During those 20 years, the only instrument to reduce emissions was the Kyoto Protocol, with a commitment period of 16 to 20 years later. That protocol covered only 17 percent of global emissions and aspired to shave only 5 percent off them. Even if it had succeeded, it would have shaved perhaps 0.2 degrees Celsius off the average global temperature increase. It was intended as a precursor to a comprehensive, binding global agreement. That is now to be negotiated by 2015, to come into force in 2020, so the global agreement designed to commence the task identified in 1992 of containing the global emissions increase will come into force 28 years later. It is likely, in the best of all worlds, to take a decade before emissions would peak after that. That would be 13 years after emissions need to peak to avoid serious climate change.

In 2010 the international community agreed on a threshold of 2 degrees Celsius rise on average global temperature. One year later, the scientific community revised the expected temperature increase to between 3 to 4 degrees Celsius. So no sooner did the Governments identify a global warming target, than that target was rendered unlikely if not impossible. This is humanity at work, addressing for the first time ever an issue pertaining to its survival. Scientific concern is now being expressed over the indeterminable risk of non-linear climate change occurring from ice melt, thermal ocean expansion, and methane release from the tundra and subterranean vents. These are the tipping points that could cause catastrophic disturbance to the biospherical balance of the planet on which we dwell for our survival. These three global facts depict a planet in decline. They forecast severe strain, perhaps intolerable strain, for the global economy. The New Zealand economy accounts for a tiny portion of the global economy—only 0.2 percent—but it is not negligible.

The fate of New Zealanders rests on the fate of the global economy, yet the Budget says nothing of this. The Budget Policy Statement advanced last week by the currency trader Government contains not one word on population, not one word on ecological overshoot, not one word on biodiversity lost, and not one word even on climate change. Rather, its highlights are tax credit reductions for paper deliveries, and adjustments to livestock valuations. It plans to cut policy advice on climate change by 30 percent, compared with 2 years ago. Because of this, the 2012 Budget has an air of unrealism to it, reminiscent of the Titanic.

What does the Budget do about climate change, even though it does not mention the words? The Budget seeks to hide the line items pertaining to climate change, splitting the emissions trading scheme into various line items that would challenge any corporate investigator. The New Zealand emissions trading scheme is a complex creature. It was born of proud parentage but slipped into a wayward life, early on. Its original objective under the Labour Government was to meet the Kyoto Protocol obligation of the same emissions level in 2008-12 as that in 1990. It was to achieve that by setting a carbon price and then let the market work. It was based on the assumption that other countries would do the same around the same time so there would be little carbon leakage, and an integrated international carbon trading market would emerge. But this was beset with flaws. First, no emission reduction obligations were required under the framework convention or the protocol for developing countries. Second, the United States stayed away. So some 83 percent of global emissions have faced no such constraints, so the risk of carbon leakage is ever-present—something the corporate world exploits to the full for self-interested commercial reasons.

Third, the emissions trading scheme itself was designed to be soft on the New Zealand economy, setting no cap for the emissions permit trade. It sets a ridiculously low carbon price and it gives free allocations to carbon-intensive, trade-exposed companies like medieval indulgences, comprising 76 percent of the environment ministry’s budget. So there has been zero incentive for any New Zealand firm to actually cut emissions. So rather than staying level, our emissions have soared from 60 million to 72 million tonnes by 2010.

The independent review panel recommends further deferrals in the name of doing our fair share. The Government’s proposals reflect the panel’s recommendations. The submissions and hearings will run their course and the Government will enact those deferrals. The 2012 Budget contains the multiple concealed line items in anticipation of that. Meanwhile, New Zealand fights its corner at the international conferences, determined to gain some short-term maximum advantage in the game of global carbon negotiations, wilfully heedless of the repercussions in the medium term that will harm itself. Each time the climate Minister returns from yet another Olympian mission overseas we are assured that New Zealand has once again punched above its weight. By definition, that is a recipe for disaster. If 194 States’ parties punch above their weight, the global carbon emissions and ecological footprint will shoot higher, yet this is what we are all doing. We need to avoid such hubristic pursuit of competitive national interest on climate change. We need to engage in a collaborative national interest in pursuit of the global interest. One day, a New Zealand annual Budget will reflect that underlying truth. The question is: will it be too late?

TE URUROA FLAVELL (Māori Party—Waiariki) :Talofa lava.

