Tuesday, 20 May 2014

Tuesday, 20 May 2014

Tuesday, 20 May 2014

Mr Speaker took the Chair at 2 p.m.

Prayers.

Privilege

Question of Privilege Regarding Use of Social Media to Report on Parliamentary Proceedings

Mr SPEAKER: Honourable members, following discussion in the Business Committee, I have considered as a matter of privilege the recent use of social media to report on parliamentary proceedings and to reflect on members, including the Speaker. Although Standing Order 400 requires an allegation of breach of privilege or contempt to be formulated as precisely as possible so as to give the member or person against whom the allegation is made full opportunity to respond, no allegation against a particular member has been made out. However, the issue is a significant one.

The longstanding and carefully nuanced rules of the House do not necessarily sit comfortably with the informal and instant nature of the new information and communications technology, with its potential to reach a very wide audience very quickly. Although members tweeting from the Chamber during question time or debates is clearly not a proceeding in Parliament, this is not well understood and nor are the House’s wider rules protecting parliamentary proceedings and the various participants in them. Tweets may be actionable in the courts. Members could find themselves held in contempt by the House for publishing a false or misleading account of proceedings or reflecting on the character or conduct of the House or members. Furthermore, accusations that the Speaker has shown partiality in discharging his or her duties have in the past been judged very seriously, given the special position the Speaker holds.

Some uncertainty surrounds the application of parliamentary privilege to official social media usage for disseminating information about what Parliament is doing and facilitating wider public participation. The level of engagement with social media is such that it cannot be ignored. I believe that the House’s rules need to be examined in light of this new technology. Members and those participating in or commenting on parliamentary proceedings need to be clear about the rules and how they will be applied.

Consequently, I have determined that a general question of privilege does arise. The question therefore stands referred to the Privileges Committee.

Points of Order

New Zealand First Board Minutes—Leave to Table Document

BRENDAN HORAN (Independent): I raise a point of order, Mr Speaker. I seek leave to table a document, the New Zealand First board meeting minutes from March 2013, which point to improper use of—

Rt Hon Winston Peters: Point of order, Mr Speaker.

Mr SPEAKER: Order! Leave has been sought. I will allow the member the Rt Hon Winston Peters to speak before I put the question.

Rt Hon WINSTON PETERS (Leader—NZ First): I raise a point of order, Mr Speaker. This House should not be used in that way, particularly by the Jimmy Savile of New Zealand politics.

Mr SPEAKER: Order!

Brendan Horan: Point of order, Mr Speaker.

Mr SPEAKER: Order! I need no further assistance. The way forward is for the House to decide this matter. Leave is sought to table particular minutes of a political party dated—I have forgotten—March some time. Leave is sought for that document to be tabled. Is there any objection to it being tabled? There is objection.

Questions for Oral Answer

Questions to Ministers

Budget 2014—Economic Programme and Financial Support for Families

1. PAUL GOLDSMITH (National) to the Minister of Finance: How will Budget 2014 continue to support a growing economy, including jobs, higher wages, and delivery of better public services?

Hon BILL ENGLISH (Minister of Finance): The 2014 Budget struck a good balance by returning the Government’s books to surplus next year—the first of a number of surpluses—and making important investments in families and public assets. The Budget signals that the Government has moved from managing recession and recovery to managing in a growing economy. This is reflected in the significant progress the economy has made, with businesses investing, wages rising faster than inflation, 84,000 new jobs in the last year, and our exporters posting record results despite a high exchange rate and frequent disruptions in international markets. As the Prime Minister has said, Budget 2014 was a confident Budget for a confident country.

Paul Goldsmith: What specific measures did the Budget include to support children and families?

Hon Ruth Dyson: Were you away on Thursday?

Brendan Horan: I raise a point of order, Mr Speaker. When I raised the point of order earlier, it was to speak to the point of order that I took offence at the Hon Winston Peters’ comments.

Mr SPEAKER: Order! We have moved well past that at this stage.

Hon BILL ENGLISH: Some people just want to hear it all over again, including that member, I am sure. A $500 million package over 4 years supports children and families. It has five parts: a boost to the paid parental leave scheme, a $42 million increase to the parental tax credit to provide free general practitioner visits and free prescriptions for children under 13, an extra $150 million to help early childhood education centres remain accessible and affordable, and $33 million to help vulnerable children. The Government is able to provide this support in this Budget because of the hard work in previous Budgets to get spending under control, and the better tools the Government now has for deciding where to spend now for a long-term pay-off.

Paul Goldsmith: According to Budget forecasts, what progress is the Government making in meeting its two key fiscal targets over the next few years?

Hon BILL ENGLISH: The two important targets for the Government’s books were to achieve surplus in 2014-15 and to return Crown debt back to 20 percent of GDP by 2020. The Budget shows that we are on track to achieve both of these targets. It is important, having run up debt over the last 5 or 6 years to fill the gap between our expenditure and revenue and to pay for the earthquake, that now that times are better we take the opportunity to repay that debt so future Governments have the same tools available to them as this Government did.

Paul Goldsmith: What steps does the Budget take to help ensure that interest rates remain lower for longer and do not reach the historically higher levels seen in 2008?

Hon BILL ENGLISH: Interest rates reached over 10 percent in 2008, partly because of runaway Government expenditure and a drastically overheated housing market. The Government has confirmed that it will stick to its $1 billion operating allowance in this Budget and increase it to just $1.5 billion in Budget 2014, because we do not want to see a rapid rise in Government expenditure put pressure on interest rates for households, which on average have relatively high levels of debt. These allowances are very modest by historical standards—in fact, a bit more than half of what the new allowances used to be in the 5 years up to 2008. This represents significant support for homebuyers and people who have mortgages, where the Government is tightening its own belt to assist them with lower interest rates where possible.

Housing, Affordable—OECD Ranking, Issues, and Government Policies

2. Hon DAVID CUNLIFFE (Leader of the Opposition) to the Prime Minister: Does he stand by his statement, “there’s no fundamental underlying reasons to believe there’s a problem in our housing market”?

Rt Hon JOHN KEY (Prime Minister): Yes, particularly when you compare the current situation with that over the 2000s, when, under Labour, house prices doubled and mortgage rates went to 10.9 percent. A house price unit was set up in the Prime Minister’s department, which said that the Government should work to increase the supply of land and lower the cost of construction. It was completely ignored. No wonder they are embarrassed—house prices doubled under their watch.

Hon David Cunliffe: Why does the Prime Minister not believe that there is a problem in the housing market when New Zealand has the highest house prices in the OECD relative to rents, the second-highest compared with income, and the fastest-inflating prices in the OECD last year?

Rt Hon JOHN KEY: Depending on which part of New Zealand you are talking about, there is certainly work that can and should be done, and this Government is undertaking that work. That is why, for instance, we have the special housing areas that we have agreed on and the housing accords in Auckland and Christchurch. That is why we suspended the duties and tariffs on imported building goods. That is why we have reformed the legislation to limit development contributions. That is why we made proposed changes to the Resource Management Act, and that is why we trebled the number of Welcome Home Loans from 845 to 2,500, to assist first-home buyers. That is why we increased the eligibility for KiwiSaver first home deposits, and that is why we have been working very hard to help the Reserve Bank keep interest rates lower for longer.

Hon David Cunliffe: I am glad the Prime Minister mentioned all that, because I wonder whether he can confirm that his building materials tariff reduction will make less than a 1 percent difference to the cost of an average home, and that his social and community housing initiative, at the current rate of funding, would mean it would take 455 years for National to meet its 20 percent social housing goal?

Rt Hon JOHN KEY: The difference on duties and tariffs is, I am advised, about $3,500, for a new home. This is a Government that is doing a series of things, some big and some smaller, all to make a difference. I can see why Mr Cunliffe thinks there is no point in doing it, because Mr Cunliffe was part of a Government that thought there was no point in doing anything, which was why house prices doubled under Labour. They went up 96 percent. I advise members to get used to hearing that, because they are going to hear it on every radio station and every television debate for a long time to come.

Hon David Cunliffe: Given that the Reserve Bank Governor said in recent weeks that house prices were overvalued on several measures, why did he miss his last chance to do something significant for first-home buyers in the Budget when 76.4 percent of New Zealanders indicated that that was what New Zealand needed, or did the printer just omit the housing chapter from the Budget document?

Rt Hon JOHN KEY: Actually, one of the most important things the Government did during the Budget was show economic leadership that would, firstly, keep interest rates lower for longer, and, secondly, ensure that New Zealanders actually got jobs. Just before, when I said that under Labour’s watch house prices doubled, Annette King said, under her breath: “Who cares?”. Well, that is exactly the point.

Hon Annette King: I raise a point of order, Mr Speaker. [Interruption]

Mr SPEAKER: Order! This is a point of order.

Hon Annette King: The Prime Minister’s last comment is incorrect. I did not say it—

Mr SPEAKER: Order!

Hon Annette King: —and he needs to check his hearing.

Mr SPEAKER: Order! And that is not the way to use a point of order.

Hon David Cunliffe: Given that the Government’s most far-sighted attempt at economic leadership was the removal of cheque duty from cheque books, does he have confidence in the Minister of Finance and the Minister of Housing given that he has allowed house prices to rise by over 40 percent in Auckland on his watch while 46 percent of New Zealanders did not get a pay rise in the last year?

Rt Hon JOHN KEY: I reject the numbers and the assertion in the member’s question, but if we want to put a bit of realism back into the housing debate, let us go to the Roost home loan affordability index. As I am sure the member will know, that measures someone who would have an 80 percent mortgage on the average house in that particular area, and who earns the average income. That index, which you have got to say is, by any definition, a pretty fair index, shows that, in fact, houses were far more unaffordable—by about 30 percent, actually—under Labour. In 2007, if you went to Auckland, not only were they more unaffordable than they are today but when Maryan Street—you will remember her; she was your Minister of Labour—was asked the question: “Is this a crisis?”, she said: “No, it is not a crisis.” So when those members are in Opposition and when it is not as bad as it was when they were in Government, it is a crisis, but when they were in Government, it is: “Nothing to see here. Nothing to do.”, and that was the point. Nothing got done. As Annette would say “Who cares?”. [Interruption]

Mr SPEAKER: Order!

Hon David Cunliffe: I seek leave to table a copy of the labour cost index, which confirms that 46 percent of New Zealanders did not get a pay rate increase last year.

Mr SPEAKER: That document is freely available to all members.

Hon David Cunliffe: I raise a point of order, Mr Speaker.

Mr SPEAKER: This is a further point of order?

Hon David Cunliffe: The Prime Minister has disputed the matter, and clearly does not have access—

Mr SPEAKER: Order! No. The member is now trying to use the ability to table a document to continue a political debate. That is not the appropriate thing to do with the seeking of leave to table a document.

Hon David Cunliffe: When will the Prime Minister stop playing politics with the Resource Management Act amendment bill and split it to allow the housing affordability measures to pass through the House on a bipartisan basis?

Rt Hon JOHN KEY: I am happy to tell the member exactly the same thing that I told the press gallery on the way in, which is if the member’s party wants to support the Resource Management Act amendment bill as the Government has been wanting to introduce it, and send it off to the select committee for every New Zealander to have their say about what they think, the Government would welcome that—and Mr Cunliffe should come up and have a nice glass of wine and we can celebrate that in my office tonight. See you at 10 o’clock.

Hon David Cunliffe: I seek leave to table a bottle of good Pinot noir if he would like to meet to discuss the second part of the bill on housing affordability alone.

Mr SPEAKER: Order! We do not use the seeking of leave to table a bottle of wine. If he wants to share—

Hon David Cunliffe: To clarify, I would be very happy to table a bottle of PM’s Pinot, which, apparently, is in a blind trust that the PM does not know about.

Mr SPEAKER: Order! And the member is now also—[Interruption] The member is abusing the system for seeking to table documents.

Rt Hon JOHN KEY: Speaking to the point of order—

Mr SPEAKER: I will hear—I am hoping that it is helpful to the House—from the right honourable Prime Minister.

Rt Hon JOHN KEY: If the member is so keen to have a bottle of my PM’s Pinot—and I can understand why he would be—I will make sure his office has one delivered to him this afternoon. [Interruption]

Mr SPEAKER: Order!

Hon David Cunliffe: I raise a point of order, Mr Speaker.

Mr SPEAKER: This will be the last one.

Hon David Cunliffe: I wonder whether you could make a considered ruling on whether it is possible for the Prime Minister to make an undertaking to the House to deliver a bottle of wine when he has no idea where it apparently comes from.

Mr SPEAKER: Order! Now that members have had their fun, we will get back to the serious business of questions for oral answer.

Housing, Affordable—Auckland Property Market and Alternative Policies

3. METIRIA TUREI (Co-Leader—Green) to the Prime Minister: Does he stand by all his statements?

Rt Hon JOHN KEY (Prime Minister): Yes.

Metiria Turei: Why did he say that homes in Auckland are more affordable than homes in London, New York, Singapore, Melbourne, Sydney, and Brisbane, when, according to the OECD, they are actually much more expensive, relative to income, than almost anywhere in the developed world?

Rt Hon JOHN KEY: I think the member is wrong in her facts.

Metiria Turei: Is the Prime Minister saying to young Aucklanders that they are not locked out of the housing market when they know too well that they are locked out by rising rents, high loan-to-value ratios, $600,000-plus median house prices, and with student loans to pay off, to boot?

Rt Hon JOHN KEY: For a start off, if the member wants to take a cursory look at TradeMe and refines her search to Auckland, there are currently over 2,000 properties listed under $400,000. Most people can go to the bank and get a loan of 80 percent, obviously subject to their mortgage, but some people can actually get more than that because loan-to-value ratio restrictions overall are not in total. But the reality is that no one is arguing that Auckland is the cheapest place to buy a house. We are just arguing that the Government is taking a lot of steps to help address that, with its special housing area, and it was more unaffordable under Labour.

Metiria Turei: Would the Prime Minister then be surprised to learn that on TradeMe yesterday, excluding those properties without their own freehold land, like removable homes and apartments, there were actually just 11—just 11—three-bedroom homes or larger in Auckland City for sale below $300,000, and just 36 for sale were below $400,000?

Rt Hon JOHN KEY: The member is putting all sorts of conditions around it, but there are over 2,000 properties under $400,000 in Auckland. That is the very point as to why the Government has worked with the Auckland Council for there to be 39,000 sections released. What is that member doing? I know—that member is standing in the way of the Resource Management Act, which would help speed up the release of land. The member is doing what she always does—she is crying crocodile tears but is not actually prepared to do anything about it.

Metiria Turei: Can the Prime Minister confirm that house prices in Auckland, under National’s 5 years in Government, have risen by the same dollar amount as they did in the previous 9 years under Labour, about $187,000 per home, and when will he start taking responsibility for the housing crisis rather than denying it exists?

Rt Hon JOHN KEY: What I can confirm is that under the Roost survey, which is, by far, the best measure, houses were more unaffordable under the previous Government than under ours. To run through it—this is the responsibility this Government is taking. We have organised the Auckland Housing Accord; 39,000 consents will be issued over the next 3 years. We have suspended duties and tariffs on imported building materials. We have reformed legislation to limit development contributions. We have made some changes to the Resource Management Act and we would like to make more. We have increased the additions on Welcome Home Loans and KiwiSaver first-home deposit subsidies. We have built a strong and robust economy with the support of New Zealanders and their businesses to see them in jobs. What we do know is that no one will be able to afford a house if they lose their job, which under a Labour-Greens Government many of them will.

Metiria Turei: Does the answer to the housing crisis not include a major State house building programme so that those who need a house to rent or buy can get it, and a capital gains tax to prevent investment driving up prices and ensure that those who are making money off property pay tax just like the rest of us, helping to build a sustainable economy with real jobs?

Rt Hon JOHN KEY: Given that a capital gains tax includes the majority of homes, I can only make the assumption that—and the member might want to correct this—what the member is telling the New Zealand Parliament is that under the Green Party, if it were part of the Government, every home would have a capital gains tax on it. That is an interesting assertion.

Metiria Turei: I raise a point of order, Mr Speaker. You have previously ruled that it is not necessarily appropriate for parties to talk about other political parties’ policy. That is all the Prime Minister did. He did not address the question of whether a capital gains tax excluding the family home and a major State house building programme were part of the solution to the housing crisis.

Mr SPEAKER: The difficulty is the member herself brought in, effectively, alternative politics in her supplementary question.

Metiria Turei: Is the Prime Minister basing his assumptions about home affordability on his own personal experience of owning several properties offshore, and does that not show how staggeringly out of touch he is with young Kiwi families trying to buy a modest three-bedroom home in Auckland—staggeringly out of touch?

Rt Hon JOHN KEY: No, but what it does show is the Greens, whenever they start losing an argument, get personal. I think Jan Logie is a very interesting person to reflect on her own comments in the decorum of this Parliament. Actually, the Green Party used to say under the old leadership that it stood up for decent values. That has clearly now gone, and all New Zealanders should understand that the Greens have turned into the nasty party.

Hon David Cunliffe: I seek leave to table a transcript from Hansard of the Prime Minister—

Mr SPEAKER: Order! The member will resume his seat. We do not use the tabling of documents process to then attempt to table Hansard.

Tax System—GST, Tax Cuts, and Capital Gains Tax

4. Hon DAVID PARKER (Deputy Leader—Labour) to the Minister of Finance: Does he agree with the reported statement last Friday, from the Prime Minister, who would not rule out an increase in GST?

Hon BILL ENGLISH (Minister of Finance): I agree with the Prime Minister’s comment on radio last week when he said: “Our general view is GST at this current level is about the right setting.” I also agree with the Prime Minister’s comment that the Government has not decided whether to undertake a tax reduction programme, let alone the design of it. However, he has also made clear the question of whether GST would rise as part of any tax programme, and the answer is no.

Hon David Parker: Why should New Zealanders believe him when he says that he will not increase GST, given that the Prime Minister promised in 2008 he would not increase GST but then did just that in 2010?

Hon BILL ENGLISH: The member misrepresents the comments in 2008. The tax package including an increase in GST was put to the test in the 2011 election, and, as I recall, the Government of the time won that election. There will not be any increases in GST.

Hon David Parker: Did John Key check with him before the Prime Minister flew his kite about GST increases and tax cuts; if so, why did he, the Minister of Finance, appear blindsided? Was it because the Prime Minister thought his budget so underwhelming he wanted to distract attention by flying his kite?

Hon BILL ENGLISH: In answer to the second question, the Prime Minister has been of the view that the Budget has been an overwhelming success, and I too am expecting the donation of a bottle of wine to appear in my office, to indicate a bit more gratitude.

Hon David Parker: Is John Key the person he said bounces from cloud to cloud; if so, is it time to remind him that 40 percent of his 2010 income tax cuts went to the top 10 percent of income earners, which everyone paid for through an increase in GST?

Hon BILL ENGLISH: Any comment I have made about the Prime Minister is much more flattering and supportive than almost anything the Labour caucus is saying about its leader. I am sure that pattern will persist through to the election. Secondly, the member is simply wrong about the 2010 tax cuts. Analysis produced at the time showed they were distributionally neutral—that is, they had a similar impact on taxpayers of all income levels.

Hon David Parker: In terms of distributional effects, will he advise the Prime Minister that recent analysis by Westpac on the effect of Labour’s policy of 15 percent tax on capital gains for investment property shows it would take significant pressure off house prices?

Mr SPEAKER: In so far as the Minister has responsibility, the Hon Bill English.

Hon BILL ENGLISH: As the member may be aware, there is already a capital gains tax on anyone who trades property. I have not seen Westpac’s analysis that indicates that that has had the impact of a 15 percent reduction in prices. In Australia they have a capital gains tax on all commercial and investment property, and they have house prices rising almost as fast as, if not faster than, they are in New Zealand.

Tim Macindoe: How is the National-led Government’s 2010 tax package, which reduced taxes on income and savings and increased GST, helping families on low and middle incomes to get ahead?

Hon BILL ENGLISH: Low and middle income families are still enjoying the benefits of the reduction in tax rates that were brought in then. The tax changes meant that someone on the average annual wage, which was around $50,000 in 2010, was immediately $15 a week better off, and they still are. A family with two children, on the average household income of $76,000, was $25 a week better off. The tax system has become more progressive since 2010. Households earning less than $60,000 a year are generally expected to pay less in percentage terms towards net tax in 2013-14 than they were paying 5 years ago. The income tax changes, combined with the growth of the economy, mean that higher-income New Zealanders are paying a greater share of the income tax burden.

Justice, Minister—Confidence

5. Rt Hon WINSTON PETERS (Leader—NZ First) to the Prime Minister: Does he have confidence in the Minister of Justice; if so, why?

Rt Hon JOHN KEY (Prime Minister): Yes; because the Minister has made a significant contribution to the Government and to the people of New Zealand in the portfolios she either has held or holds.

Rt Hon Winston Peters: Does he believe the Minister of Justice has provided him with all the information required to make his decision that she should remain as a Minister?

Rt Hon JOHN KEY: I believe she has advised me of all the pertinent information.

Rt Hon Winston Peters: Has the Minister of Justice given him all the details and information, including the name of the Chinese border official who was at the Oravida dinner?

Rt Hon JOHN KEY: I cannot remember who gave me the name of the official, but I certainly have the name. That was the very name, the agency, and the role that I took to the Cabinet Office.

Question time interrupted.

Points of Order

Racehorse Ownership—Leave to Table Document

BRENDAN HORAN (Independent): I raise a point of order, Mr Speaker. I seek leave to table a document from New Zealand Racing that shows the ownership of the racehorse—

Mr SPEAKER: Order! The member has described the document. This is information from the New Zealand Racing Conference. Leave is sought to table it. Is there any objection? There is objection.

Hon TREVOR MALLARD (Labour—Hutt South): I raise a point of order, Mr Speaker. Is this one of these documents that is available online? The question is why that member was not asked that. My understanding is that it is.

Mr SPEAKER: I am not sure whether it is available. Possibly it might have been better to do that.

Rt Hon WINSTON PETERS (Leader—NZ First): I raise a point of order, Mr Speaker. I think if the member had properly explained what he was trying to table, there would not have been opposition. He referred to the word “ownership”, and Jimmy Savile—

Mr SPEAKER: Order!

Brendan Horan: Point of order, Mr Speaker.

Mr SPEAKER: Order! The member will resume his seat at the back. I have put the leave. The House has decided. That is the end of the matter.

BRENDAN HORAN (Independent): I raise a point of order, Mr Speaker. I draw your attention to Standing Order 116, and I take offence at the disgusting comments from—

Mr SPEAKER: Order! Can I refer the member to Speaker’s ruling 20/8: “Constantly raising trifling points of order is itself disorderly.”

Hon ANNE TOLLEY (Deputy Leader of the House): I raise a point of order, Mr Speaker. There is a protocol in this House, which is in the Standing Orders, that if a member takes offence at an offensive remark aimed at them, the House upholds it. That was a really offensive remark.

Mr SPEAKER: Sorry. Then I apologise to the House. I never heard anything that I considered—

Hon Anne Tolley: He referred to him as Jimmy Savile.

Mr SPEAKER: Order! [Interruption] Order! I never heard anything that I thought was offensive. But, as is the practice of this House, if the member did make a remark at which offence has been taken, then the member should stand, withdraw, and apologise.

Rt Hon WINSTON PETERS (Leader—NZ First): Yes, I did make that reference, it is true, and I apologise.

Mr SPEAKER: Order! The member will stand, withdraw, and apologise according to the rules, without adding—

Rt Hon WINSTON PETERS (Leader—NZ First): I withdraw and apologise.

Mr SPEAKER: Thank you.

Question time resumed.

Questions for Oral Answer

Questions to Ministers

Budget 2014—Tertiary Education and Research

6. Dr CAM CALDER (National) to the Minister for Tertiary Education, Skills and Employment: How will Budget 2014 advance the Government’s work to strengthen the New Zealand tertiary education system?

Hon STEVEN JOYCE (Minister for Tertiary Education, Skills and Employment): Budget 2014 contains an additional nearly $200 million over the next 4 years from new spending and reprioritisations for tertiary initiatives that will further improve the quality of our universities and help maintain their international competitiveness. It continues the Government’s focus on increasing funding for science, technology, engineering, and maths—areas that are critical to innovation and to New Zealand’s economic future, and where there has been long-term underfunding relative to other subjects. The funding lift provides a lift in tuition subsidies for science, agriculture, and selective health sciences. This comes on top of funding increases for engineering and science in previous Budgets. Since 2008 we have increased the average funding rate for science by 23 percent and engineering by 20 percent.

Dr Cam Calder: How does Budget 2014 support excellent research?

Hon STEVEN JOYCE: Budget 2014 boosts operating funding for the centres of research excellence by $53 million over 4 years. This means that the Government will be now funding 10 centres of research excellence from 2016-17, up from the six that were recently selected through the competitive process run by the Royal Society. The Government has decided that one of the four additional centres of research excellence shall be dedicated to Māori developmental research. I want to thank the Māori Party for its strong advocacy for this approach. Centres of research excellence are research networks that produce world-class research and make an important contribution to our society and economy, and we are very pleased to support the programme.

Dr Cam Calder: What investments has the Government made in tertiary education since 2008?

Hon STEVEN JOYCE: The Government invested $2.25 billion in publicly owned tertiary institutions in 2013. That is an increase of 14 percent since 2008. This has been a significant increase in tough economic times. Funding of universities has increased greater by 19 percent from 2008 to 2013. We have significantly increased the size of the Performance-based Research Fund. That will hit $300 million a year in 2 years’ time. We have also seen increases in the Marsden Fund. Our reforms and increased investment are paying off. The tertiary system produced more qualifications than ever before in 2012. The number of domestic students who completed a Bachelor’s degree in 2012 was the highest ever, at 25,400—up by nearly a quarter since 2010.

Budget 2014—Financial Support for Families

7. JACINDA ARDERN (Labour) to the Minister of Finance: How will the changes to the Parental Tax Credit he announced in the 2014 Budget help those who, as he states, are at “the hard end of poverty”?

Hon BILL ENGLISH (Minister of Finance): The extension of the parental tax credit, which applies to 15,000 families, will assist those who are at the hard end of poverty if and when they are able to get into work. The parental tax credit extension is part of a package that has five elements, and three of those are available to all children and all families, regardless of parental income—for example, free doctors’ visits and prescriptions for under-13s, as well as significant investment in protection for vulnerable children. As it happens, the member, I know, has a view that a lot of the families covered by the parental tax credit still have children who are “in poverty”, even though they do have some work income.

Jacinda Ardern: Why do those at the hard end of poverty in work deserve help, but the up to 14,000 who are at the hard end of poverty and who have not been able to find work not deserve support from this Government?

Hon BILL ENGLISH: In fact, this Government has devoted more new spending over the last 2 or 3 years to those families than any previous Government has, through practical support and the welfare system. For example, every sole parent under the age of 20 has a supervising adult in their life funded wholly by the Government. That person or organisation has the purpose of ensuring that that family gets their power bills paid, that they have some kind of stable housing, that they are protected from violence, and that their social issues have some opportunity to be dealt with, at the cost of $7,000 per head per year, for each of the now around 3,000 sole parents under the age of 20. Their children are among the most vulnerable in our community, and they now have extensive support from the Government.

Jacinda Ardern: What additional income support have the 14,000 families at the hard end of poverty received from his Government in this Budget or, indeed, in any Budget?

Hon BILL ENGLISH: They have received an increase in their benefits consistent with the increase in the CPI over the last 4 or 5 years, despite the fact that we have had a pretty tight Budget. They benefit from increased early childcare subsidies, which, I think, have doubled in the last 5 years in cost to the Government. If the simple transmission of cash was the answer to all these problems, we would have no poverty, because for 30 years Governments have been increasing the payments per child and benefit payments for these families. That is why this Government has taken a much more targeted and individually supportive approach to helping people out of persistent deprivation.

Jacinda Ardern: Does he agree with Dr Nikki Turner that free doctors’ visits and prescriptions will do little to reduce child poverty without also improving the incomes and the housing conditions of the very poor; if not, why not?

Hon BILL ENGLISH: The Government has had a very strong focus on improving particularly the housing conditions for the most disadvantaged, through the insulation programme, which has meant that every single State house that can be insulated is now insulated, and through a 5-year programme of discussion with the community housing sector about how we can more efficiently help more people in serious housing need, and we continue to make changes in that respect.

Jacinda Ardern: Does he agree with the Justice and Peace Commission of the Catholic Diocese of Auckland, a group that deals with people struggling to make ends meet, that the Budget does not address the root causes of poverty, or does he consider a CPI adjustment for those at the hard end of poverty to be sufficient?

Hon BILL ENGLISH: I respect the voice of the Justice and Peace Commission of the Catholic Church, and I expect it to be better informed than a lot of other spokespeople, for pretty obvious reasons. In fact, when I put money on the plate each Sunday, I know that some of it is going to our critics, and that is what you expect in a robust democracy. But I think it would be interesting to have a discussion about what we believe the root cause of poverty to be, because if it was just a lack of cash, then we would have solved the problem years ago. In fact, this Government is focusing in on those things that lock people into poverty, which are welfare dependency, no educational achievement, and victimisation and regular revictimisation through crime. We are digging into those long-term causes. Of course, where we do have the capacity to provide more cash support, we have, such as $500 million for families in this last Budget.

Accident Compensation—Levies and Car Safety Ratings

8. JOANNE HAYES (National) to the Minister for ACC: What reports has she received which show New Zealanders could pay lower ACC levies in 2015?

Hon JUDITH COLLINS (Minister for ACC): As I announced last week, Budget 2014 indicates the Accident Compensation Corporation is on track to provide further levy cuts for New Zealanders of around $480 million in 2015-16, following more pleasing results over the past year. Today ACC announced it will go out for public consultation on the 2015-16 levy rates. ACC continues to improve its financial situation, transforming the way it supports injured New Zealanders back to independence and building on its investment returns. As a result, it is proposing reductions in the workers and earners accounts and the motor vehicle account. New Zealanders can take part by submitting to the ACC by 5 p.m. on Tuesday, 17 June 2014. Consultation papers are available on ACC’s website. The Government will make its final decision after ACC’s public consultation, but we anticipate the bulk of these cuts will be for motor vehicle levies, along with the possibility of a levy reduction for employers and the self-employed.

Joanne Hayes: What factors are taken into account when determining levies?

Hon JUDITH COLLINS: Each year ACC assesses the levy rates required for future levy years. The assessment is based on a number of factors, including actual and projected claims costs, returns on investment, interest rates, and the number of registered motor vehicles. Due to changing patterns of these and other elements, the amount that ACC must collect may change each year. ACC is successfully managing these factors in order to provide a scheme that is fair for levy payers and for clients. Following the consultation process and receiving ACC’s recommendations, the Government will make a decision on levy rates, also taking into account public interest considerations such as the economic environment. It is also important that any decrease in ACC levies is sustainable and provides consistency for households and businesses in the long term. Nobody wants to be the Government that has to put up levies, as we had to do after Labour left ACC in such a mess.

Joanne Hayes: How is ACC addressing car safety in the consultation process?

Hon JUDITH COLLINS: What an excellent question. As well as reducing average motor vehicle levies, ACC is also proposing the introduction of risk rating for cars in 2015. Risk rating would mean the cost of levies would more closely reflect the level of risk associated with a car. All car owners would pay lower levies under ACC’s proposed changes. Owners of the safest cars would receive the largest levy cut. The proposal is for the implementation of four bands for light passenger vehicles, based on how vehicle design affects injury outcomes. Each band would have a different levy rate, based on the combined risk of injury to the vehicle occupants—

Grant Robertson: I raise a point of order, Mr Speaker. I think there are rulings about tabling press releases, but I would encourage the Minister to table that press release she was reading out there.

Mr SPEAKER: Order! And that is not a point of order, but I think the point the member was attempting to make is that the answer was certainly going on for a long, long time.

Housing, Affordable—OECD Ranking, Issues, and Government Policies

9. PHIL TWYFORD (Labour—Te Atatū) to the Minister of Housing: Is he concerned that New Zealand has gone from the 10th highest rate of house price growth in the OECD from 2004-2011 to the highest in 2013?

Hon Dr NICK SMITH (Minister of Housing): I am concerned that house prices rose by 9 percent in 2013. That is why the Government initiated a whole batch of reforms on land supply, development costs, and materials, and expanded support for first-home buyers. The member is being very selective, though, in his choice of years in the study, because in the preceding 5 years house prices rose by only 1.8 percent—i.e., 11 percent over the last 6 years. In the preceding 6 years, house prices rose by over 10 percent every year for 6 years—i.e., 83 percent. The difference in what the previous Government did was that for 6 consecutive years with house prices over 10 percent a year, it did nothing; we have 1 year at 9 percent, and we have got a big package of reform.

Phil Twyford: Does he agree that there is market failure when house prices increase so much faster than rents and wages; and when will he stop whining about historical data and get on with helping young Kiwi first-home buyers into their own homes?

Hon Dr NICK SMITH: Yes, there was serious market failure in Auckland, with a metropolitan urban limit that drove land prices through the roof. The interesting part is that Mr Twyford was one of the architects of the metropolitan urban limit. We have broken it, and we have got 33,500 new sections coming on stream.

Jami-Lee Ross: Which countries in the OECD study showed the most favourable house price data, and what elements of those countries’ economic policies is the Government considering adopting?

Hon Dr NICK SMITH: In respect of the table quoted in the original question, the countries that had the lowest house price rises were Greece and Spain. These countries have unemployment rates of over 25 percent. They have massive debt problems and huge deficits. People are leaving those countries in droves. It might be the economic prescription that members opposite have for New Zealand; we have a very different vision.

Phil Twyford: Does he agree with the Prime Minister that falling rates of homeownership, Kiwi first-home buyers being locked out of the market by loan-to-value ratios, and Government agencies referring people to live in campgrounds are all symptoms of an economy that is successful?

Hon Dr NICK SMITH: The long track record of homeownership post - World War II is very clear. That is, homeownership rates declined in periods when interest rates were high, and improved in years when interest rates were low. It is also interesting, in looking at that long-term study, that interest rates were always higher under Labour Governments and lower under National Governments. That is why people who want to enhance homeownership will vote for a John Key - led Government.

Jami-Lee Ross: Has he received any reports of proposals for managing migration pressure on housing; if so, what feedback has he seen on those proposals?

Hon Dr NICK SMITH: New Zealand’s migration issue is that Kiwis are voting with their feet and not leaving. That should be celebrated. But I have heard a proposal on Morning Report yesterday that we should cut immigration numbers by between 20,000 and 30,000. But when I listened to Morning Report this morning, I heard a person from the same organisation saying that that was not true. The first report was from Mr Twyford; the second from Mr Cunliffe. I do not think they have got any idea what they stand for.

Phil Twyford: How many of the 22,000 offshore landlords he cited in the House last week own more than one house, and how many of the 185,000 empty houses are owned by offshore owners or syndicates?

Hon Dr NICK SMITH: What we know from the Inland Revenue Department data is that there are 22,000 taxpayers who live offshore and own a home in New Zealand, and are receiving rent. We further know that that number has been constant over the last 5 years. There was some increase in that number under the previous Government, which, like most things on housing, did absolutely nothing about it. That number is 1.2 percent of our housing stock. We want to focus on the main game in housing. The Productivity Commission said that it was a non-issue, and that is why we are focusing on things like land supply, infrastructure costs, materials—those things that will make a difference.

Rt Hon Winston Peters: Why is the Government so against keeping records of sales to offshore buyers, and how can the Government possibly explain its policy on the housing crisis when it has no idea how much housing stock is in foreign hands?

Hon Dr NICK SMITH: The advice the Government has received from Treasury, from the Productivity Commission, and from my own ministry is that foreign buyers are having no substantive effect on the New Zealand housing market. If we had some registry where every time you wanted to buy a house you had to show your passport or evidence of your residency, that would not answer the question either, because the advice is that the bulk of people who are buying houses from overseas are actually then coming to New Zealand to live and gaining residency and citizenship. So if you really wanted to get accurate data, you would have to fill out a whole lot more forms to then trace that further. Having an argument as to whether the number is 1.3 percent or 1.4 percent takes our housing debate nowhere.