Kia ora tātau katoa te Whare e hui nei i tēnei pō ki te wetewete, ki te wānanga i te kōpaki pūtea o te Kāwanatanga. Ko te wā o te tahua pūtea e korerohia ake nei, ehara i te mea he wā ki te titiro ki ngā mea hē anake. Me titiro anō hoki tātau ki ngā mea hei whakapakari ake, hei whakatika ake, hei whakakaha ake, hei whakanui ake rānei i te motu. Koinā te tikanga o te kōpaki pūtea. Mō te Pāti Māori, koirā te wā pai hei whakatinana i te kaupapa o te Pāti Māori i tuhia i roto i tō mātau whāinga matua, arā, kia manaaki tētahi ki tētahi, ko te whanaungatanga tētahi ki tētahi, ko te tiaki a tētahi, ki tētahi kia taea e au te kī, he peka kai, he peka whakaruruhau, he peka herenga. Hei tīmatanga kōrero anei tētahi kōrero o Kahurangi Iritana Tāwhiwhirangi, i a ia e kōrero ana mō te Whānau Ora. E ai ki tāna: “Every person being nurtured and enhanced and given hope, given purpose, given dignity, given responsibility”. Koinei tā Iritana Tāwhiwhirangi. Nā, koinei tā mātau o te Pāti Māori i kōkiri nei i roto i ngā kōrero i waenganui i ahau, a Pāti Māori me te Rōpū Nāhinara i roto i ngā wetewete mō te kōpaki pūtea.

E ai ki tā ētahi, he pūtea korekore nei, arā, i roto i te reo Pākehā, ko te zero Budget. Ahakoa kai reira tonu tērā taiapa, kai te harikoa te Pāti Māori i te mea, kei te anga whakamua tērā whakaaro o whaea Iritana. Kua mauheretia, me kī, te 164 miriona taara ki te Whānau Ora. Nō reira, ki a mātau he mea pai tērā. Ko te huarahi ki te whai ao, me kī, e ai ki tā mātau o te Pāti Māori, kei roto i ō tātau ake ringaringa. Kua aro nui mātau ki ngā take kimi mahi, ngā take whare, take mātauranga, take hauora i roto i ngā kōrero katoa, ā, kai te whakatinanatia ērā kaupapa katoa i raro i te Whānau Ora, i roto i tēnei o ngā kōrero mō te kōpaki pūtea. Koinei mātau e kī nei kia aro tahi Te Puni Kōkiri ki ngā kaupapa whai mahi, ngā kaupapa whai mātauranga, ngā kaupapa ā-whare nei, me kī. Ki a mātau, kai roto i te whānau ngā whakautu, ngā whakahoki ki ngā uauatanga o te wā. Nō reira, me hāngai tonu te titiro ki wā tātau tāmariki, ā, mokopuna.

I ngā 10 tau mai i te 2000, arā, ko te tau 2000 ki te 2009, i te wā i piki te whakapaunga o te pūtea o te kāwanatanga mai i te 35 piriona taara, arā, billion, tērā hai āwhina i a koe, ki te 64 piriona taara, i warewaretia katoatia wā tātau tamariki. Nā, kai te harikoa mātau mō te 24 miriona taara ki tēnei māuiui nui nei e pā nei ki ngā tamariki Māori me ngā tamariki o Te Moana-nui-a-Kiwa, arā, ko te rheumatic fever. He pūtea nui tērā hei āwhina i tērā kaupapa, hei karo i tērā māuiui. Kāre mātau i te rata ki te pikinga o te utu mō te rongoā, he uauatanga tērā ka pā, kāore e kore ki ētahi ā-rawa kore, ā-kore moni nei. Kia noho ora ngā tamariki. Me noho rātau i roto i te mahanatanga o te whare. Koinei mātau i tohe nei kia whakaroa ake i te kaupapa e kī ana ko te Warm Up New Zealand programme mō ngā whare 20,000 ā ngā tau kai mua i te aroaro.

Nā, e ai ki tā ētahi o tēnei Whare, ko te tikanga o te zero Budget, ko te kore moni ki ngā kōhanga reo, ki ngā kura kaupapa Māori mō tēnei mea, mō tērā mea, ēngari anō mō tērā. 4.4 piriona taara he moni hōu. He moni nei kua tangohia i ngā wāhi ngoikore, me te penapena moni anō hoki o tēnā tari, o tēnā tari. Kai te titiro mātau ki te pae rangi, arā, ki tawhiti, ki ngā rā kai mua i te aroaro. Koinei tā mātau e aro nei te Pāti Māori. 19 miriona taara hei whakatuwhera i te kuaha ki ngā kura kōhungahunga, ngā taitamariki pakupaku nei. Me pērā te titiro i te mea, kua puta te pūrongo a te Tari Arotake Mātauranga, arā, ko te Education Review Office me tana whakatau, arā, 10 paihēneti noa iho o ngā kura kua aro mai ki te whakawhanaungatanga ki ngā whānau Māori. He uauatanga, he momo mate tērā ki a mātau. Ki te rongo ngā tamariki ki tō rātou ao ā-wairua, ā-ngākau, ā-kupu ka tau pai rātau i roto i te āhuatanga o te ao mātauranga, nō reira, he whiwhinga nui tērā mōni, me kī, mō ngā tamariki nohinohi. 19 miriona taara i tēnei wā, ā, ka kitea mai ai te puāwaitanga ā te wā.