Rt Hon Winston Peters: Why on earth is he trying to maintain that argument for—

Hon Steven Joyce: Winston’s arguing for more pen-pushers.

Rt Hon Winston Peters: —New Zealand offshore housing in the country, and especially in Auckland, when the OECD, the Reserve Bank—and “Big Ears”, when he is awake—and Treasury are claiming that it is adversely affecting both inflation and high interest rates?

Hon Dr NICK SMITH: The member is wrong. The reality is that the advice from Treasury, the advice from the Productivity Commission, and the advice from my own ministry is that foreign buyers are having no substantive effect. It is the oldest trick in the book, whether it is crime, whether it is unemployment, or whether it is a challenge like housing, for Mr Peters to jump on the bandwagon and say that it is all the foreigners’ fault. That will get us nowhere. We should address the real issues.

Hon Tau Henare: Where’s the smoking gun?

Rt Hon Winston Peters: It is coming, son. Why is the Government trying to defend the recent record of thousands of houses bought by offshore buyers ahead of the right of New Zealanders to be able to afford a house in their own country?

Hon Dr NICK SMITH: The data from the Inland Revenue Department is that 22,000 overseas persons own property in New Zealand and rent it. The bulk of those are actually expat New Zealanders who are living overseas, doing their OE, and who own a house, whom members opposite now want to ban from being able to own a home in this country. We say that that is a nonsense.

Phil Twyford: Does he agree with the New Zealand Herald, which said yesterday in an editorial that his refusal to seek comprehensive data “raises the implication that the Government does not want accurate data for fear of what may be revealed.”?

Hon Dr NICK SMITH: My correct comment was that I rejected a register, and I maintain the position that it would be a waste of money. I am happy to receive further information, but I have to say that an argument over whether it is 1.3 percent or 1.4 percent does not make a dime of difference to the major arguments that we need to address if Kiwis are going to be able to afford their own homes.

Intelligence Agencies—Information Sharing and Drone Strikes

10. Dr KENNEDY GRAHAM (Green) to the Prime Minister: Has he received information that any other New Zealander, apart from Daryl Jones, has been killed in United States drone strikes; if so, what was that information?

Rt Hon JOHN KEY (Prime Minister): I have previously said that a New Zealander was killed in a counter-terrorism operation in Yemen. I am advised that I have not received information that other New Zealanders have been killed in drone strikes. However, I am not going to rule that out, for the following reasons. As I have said, there are sometimes New Zealanders who put themselves in harm’s way, the Government does not know where they are and what they are doing, and a number of people are registered as dual citizens.

Dr Kennedy Graham: Can he affirm that information supplied to US intelligence during his time as Prime Minister has never led to the death of any civilian?

Rt Hon JOHN KEY: I cannot be sure of that information. As I said yesterday in my press conference, New Zealand intelligence agencies have gathered information—in Afghanistan, for instance—and have passed that to our International Security Assistance Force partners. Our International Security Assistance Force partners have used that information, I suspect, and I cannot confirm exactly the results of that.

Dr Kennedy Graham: Does he then consider the New Zealand Government to be an accomplice to an extrajudicial killing of a New Zealand citizen if our intelligence agency supplies information to its US counterpart about a New Zealander and that New Zealander is killed by a US drone strike?

Rt Hon JOHN KEY: The member is talking about a hypothetical situation that has not occurred, to the best of my knowledge.

Dr Kennedy Graham: I raise a point of order, Mr Speaker. My previous question was not hypothetical, because, in fact, it has been acknowledged and accepted by the House that a New Zealander has been killed.

Rt Hon JOHN KEY: The member was quite clear. He made the comment in his question that New Zealand intelligence services have provided information that had been used in the killing of a New Zealander in Yemen. As I have made quite clear in public statements, New Zealand did not supply information to the US authorities when it came to the New Zealander who was killed in counter-terrorism operations in Yemen.

Mr SPEAKER: The point is that the question was asked, and it has been addressed in the answer of the Prime Minister.

Dr Kennedy Graham: Will the Prime Minister instruct our intelligence agency to adopt a policy similar to that of its German counterpart, which rules out the possibility of shared information being directly used in a US drone strike against one’s own citizens?

Rt Hon JOHN KEY: No.

Hon David Cunliffe: As a matter of policy, and not of operational detail, what caveats, limits, or policies of any kind does New Zealand place on the use of New Zealand - sourced signals intelligence provided to its Five Eyes partner countries in operations such as drone strikes?

Rt Hon JOHN KEY: That is a very detailed question and I simply do not have the answer to that with me in the House.

Hon David Cunliffe: I raise a point of order, Mr Speaker. It may be legitimate for the Prime Minister to say that he does not have all the detail, but given that the question was carefully phrased to say “of any kind”, could the Prime Minister please—

Mr SPEAKER: Could the member come to the point of order? What is the point of order?

Hon David Cunliffe: —say whether there is some detail that he may be in a position to provide.

Mr SPEAKER: That is not a point of order; that is, effectively, the member asking another supplementary question, which he may well be entitled to do. The Prime Minister has answered the question. If the member wants to continue with further supplementaries, he has every opportunity to do so, but not by a point of order.

Justice, Ministry—Employment Issues

11. Hon MARYAN STREET (Labour) to the Minister of Justice: Does she stand by all her statements?

Hon JUDITH COLLINS (Minister of Justice): Yes, especially my statement that this Government is focused on the big issues.

Hon Maryan Street: Did she express any concern to the chief executive of the Ministry of Justice after the release of the Paula Rebstock report into the Ministry of Foreign Affairs and Trade leak, regarding the employment of Nigel Fyfe?

Hon JUDITH COLLINS: No, and it would be most inappropriate for me to do so.

Hon Maryan Street: Was she or any of her staff involved in any discussions with the chief executive of the Ministry of Justice about Nigel Fyfe being put on gardening leave before or after the Rebstock report was made public?

Hon JUDITH COLLINS: No—in fact, Mr Andrew Bridgman, the secretary, advised me of the situation based on the no-surprises policy. I note that that member has previously put out a press release saying that I “could have moved to reinstate Mr Fyfe much earlier except that Paula Rebstock is a close friend and trusted ally of Ms Collins.”, as in me. I completely reject that allegation. I think it would be most improper for me to have taken her advice.

Hon Maryan Street: Has she ever referred to Nigel Fyfe as a “bad egg”?

Hon JUDITH COLLINS: Certainly not.

Hon Maryan Street: Did she discuss the Rebstock report with the chief executive of the Ministry of Justice prior or subsequently to its release in December 2013?

Hon JUDITH COLLINS: I think I have already made it very clear that the chief executive, on the no-surprises policy, as he should do, advised me of the situation. I was advised of the—

Grant Robertson: You said nothing. You were mute at that point.

Hon JUDITH COLLINS: Well, actually, I never make comments about employees. I am not a Labour Government Minister; I am a National Government Minister.

Budget 2014—Kauri Dieback Disease

12. SCOTT SIMPSON (National—Coromandel) to the Minister of Conservation: What new measures will the Government be able to take to contain and control the kauri dieback disease as a consequence of the $26.5 million committed in the Budget?

Hon Dr NICK SMITH (Minister of Conservation): The funding will enable us to put over 100 kilometres of new track and 5 kilometres of new boardwalk in particularly sensitive areas, and also to install a further 300 additional hygiene stations in the kauri forests of Northland, Auckland, and the Waikato. It also includes increased pig control and investment in critical research. The funding is complementary to that also being contributed by our partners in regional councils as part of the Keep Kauri Standing programme.

Scott Simpson: When was funding for kauri dieback first sought from the Government and what was the process for securing that funding?

Hon Dr NICK SMITH: Funding for kauri dieback was first sought from the Government in 2007, and again in 2008, but on both occasions was declined by the previous Government. The first Government funding that was provided for kauri dieback was in the 2009 Budget, and was provided for a period of 5 years. We did a review last year and the Minister for Primary Industries and I agreed on a Budget bid in November for this $26.5 million, which is supported by science and will ensure that kauri is maintained for future generations.

Budget Debate

Bills

Appropriation (2014/15 Estimates) Bill

Debate resumed from 15 May on the .

Hon STEVEN JOYCE (Minister for Economic Development): I rise to support in the most fulsome way this excellent Budget from the Minister of Finance, the Hon Bill English. It is the sixth Budget from the Minister of Finance and, as he pointed out last week, it is also similar to the number of children that he has. That means that there is a number of us pondering having a discussion with his good lady wife as to whether we could possibly extend the brood to make sure we get further good-quality Budgets like this one.

This Budget, as it says on the cover, is what it says on the tin. It is about managing a growing economy. Yes, we have a strongly growing economy. It was one of the fastest-growing in the OECD last year, and it is likely to be one of the fastest-growing in the OECD this year—

The ASSISTANT SPEAKER (H V Ross Robertson): Order!

Hon STEVEN JOYCE: —and likely—

The ASSISTANT SPEAKER (H V Ross Robertson): Order! [Interruption] Well, I was not interrupting the honourable member. I was actually bringing the House to order. Courtesy is contagious, but the member may continue.

Hon STEVEN JOYCE: It was one of the fastest-growing economies in the OECD last year, one of the fastest-growing this year, and likely to be one of the fastest-growing in the OECD next year. That is, firstly, because of the fantastic fiscal management of this Minister of Finance, but also because of a range of other initiatives. I would like to focus on a few of those that are part of the Government’s very successful Business Growth Agenda, which is being well supported by businesses that want to invest and grow jobs up and down this country. If you look through the Business Growth Agenda, there are a number of new initiatives this year, including extending the investment in New Zealand Trade and Enterprise to help expand its support for businesses as they grow offshore, around the world. There is $69 million over 4 years there.

There is increased investment in the science area through science and innovation funding of $58.6 million over 3 years. There is the approach of tax exemptions for loss-making start-up companies to allow them to cash out part of their tax losses, the research and development black hole expenditure, and, of course, the centres of research excellence.

In the skills space, we have talked at question time this afternoon about the investments in tertiary education. In infrastructure there are significant investments in transport and for the KiwiRail Turnaround Plan, and also significant investments in the Hobsonville Land Co. housing development. In the natural resources space, we have had the Future Investment Fund moneys for Crown irrigation and, of course, as just mentioned in question time, the kauri dieback programme. So this Budget is a Budget that is focused on encouraging New Zealand to continue to grow over the longer term, and that is a good thing for the New Zealand economy, but, most of all, that is a good thing for New Zealand families. This Government stands proudly on its record now of six excellent Budgets under the tutelage of the Prime Minister and, of course, our Minister of Finance.

So we come to the other options we could have had, standing here today in terms of talking about a Budget. Of course, this is what the Labour Opposition might have done. The Opposition is now telling us, in its latest manifestation, that it would be as fiscally responsible as the current Government. That is its current statement of the day. Mr Cunliffe gets up there, puts the nerd face on, and says: “Oh, no, no. We would be as fiscally responsible as the current Government.”, except that those members would not be. We have to remind ourselves of what they have said over the last few years. For example, one finance spokesman for the Labour Party in 2009 said that we needed a bigger stimulus package. How could anybody call this robust? David Cunliffe said, adoringly: “New Zealanders have watched an American President take office and take action, passing a NZ$1.5 trillion stimulus bill. They look across the Tasman, and they see a Government prepared to move heaven and earth with a NZ$67 billion stimulus package.” And now, when the chickens are coming home to roost across the Tasman, he says: “Oh, no. We would be as responsible as the National Party in terms of our fiscal responsibility.”

If you go back, you will see that it was not just once. In 2011 he signalled that Labour would increase its borrowing so that it could spend more than National’s $1.1 billion allowance. That was at the end of 2009. Then he said that you cannot be driven simply by Government debt as your overriding concern. That was in another speech from Mr Cunliffe, when he argued that there should be more expenditure again. And then there was the one where Mr Cunliffe called the National Government’s spending packages timid and said that Labour would have spent more. So that is what Labour actually said at the time, yet today it is: “Oh, we would have got back into surplus at the same time as everybody else.”

But let us test it again. Let us look across at the front bench. Let us look across the front bench and see what those members would have done. Well, we will start with Grant Robertson, who has not seen a student whom he does not want to spend more money on. In the three times that he was tertiary education spokesperson, he opposed every single change to save money so that we could spend more elsewhere in the tertiary system. Then there was David Cunliffe, who was another great spender, as I have said. There is Annette King, who has never seen enough spent on health, and who has constantly criticised Tony Ryall for not spending more on health. Then there is Jacinda Ardern, the one-time spokesperson on social development. Today she was moaning that the Government had not spent more in the lower-income areas. Finally, there is Mr “Twifford”—Mr Phil Twyford—who sits there saying—

The ASSISTANT SPEAKER (H V Ross Robertson): Order! The member will refer to another member—

Hon STEVEN JOYCE: I actually corrected myself.

The ASSISTANT SPEAKER (H V Ross Robertson): —by their proper name, not by a nickname or anything else.

Hon STEVEN JOYCE: It was a mistake, and I corrected it. Can we keep going? Anyway, there is Mr Twyford, who, in his house-building plan, wants to spend anything up to $20 billion replacing the private sector on housing. And that is just its front bench. So you have a leader who has spent the entire time wishing he could have been Barack Obama or Kevin Rudd, and that he could have spent a lot of money through the global financial crisis. And now, even today, we have a front bench—which, of course, is without the lately lamented Shane Jones, who was the only person interested in growth; he is gone—that wants to spend more and borrow more.

But there are other issues to deal with, including the latest problems that have apparently manifested themselves since the Budget. We have now got not one but two new crises to deal with, on top of all the other crises that the Opposition has been consumed with over the last few years. You may recall the regional crisis. That was a massive crisis in the regions, where 2 days before the census came out, the Leader of the Opposition at the time, who apparently is still the leader, actually wandered out and said there had been a massive departure of people from the regions—except there had not. In fact, ANZ has come out today and said that every single region in New Zealand has grown in the last year, including Otago, which went up 4.5 percent. So where is that little Dr David Clark now? It went up 4.5 percent in Otago. The crisis continues in Otago!

Then there is the manufacturing crisis—another fantastic crisis. The manufacturing sector has now been in expansion for 19 consecutive months. Then we have the export crisis, which was immediately followed by the highest-ever New Zealand dollar value of exports leaving New Zealand. So then we have the two new crises, including the housing crisis. Unfortunately for the Opposition, the only difficulty with the housing crisis is that it was a lot worse when Labour was in Government. That is the only slight problem with the housing crisis. But, nevertheless, let us roll with that sucker for a minute. Let us have a look at the housing crisis under Labour. Under Labour, house prices in the country doubled for over 9 years. Under National, in 5 years they have gone up 16 percent. So that is a crisis; there is no doubt about that!

The latest crisis—the one I love now—is the immigration crisis. There is now the immigration crisis. Well, let us analyse that just for a second. In the year to March 2014, net 32,000 people came into New Zealand, which is about 30,000-odd more than 2 years ago—35,000, in fact. What has happened? It is that fewer New Zealanders have moved to Australia, which is something that the Labour Party used to be concerned about, and 24,000—two-thirds of that reduction, or more than two-thirds—are people who have not moved to Australia. Apparently it is causing house price problems in Auckland, except that most of those people who have not moved to Australia have not left their provinces. It has nothing to do with Auckland. It is that 19,000 of the 24,000 are still living in Dunedin, still living in Napier, still living in Invercargill, where they are slightly bemused to see Mr Twyford popping up at their window and asking: “Are you buying houses in Auckland?”. It is not happening, and that is the trouble with the Opposition members. They are a bunch of panic merchants who do not understand that actually it is about sensible economic growth, and that is what this Government delivers.

Hon DAVID PARKER (Deputy Leader—Labour): It was interesting that the Hon Steven Joyce did not talk about his own Budget. There is nothing in it to talk about. Those members on the other side are one-trick ponies. They think that the only thing to be done is to balance the Budget. I say one thing to Mr Joyce, and that is that we would not have distributed our tax cuts in the way National has—40 percent to the top 10 percent of income earners.

This Budget is underwhelming. I do give some credit to the Minister of Finance for getting back to break even. I do call it “break even” rather than “surplus”, because there are enough “fudge-its” in there to show that it really is just a break even—the delaying of the ACC payback to New Zealanders through overcharging for ACC, and the swizzle in respect of the Christchurch rebuild numbers. When Christchurch sees infrastructure rebuild costs going up, it is because the Crown has decreased its allowance for Christchurch on the Government side of the ledger. It is hard to believe that that is right. Then it took out, except in the contingency, the cost of increasing KiwiSaver. None the less, it is good that we are back to break even, because Governments should live within their means.

But this Budget is so underwhelming overall, because a Budget should do more than just balance the books. Any responsible Government would address the long-term issues facing the country, and this Budget does not. Let us start with low wages. What has happened in the last year? Forty-six percent—46 percent—of New Zealanders have had no increase in their wage rate in the last year, and that is the official statistic from the labour cost index prepared by Statistics New Zealand. It is even projected that wage growth—real wage growth—going forward after inflation is on average less than 1 percent per annum over the next 3 years. That is really lacklustre in a country that has a low-wage problem. When people cannot afford to buy a house, that is a terrible outcome. Why? Because the Government is so lacking in economic vision that it will not pull the levers that most people know should be pulled.

We need deeper pools of saving in New Zealand. That is why we need universal KiwiSaver. The vast majority of New Zealanders agree with us, and so does the business community. The reason that Australian businesses pay higher wages than New Zealand businesses is that they have invested more in their businesses through the product of their universal work-based savings scheme. What does National say? It will not go there—it will not go there.

What is next on the agenda? We know that we need to push that money out of the speculative economy and into the productive economy, so we need some pro-growth tax reform, like with a capital gains tax. The Government says: “Oh, it won’t work. It won’t work unless every house is included, including the owner-occupied home, which we would not endorse.” Well, the Government’s problem is that—see page 1 of the New Zealand Herald today: “Support for capital gains tax”. Economists say that Labour’s 15 percent capital gains tax on investment property would work—it would work. So the Government fails on that front, too.

What is it doing more generally in respect of housing? It is drawing lines on maps. That is what its policy has been to date—draw some lines on maps. Not only that but when it had the opportunity to improve consenting for housing in Auckland through giving effect to provisions in the plan that would have enabled more dense housing inside the urban limit, it would not do that because it is so doctrinaire in its opposition to things that actually work.

What is it doing on superannuation? Well, actually, this year the New Zealand Government will spend more on superannuation than it spends on preschool, primary, intermediate, secondary, and tertiary education combined—this year. Is that not shocking? We as a country are going to spend more on superannuation than we spend on educating our young people. I think that that shows there is a need for reform of the age of eligibility for superannuation. The Government has not got any vision to fix that. It will not fix that on the saving side and it will not fix it on the expense side.

On exports, the Government was going to increase exports to 40 percent of GDP. It patently failed to do that. What do you need to do that? You actually need Labour Party policy, whether it is on savings, capital gains tax, research and development tax credits, accelerated depreciation, or addressing monetary policy in the way that we have most recently proposed. All those things are connected. The reason why our monetary policy went down so well was actually that the public is seeing that. The public is starting to understand that rampant house price inflation in Auckland causes the Reserve Bank to push up interest rates, despite the fact that general non - house price inflation is close to zero. And those increases in interest rates do not just hurt everyone paying a mortgage, their credit card, their hire purchase on their car, or their borrowings for their business. Those increases also hurt exporters because they put up the exchange rate, because New Zealand’s interest rates go further above international norms.

Then what does that cost? That costs jobs. That costs jobs in the regions especially, where we do not process our timber. We instead send more logs out raw. This Budget is underwhelming, as evidenced by what the Government pushed through under urgency. Under urgency, through all stages, it pushed through the abolition of cheque duty to save 35c per person per year. That was the big idea in this Budget economically—35c a year saved on cheque duty pushed through under urgency because there was nothing else in this Budget that the Government could pretend was more significant.

The Government has adopted some of our social policy—a pale comparison of it. Its extension to the parental tax credit does not touch the most vulnerable in a country where we have got increasing deprivation caused by higher house prices, higher rents, and higher electricity prices above the rate of inflation. Our most vulnerable people and the most vulnerable children get nothing. The National Government turns round and it says: “Oh, this is all about beneficiaries.” You know, New Zealanders have actually got a social conscience. They do not like to see these gaps rising. When their children are playing with the next door neighbour’s children who might be in impoverished circumstances, they do not like to see those gaps getting bigger. This Budget is a disgrace on that front, given that we have done nothing—nothing—other than to put off until next year children who are 12 years and under getting free doctors visits. Free doctors visits for under-13s is a good thing, but it really does nothing to decrease the increasing gap between the most vulnerable children and others.

We have rising inequality in New Zealand. I thought the most disgraceful part of the Prime Minister’s speech last week was when he pretended that we have not got rising inequality in New Zealand. He took the Bryan Perry data and he did not acknowledge the limitations of it. First of all, it excludes capital gains, so therefore it understates the economic income differences between low and high-income people, because those capital gains are concentrated amongst the wealthy. In fact, the top 5 or 10 percent earn more than 90 percent of the capital gains. We know that from the research we did around our capital gains tax. It understates income inequality, but more than that, we have moved as a country from being in the best third of countries in the OECD with low levels of income inequality, to being in the worst 40 percent. We have gone right up the scale of income inequality at a time when the OECD overall was getting worse. We bucked the trend by being worse than the trend, and the trend was already bad.

The next thing to say in respect of overall inequality is that the longer you have that income inequality carrying on, the more consequences pile up. They show up in things like homeownership. That is why New Zealand has the lowest rate of homeownership in 50 years. What did this Budget do about it? Absolutely nothing—nothing. A very minor measure around tariffs on imported building products that would save, in respect of a new house—and that would only be about 1 percent of your houses—less than 1 percent of 1 percent of your houses, which is so insignificant as to be derisory.

Health spending is going down in real terms. The Government has lauded this change to general practitioner visit costs for children 12 years and under, but it has ignored the fact that, in real terms, according to Treasury’s own model, spending has gone down by 2.3 percent.

Labour’s economic upgrade package will lift wages. It will lift investment into our productive export sector. It will dampen house prices. New Zealanders will be better off as a consequence. It will mean that New Zealand can have lower interest rates. We can get New Zealand’s interest rates back to where they are for our international peers, rather than being perpetually higher than them. Those are the sorts of policies that New Zealanders need.

The fact that the Prime Minister was so ashamed of this Budget that he went out there on the day of the Budget spinning about tax cuts and increases in GST shows how the Government’s policies have failed. National is falling apart on these things. He did not even tell Bill English that he was going to go out and say it, because the Hon Bill English was so obviously blindsided and had to put down cover because its promises were not affordable. National has got no economic plan.

Hon NATHAN GUY (Minister for Primary Industries): That was David Parker. We did not hear one word about an alternative Budget. He stood up in the House and said that it is an underwhelming Budget. Well, I must say, when I was in my fantastic electorate of Ōtaki on the weekend, doing a bit of doorknocking in Waikanae, every person whose door I knocked on said “What a great Budget.” They really appreciated the real focus of this Budget on families. I need to acknowledge Bill English’s sixth Budget and what a fantastic job he has done tracking us through the tough economic times and returning us to surplus. Bill English is a star in our Cabinet. He has delivered a fantastic 2014 Budget. It needs to be acknowledged, the hard work that he does, supported by the Prime Minister, who is doing a fantastic job also.

What we have not heard from Labour, over the other side, is an alternative Budget. We are 4 months out from the election, and we cannot even recall hardly any Labour policy. I can, actually. I can recall something. Labour talked about banning trucks in the fast lane on four-lane highways in New Zealand. I think we worked out that there is less than 50 kilometres of four-lane highway in New Zealand. That was one of Labour’s big policy announcements.

This Budget is all about building on the work of hard-working New Zealand households and, importantly, businesses over the last 5 years. We also need to acknowledge our export sector. Our export sector and our manufacturers are not in crisis, like our opponents wanted us all to believe 6 or 8 months ago. They are the ones who are driving this economy forward—our hard-working Kiwi farmers. Even up against pretty challenging exchange rates, they are delivering for this country.

Growth is forecast to be 4 percent next year, in 2015. When you look out across the next 3 years, it is an average of 10 percent. Is that not fantastic? And 170,000 people are predicted to be in employment by 2018, with unemployment forecast to be down to 4.4 percent in the next few years. Is that not fantastic?

The other important thing that we should not lose sight of is that when Labour was in office in 2008, interest rates were at an all-time high of over 10 percent. If we think back to 2005, the tradable sector, which is basically everything apart from Government spending, was in deficit. That was masked over by excessive Government spending in the last term of a failing Labour Government. It came to Bill English and John Key to get Government expenditure under control, to move New Zealand towards savings and away from consumption and also focusing on decent long-term fiscal policy and financial management. We are now the envy of many developed countries around the world—4 percent economic growth. If you look across the Tasman at Australia’s Budget, what a contrast. We have seen the damage that Labor and the Greens have done over in Australia. Its economic growth is on a decline; ours is on an up.

This is a real family-focused Budget, with $500 million invested, paid parental leave extended by 4 weeks, parental tax credits up from $150 to $220 a week, entitlements extended from 8 weeks to 10 weeks, and free general practitioner visits and also prescriptions free of charge for under-13-year-olds. The feedback I got on the doorsteps on the weekend about paid parental leave was that people are very excited about that, and excited that we are focused on families, making sure that every 13-year-old and younger can get the chance to see a doctor. And, importantly, there is $156 million invested in early childhood centres, making sure that they are accessible and affordable. Also, there is $33 million focused on vulnerable children, with eight new children’s teams looking at at-risk children. Importantly for my electorate and for many elderly up and down the country—I have got one of the highest proportions of over-65s in any electorate in New Zealand. When I am knocking on the doors, like I was on the weekend, they mention to me the focus that we have, under Tony Ryall, particularly on elective surgery and more hip and knee replacements—$110 million of new money over the next 4 years.

Importantly, this afternoon in the House we heard that ACC is out there, publicly consulting on levy reductions. That means that the average vehicle registration charge could drop by $130 a year. Is that not fantastic? When you look at the Ministry for Primary Industries’ budget, it is up by $17.4 million. It is strengthening its core system, working with my colleague Nikki Kaye on food safety, supporting the engine room of our primary industries, and boosting biosecurity, which is my No. 1 priority. We heard today in the House my colleague the Hon Dr Nick Smith talking about how we are investing more in kauri dieback disease prevention. It is fantastic to be able to work with the Department of Conservation and the regional councils to focus on what is a serious disease affecting our kauri, and on tracks, boardwalks, hygiene stations, and education. Importantly, the Ministry of Primary Industries is doing work on research. It is also focusing on our overseas footprint, with $2.2 million invested there to look at what we need to do, beefing up our resources in China and, importantly, looking out over the horizon with industry on new and emerging markets.

Think back to just 12 or 14 months ago to how we were in the worst drought that we have ever seen, some say, for the last 70 or so years. We do not have a water shortage issue in this country. We have a water storage issue. We collect only 2 percent of rain that falls in this country. The rest goes into our rivers and streams and heads out to sea. That is why in Budget 2014 we are investing $40 million and purchasing shares in Crown Irrigation Investments Ltd, which carefully selects projects to support. Think back to the research that the New Zealand Institute of Economic Research did, which forecast that 420,000 hectares could be under irrigation that is not currently, an investment return for our exporters and our GDP of $3 billion to $4 billion. This is all about growing our exports but, importantly, focusing on the environment as well. When you have decent water storage projects, you have consistent summer river flows, which are good for the aquatic and marine life and also take the pressure off the groundwater that is extracted from those aquifers. This is about growing our exports but, importantly, looking after the environment in a sustainable way moving forward.

In summary, we have had a fantastic Budget delivered by Bill English this year. It has been applauded by most people up and down the country. Some of the education people have been pretty silent. Normally on the back of the Budget every year they say that we are not doing enough. We have not heard too much from them. This is a Budget that is focusing on families, a Budget that is looking after our elderly, a Budget that is looking after our most vulnerable, a Budget that is focused on growing our exports, and a Budget that is looking at our overseas footprint to make sure we are doing more.

What do we have from members on the other side of the House? We had no support from them when we went through the tough 6 years previously, and no support from them for what we were doing about savings and restraint. They did not back one initiative that this Government put up. They said no to welfare reform. They do not support getting people back into work. They said no to any tax reductions. They said no to a 90-day probation period to support our small and medium enterprises. They do not care about business; we do. They said no to Resource Management Act reform and no to special housing areas. The list is long and it goes on and on and on.

Under Bill English and John Key, this is a Budget for the future. This is a Budget of confidence in New Zealand. This is a Budget indicating that we are going to get back into surplus. This is a Budget forecasting 170,000 jobs by 2018. This is a Budget that has been well received by New Zealanders. This is a Budget whereby people acknowledge that Bill English, John Key, and the leadership of the National Government have been through tough economic times. In 4 months’ time people will be queuing up to return the leadership of John Key and Bill English for a brighter future. Bring it on.

PHIL TWYFORD (Labour—Te Atatū): I want to talk about housing in the Budget. It is the missing chapter. But first I think we have to just pause for a moment and reflect on the events of the last 24 hours. Apparently the Prime Minister thinks that there is not a housing crisis. I have three words for the Prime Minister: out of touch. He is out of touch. Clearly, the Prime Minister thinks that denial is a river that runs through Egypt. This is the view from “Planet Key”—golf courses as far as the eye can see, but you cannot buy a house for love nor money. Let us just recall what the OECD said in the report that came out in the last few days. New Zealand, in the last 12 months, had the highest rate of house price inflation of all of the 34 member nations of the OECD—the highest rate of house price inflation. The OECD also said that based on one of the two indicators that it uses—that is, the ratio of house prices to incomes—New Zealand has the highest valued, or most overvalued, house prices in the Western World, but apparently, according to the Prime Minister and Nick Smith, we do not have a housing crisis.

Put the OECD data together with the fact that we have the lowest rates of homeownership in 50 years; first-home buyers locked out of the housing market by loan-to-value ratio lending restrictions; and in Canterbury, 3½ years after the earthquakes, the slow pace of the residential rebuild borders on the criminal. Something like 60 percent of the above-cap—that is, the more expensive—home repairs still have not been done and people are living in totally unacceptable living conditions because of the failure of this Government to expedite the rebuild. On top of that, at the low end of the market you have got the Government agencies routinely referring people to live in campgrounds. If you put all of that together, I argue that that is the picture of a housing crisis, but, according to the Prime Minister, we are simply victims of our own success.

I met a young professional couple few weeks back who had moved from Auckland to get away from the high house prices so that they could buy their own home. They were a young family with both parents working, and a good salary. They moved there a week before loan-to-value ratio lending restrictions came in and they said to me that it would take them 5 years to save the $100,000 deposit they need to get into their home. There is a family who came into my electorate office last week: mum, dad, three kids, and another one on the way. Dad is working but they are homeless. They are homeless because they cannot get into a private rental. There is nothing available for them and they are not eligible for a State house under Nick Smith’s eligibility policies. That is ridiculous. Dad is in work, there are three kids and another on the way, and the family is homeless under this National Government’s housing policies.

Let us talk about the Budget. What did the Budget do for the housing crisis? Last Friday morning the Fairfax papers published a poll that said that 76 percent of those polled wanted to see the Budget, more than anything else, deal with the housing crisis and help first-home buyers. So what did National do? It has taken the tariffs and anti-dumping duties off varnish, nails, and Gib board. Nick Smith estimates with no analysis, no evidence to back it up, and on the back of an envelope that that is going to knock $3,500 off the cost of a new home, with no reassurance and no confidence that that saving—if it, in fact, happens—will be passed on to first-home buyers. It is more than likely in the current market that that will be pocketed by the builders and developers.

What else did National announce in the Budget? There is $30 million for social housing, which is a drastic cut to the funding of social housing, in the middle of a housing crisis. Two Budgets ago social housing got over $100 million. Now it is getting $10 million a year over 3 years. That does not even kick in until 2015. Nick Smith has been going around talking up what the Government is going to do for social housing for the last year and a half. The NGOs—the Salvation Army, VisionWest Community Trust, and all the others—are waiting for capital grants to help them get going so that they can build houses, and what does the National Government offer them? It offers them only enough to build 100 houses. That is pathetic, Minister, after you have been going around bragging about what you are going to do for the social housing sector and how you are going to build all these great new houses. Over 3 years you have put on the table only enough to build 100 extra houses.

What else did the Budget announce? It announced $80 million to pay the Ministry of Social Development to do the eligibility assessment work that Housing New Zealand was doing out of its baseline until recently. Nick Smith is putting more than double the amount that he has given to the social housing sector and is paying a cash grant to Ministry of Social Development bureaucrats to do the eligibility assessment work that Housing New Zealand used to do out of its baseline. How unbelievable. On top of that there is $16 million—again, not to build houses, not to help first-home buyers—to pay the Ministry of Social Development to kick pensioners and disabled people out of their State houses. That is the National Party to a T. One of the big announcements of its Budget housing policy is to pay Ministry of Social Development $16 million to kick people out of their State homes because they have committed the crime of earning enough as a household to afford a market rent. That says it all about housing policy under Nick Smith.

But this Budget should not surprise us. It is just the latest cop-out from a Government that has done nothing of substance to tackle the housing crisis. All it has got is a lame Auckland Housing Accord with Auckland Council that will deliver on its own numbers through the special housing areas, which is the centrepiece of this so-called housing accord, 5,500 houses over the next 3 years—5,500 houses in the housing accord over the next 3 years. Yet what Auckland needs is 39,000 houses over 3 years. It needs 13,000 a year just to catch up on the backlog and to meet projected demand. In the face of surging inward migration it is going to be virtually impossible to meet that demand and yet that is all the Government has: a lame housing accord. The market alone is almost meeting the unambitious targets that Nick Smith set for the Auckland Housing Accord.

What else has the Government got? I do not know. It is very, very hard to put your finger on. The Minister of Housing is bringing a bill back to the House this week about development contributions, which basically consists of telling councils they cannot ask developers who are building a new residential subdivision to contribute to community facilities that will be needed in those new communities like swimming pool, like halls, and like community centres. And, under this Minister, his idea of trying to reduce development contributions is forcing ratepayers to pick up the tab and subsidise new developments. That is as creative and bold as this Government gets when it comes to housing affordability.

Labour’s agenda is to build 100,000 affordable homes for first-home buyers. We will use the resources of Government to intervene in what is a case of market failure. The housing market is market failure. Labour will intervene. We will address that market failure and we will stand up for first-home buyers by building 10,000 affordable starter homes every year. Our monetary policy upgrade will lower interest rates, unlike what is happening under this Government. It is going up over 2 percent according to the Reserve Bank over the current period—2 percent. It will add thousands of dollars to the mortgage repayments of struggling Kiwi households. We will set minimum standards for healthy homes. We will make it a requirement that all private rental properties are warm and dry.

Our capital gains tax—supported by almost every mainstream economist in New Zealand now, but not by this National Government—will take the steam, the speculative heat, out of the market. According to an economist in the New Zealand Herald today, Dominick Stephens from Westpac, Labour’s capital gains tax will reduce the value of a rental property for an investor vis-à-vis an owner-occupied property by 23 percent. That is substantial and the Minister has nothing to say to that. We will put a stop to foreign buyers and offshore speculators bidding up the price of houses out of reach of Kiwi first-home buyers. There is a problem in the housing market whether the Prime Minister wants to believe it or not. This is a housing crisis and Labour has a plan to fix it.

LOUISE UPSTON (National—Taupō): It really is a pleasure to rise and speak in the Budget debate today. On just Thursday last week, the sixth Budget was delivered by the Minister of Finance, the Hon Bill English, and judging by not my personal views but the views of the people I represent in the Taupō electorate and actually wider than that across the Waikato, the feedback has been absolutely phenomenal. It is really interesting because the word that comes up time and time and time again is very much and very clearly that this is a Budget aimed at families.