Nā mō te wā poto, ka huri ki te reo Pākehā mō ngā taringa areare i te mea, kai te pīrangi au ki te hama atu i tētahi take ki a koe mō te wā poto kātahi ka huri ki te reo Māori.

[Greetings everyone here in the House this evening to analyse and discuss the Government’s Budget. Budget time is not just about fixing up what is wrong; it is about strengthening what is right. That is the purpose of the Budget. For the Māori Party, it is a good time to implement the rules written in our constitution, to care for each other, to build positive relationships, and to protect one another, so that it can be said that there is sustenance, support, protection, and a connection for our people. I would like to begin my speech with a quote from Dame Iritana Tāwhiwhirangi about Whānau Ora. She said: “Every person being nurtured and enhanced and given hope, given purpose, given dignity, given responsibility.” And that is according to Iritana Tāwhiwhirangi. This is what the Māori Party has pushed for in Budget talks with National.

Some have called this a zero Budget. Despite that obstacle, the Māori Party is delighted because the aspirations of Aunty Iritana are being enacted. We have protected the $164 million in funding invested in Whānau Ora, which is a positive. The pathway to transformation lies in our own hands. We have focused strongly in all talks pertaining to employment, housing, educational achievement, and health, and all these matters are being enacted under Whānau Ora in the Budget package. At the same time, we are refocusing Te Puni Kōkiri to give urgent priority to improving Māori employment, training, and housing outcomes. We believe the answers to our current problems lie with whānau, so we must concentrate on our children and grandchildren.

In the decade from 2000 to 2009, when Government spending increased from $35 billion to $64 billion, our children were forgotten. We are thrilled that we secured $24 million to reduce rheumatic fever, which impacts on Māori and Pacific Island children. It is a significant amount of funding to assist in efforts to combat that disease. We oppose the rise in prescription charges, which will affect the poor.

For our children to be well, their homes must be warm. And that is why the Māori Party also argued to extend the Warm Up New Zealand programme to 20,000 more homes in coming years.

Some members in the House have made simplistic assumptions that a zero Budget means zero for kōhanga reo and Māori immersion schools—zero for this, zero for that—but $4.4 billion worth of new money is coming about by reprioritising existing spending, and achieving savings across Government departments. We are looking towards the future. This is our focus of the Māori Party. We sought $19 million to improve access to Māori-medium early childhood services for these small children. If there is any doubt about why we need this, one should turn to a report from the Education Review Office, which found that only 10 percent of early childhood centres had built effective and culturally responsive partnerships with Māori whānau. That is a major problem to us. To engage Māori children, learning must be relevant and allow these children to see, hear, and feel their culture around them, so that is an incredible investment in our future.

I will speak briefly in English for those listening because I want to hammer out an issue with you for a short while and then turn back to speak in Māori again .]

For the member of this Parliament who did zero research to conclude that there was zero for kōhanga reo, and, indeed, for the media who reported these statements and who also did zero research to even check the facts, the $19 million I have just talked about is reserved entirely for Māori-medium service, which is a service that currently uses the Māori language at least 80 percent of the time. Currently, this includes all kōhanga reo services, plus 10 education and care services.

But wait, there is more. We also have secured an increase of $15 million in equity funding, with an emphasis on te reo Māori and tikanga Māori. In addition to the access funding, each kōhanga reo will receive an estimated average increase of around $9,000 per year—

Hon Tau Henare: How much?

TE URUROA FLAVELL: —$9,000 per year—through new equity funding.

But wait, there is still more. We achieved another $8.5 million for strong resources to support learners in Māori medium education. This is fundamental to both protecting and revitalising te reo Māori, and for achieving good educational outcomes for our learners. So I thought,