What have we heard from members on the other side? The speaker immediately preceding me, Phil Twyford, talked about housing. The Opposition has this myth about housing. I just want to put two statistics on the table. The first is that if you look at the rise in house prices under Labour’s 9 years in office, 96 percent was the increase in the average house price. In our term of office, it has been 22 percent—that is, 96 percent compared with 22 percent. So I am not quite sure why that side of the House goes on and on and on about housing when, actually, it had many opportunities and did nothing. The other one is interest rates. During our time in office, we have seen interest rates at the lowest they have been in 50—50—years. That is one of the biggest costs that contribute to housing.

I wanted to start by just refuting some of the comments by the speaker before me but, actually, I want to focus my attention on the things that matter to New Zealanders. Comments have been coming back to me over the last few days, literally in only the few days since the Budget went out there. It is absolutely amazing how many people have come up and commented on how pleased they are—

Phil Twyford: Family members don’t count, Louise.

LOUISE UPSTON: —particularly about the half a million dollars that has gone into families. You know, there are a few little, cynical barbs coming from across the House. Well, actually, let us talk about the real issues. At the Women’s Lifestyle Expo in Hamilton, which actually used to be a Labour heartland—used to be—

Sue Moroney: Still is.

LOUISE UPSTON: No, no. I have to tell you that the feedback at the Women’s Lifestyle Expo in Hamilton on the weekend was absolutely amazing. People lined up to get information from the National Party MPs who were there, and there were many of us there over the weekend, and—

Sue Moroney: You mean the Young Nats boys?

LOUISE UPSTON: Yes, Ms Moroney does not like the facts. Some of us were there for hours on end and, yes, we were listening to the comments of the people of Hamilton, in particular of the women of the Waikato. I can tell you that the thing they talked about more than any other issue was our announcements about families, about the fact that we have got free general practitioner visits and prescriptions for children under 13. I can tell you that when I sit in my electorate office in places like Tokoroa and talk to families and constituents, they do not want to have to think twice about whether or not they can afford to take their children to the doctor. And with this Budget, we solved that issue for them. We have got a fantastically upgraded medical facility, an integrated health centre, in Tokoroa. But, actually, we want them going to general practitioners instead of ending up in hospital with severe issues. Where we have a high incidence of rheumatic fever, we want those issues addressed by an early visit to a general practitioner rather than having a parent of a child asking themselves whether they can afford to take their child to the doctor today. So that is the feedback that has come from on the ground, which I think we should be enormously pleased with.

The other issues that got quite a good airing last week were around our 4 weeks of extra paid parental leave, and our extensions to the parental tax credit. The thing we have not talked about a lot so far is the extra support for vulnerable children. Again, this side of the House has put an enormous amount of work into trying to solve and deal with the most difficult issues of some of our families. Far from what the other side would accuse us of, we are tackling, with Minister Paula Bennett, the hardest end with some of the most vulnerable families. There is $33.4 million extra going into supporting these vulnerable children with Children’s Teams. We have eight additional teams, and they are intensive, wrap-around, and working with children in a way that no other Government has had the foresight to work, really—I was thinking of other words to use, and there are words that you are not allowed to use in this House, so I will not use them. It is so intensive, and these are the teams that are working with the most vulnerable children. So while that side of the House tosses out phrases about children living in poverty, this side of the House is actually putting money into that and doing something about it.

Sue Moroney: But do they?

LOUISE UPSTON: Oh, but that side cannot cope with that.

Another significant area of investment is, of course, education. There have been many times when I have spoken in this House about the importance of education, so it is fantastic that this year’s Budget again has put more money into education, invested more in education. One of the areas in particular is early childhood education. Again, unlike any other Government before us, we have actually set targets. We have set Better Public Services targets that we allow the public, basically, to measure our performance on. If we have a conversation about early childhood education and participation, we have said 98 percent of children, because that is right. If you talk to any teacher in any classroom, particularly those who teach new entrants, they will say that the biggest difference in their classrooms is having a higher number of 5 and 6-year-olds who have participated in early childhood education. So if we can get them on to an equal footing at the start, then they have got the best opportunity of doing well.

Actually, there were a couple of people on Sunday afternoon who were early childhood education teachers, and, of course, they were thrilled at this announcement. They were absolutely delighted that this money is going into centres—$155.7 million invested directly into early childhood education centres. So, no, we do not just set these targets; we look at what is needed to achieve those targets, where we need to put the focus, and what we need to do to make sure that we are lifting our early childhood education participation rates.

I am going to give you another example of where this Government has set a target—where we have allowed ourselves to be measured on something. Then I will look at where the investment in this Budget, which is so focused on families, backs that up. The example I want to give is the National Certificate of Educational Achievement (NCEA) level 2 and our achievement target of 85 percent. It is fair to say that some of the schools from one end of the electorate of Taupō to the other have had quite a gap to achieving that level—quite a gap. One school, for example, in 2003 had 28 percent achieving NCEA level 2. Now it is 93 percent. That is a massive achievement—a massive achievement for its students. It is focused on 100 percent, and that is what is doing it.

So when you talk to schools around the electorate about the additional $284 million for schools, classrooms, improvements to school properties, and putting more money into home computers for digital literacy for those very same low-income families—and this is actually a decile 2 school I am talking about. I am not even talking about decile 5, 6, 7, or 8; I am talking about a decile 2 school that has had significant achievement, going from 28 percent to 93 percent, and, yes, with a high number of Māori and Pasifika students, who are achieving, who are doing outstandingly well in their results in Tokoroa. Tokoroa High School is just an absolute standout. It knows that this Government is investing in the things that matter to it, and it is focusing on lifting achievement for each and every one of its students. It is getting results. It is having stunning results.

Another thing that has not had a lot of attention so far and that really does make a difference to New Zealand families is the investment we are putting into cancer services: an additional $33 million. Only a month ago another of my family members was diagnosed with cancer, and I have said “another” very deliberately, as I am sure that many members in this House have had direct family members diagnosed with cancer. The thing that you want to know is that your family members are able to be treated quickly and swiftly, and, first of all, that they get the diagnosis and then get the treatment they need. So another $33 million—this side of the House is putting money where New Zealand families want it. Thank you.

METIRIA TUREI (Co-Leader—Green): Tēnā koe, Mr Assistant Speaker. Tēnā koutou e te Whare. Bring on 20 September, I reckon. Bring on 20 September so New Zealanders will finally have the chance to absolutely and without question reject John Key’s exclusive Cabinet club economy—an economy that we have seen laid out in this year’s Budget. What a disgrace. What a disgraceful Budget. New Zealanders will have the opportunity to instead have a genuinely progressive Government, of which the Greens would be a part, to build a smarter, greener, and more compassionate future for our country, a future from which we will all benefit, not just the wealthy few.

If this had been a Green Party Budget—and we expect that in time we will be able to say that with absolute certainty—we would have set out the steps to enable a living wage for every working New Zealander. If this had been a Green Budget, we would have removed the discrimination in the Working for Families tax system that leaves out from the benefits of Working for Families those families who are most poor. Do not forget that this Budget reinforced the discrimination against New Zealand’s poorest children with the criteria for the parental tax credit. But the Greens would remove that discrimination because we believe that every child, regardless of their parents’ income, is entitled to a good life and a fair future.

If this had been a Green Budget, we would have implemented our “schools as community hubs” policy, a dedicated school nurse in every low-decile school, free after-school care, and free holiday programmes for kids so that they can keep and maintain their learning through the holiday periods. We would have implemented a school lunch fund so that every low-decile school could provide lunch to their kids as they see fit, whether it is through community gardens or working with their local community, devising community solutions to community-defined problems. We would have implemented a school hub facilitator in every low-decile school so that school teachers and principals are relieved of the burden that they face every day in dealing with inequality and poverty with their kids. Instead, there would be a full-time person whose job it is to find those social services that would work best with that school community to help remove the barriers that children face every day when they are sick and poor and hungry.

If this had been a Green Budget, we would have made a significant investment in safe cycling and walking infrastructure for our kids so that we would all know that our kids could walk and bike to school safely. Who in this country does not believe that children should be able to walk and bike to school safely, just like we used to in the old days? We were all walkers and bikers. I remember walking to school. But parents are too frightened to allow their kids to walk and bike to school these days. Why is that? It is because we have not built the separated cycleways that would mean that our kids could get to their schools safely every day. We know that kids want to walk and bike to school. We know that they want to be with their friends, out and about, and getting physical exercise. We know that it is good for reducing congestion in the morning. A Green Budget would have delivered the steps to achieve that for our kids—their safety and a reduction in congestion.

If this had been a Green Budget, we would have implemented the NZ Power solution to bring down power prices and the power bills of New Zealand households by $300 a year. We know that families are really struggling right now to pay school fees, to pay the power bill, to get healthy food, and to pay the rent or pay the mortgage. A Green Budget would have dealt with those problems that our families face every day. One of those solutions is implementing NZ Power to bring down the price of electricity for families.

If this had been a Green Budget, we would have introduced our Home for Life policy, which is about building new homes in this country. That is a consistent State house - building policy to create jobs and build skills for our young people, to build homes for all of those families who need them, and to bring in a progressive ownership scheme that allows for a person to be able to slowly buy their home from the State over time without a mortgage and without debt, just like many of our parents did through the old family benefit or the old State loans scheme.

Safe and secure tenure for tenants is another core part of our Home for Life programme. We would have eliminated by now those ridiculous renewable tenancies that throw families, older people, and children out on the street. Instead, we would have brought in secure tenure for renters so that they know they can have pride in their home and they can invest in their home—even if they are renting it—because they know that they are secure in their home and have a right to stay. And we would have brought in a warrant of fitness and a home insulation scheme so that every New Zealand family would know that their home was warm and dry and safe for them and for their kids. That is the kind of security every family needs if they also want to make sure that their children have access to a great education at their local school, which they would know is consistent and secure too.

I guess it is no surprise that John Key and Bill English and the National Party did nothing for housing in this Budget. It is the great and glaring hole that at the time of a national housing crisis John Key, Bill English, and the National Party did nothing for housing in this Budget. John Key, of Cabinet club fame, thinks that homes in Auckland are more affordable than homes in London and New York. He was on the radio yesterday talking about how he had lived in those places and he had visited those places overseas and that Auckland was not any more expensive than the homes he had looked at. Well, I guess it depends on the kinds of homes he was looking at. The OECD’s actual evidence—research-based evidence—shows that, in fact, Auckland homes are grotesquely expensive compared with those in these overseas cities. So is that really what we have now, a Prime Minister who, because of his own personal experience of buying homes in other countries, believes that he knows all about what it is really like for a young family on a median wage who are just trying to get into their first modest three-bedroom home? This Budget proves that he does not have a clue. This Budget proves that John Key is staggeringly out of touch with ordinary New Zealand families who are facing the housing crisis every day.

John Key will argue that he has been terribly generous. He has, of course, brought down the cost of nails, for example, for those people who might be lucky enough to be able to afford to build their own home. How generous! New Zealanders, do not forget this! Be thankful, New Zealand, because John Key and Bill English have brought down the price of nails for you! That is their great contribution to the housing crisis—bringing down the price of nails! We had better all be thankful and grateful for it, while everybody who is desperate for a decent home is out there scrambling around to save as much as they can on low wages while kids are getting sick in homes that are too expensive—too expensive to rent, too expensive for mortgages, too expensive to heat—poor quality, and making them sick. Be thankful, New Zealand, says John Key. In his experience of living in London and other places, New Zealand and Auckland are not that bad.

Perhaps what we need in this place is a new Government that does understand what it is like for ordinary families who have to get by on an ordinary income and who want the security of a home that they can be proud of, who want to have access to a home that is warm and dry and safe and will not make their kids sick, who want the security of being able to either be a tenant for long periods because they have a secure tenancy or perhaps buy that little patch of Aotearoa New Zealand that they can call their own—that is part of the Kiwi dream—so they know that they will be safe and secure and so will their kids. Why is that so difficult for this National John Key Government to understand? Why is it so difficult for this National John Key Government to take seriously and understand that this is a real difficulty, a real crisis for New Zealand families? What we have is a Government that refuses to even acknowledge that the crisis exists.

The Green Party will deliver a Budget that will deliver for our families after 20 September, after the election. Party vote Green. Thank you.

PAUL GOLDSMITH (National): It is my pleasure to speak in this Budget debate. I must say, it is rather galling to listen to a lecture from the previous speaker from the Green Party, Metiria Turei, lamenting house price costs. That is a party whose very essence has been all about squeezing and putting urban limits round cities. It is all about making sure that Auckland cannot grow, because it is determined to squeeze everyone into a small, compact city that is all about people getting on their bikes, which would lead inevitably to a massive increase in the cost of houses in Auckland and artificially increase the value of land in Auckland hugely.

Yet she has the gall to say that we do not care about housing affordability. It is people of her ilk who have caused a big part of the problem in Auckland. This Government and, in particular, Nick Smith are doing an excellent job at unravelling that problem and are working closely with Auckland Council to get a greater supply of houses, which will make a difference to the affordability of houses and will really, really change things. The Green Party also opposes any changes to the Resource Management Act. It opposes those changes. It always wants to add as many costs as it possibly can around heritage, around any aspect of housing. It is the party that wants to add costs, yet here it is lecturing us on housing affordability.

I am very keen to talk about this Budget, which, as part of the National Government, I am proud to be associated with. It is a Budget that is about managing a growing economy. When we look at what we have achieved, it is about locking in gains from higher growth and more jobs. We are expecting, as this Budget outlines, another 172,000 jobs in the New Zealand economy by 2018. We have seen average wages go up by $3,000 in the past 2 years. Under this Budget they are forecast to grow another $7,600 to $64,000 per annum as the average wage by 2018. I think we have got a lot to be proud of there. We have seen lower cost of living increases. Wages will be growing by about 14 percent to 2018, but we expect inflation to be less than 10 percent. So that is actually how you improve the standard of living in this country: you get wages growing faster than inflation. We have also had the ability to invest in children and in families, with a $500 million package, which I will talk about later.

Let us have a look at some of the figures. We have a very positive outlook for the economy, with growth expected to rise over 3 percent—and rising at close to 4 percent in the next little while. That stands us in excellent stead in the OECD and amongst developed countries around the world. The New Zealand economy is growing well. The challenge that we have set ourselves is to extend that period of growth so that it is sustainable over a longer period. As always we have the Treasury forecasts that have us dropping back down to 2 percent next year, because Treasury worries about the sustainability of growth in the New Zealand economy. Our challenge in all the work that we are doing around the Business Growth Agenda and all the work of the Government is to try to extend that period of growth so that we can sustain 3 percent growth for a longer period and really increase the living standards of New Zealanders.

I just want to have a look at the unemployment rate. We heard Mr Cunliffe a couple of weeks ago going on about how he had promised to get the unemployment rate down to 4 percent if he ever got near Government. Well, lo and behold, if we look at the Budget forecasts, we see it is forecast to be 4.4 percent in late 2017. So we are actually on track to make excellent progress on reducing unemployment, but the main thing, of course, is that employment itself is up magnificently. So there are more people working hard with the opportunity to do well for themselves and their families and to receive those higher annual wages.

Every Budget cycle we have a lecture from Mr Parker about the woes and perils of the current account deficit and how bad New Zealand’s deficit is and how badly we are doing. Well, actually, if we look at this Budget, we are not doing too badly on the current account deficit. It is going to be less than 3 percent of GDP.

Hon Phil Goff: Look at the projections.

PAUL GOLDSMITH: And, yes, Mr Goff suggests that the projections are not looking so good. If we look at the projections of the Budget in 2010, Treasury was forecasting us to have a current account deficit this year of 7 percent of GDP. Oh dear, it got that wrong, did it not? Treasury has form in being overly pessimistic about current account deficits in New Zealand. This Government has actually been very successful in doing what it can to encourage export growth and a good net balance of payments, which is putting us in good stead long term.

It is true that this Government has very substantially increased net core Crown debt in the last 6 years. It will be peaking at $65 billion. We have done that very deliberately to protect the vulnerable in New Zealand through a difficult time. Again, we have had a lecture from Mr Parker. Like a cracked record, he is always talking about inequality. He seems to forget the massive redistribution that we have in this economy, which has over the past few years been funded by debt, in part. We have a situation at the moment where 12 percent of the households in New Zealand pay 76 percent of the income tax. Is Labour saying that is not enough? What would be enough? Is it really advocating that perhaps that 12 percent of households should pay 90 percent? Or maybe they should just pay 100 percent—why not? In fact, why be so bold as to say it is only 12 percent of households? Why do we not just get the top 1 percent of households paying 100 percent of the tax and be done with it? I think that has been tried in other countries like Russia, but I think that is what Labour thinks.

What we often forget about when we talk about income redistribution and poverty in New Zealand is that roughly half the households, particularly if they have children, pay very little or no income tax after Working for Families is taken into account. As well as paying little or no income tax, they receive basically free health care, they receive free education for their children—high-class , First World education. We also receive superannuation when we retire. All of that is on the back of a highly redistributive Government system. That is something that we as New Zealanders are proud of and it is part of the reason why we have a highly successful society and culture. I do not believe for one moment that we should listen to lectures from Mr Parker saying that the solution to all our problems is even more redistribution.

Moving on to responsible Government spending in this Budget, this Government has an exemplary record over the last 6 years of responsible Government spending. If we look back at that terrible period of the Labour Government in the 2000s, we heard another great diatribe from Mr Cunliffe—I have not seen him recently—where he told a whopper and said that under Labour there were nine surpluses in a row. What a load of nonsense. The last Budget that Labour was responsible for in 2008 led to a $3.9 billion deficit, and that was largely because it had increased spending by 12 percent in 1 year—12 percent in 2008—with $7 billion of extra spending. Well, this Government has not been able to continue doing that, and there is no way the economy would have survived if we had continued to do that.

We have had new spending in the Budget of less than $1 billion a year over the last little while. The main consequence of that is that we are back in surplus and we have been able to keep interest rates lower for longer. We have had the lowest interest rates in 50 years. Yes, they are starting to go up at the moment, but only from a very low base. When we talk about housing affordability in Auckland, that is the most important aspect. If you have the ability to borrow when interest rates are at around 6 or 7 percent, that enables you to borrow money and buy a decent house.

And, yes, there is no question that people in the area where I come from, Epsom, are worried about housing affordability. That is why the Government is paying an enormous amount of attention to the issue. It is why we are focusing so hard on getting the supply of new houses and land availability up so we can reduce that pressure. It is why this Budget reduces some of the costs of building materials. It is why we have got a bill coming through the House at the moment trying to restrain development contributions, which in some councils have been like a runaway train. It is why we are trying to reform the Resource Management Act. We are not being helped by members on the other side, who cry crocodile tears about wanting to increase housing affordability but do nothing about it. It is why we are determined to keep interest rates lower for longer. On that basis I do commend this Budget to the House. Thank you.

DAVID SHEARER (Labour—Mt Albert): That was a fine speech by the person who should be the member for Epsom, Paul Goldsmith. He should have been elevated in the last reshuffle that Mr Key did, rather than Nicky Wagner. How he missed out I do not know, when he did his best not to win Epsom. Why was he not elevated up the rankings?

He did touch on two or three issues that I think were relevant. He touched on the current account deficit—the worst in the Western World, worse, even, than Greece’s. Good on you for bringing that up. He also brought up the issue of Government debt, which is currently at $60 billion—$60 billion—and that is the result of having to finance five deficits in a row.

I congratulate Mr English on his sixth Budget, his final Budget in his position in office. He finally gets it right and he crawls across the line and gets us into a Budget surplus. The margin of error is really why he got across. The Government had to cut things, it had to put things on 4-year time horizons in order to be able to get across the line, but he managed to do it with the last and final Budget that that man will ever deliver to this House. He will never be able to replicate nine Budget surpluses in a row, which the Labour Government was able to deliver year after year after year.

What is the reality here? The reality is that despite all the crowing by this Government, people are not doing as well as they want to. What we are seeing is that the increase in wages over the past year, the average increase—including all those rich listers who get factored into it as well and who bump up the average—was just 1.6 percent, whereas inflation went up 1.5 percent. So we are seeing a 0.1 percent increase in people’s real wages. Forty-six percent of New Zealanders did not get any wage increase over the past year—46 percent. So when you are asking who is benefiting, the great bulk of New Zealanders, the great bulk of Kiwis who are out there working hard, trying to bring up their families the best way they can, are not benefiting. Instead, the people who are benefiting are those who could afford to buy some time with a Cabinet Minister or who belong to a Cabinet club so they can get preferential access to people whom nobody else would ever have a chance to meet. That does not feel right to me, and it does not feel right to most New Zealanders out there either.

We want to help people who are working hard to get ahead, and we want to help them particularly in the area of housing. A family I know—a husband and a wife and two kids—were renting a house close to inner city Auckland. They were saving like crazy to try to buy their own house. What they were doing to it as they were going along, because they wanted to live in a decent home, was they improved that rental property they were living in. They painted it, put in a vege garden, and made a whole bunch of different improvements to the place. What happened? The landlord chucked them out, gave them notice, and put in another family at a much higher price, off the back of their hard work. So they went further out in Auckland because they could not afford to be in the same place as they were before, so their kids had to go to a different school. And what happens? They save and they save and they save to try to get there. They are improving that place as well, but they tell me that they cannot get ahead. They just cannot make it, because as they are saving, the prices of houses are getting beyond their reach.

A guy came up to me the other day when I was in one of my local markets and said: “I’m a 42-year-old teacher. I earn a reasonably good living, but I will never be able to buy a house, and it is a really sad fact that I’ve actually come to that conclusion. I’ve flatted with other people. I’ve saved as much as I can. I’ve cut out all the luxuries in life so I can try to get ahead and get a house, but I do not believe that I will ever be able to afford a house, despite my parents saying that that is what I should do.”

That is what it is all about. It is about a Government that will give opportunities to Kiwis and New Zealanders and that is able to give people what I believe they deserve and what is a birthright for us, which is the ability to own your own home. You know, despite the fact that the prices are going through the roof, you have got the incredible statements by John Key that there is no housing crisis and there is no problem. I quote what he said: “there’s no fundamental underlying reasons to believe there’s a problem in our housing market”. Well, three-quarters of New Zealanders do not believe him—

Hon Dr Nick Smith: Finish the quote.

DAVID SHEARER: —and three-quarters of New Zealanders do not believe Nick Smith either. Let us take a look at the facts.

Hon Phil Goff: At least 80 percent.

DAVID SHEARER: Eighty percent. I was going to say 76 percent. I was even conservative by saying “three-quarters”, which is 75 percent, but it must be—

Hon Trevor Mallard: It’s moving.

DAVID SHEARER: It is moving all the time, you are absolutely right—just like house prices in Auckland. The average house price in Auckland now is $700,000. That is the average house price. And this Government has now ensured that people will have to have a 20 percent deposit to get into one of those houses. Well, do the maths around that. That is a $140,000 deposit that they are going to have to come up with in order to get into an average house in Auckland—$140,000. Who on earth can afford that? Does that sound like anything that a first-home buyer could ever afford?

House prices are going up. They have gone up 22 percent right across the country and 40 percent in Auckland. And when you put that to this Government, what is its reply? That houses went up a bit more years ago. Well, how about taking responsibility for what is going on right now? You have been in Government for 6 years now. You saw this coming and you did nothing. And if this Budget is anything to go by, you are still doing nothing, because a $3,500 saving on building materials, less than 1 percent of any house that is being built, does not go anywhere near to solving the problems.

We have a real solution to our housing crisis. We are willing to take the courageous, brave decisions that need to be taken. We are willing to get in there, roll up our sleeves, and get stuck in. So what are we going to do? Make a real difference. We will build 100,000 houses over a 10-year period. We will use the economies of scale to be able to keep those houses cheap enough for ordinary New Zealanders to get into. We will raise a capital gains tax. Anybody would tell you that taxes are not the sort of thing you want to introduce, but three-quarters of New Zealanders actually believe that it is the right thing to do. Today in the paper Westpac’s economist said that a 15 percent capital gains tax would reduce the amount of speculative value in houses by 22 percent. Why does this Government not listen to all the objective advice, rather than listening to its own spin?

We will limit offshore speculators, which the Government does not even want to measure, because it does not want to know what we already know, that these people are driving up prices. If you ask anybody who goes around to auctions in Auckland and ask them about speculation, they will tell you that there are lots of people out there who certainly are not New Zealanders and who are out there speculating. In Auckland, 2,750 homes were bought by foreign speculators in a year, and we build 4,000 homes a year. Three-quarters of all those homes are actually nullified by the fact that people are out there speculating.

We will bring in loan-to-value ratio restriction exemptions so that although Auckland and Christchurch might have a loan-to-value ratio restriction placed on them, at least let the people in the rest of New Zealand off those restrictions, so they do not have to have a 20 percent deposit in order to be able to afford their own home. And we will bring in healthy home guarantees so that even if you are in rental accommodation, you will be able to have a warm, dry home. They are real solutions, and that is what Labour will deliver on 20 September.

Hon PHIL HEATLEY (National—Whangarei): It is a delight to stand today and support my colleagues John Key and Bill English on a very, very good Budget indeed—a Budget that shows clearly that New Zealand is heading in the right direction. We have managed to walk the country through the worldwide recession, the economic crisis, of several years ago and help bring New Zealand out the other end, with the hard work of many businesses across the country and their employees. It has been difficult for everyone. Every family in New Zealand knows of someone—if not in their own immediate family—who has struggled getting work and who has looked overseas and seen the difficulty in other countries like Australia, England and other parts of Europe, America, and Japan. Everyone knows it was a difficult time everywhere in the world, and yet it is New Zealand that is now ahead of the pack, leading the way, and showing that we can, by going forward with sensible Government spending, get a surplus in this, our fifth year, our fifth Budget, and make sure that we have got a good platform to grow going forward. So Budget 2014 reflects 6 years of hard work by the Government and by those businesses and those families, and this is a Budget focused on growth.

Denis O’Rourke: Five long years—nothing on housing.

Hon PHIL HEATLEY: During that difficult recession, of course, people in the New Zealand First Party and the Labour Party thought the best idea back then was to spend up large. That was what they were going to do: throw lots of cash around New Zealand, have Budget after Budget where there was a lolly scramble, and have multimillion-dollar spending in order to stimulate the economy. That was their idea.

They got those ideas from a number of countries throughout the world, and what has history shown us? It has shown us that prudent spending, stopping spending on programmes that were taking us nowhere, and redirecting that spending towards sensible investment in things like roads, electricity generation, and infrastructure like broadband, was the way to go. Those big spend-up countries and those countries that the Labour Party and New Zealand First wanted to mimic are the ones struggling now. We only have to look across the Tasman and right throughout Europe, America, Japan, and those other countries that I noted. It did not work for them. The Labour Party’s strategy did not work for those countries and it would not have worked for us. The National Government’s strategy of better directing spending in areas where investment was required was certainly the way to go.

But that is not the whole story of the last 5 years, though, is it? There are numerous examples where Bill English and John Key decided to spend money directly in areas that the Labour Party had ignored. I will give three examples. They are stunning examples when you think about them, because they are areas of spending that you would normally associate with the Labour Party and its compassion. The first one—and members will cast their minds back—was when the Labour Government turned its back on women with breast cancer and said that it would not fund Herceptin. Do you remember that? The Labour Government said that it would not fund Herceptin for women with early-stage breast cancer. It turned its back on those women and said it could not be done, it would not be done, and it should not be done, and it was not done. What happened was that we came into Government with a worldwide recession and our books looking bad, and said “Well, wait a minute here. Let’s just check our priorities.”, and John Key insisted that funding for Herceptin be provided, even with that economic backdrop. Where was the Labour Party? Why are Labour members not shouting now? Why have they gone so very, very quiet? I am up to only example one.

Example two: do you remember the Labour Government and the Green Party waxing lyrical about the wonderful idea of funding the insulation of households right across New Zealand? “We should do it.”, they said. For 9 years they trumpeted this idea. They did studies on it, they had committees on it, they ran commissions on it, and they wrote policy on it. There were 9 years of discussion. Did they insulate tens of thousands of homes? No, but they had a wonderful conversation. We came into Government, and John Key, Bill English, and the team insisted on insulating people’s homes throughout New Zealand. So what did we do? First of all, we have insulated every single State house in New Zealand that can be insulated. Why did the Labour Government not do it? Why are members opposite so quiet now? We insulated private homes, funding them with thousands of dollars, and we have got tens of thousands—in fact, I think it must be up to 140,000—private homes and rental properties across New Zealand that have been insulated through the Government’s insulation scheme.

So there you go: the Labour Government would not fund Herceptin when the economy was going well across the world, but the National Government funded Herceptin when things were tough, because we knew what the priorities were. The Labour Government would not fund the insulation of private homes across New Zealand. It would not even fund State Houses—the ones the Government owned. Labour talked about it for 9 years, and National comes in with a worldwide recession and funds the insulation of not only State houses but private rental properties as well.

I would like to give the third example of where the Labour Government was. I recall, as a young lad, when the National Government, along with New Zealand First—its members had some ideas back then; they were young, and they had some fresh ideas—introduced free general practitioner visits for under-sixes. Do you remember that? I do not know why Labour never introduced that 10 or 20 years ago. I would have thought it was in its territory. Anyway, the National Government did it.

So what do we discover in this Budget? Rather than Labour introducing something that you would think was its core concern, we, in this Budget, the first time we reached a situation where we have got a surplus, decided to raise the age to 13. So now we have free general practitioner visits for under-13-year-olds right throughout New Zealand. There is nothing stopping any parent or grandparent across New Zealand taking their under-13-year-old to a general practitioner, and it will be funded. So there you have it. In the times when the worldwide economy was doing well, the Labour Government, through 9 years, refused to fund Herceptin, refused to insulate State houses and houses across the country, and never even considered raising the age of funding free general practitioner visits for children up to the age of 13. We have had the worldwide recession, we are just coming out of it through good economic management, and over that period—I just gave three examples—the National Government has stepped up and funded the programmes that deliver benefits to New Zealand and that matter.

Why is it that we, as a National Government, can behave like a typical one—manage the economy well, manage law and order well, and manage all those things well—but we are also in Labour territory, doing so well for education, so well for health, and so well in welfare? I can say only this: the Labour Party has lost its way. It needs to spend some time studying our policies, and to take some of our ideas and perhaps improve on them, if that is at all possible. I commend this Budget to the House. I will be voting for it enthusiastically on Thursday, and I must say that I am absolutely delighted to be part of this team.

POTO WILLIAMS (Labour—Christchurch East): Thank you for permitting me to add some sensible discussion to this Budget debate. I want to talk specifically on housing and the issues we are facing in Canterbury, and on some specific issues relating to those of us in Christchurch East. When you have come from a base of having lost in the region of 10,000 to 11,000 homes; when you have come from a base of having lost significant land area on which housing can be rebuilt, according to the current geotechnical information—that is when you are using current building technology, of course—when you are unable to commence any significant work on that land while it is still unstable and shaking and the horizontal services are still being rebuilt in some areas, and then we have got some specific areas with their own special conditions that impact on rebuilding, such as the mitigation of hazards like rockfall or liquefaction and the like; when you have got those issues and then you turn the pressure up; when you develop a structure to rebuild that is accountable to no one but the Minister for Canterbury Earthquake Recovery; when you then develop a mechanism to allocate the work through the Earthquake Commission, which has less accountability to homeowners and local people than the Canterbury Earthquake Recovery Authority has, and it charges for the privilege on the way; when you have totally missed the boat on the number of people needing temporary accommodation; when you are not looking at the patterns of short-term tenancies that then become longer term as the repair phase transitions into the rebuild phase for homeowners; and when at the same time you cut the funding to the temporary accommodation services by two-thirds—two-thirds—this intense pressure upon the rental market has elevated our rental costs and accommodation costs to unprecedented levels.

Many of those rentals are in the “as is, where is” category, whereby cash-settled homeowners have taken the money, not repaired the homes, and let some other family that is desperate for a roof over their head be forced into homes that would not meet any kind of warrant of fitness standard. And we still have people waiting in the queue to have their claims resolved, with the threat of cash settlement being thrown at them regardless of whether they want a cash settlement or not. Then there was the Budget announcement that the appropriation allocated to Canterbury to support the rebuild is slashed. We can add to that the 3K to Christchurch scheme, where the PM , in answer to the question “And where are these people going to live?”, said that they can sleep on the couches of friends or family. I can tell you now that a couch is not even the last resort for many people in Canterbury. In order to get priority A on the waiting list for social housing, you cannot be on a couch or even in a garage—no. As reported in the Press a few weeks ago, in order to make that priority waiting list you have to leave your cosy garage and live in a car. There are housing developments, sure, such as Prestons and Wigram Skies , but neither of those is the size or type that could be called affordable. So our people have been totally left behind in order to scrape together the slimmest of surpluses.

So you might ask what should happen, what should have happened, and what we will do. Our people in Canterbury should have been the first option to upskill to take advantage of the work—Cantabrians rebuilding their region. How powerful is that message to send to the region that you are in charge of the recovery of your city, your town, and your region? Then match that with the need to bring people into the region to support the local workforce. We will have a supercharged programme to build houses—100,000 around the country, but front-loaded into Canterbury—because the issue is one of supply. It would not be mechanisms that let the market dictate, but construction on a scale not seen in this country since the first time a Labour Government addressed a housing crisis in this country. We will have 10,000 affordable homes in Canterbury, utilising the best in the business, with construction methods that will see homes up on site within a few weeks. That will support our local manufacturers and suppliers, utilise locally sourced materials as a preference, and ensure that we use green technologies. We will build strong partnerships with the community housing providers, increasing the number of social and State houses, utilising transfers of housing stock and income-related rent subsidies. From the Government’s own figures, up to 7,400 people are homeless in Canterbury or are living in substandard accommodation. That is why we will front-load KiwiBuild with 10,000 affordable homes to be built in our first 4 years in office, and why we will take an urban development approach to the revitalisation of New Brighton and the city centre.

But we do not look at housing in isolation. Our economy needs to be one that supports development at this level, with a capital gains tax and KiwiSaver contributions supporting investment in this country, growing the manufacturing and production sectors to provide jobs—better-paid jobs—and taking people off welfare dependency. We will have a capital gains tax that will take the heat out of the housing market, and Labour’s monetary policy changes, which will lower interest rates. We need jobs and better income for young people who are currently locked out of the housing market by loan-to-value ratio restrictions, and we need jobs and income for people struggling to pay crippling rents and living in substandard accommodation. Well, not with our healthy homes guarantee, which means certainty in the standard of housing in the rental market, and certainty will be returned to those who need help with housing. The waiting lists are too long and the criteria are too extreme. There should be no one living in a car, let alone young women with children and babies. There should be no one in garages, especially heading into the fourth winter since the earthquakes. There should be no one still waiting to have their home repaired, especially the elderly and those with illnesses, whose homes should have been the first to be repaired and not the last. We will not mismanage the State housing stock while 5,000 families languish on waiting lists.

We believe that every Kiwi deserves a warm, dry, affordable home so that they can contribute to building a strong community life. We believe that all Kiwis deserve decent and safe jobs that pay a living wage so that families have enough to support their needs and so that our kids can have the best start in life, be safe, be healthy, and be able to fulfil their potential. That is what they deserve and our country deserves, to be able to build its future. Thank you.

Hon MICHAEL WOODHOUSE (Minister of Immigration): On Sunday I had the unusual experience of sitting in the classroom that I occupied at St Patrick’s School in South Dunedin when I was an 8-year-old. I was there with my own 8-year-old. Of course, it was a somewhat nostalgic experience where I recalled the 30 or so classmates who were there. They had a particular feature in common. They were all, but one, Pākehā, and one of them was a Māori. But on Sunday the similar number of kids who were in this former classroom—it is now a community hall—came from all over the world. They were from Viet Nam, the UK, Malaysia, the Philippines, Samoa, Tonga, China, and possibly many other countries that I do not recall—Kiwis every one of them. They had different food preferences—we had a pot-luck lunch—and obviously there were slight differences in clothing, but they were Kiwis. My and Amanda’s daughters will grow up in a country that I think is much more diverse, much more colourful, much more tolerant, and, ultimately, more enjoyable.