Ka kōrerohia ērā kupu i Te Reo Pākehā kia mōhio mai ai te ao kua whiwhi i te Pāti Māori i ētahi painga i roto i tēnei budget. Nō reira, waiho tērā ki reira. Kāre mātau i te titiro ki ngā mea, me kī, tere whakatika i ngā uauatanga o te wā, kai te aro kē ki tētahi huarahi hei whakatikatika, e kī ana te Pākehā, ko te transformational agenda. Kua tīmata te Māori economic strategy, kua tīmata te constitutional review, te spectrum, te Māori Language Review ēngari, ā ngā rā tata kai mua i te aroaro, ka puta ētahi kōrero anō hoki mō ngā mea kua whiwhi i a mātau i roto i te kōpaki o te kāwanatanga. Ehara i te mea mō nāia tonu nei ngā painga anake, koinei te pai o te kaupapa pēnei i te 7.6 miriona taara mō ngā kura-taiao, arā, mo ngā Enviroschools. Hei whakamutu atu, kāore he huringa atu, kāore he huringa mai mō te Pāti Māori ki tō mātau tirohanga. Ko Whānau Ora te huarahi ki te whai ao. I kite tātau i te painga o te mahitahi i tērā wiki i te wā i eke atu te Iwi Leaders Forumki roto i te tohetohe nei o Talley’s me ngā uniana. Nā, he aha te painga o tērā? I mahitahi rāua kia eke te kaupapa rā ki tōna taumata. Koinei te huarahi e hiahiatia nei e mātau o te Pāti Māori hai whāinga ā ngā rā kai mua i te aroaro. Kai te harikoa tōnu atu ki te āhuatanga o ngā mea kua kitea nei e mātau i roto i te Pāti Māori nō reira, koinei te mihi tēnā koutou, kia ora tātau.

[I spoke in English so that the world will know that the Māori Party has secured some benefits from this Budget. I will leave that there. We are not about quick band-aid solutions. We have a transformational agenda, and that work is under way with the priority on the Māori economic strategy, the constitutional review, the spectrum, and the Māori Language Review. We have other announcements coming out soon about the things we have secured in the governmental package. And we must ensure our gaze is not just on today; we must protect tomorrow. That is why we received $7.6 million for Enviroschools.

In conclusion, the Māori Party is even more determined than ever to keep the momentum of Whānau Ora in everyone’s sight. The power of the collective was ably demonstrated last week when the Iwi Leaders Forum came together to broker a solution in the employment dispute between Talley’s and the unions. They worked together to achieve a successful outcome. This is the pathway the Māori Party wants to pursue in the future. We are delighted with what we have found in the Māori Party, so I thank you collectively, and us all. ]

ALFRED NGARO (National) : Manuia le fa’amanatuina o le vaiaso o le gagana Samoa. Manuia le fa’amanatuina o le lima sefulu tausaga o le tuto’atasi o Samoa. Blessings for the celebration of Samoan Language Week, and blessings for the celebration of Samoa’s 50 years of independence.

I stand in support of this Budget of 2012. But I want to read from the words of Sir Apirana Ngata, who in the early 20th century told his people that they could not expect support from the culture and Government that had deprived them from their land. Instead, they would have to use their own resources to make a living within the dominant culture of New Zealand in order to create prosperity for themselves. These are wise words from our tupuna, who told us that we need to ensure that when we plan, we plan responsibly. That is the Budget that we have been given by the Hon Bill English. It is responsible for managing the Government’s finances as one of our priorities in very difficult fiscal times. Sir Apirana Ngata gave us this wisdom, and so it tells us this. How do we show a nation that we truly do care? Often members on this side of the House have been labelled as the Tories who do not care, who do not have a concern for the ordinary, everyday people of our communities.

Well, this is how we care. In our Budget of 2012 we have freed up $4.4 million to reinvest in better results from front-line services. We are lengthening educational achievement, and increasing participation in early childhood education with better quality teaching. We are balancing our investment at tertiary level between student support and greater investment in teaching and research. We want all our kids to leave school with the knowledge and skills that they need to reach their potential in the 21st century. This is what concerns me, having been involved on a board of trustees for 20 years and having been involved in schooling improvement over 25 years, and this is the thing I want to tell the people on the other side of the House. I have seen many times when education is talked about, and we support our educational system, but we also know that there are some who are in there who need a wake-up call. I have seen people take the funding for Māori and Pasifika students, but they are not willing to do the work. They are not willing to be held accountable. We have seen the Minister of Education stand up and say: “Why is it that we have increased teacher numbers, but we’ve not increased the performance and achievement of our children?”.

Our children—they are what this Budget is about. They are what this Budget is about. Four out of five kids are getting the qualifications they need, but under National’s plan we want to lift that standard. National’s plan is about getting five out of five. We want all our kids to leave school with the skills they need to reach their potential in the modern economy. You can talk all you like, but here are the results that are coming through. We are firmly focused on raising student achievement and to do this we must invest in the biggest effect possible. The quality of teaching and practice and professional leadership are what truly make the difference. We have set two ambitious targets in education. One is increasing early childhood education participation by 98 percent, within 5 years. We know that early childhood education is a way of increasing literacy and numeracy in our schools for our children. [Interruption] That is right, Ms Moroney—our children.