So it is incredibly disappointing for me to listen to the discourse that has been going on, after an oblique reference in the Budget documents to a Treasury comment that net migration was strongly positive, from people in this House, unfortunately, but also in the media who are describing that as some kind of migration explosion. Even more so, I think that members of the New Zealand First Party—and I see Denis O’Rourke, who is one of the perpetrators—have engaged in some disgraceful comments and speeches in this House and have taken the opportunity to talk about the “they” and say that there is somehow a peril at work in New Zealand and that it needs to be stopped because they are taking our jobs and they are taking our houses. I think that that is really disappointing and disgraceful.

But, actually, the people whom I am most disappointed in are Labour members, because their leader has engaged in a very subtle dog-whistle to a small coterie of New Zealanders for whom the xenophobic message will still resonate. And it was subtle. [Interruption]

Mr DEPUTY SPEAKER: Order! Interjections will be rare and reasonable.

Hon MICHAEL WOODHOUSE: He said that Labour supports migration; it just needs to somehow control it, although Phil Twyford overreached by saying that a net inflow of no more than 5,000 to 10,000 was the goal. Well, because Kiwis are not leaving, that must have caused members like Kris Faafoi and Raymond Huo, and even Ms Lole-Taylor, to have some serious disquiet, because what that would mean in practice is no more family reunification, no more partnerships, and no more students coming to study at our universities for years at a time.

I am not sure who it is who is the economic development spokesman for Labour at the moment, but that person must be worried as well, because skilled migration is very important. The Canterbury MPs must be worried if that sort of policy is adopted, because they know that their region needs to be rebuilt. Poto Williams is right. We do need to put our Kiwis at the front of the queue for those jobs.

Denis O’Rourke: Nobody objects to proper—

Hon MICHAEL WOODHOUSE: I raise a point of order, Mr Speaker. I accept the comment that you made about interjections being rare and reasonable, but I can no longer hear myself think with those interjections.

Mr DEPUTY SPEAKER: Yes, I am going to uphold that. This is a robust debate and interjections are permissible, but continuously and incessantly calling out is not acceptable, and the member will desist from that.

Hon MICHAEL WOODHOUSE: Thank you, Mr Deputy Speaker. I think that that would really worry the Canterbury MPs, because we know that although the important thing is to get as many Kiwis working on the rebuild as we can, there is no doubt that in order for that to be effective and to create the great city that it can be again, we will need to rely on foreign migrant labour, as we already are.

So the dog-whistle is really unfortunate, it is inappropriate, and it is unbecoming of this House, particularly when the net migration story had nothing to do with migrants. It had everything to do with Kiwis coming home and not leaving. Prime Minister Key, when Leader of the Opposition , stood in Westpac Stadium, which was a very good metaphor for the number of New Zealanders leaving under Labour, and said: “We’ll bring them home.” Now the number of people—

Hon Phil Goff: Oh, come on! Immigration increased in the first 5 years of the National Government. That’s true.

Hon MICHAEL WOODHOUSE: I will come to that, Mr Goff. I will come to that, Mr Goff.

Hon Phil Goff: Immigration to Australia increased every year for the first 5 years.

Hon MICHAEL WOODHOUSE: I will come to that. You have made the point. They started in the Westpac Stadium, now the number of people leaving this country would fit into the Back Bencher Pub and Cafe , and by the end of this year you could probably fit them into a phone booth in Molesworth Street. They have stopped leaving; they are coming home.

I hate to let the facts get in the way of a good rant by Mr Goff. Here is what I will tell him about the Residence Programme. In 2005-06, under Labour, the number of resident visas granted exceeded 50,000. Well, last year it was under 40,000. There was a gross 20 percent reduction in the number of resident visas that were granted, and here is why. A migration policy is a demand-driven policy—

Hon Phil Goff: What was the figure for 2012?

Hon MICHAEL WOODHOUSE: I still cannot hear myself think, Mr Deputy Speaker. It is a demand-driven policy. It is self-correcting in the medium term. If we have fewer New Zealanders leaving and more New Zealanders coming home, then the demand for those skills will be reduced and therefore the number of migrants coming in will drop. And that is exactly what has happened, albeit that I note that there has been an increase in the number of working holidaymakers and in the number of students now, after a reduction. But I absolutely reject this idea of a migration explosion that has dominated the media over the last few days. It is very unbecoming of members in New Zealand First like Mr O’Rourke and Mr Williams to create that dog-whistle to that small group of disaffected New Zealanders who think that it is a problem.

Let us talk about housing. I know and I can tell you that in Central Otago we are short of horticulture workers. Well, the whole Labour caucus should go to Alexandra , because those members would be the best cherry pickers I have ever heard of. They are cherry-picking all of the worst bits about housing. Let me tell the House about housing affordability under Labour, and I am not talking about the last Labour Government. I used to work at the National Bank, and in the 1980s, when the fourth Labour Government was in power, I was issuing mortgages. The A mortgage was 17.5 percent. The B mortgage was 21.5 percent. Those were the majority of mortgages that we gave out. Why would people take mortgages at 21.5 percent? Because they were confident that house price inflation, under Labour, would continue to exceed the cost of the borrowing. That is exactly what we had in the 1980s, we had it in the 2000s, and we will have it again if that party ever comes close to the Treasury benches. You cannot wish interest rates down. It is simply not possible. What keeps interest rates lower for longer are prudent spending and responsible fiscal management. And no pie-in-the-sky monetary policy that wishes interest rates down and takes away the choices of New Zealanders to decide whether they want to save, spend, or invest in KiwiSaver is going to do that.

Yes, there is a housing affordability issue. It is an issue that was 30 percent better under this Government than it was when Labour was in power. Members opposite can cherry-pick all the data they like, because a recent report for Treasury on the issue of migration and its effects on New Zealand’s economy, in saying that there were positive effects of net migration, said that, yes, housing affordability is an issue, but the predominant reason for house price inflation is supply side inelasticity. That is a pointy-headed way of saying that we do not have enough houses and we need to build more. Again, I say to Labour that one could wish 100,000 houses into existence but that does not make it happen. What makes it happen is freeing up land and reducing the burden of resource compliance, development levies, and, yes, the building costs. Members opposite can criticise the $3,500 saving all they like, but it is stacks on the mill. It is one issue at a time.

This was a Budget that delivered very, very good policies that will keep interest rates lower for longer, control spending, increase the value of the services that our Government agencies provide to members of the public, help rebuild Canterbury, improve our education, and improve our health. And it was all done on a reasonably modest increase in the vote. I think that that is what New Zealanders are looking for. That is what this Government had to do, that is what it continues to do, and that is what it will do. I look forward to debating any one of those issues on the hustings in the next few months. This is a really good Budget and I commend it.

DENIS O’ROURKE (NZ First): The Prime Minister says there is no housing crisis. Whom does he think he is kidding? Not the tens of thousands of young people seeking to buy their first home. These are the people locked out of the housing market by at least five forces that the Government has failed to adequately address. First of all, the cost of homes has skyrocketed out of control for more than 5 long years. Second is the lack of land for housing development, especially in Auckland and Christchurch, which the Government did not even notice for the first 5 years. Third is that loan-to-value ratio restrictions are limiting most people to 20 percent deposits. That means that a deposit is something like $80,000, which very few young people are able to afford. Fourth is rising interest rates. Fifth is excessive and badly controlled immigration, which National Governments, of course, especially under that Minister of Immigration over there, are so famous for.

The Prime Minister is also kidding the people of Christchurch who are moving out of that city to Rangiora , Rolleston , and further afield to seek affordable homes and sections. Those who choose to stay or who must stay have a real problem finding an existing home to buy at an affordable price, or they cannot find a section at an affordable price. The progress of repairs to earthquake-damaged homes or in rebuilding destroyed homes is far too slow. The fate of some properties in the Port Hills is still undecided by this Government more than 3 years since the February 2011 quake.

The Prime Minister must also be kidding the people seeking a home to rent, if he thinks there is no housing crisis, especially in Auckland and Christchurch. In Christchurch the rental market is still utterly dysfunctional after 3 years of massive rent increases, which few people can afford, and with a shortage that is getting worse as the influx of people continues to grow demand at an alarming rate. Rents of near to $1,000 per week for a three-bedroom house are commonplace. New Zealand First called on the Government to regulate rents over 2 years ago, but there has still been no action by an uncaring Government.

In Auckland not only has the Government not addressed excessive rentals there but it has made the situation worse by pushing people out of State houses into an overheated private rentals market with its disgraceful social housing policy. In other parts of the country the Government is selling off State houses as fast as it can. That is not a recipe for solving a housing crisis. I ask the Prime Minister: if all of what I have just said is not a housing crisis, then what is it? I know—I know—it is another National Government failure.

The OECD report just released is sobering. New Zealand’s houses are the second most expensive in the developed world, based on price relative to income. Our homes are the most overvalued relative to rents. So it is not just my opinion and it is not just what the people of New Zealand feel; it is what the OECD says as well. So does the Prime Minister really think that if he tells bigger lies about this, the housing crisis, people will suddenly start to believe him? Well, I have got news for him. They will not. Constant denial will not work—not now and not on 20 September either. People looking for homes want action, not some lame excuse by the Prime Minister or by Nick Smith.

The Government’s Budget measures this year barely touch on these crisis-sized housing issues. Its announcement to reduce the cost of housing by temporarily removing duties and tariffs on building materials is a drop in the ocean, saving about $3,500 on the average new home. The cost of homes in Auckland currently is increasing by something like a staggering $6,000 per month, so the Government’s generous $3,500 gift is not much more than 2 weeks of increases.

The Government caused the housing affordability crisis by allowing uncontrolled immigration and letting overseas buyers push up the cost of homes. It waited 5 long years before even recognising the problem, and has still done next to nothing to assist first-home buyers while property prices have gone ballistic. With first-home buyers pushed out of the market by loan-to-value ratio restrictions, young people need a much more stable and strategic approach to the problems of accessibility and affordability of homes, and this Government has no ideas. The Government’s market-based approach cannot work in Auckland, Christchurch, or elsewhere where land availability is not solved just by housing accords or by attacking local government development contributions. Local Government New Zealand figures show that local government development contributions average only 4 percent of the cost of a new home, so, again, there is another drop in the ocean.

What the Government’s attack on development contributions shows is that it does not really know what to do about the housing crisis, and, what is worse, it does not really care. So in the absence of any worthwhile ideas, Government Ministers simply deny that there is a housing crisis. New Zealand First has been saying so for the last 2 years. We have argued for the last 3 years that immigration was a problem. I have asked questions in this House several times and made speeches saying so over all of those years. The Government’s immigration policy is an incomprehensible mess. It allows far too many people in who have no skills to offer. In fact, only 28 percent of Chinese immigrants actually have those skills and the rest do not. That is how bad it has got.

The Government allows people to crowd Auckland when there is a labour shortage in Christchurch and elsewhere. It even allows immigrants to buy their way into New Zealand, giving priority to people with $500,000, so that they can buy a home here and then buzz off to Australia. The problem with non-resident overseas buyers is also a real factor in driving house prices up, and no denials by the Prime Minister will convince most people otherwise, because it is true. New Zealand First has revealed over the last 2 years how overseas promoters have advertised overseas and encouraged house buying in New Zealand. There are many overseas buyers who own several houses here. One reported to me appears to own 77 houses here in New Zealand. It is time that New Zealand First policy was adopted. We would not mind if the National Government stole yet another one of our policies, so I hope it is listening.

We believe that housing is a basic human right, so we want to establish a Government housing agency to invest in land for housing where it is needed most to sell smaller sections for smaller, affordable homes to first-home buyers on a long-term repayment basis with concessionary interest rates. It is not enough to try to free up land zoning for housing. The Government must be active in the residential land market if it is going to make a difference.

The Government has also failed to curb the explosion in home rentals, especially in Auckland and Christchurch. Its market-based approach, again, has demonstrably failed, yet still it will not introduce any form of control in Christchurch, where the market simply cannot cope. The Budget provision of a staggering $64 million operating and $16 million capital dedicated to pushing people out of State rentals, especially in Auckland, into an overheated rental market is irresponsible and is useless in solving the housing need. That $80 million would be better spent on hundreds of new State rental houses. The Government’s Budget measures on housing were pathetic. It knows it, so now it simply seeks to deny that there is a problem. That is even more pathetic.

Hon NICKY WAGNER (Minister of Customs): It is my pleasure to speak on Budget 2014 because I believe that it is a very intelligent, well-balanced, good, common-sense Budget. I would like to thank the Minister of Finance, the Hon Bill English, because New Zealand is heading in the right direction and this Budget will well and truly help us on our way. It is fantastic to see that New Zealand’s books are back in the black. It is a huge achievement for this country and for our Government. It has taken a lot of hard work from all New Zealanders, and the New Zealand economy is the envy of many other countries—other countries that have not managed the global financial crisis anywhere near as responsibly as New Zealand. I think particularly of Australia. Australia is always considered the lucky country, but, unfortunately, the Labor-Green overspending—and I have to say, it was interesting to hear that David Cunliffe had supported that spending and actually held it up as a model for New Zealand to follow—has forced the new Government to slash Government spending with very painful consequences. I hope New Zealand never gets into that situation.

Here our economy is growing. It is growing at about 4 percent. Wages are rising faster than inflation, and this Budget provides more money for families, for children, and for our most vulnerable. The $500 million package for young families includes the general practitioner visits for those under 13 at no charge, extended paid parental leave and parental tax credit, and more money for early childhood education and vulnerable children. I think it is a Budget that is supported by most New Zealanders, and I and they consider that this is money very well spent.

But as the MP for Christchurch Central, I am mostly interested in the Budget funding for the rebuild and recovery of Christchurch. From the very first earthquake, this Government has supported Cantabrians, and now, over 12,000 earthquakes later, it is good to see that the money is still coming. The rebuild is estimated to cost $40 billion, and this Government has committed $15.4 billion of that expenditure. In addition, this Budget provides for support and services that the Canterbury community needs right now. Firstly, it is good to see $13.5 million for community well-being. That is to continue the Earthquake Support Coordination Service to support about 5,000 families and counselling services that will provide for about 250 new clients every month. It also includes the ongoing funding for the 0800 support phone line, so that there is always someone at the end of the phone to help when people need it. As time goes by, more and more people’s lives are getting back to normal in Christchurch, but we need to be especially conscious of those who need ongoing support to get on with their recovery as well.

Secondly, on housing, there has been a good debate here this afternoon. I was pleased to see more funding going into housing, in several ways. First of all, $75 million is going to underpin the housing accord, which will rebuild, in collaboration with the city council, another 180 new homes as temporary accommodation. But once that demand is finished, it will be for affordable housing. But we have also committed to $1.2 billion, through Housing New Zealand, to repair 5,000 damaged State houses and to build 700 new ones. That is one every working day for the next 2 years. Finally, there is $24.2 million for non-governmental organisation social housing for the most vulnerable. Budget 2014 is certainly supporting huge, ongoing housing and building projects in Christchurch.

Thirdly, on jobs for young people, I really love the new apprenticeship reboot scheme. It has been a fantastic boost for young people in our city. I regularly go down to the Christchurch Polytechnic Institute of Technology to see the apprentices in action, and they are fine young people with a real sense of purpose. They tell me that they fix houses but they also fix people’s lives. This Budget gives $20 million for a further 6,000 places for those apprenticeships, bringing the number up to 20,000 places for young apprentices.

One thing the earthquake has done for Christchurch is it has allowed young people to shine. What I have noticed is that when young people understand that they are needed and that they can contribute to something worthwhile, they are very keen to step up and engage. I have to think about what we would have done without the Student Volunteer Army in those early days.

Fourthly, the Budget includes even more funding for education. This is an extra $16.9 million to deliver the property components of the $1.1 billion spending on the renewing of schools in Christchurch. I have to remind myself about $1 billion. A billion dollars is $1,000 million, so this is $1,100 million worth of money to rebuild our schools. That is particularly exciting to me, as an ex-teacher. Christchurch has always had great schools and very good teachers, and now we are going to have the very best buildings and facilities for those teachers and our children to work in. What we will be building is the newest, the most modern, and possibly the best modern school network certainly in New Zealand and maybe even in the world.

Fifthly, the Budget is also funding to clean up and prepare the red zone for future use. In the residential red zone area, 8,062 families have been paid out so that they can move on to new homes and new communities. It has been a really tough time for those people. But they are keen to see the area cleaned up and the buildings cleared away. So far, about 50 percent of that work has been done, and the rest is expected to be completed by the end of the year. But there are already heaps of bright ideas coming out of the community about how that land could be used—maybe as wetlands, for conservation or drainage, for sport or recreation, or for mahinga kai. Very soon there will be a public consultation process, where everybody can be involved, everybody can have their say, and we can make sure that we make the most of this piece of land. It is a fantastic piece of land. It goes all the way from Hagley Park to the sea.

Finally, the Budget provides another $50 million for the operational funding for the Canterbury Earthquake Recovery Authority. That is to coordinate the rebuild and to deliver on the anchor projects that were outlined in our Christchurch Central Recovery Plan. The Christchurch City rebuild is a high priority for this Government, and we are very aware of the challenges of living in that city. We appreciate the work that everyone does, actually every day, towards the rebuild and the recovery. We all seem to be dodging roadworks, supporting our neighbours, patronising new businesses, and being staunchly Cantabrian. This Government is supporting that by putting its money where its mouth is, spending $9 million every working day on our rebuild, delivering on the anchor projects, and bringing Government departments back into the city, to support commercial development.

There is a lot happening in the city, with 200 new buildings alone within the four avenues, and it is beginning to develop very fast and very excitingly. I want to thank Bill English for an excellent Budget and for supporting Christchurch and Canterbury. The Government’s books are back on track to surplus, the economy is growing, and more jobs are being created every year. I think the John Key - led Government has managed the international downturn really well. Now it is our job to manage the upturn equally as responsibly. We are certainly not going to hose away our hard-earned prosperity, like the Aussie Labor and Green Government. This Budget is a beaut, and it will underpin a brighter future for everyone in New Zealand.