The other target is having 85 percent of all 18-year-olds achieving the minimum of a level 2 qualification for the National Certificate of Educational Achievement. We have heard members on the other side say: “Oh, but that’s too high a standard.” How can members on the other side say that it is too high a standard for our children? It is not too high a standard. This is what happens. It is members on the other side who keep our children, Māori and Pacific, in poverty. This is the thing. I stand here as a person who has come from this community, and who has worked in community development. You find it hard to speak to me because I am the same person who has been there. I know the results and I know what we need. I stand here proud of this Budget because it truly does make the difference.

But what about welfare reforms? Too many of our New Zealanders have become dependent. As Sir Apirana Ngata said, this State is not where our dreams and our moemoeā are, and our vision is; no, it is not. It is trapping our families in poverty, and it is costing too much. We believe that those who can, should have the opportunity. Work is not a means to it. Work, in itself, is an ability to get us to a vision and a dream of where we want to go to. We will hear the rhetoric, though. Where are the jobs? It does not matter how many times you keep pulling out the statistics, you will keep hearing the same thing. There is an old saying: “Do not throw your pearls before the swine.”—do not throw your pearls before the swine. No matter how much of the statistics and the results we give them, it will not make a difference. But we will keep telling them why, because it is not the people on the other side whom we want to hear what we are saying. It is the people at home.

Sue Moroney: Out of touch with New Zealanders. You’re out of touch with their problems.

ALFRED NGARO: It is the people at home who need to hear this message, so we will keep preaching it, Ms Moroney. We will keep telling them this is what we are doing. So it is about a better life and better opportunities. Twelve percent of our working-age population is on a benefit, and 220,000 children are in a benefit-dependent home. That is an indictment on any nation, and this is what we are doing. We are taking responsibility under the honourable Minister that we have, the Minister for Social Development, who has a vision. Twelve thousand people have now cancelled their unemployment benefit, 13,000 people went off the DPB and into work, and there are $17 million of savings overall that we can reinvest into our youth and our young people.

We will undertake further reforms during the term of this Government. Our changes are significant. They will introduce two stages, and one includes supporting sole parents with children 5 years and older into part-time work. This is not just rhetoric. When I have gone into my communities of Glen Innes and Panmure, this is what they have said to me. They have said: “Alfred, this is what we need. We need opportunities. We have heard the one-trick pony over and over again.” But this is the thing they have forgotten about. I am a first-generation-born Pacific Islander, and this is what you have forgotten about. We are now first, second, and third-generation. We have become more educated, more mobile, and more articulate, but your message is this: you still want to keep us in poverty. This is not a message for poverty. This is a message for hope. This is the message—that I stand as a Pasifika person, first generation, and say that this is what we are doing to make a difference for our people and for our communities. You can keep talking, but after 9 years you had not made a difference—you had not made a difference. So this is what we are doing—this is what we are doing. We are helping those who can work to find a job. We are removing barriers to work through childcare assistance. We are targeting resources to those most at risk of long-term dependency and helping young people make better choices.

But what about health? What about health? I really do want to take my hat off and acknowledge the support of the Māori Party as our coalition partner. We have $6 million in a Pacific Innovation Fund—$6 million. Let me tell you this. I have researched what happened under Labour, and you did not give any innovation fund to our Pasifika for health—not once. Your funding was all in the mainstream vote for health. But this is what we have done. This is what we have done under the honourable Minister Tariana Turia, Associate Minister of Health. She has allowed for $6 million to be invested in innovation. What is that for? So that our own people can be self-determining—our own people can make the choices about what we need to do to improve our health. It is not State-dependent, but dependent on our own people. And we will see more innovations that will come out of that.

I am proud of this Budget. I am proud that what this Budget does is put the resources in the hands of our people to be self-determining. This Budget not only does that but it says this to us: there is a hope and there is an opportunity for us to be self-determining so we can make the choices for our children. I stand proud to be here today so that my children will look at me, speaking in this House and knowing this: that we are not dependent on anyone else but ourselves. Sir Apirana Ngata, who was in this House at one time, said this: “We are not dependent on the State. We are not dependent on anyone but ourselves. We will find the answers for ourselves.” What this Government is about is allowing our own community to be self-determining, to make the choices for itself, and to be caring for the concerns that we believe are very important. This Budget is such a good Budget that it allows for great opportunity in health, education, and welfare reforms.

And I want to say this; this is the last thing I want to say. As the honourable member from the Māori Party Te Ururoa Flavell said, research is important. It concerns me that members of the New Zealand First Party talk about Whānau Ora and condemn the work of Whānau Ora. They say things about the work that it is doing, and all those members are doing is grandstanding. But what is it about? They have not seen the impact that Whānau Ora has had on many of our whānau and family. What is it doing? It is allowing Māori to be self-determining. Instead, what do we have? We have the nitpicking. We are accused of being penny-pinchers. We are accused of taking from the paper boys. There is a lot of nitpicking that comes from over there on something that truly is making a difference. If they really felt that they supported something that was indigenous for Māori, then they would give it an opportunity to do its best, and that is what it is doing. It is doing the best that it can. We hear all these inflammatory remarks, but there is no truth in them. I am proud to be here today. This is a great Budget for our country, for our nation, and for our community.

Hon DAVID CUNLIFFE (Labour—New Lynn) : Talofa lava, Mr Speaker. I also would like to recognise Samoan Language Week, and to acknowledge the 50-year anniversary of Samoa’s independence from New Zealand administration, the record of which was not proud.

The member who has just resumed his seat, Alfred Ngaro, opened his speech by saying that some people say National members are Tories who do not care. I would never say that about that member. I would say that his record of service before he entered this House proves that he does care. In fact, I nearly appointed him to the Auckland District Health Board because of that service. Perhaps, given where he sits now, I should have. But I would not say he does not care. What I would say is that the policies his party is advancing are not going to achieve the hopes and dreams that he says he stands for.

He said that he wants all our kids to leave school able to reach their potential. Then do not increase their class sizes! Do not turn intermediate school class sizes from 30 to 40 children. And do not continue to spend $35 million a year subsidising private schools, which do not need it, while cutting funding to low-decile public schools. While you are at it, do not waste millions on league tables, which all the evidence shows are a complete waste of money and achieve nothing for our students. Or, on the wider agenda, do not cut taxes for the wealthy—for the very wealthy—by putting up GST on every loaf of bread that is bought by needy families in his own South Auckland. That is what we do not do if we hope our people will be better off.

I have a little pointer for the member, the Rev. Ngaro, who has just resumed his seat—a little humility lesson. In the 9 years of the last Labour Government life expectancy itself increased by 3 years—1 year longer for every 3 years we were in office. Debt was cut to zero, we ran surpluses every year, and every region of New Zealand grew. So a little humility around the historical record would be in order. [Interruption] I see the members opposite have had an emotional dinner break, and they are back in fine form. Liquidity was flowing tonight, quite obviously.

In this Budget debate it is rather easy for us to talk in big numbers or big words. We talk about billions of dollars of trade deficit or hundreds of thousands of people unemployed, and it is easy to forget that every one of those people is a New Zealander, a hard-working Kiwi who wants to do the right thing for themselves and their family, who wants a fair day’s work for a fair day’s pay—remember that—and to get ahead. Now the reality for too many is no work at all, or if they can get work, they are working two or three jobs to pay the rent and make ends meet, all the time worried to death that their children are not seeing enough of their parents. That is the reality for so many in our society. There also are the thousand a week who are making their way to the departure gates as they move permanently to Australia. That is twice, roughly, the number of members of this whole House. Every working day two Houses of Parliament leave for Australia permanently. We can see the hope dying in their eyes. They have lasted for 4 years under this Government being promised that growth and more jobs were just round the corner, but it is a corner that never comes.

There also are the small-business people or the medium-business people who are working every hour that God sends to make a success. They have put their homes on the line. They want their businesses to succeed. They are not lazy. They are trying their hardest. But there just are not enough customers, or they have not got enough money to spend.

Hon Tau Henare: If he’s Sonny Crockett, who’s Tubbs?

Hon DAVID CUNLIFFE: It is called, in the jargon of economics, which that member does not know, an output gap, and Treasury says we have got one still. There is not enough demand in the economy. That is why this zero Budget makes zero difference.

These real people are the real casualties of this Budget: our friends, our neighbours, our constituents, and our family members. They have been told to expect the best, and what they got was a zero Budget. And it is not enough—it is not enough. Tinkering is not enough. A zero Budget is not enough. Balancing the books is not enough. It is not enough to get people back to work. It is not enough to get businesses back afloat. It is not enough to stem the tide of people going to Australia. We want a future we can believe in. We want an economy that can sustainably grow and provide for our beautiful children. That is what we want, not a zero Budget, not a zero vision, and not zero hope. That is what we want.

So how should a Budget deliver on those things? Before I turn to that, I just need to say that the press has cottoned on to what is going on here. Here are some quotes on this issue of economic development and sustainable growth. Fran O’Sullivan—no lefty—says “the major problem is that there is no clear economic growth agenda.” The Press editorial—again, no left-wing rag—says “The Budget delivered yesterday by the Minister of Finance, Bill English, had a distinctly underwhelming feel.” Fairfax says “It was billed as a Zero Budget, and that’s what we got.” Or there is Brian Fallow, who says the Budget is definitely “contractionary. Fiscal policy will subtract from demand and from growth not just next year but for the next four years.” Or John Armstrong in the New Zealand Herald says “a fiscal surplus is not a growth strategy.” And so it goes on.

But of course it is easy to criticise; it is hard to build. And what the public wants is hope for a better future. Here is what Labour would do. Labour is going to provide leadership that is willing to take the tough decisions and try new ideas to grow jobs and incomes. As my colleague David Parker has rightly said, if you change nothing, nothing changes. Over there is the party of conservatism, the party of steady as she goes, the party of Keith Jacka Holyoake. That may have been appropriate when we were all collectively on the sheep’s back, but we are not on the cow’s back now. We have got all our cows in one basket, and the basket is leaking. Change nothing, nothing changes. Change nothing, Rev. Ngaro, and your people will not find change.

There are some things we can do individually and we should. We do not abdicate individual responsibility, but we believe in co-responsibility: the responsibility of the individual to society and society to the individual. We cannot all individually solve the problems of this economy; we must do it collectively. That is why our constitution vests in the Treasury benches the responsibility to guide our country through—not to balance their own books at the expense of the people’s books, not to pull a zero Budget at the cost of zero hope. The mandate is deeper, broader, richer, and more sacred than that.

Labour will create jobs by supporting our exporters to expand and earn more. We will help Kiwis get the education and skills they need. We will grow incomes by investing in science and innovation. And we will make it easier for New Zealanders to save for their first home and for their retirement. We will do it with the following. I am going to mention just six tools: firstly, pro-growth tax reform like a capital gains tax that gets money flowing where it can do more good, and research and development tax incentives that get our innovators going; increasing savings through universal KiwiSaver; the research and development tax credits; monetary policy; fiscal policy that seeks to balance demand and supply across the cycle and across the economy; and an economic development policy that works with every sector and every region in the country so that every New Zealander can be the best that they can be.

What has this Government done to the Budget for economic development? Well, it has cut it. It has cut by two-thirds the Seed Co-investment Fund, which helps struggling businesses get up to the next level. It has cut, would you believe, the in-market assistance to help people export to China and India. It has cut regional development by 90 percent around the country—and it says it wants growth. It has cut industry assistance. It has cut development in our regions. It has cut assistance for exporters. It is cutting our future.

Big words, big numbers, big problems, but at the end of the day real people who deserve real hope and real policy. Thank you.

Mr DEPUTY SPEAKER: I call Andrew Williams. Is this a split call? Do you want a bell at 4 minutes?

ANDREW WILLIAMS (NZ First) : Yes, please. I would like to table sources that the Parliamentary Library prepared today. It is a spreadsheet that details the Government’s operating balances for the years 2002-12, the last decade of surpluses and deficits, prepared today by the Parliamentary Library. I would like to table that.

Mr DEPUTY SPEAKER: Is there anyone opposed to that course of action? Leave is not granted.

ANDREW WILLIAMS: Well, as I suspected. I suspected that that leave would not be granted, because these are the facts. These are facts from our own Parliamentary Library sources. The National members on the other side like to live in fantasyland, but these are the facts. They are the same facts that were printed in the Dominion Post last week, laying out the last 10 years of deficits and surpluses.

Earlier tonight we heard one of the members, Mr Tim Macindoe, saying that we have shackled our economy and imperilled our children’s future as a result of the former Labour - New Zealand First coalition Government. He tried to make out that all the problems now were a result of the former Labour - New Zealand First Government. Well, I would like to point out—and it was printed in the Dominion Post and other papers in New Zealand—that during the period 2002 through to 2007 the surpluses were running in the order of $2.4 billion, $4.3 billion, $5.5 billion, $7 billion, $7 billion, $5.86 billion, and then $5.6 billion. There were surpluses of billions and billions of dollars right through until the following year after the National Government took office, and suddenly we are into $3.8 billion deficit; the following year after that, $6.3 billion deficit; the following year, this latest year, $18.4 billion deficit; and this year the Budget is an $8.4 billion deficit. The following year after that it is a $7.8 billion deficit. The year after that it is a $2 billion deficit. Finally, in about 3 years’ time, this shows that we come into a surplus of $197 million. It is so close to the margin of error it is not funny.

After 7 years of huge surpluses we now have 6 years of huge deficits. So do not give us any of this business about how we have imperilled our children and about how we have left it in such a shocking situation. Basically, for the next 2½ years we are seeing another $20 billion in deficits from this supposedly brilliant Government with its brilliant strategist, the ex - Merrill Lynch world banker and world financier. We are seeing this economy continuing to go down the drain. This is what a lot of red looks like, I say to the National members on the other side. Again, this chart is out of the Dominion Post the other day. The black lines came through here as the surpluses. All the big reds, funnily enough, are from that side of the House—from the National Government side of the House.

Further to that, let us have a look at the record over the years. Have a look at this chart, which shows average unemployment. This is the average unemployment by Government, with Governments going right back to 1957—unemployment. It is very interesting, because where there is red, that is Labour Governments, and sometimes New Zealand First - Labour Governments. Where there is blue, that is National, Tory Governments. Is it not interesting that the unemployment figures are always incredibly high when there is a National Government around? They are incredibly high—always high.

Then, when you look at the GDP growth by Government on this chart, going right back to 1957, is it not interesting that, again, in the Labour Government periods and, again, when New Zealand First is with Labour we have very high GDP growth. But look at the low points—the blue low points—down here, and look at the latest low point under the National Government. It is almost down to zero. Is it not incredible? With the two charts combined, the unemployment under National goes right off the top of the chart, while the GDP growth goes right off the bottom of the chart. These are the facts, not the rhetoric—not the fantasy world on that side of the House. These are the facts, and the sooner New Zealanders wake up to the fact that we are being led down a garden path by this Government, the better.

RICHARD PROSSER (NZ First) : I am pleased to rise on behalf of New Zealand First to take a short call on this quite dreadful Budget as it has been delivered by this quite terrible Government. It has been called a zero Budget, and that is what it has delivered for the New Zealand Defence Force—zero, nothing, zip, nada. I have to refer to my notes here, because zero can be spelt in a number of different ways.

I listened to the Minister of Defence earlier in the evening. I listened to Dr Coleman attempting to defend the indefensible. He made a valiant attempt. He is a good man, of that I am sure. I am sure that Dr Coleman is genuinely committed to the New Zealand Defence Force. I am sure he genuinely wants to see it perform to the best of its ability, and for our forces, when they go out into the world, to go with the best of equipment and the best of support. It is a testament to his loyalty to the Government of which he is a part that he was able to stand and defend the fact—or attempt to defend the fact—that the Defence Force is not being given enough resourcing for it to be able to defend New Zealand.

It is also loyalty that drives the men and women of the New Zealand Defence Force to carry on their duties in the face of ever-dwindling resourcing. They do not do it for the money—God knows they do not do it for that. Even in this secular Parliament it is important that God knows it, because under this Government’s ongoing defence cuts, it really will be God who is tasked with defending New Zealand. But despite Dr Coleman’s best efforts to justify the illogical, irrational, and downright dangerous penny-pinching of this Government’s meagre and, some might say, feeble—indeed, embarrassing—allocation to defence, it remains a fact that New Zealand’s military is disadvantaged by it.

I had the honour to accompany the Minister and a number of other members to Exercise Alam Halfa in Waiōuru last month. I have to say I was seriously impressed with the commitment, the dedication, and the professionalism that I saw from our boys and girls in the military forces, who were small in number and young in age, I have to say, to my eyes in a comparative sense now. I was impressed by their continuing commitment.

I do not see that level of commitment continuing from this House to those people. We continually over the decades and over the years continue to downgrade defence. We continue to cut costs. We continue to cut corners. We continue to believe that we live in some kind of imaginary benign strategic environment—a term that was crafted more than a decade ago by people on this side of the House, but by people who, in my estimation and in the view of New Zealand First, were not grasped of the realities of the military world, and did not have a world view that took history into account.

We do not live in a special bubble of human existence. The world is not different now. The world has not changed. People have not changed; the behaviour of humans and the behaviour of nations have not changed. Conflict will come again, because conflict is the natural state for humanity. We live in a break between conflicts. That is all. The Pax Americana has been imposed through the threat of force on the Western World these past three generations. Conflict will come again and we are not prepared for it. The Budget allocation for defence this year by this Government has not assisted in that process.

The world is an uncertain and unstable place, and it is becoming more so by the day. Only this morning on CNN American defence analysts were warning of renewed instability in the Middle East. Tensions are growing between Israel and Iran. The former is already armed with nuclear weapons and the latter is quite possibly seeking to become so. Iran is certainly armed with weapons capable of reaching southern Europe. And there are southern European nations that have been exercising with the Israelis that Iran might take to be enemies. Iran has missiles capable of reaching Italy and Greece. In the South China Sea, a half-dozen nations including China lay claim to the Spratly Islands, rich in oil, and to fishing grounds that are ever more contested and ever more congested. Several nations—Viet Nam, the Philippines, and China among them—have taken to sending naval vessels out with their fishing fleets in order to protect their national interests.

Against this backdrop, New Zealand is cutting funding to our defence forces. We are civilianising back-office jobs and looking for savings from operational budgets. This is folly. It is misguided and short-sighted. There are people in Christchurch suffering because they failed to make proper account for their insurance and then the earthquakes happened upon them. New Zealand today is not making proper account for our national insurance for our defence. The defence of the nation is the first responsibility of Government, not the last. It is the very last thing that should be cut in this nothing Budget. It is a mediocre, lacklustre Budget from a mediocre, lacklustre Minister of Finance. The National Party should be ashamed of him and of his Budget. Thank you.

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