Hon RUTH DYSON (Labour—Port Hills): I want to acknowledge the member Nicky Wagner, who has just resumed her seat, and particularly her comments about the high-quality education system that we have in Canterbury, and, in fact, in New Zealand, and also the commitment she has made—and, likewise, the Prime Minister and the Minister for Canterbury Earthquake Recovery, Gerry Brownlee—to the people of Canterbury who have been so displaced by the series of earthquakes, numbering over 13,000. I do not recall seeing that member once acting or speaking, or perhaps even thinking, in support of Phillipstown School. That school, so strongly supported by the community, was threatened with closure. The community said to Minister Parata: “We don’t want our school to close.” The neighbouring community said: “This is a fine school. It’s got a great record.” It was clear that the assessment that the Ministry of Education did on it was totally flawed, and not once did that member speak out in support of a local school under threat of closure within her own electorate.

Moana Mackey: Which electorate is it?

Hon RUTH DYSON: It is the Christchurch Central electorate. I hope that on 21 September we will be able to say that it is Tony Milne’s electorate, because he is the Labour candidate there. He will stand up for the residents of his electorate, if he has the privilege of being elected.

I will say more about the citizens of Canterbury who have been so let down, not just by this Budget. They did not expect anything out of the Budget, actually, because for over 3 years they have felt tricked and let down and abandoned by the broken promises that John Key made. He came to Canterbury and he said: “No one will be worse off.” Ha! That is a joke, but it is a very sad joke for the people who have had to accept 2007 rateable valuation offers for their land and their home, and if they do not have a home on their land, they have been offered 50 percent of the 2007 rateable valuation in compensation for the Government compulsorily acquiring that land. It is the same for commercial properties. That is not making a truth out of the Prime Minister’s statement that nobody would be worse off.

But I want to start by talking about housing. Frankly, I do not give a toss what the description is of the situation we are in, particularly in Canterbury but also in Auckland and in other parts of the country, in regard to housing. I do not care whether we call it a crisis or we just say that people cannot afford to rent a home and they cannot afford to buy a home. If that is not a crisis, let us not get bogged down in terminology. Why does the Government not front up to the fact that particularly in Canterbury and Auckland, but also in other parts of the country, people cannot afford to rent somewhere to live? That is not acceptable in our country. It should not be acceptable to this Government. But all it does in response is say that it is not a crisis, as if that solves the situation.

In my electorate I have a suburb called Linwood. It is a nice suburb—all my suburbs in my electorate, actually, are nice. It is a low to middle income earning area and the rental properties are not excessive normally. I just had another look on TradeMe—the Prime Minister’s source of all reference and analysis—and got a bit of a random sample of the three-bedroom homes for rent in Linwood. How much would a three-bedroom home cost to rent, do you think, in a low to middle income area in Canterbury? [Interruption] The member Denis O’Rourke knows the area well. He has represented it as a city councillor in the past. One three-bedroom home in Linwood was $1,190 per week. Another one was $1,015 per week. It has got hot and cold running water inside the home—that is an advantage. There was a bargain home at $799 per week for rent in Linwood. This is not an expensive area. How do people afford that? Well, the answer is that they do not. They try to get into social housing. We have hundreds of homes wrecked. This is social housing owned by Christchurch City Council and I hope that it will be owned in the future by Christchurch City Council. I am very proud that our council is the second-biggest landlord in the country. But because the Earthquake Commission payments have not been resolved between Gerry Brownlee and the Christchurch City Council, those social housing units are boarded up, damaged, and obviously have nobody living in them.

It is the same with Housing New Zealand stock. Hundreds of Housing New Zealand houses across our city are empty and boarded up because Nick Smith has not put it as a priority to get those homes repaired. They are repairable, they are empty, and we have people squashed into houses, living in garages, or staying with friends, and moving constantly as they burn up their relationships with friends or relations. It is just not acceptable. I found another house in a suburb that I used to live in, in Heathcote. It is a magnificent suburb just under the Port Hills. A lot of people have been displaced in that suburb, firstly, because of rockfall—a lot of rocks came down into the valley—and, more recently, the area has been very badly hit with floods. A two-bedroom house in Heathcote—again this is not a high-income, top-of-the-market place—is $1,120. That is to rent a two-bedroom home in Heathcote. Let us not worry about the description. Let us not worry about whether it is a crisis. We have places that are being rented at prices that people cannot afford to pay. The market is not working and the Government is walking away and abandoning people in our city. That is not what the Prime Minister promised. He said that nobody would be worse off. If you cannot live in your own home and you cannot afford to rent somewhere, you are actually worse off. There is no debate about that.

I want to move on to another critical issue and that is the issue of employment and training. We raised this issue immediately post the September 2010 quakes and then again, more strongly, directly with the Minister after the February 2011 quake. We said: “There’s going to be lots of work in our city. Why don’t we start training young people now, so that they will be qualified and have the skills as the recovery progresses, as the rebuild programme rolls out, so that we will have trained Cantabrians able to do the work that’s being needed?”. It did not happen. It did not happen. Eventually, the Government said we should put some money into apprenticeships. I applaud that move. It was a great move. Any investment in apprenticeships is good. It was just 2 years too late. A lot of our young people could not get work because so many of our businesses have run down or closed, so they left town. We are becoming a city where the people who are there are either the few who are going to make a lot of money out of the recovery or people who just cannot leave—they have got no option—and that is not the sort of mix that we should have. We want young people who are trained and committed to being part of the recovery and able to contribute in a practical way to the rebuild.

So what was the great announcement that the Prime Minister and Paula Bennett came out with recently? It was that they are going to pay beneficiaries from all around the country $3,000 to come to Canterbury and get a job. That is great that they are giving people on benefits extra money to get a job, but I would like to see Cantabrians get preference with helping them get a job. They deserve it. They have been through the worst of times. Help them to step up to being part of the improving times. So why is it not for local people? The other question is where these people are going to live and there is no answer at all to that.

I want to touch just briefly on an issue particularly relevant to my electorate and that is the issue of rockfall protection and the response that Gerry Brownlee has given. We have beautiful houses that are at risk of being damaged—and, obviously, lives are at risk, as well—because of the threat of rockfall in future earthquakes. There are engineering solutions for a large number of these properties. They are called rockfall fences, attenuators, bunds, terracing—any number of geotechnical-engineered solutions to make those houses safe. The geotechnical people say we should do it. The cost-benefit analysis says we should do it. The homeowners say they would love to be back safe in their own home and community. There is one obstacle and that is Gerry Brownlee. He has said no to rockfall protection to make those homes safe and liveable. He has torn apart communities for no good reason, and ratepayers and taxpayers are paying the price for what I can describe only as vandalism. Those families should be supported to have rockfall protection structures put up and be able to live in their home. Likewise, the Port Hills owners of red zone land are still waiting for an offer. This Budget—

The ASSISTANT SPEAKER (Lindsay Tisch): Order! The member’s time has expired.

MARK MITCHELL (National—Rodney): It is a real honour to take a call and I just want to acknowledge our Deputy Prime Minister, our Minister of Finance, the Hon Bill English. I remember back in 2011 when as a new candidate I was attending a candidate debate in my electorate up in Matakana. I was approached by a well-known political leader and he said to me: “Listen, I have been talking to some of your National Party colleagues and they have said to me quietly that there is no way, it is impossible, for the finance Minister to achieve a surplus when he says he is going to achieve it.” I said: “Oh yes? Well, I am not going to fall for that one. If he says that he is going to achieve it, then I have faith that he will.” So I just want to acknowledge him and, of course, I will be reminding that person, if they are out there listening today. It might be a bit disingenuous, but I will raise it and remind them of the comments that they were making back in 2011. I just want to commend and acknowledge our Minister of Finance for achieving what a lot of people said could not be achieved for our country.

It is a very good Budget. It shows that New Zealand is heading in the right direction. It is a confident Budget for a confident nation. I know that the Prime Minister said this the other day, and it brought a great deal of pride to me that we are a confident nation, that we have come together, and that we have come through a very, very tough period of time for our country, through a global financial crisis and through global recession. Our Minister, our Cabinet, our caucus, our coalition partners—everyone has worked very hard to do what we need to do.

But this has not been just about us; this has been about the whole nation. This has been about the country: the people at home who have decided that they are going to save more; the businesses that have found ways of trying to do business a little bit better and a little bit smarter; our NGOs that have tried to work with the funds that they have, which may not have been as readily available as when we were not in a recession; and our volunteers in the volunteer sector who have continued to get out there. Everyone combined has kept our country running and we are emerging now as one of the strongest nations, in terms of OECD measures, to come out of that global recession. I firmly believe that it has been a team effort for all of us. All of us Kiwis in this country have worked hard, we have come together to make sure that we drive ourselves to get through the recession, and now we are definitely, without a doubt, looking at a brighter future.

Budget 2014 reflects 6 years of hard work. It is a Budget that sees the books back in surplus and growth at 4 percent, which is phenomenal when you look at the rest of the global community and countries that are going to be struggling to continue to see any growth in their economies. We are putting the well-being of young families and children at the heart of our new spending with a $500 million package to help families and children. I want to talk about one of those measures, which is the change to free medical care for children up to 13 years old. The first policy was around children up to 5 years old—

Dr David Clark: Doesn’t come in for another year yet.

MARK MITCHELL: Well, it is coming in. It is coming in. So what would you rather see? Would you rather see a policy like this or would you scrap it and not want to see the policy? This is what we continually hear from the Opposition benches: that it is not good enough. Actually, it is very, very good.

Talking to people, particularly mothers, in my electorate, I know that kids who may have missed out on a visit to the doctor because they may have had a slight cold, or a small infection that mum and dad thought they might be able to manage themselves, will be going to the doctors now. Those parents will be able to actually take them and get that free medical access they had for their 5-year-olds. So it is a very, very good policy. It is one that is going to have a direct impact on people, and I know that it has been very, very well received in my own home electorate of Rodney.

We have talked about housing, so I really just want to take the opportunity to discuss what is happening in, again, my home electorate of Rodney. We have been lucky enough to have a special housing area. We have got a big residential development going on in Millwater, and the whole area is pretty excited about that, although we understand and know that there are challenges associated. We have to make sure that we continue to have investment in our infrastructure, that we continue to make sure we have capacities in our local schools, and that we continue, especially around our roading infrastructure and public transport, to work to grow those to meet the demands that we are going to have in our electorate.

But we are excited about it because we have got new retail sectors opening up. We have got a brand new retail sector in Silverdale. When we had that open, of course there was a fair bit of excitement and buzz in the community, but also there was a bit of concern. There was a bit of concern that our historic Silverdale retail sector might suffer a little bit, but the great news is that we are 12 months into this now and there has been a positive spin-off from it in terms of trade actually going up. So not only are people coming to enjoy themselves in the new retail sector with new cafés and new shops that were not available before but also they are getting down into our wonderful older retail sector, and that is growing as well. So we are seeing some pretty good growth. Ōrewa is such a beautiful spot in New Zealand, on the beautiful Ōrewa Beach, and it is starting to feel like it is becoming revitalised. There is a new energy forming down there because we have got new people moving into our area. We want to welcome them and we want to encourage them to do that. On top of the Millwater development we have got another 960 sections and properties coming online.

In terms of infrastructure, again, just while I am speaking about my electorate—if you can bear with me, Mr Assistant Speaker—I just want to mention that we have one project that certainly has had some national coverage, and it certainly is something very important to us in Rodney and especially those in northern Rodney, and that is the Hill Street intersection. It is quite an amazing intersection. It has sort of evolved and grown as the township has grown, and it is really two or three intersections that converge into one. Of course, we really have the Northland economy consolidating down through this intersection, so it is something that is critically important, particularly to those living in north Rodney.

I just want to acknowledge some people, because we have been working on this for the last couple of months and we had another meeting on it in my office yesterday. There are just a few people I want to mention in relation to this. Two are Mieszko Iwaskow and Sebastian Reed. They are two young New Zealand Transport Agency guys—Mieszko is the manager—who have been working on this. I just want to acknowledge them because they have done a fantastic job, and they are listening and working very carefully with the local community. I want to acknowledge Councillor Penny Webster and also Steve Garner, who holds the transport portfolio for the local board. Both were there yesterday. I also want to acknowledge and congratulate Tommy Parker. Some of you may know Tommy. He has done some really great work in Auckland, and I want to congratulate him on his recent promotion. The only downside for us is we have lost him from Auckland. He is down here in Wellington, so it is a bonus for them. There is also Bruce Manson and Warwick Massey, the co-chairs of the Warkworth Area Liaison Group; Steve Haycock, the secretary; Glyn Williams; Richard Papworth; the Algies Bay Residents and Ratepayers Association; Bruce Scoggins; the Mahurangi East Residents and Ratepayers Association; Bryan Jackson; the Snells Beach Residents and Ratepayers Association; Martin Dancy from Matakana Coast and Country; and David Wilmot from the Warkworth Area Business Association.

Hon Members: Ha, ha!

MARK MITCHELL: You may laugh over there, but the reason I wanted to mention these people is that these are people from our community, right, who actually represent groups, and they have come together and they are working very hard to develop a solution, which we are very close to achieving, and getting some funding into an issue that is going to be fixed for my local community. So I just wanted to acknowledge them because these are the people who are part of a wider roll-out of our investment and infrastructure.

I want to mention one thing that all of them raised. I do not know what the political affiliations are in this group. I know that one of them is definitely heavily involved with the Labour Party. There are probably some National supporters and maybe some ACT supporters in there too. But I want to mention one thing they all raised as a concern to me yesterday. They said they are very, very worried that if there were a change of Government, they would lose the Pūhoi to Wellsford motorway. I would challenge the Labour benches and the Green Party—and I see Julie Anne Genter in the House—to get up and make a commitment to these people, who are also representing their communities, on the Pūhoi to Wellsford motorway. North Rodney and Northland have been ignored for too long in terms of having a highway system that gives them better access to their economy. It is an important part of their future economic growth.

I am very pleased to take a call on the Appropriation (2014/15 Estimates) Bill. Thank you.

Hon PHIL GOFF (Labour—Mt Roskill): I have heard some of the National speakers pretend that this Budget is a “Labour-lite” Budget. There is nothing “Labour-lite” about this Budget. This is a conjuror’s Budget. You know, Mark Mitchell was right; it is quite a good thing that under-13-year-olds can go to the doctor without charges. What he did not tell us was that while the great conjuror was saying “Look! Look here! Under-13-year-olds—free general practitioner visits!”, at the same time he was ripping out the guts of the health system by cutting health spending in real terms by 2 to 3 percent. That is what Treasury says. That is what Bill English was challenged on, on Q+A on Sunday, and he had no answers. It is fine that we get our kiddies to the doctor; it is not fine that we rip the guts out of health spending by increasing spending at less than the rate of the increase in population and the increase in inflation.

The same thing is happening in education. A good Budget is a Budget that helps the wealth of the country through the people of the country. It is people-centred. This Budget cuts real spending on health, cuts real spending on education, and reduces the police budget in real terms by $40 million, according to the Police Association. So much for the law and order party that wants to have a safer community. There is a $40 million cut in real terms in the policing budget.

Those are all failures—those are all failures—but the biggest failure in this Budget is that this Budget does not recognise, does not act on, and does not put in place measures to deal with the housing crisis. There is John Key, who says “What housing crisis?”. Well, there is an example of a Government that has become arrogant and out of touch. From the lofty heights of St Stephens Avenue, the lord looks down over his empire and says “What crisis? What peasants? What is the problem with housing?”.

I will tell Mr Key what the problem with housing is. The problem with housing is that this year we will have the lowest rate of homeownership in New Zealand in half a century—half a century. I grew up and you grew up, Mr Assistant Speaker Tisch, in a New Zealand where the Kiwi dream of owning your own home was something we assumed we could aspire to. My parents were a working-class family. They bought their own home. They capitalised on my family benefit to do so, and good luck to them. I had my own home in my early 20s. I paid $12,500 for a very nice cottage in Papatoetoe. My children go out into the market today, and to buy a house in my working-class electorate of Mt Roskill—what is it, Mr Mitchell? It is $700,000—$700,000—and the increase in house prices since 2008 has been 40 percent.

Hon Ruth Dyson: What?

Hon PHIL GOFF: A 40 percent increase in house prices since 2008. I ask any member on those benches opposite to tell a young Kiwi couple desperate to own their own home how they can do that. Forty-six percent of all New Zealanders had no wage rise in the last year—46 percent. Nearly half of all New Zealanders got no wage rise. Every one of those New Zealanders had their rent go up. They sat in my electorate and watched the price of houses in the last month alone, the month of April, go up by $6,000. Can you imagine the despair of a young couple who are desperate to get a home of their own when they face that? No wonder the OECD has just produced a report, in utter contradiction to what the Prime Minister says, saying that we are the country with the most expensive houses in the world and the least affordable houses. Do you know what this Prime Minister does, after 6 years in office? He says that it is the Labour Government’s fault—6 years in office, Mr Key. After 6 years we are sick of the excuses. We want to see some action. But we are not seeing action; we are seeing only excuses.

Well, when we look at this Budget, what does Treasury say? Treasury says about housing that at the moment to buy an average-priced home in New Zealand with an 80 percent mortgage you will be paying 43 percent of the average full-time wage—43 percent. It sounds quite high, does it not? But do you know what Treasury says?

Jami-Lee Ross: It would have been less if prices didn’t go up so much under Labour.

Hon PHIL GOFF: It says that in 5 years’ time that figure will be 63 percent. For Jami-Lee Ross’ information, in Auckland it will be 86 percent of the average full-time wage. That is fine if you are a born-to-rule person who has money and help from your parents. Every parent wants to help their kid get into their own home, but what about all those families out there who cannot rely on that help? How can they ever aspire to homeownership?

The other day I was knocking on doors down on the street that I was brought up on in Mount Roskill. It is called Warren Avenue. I went down a long driveway. There were the old houses there, and there were infill houses behind them. I knocked on every door. Do you know what I found? I found that every single family living in both the old homes and the new homes were tenants. They were renting their properties. When I talked to them, they felt that they were doomed to becoming tenants in their own land because there was no hope at all of homeownership. And this Government did what in the Budget to help those families? Let us hear it from the Government members.

Denis O’Rourke: Nothing.

Hon PHIL GOFF: Nothing—well, actually, it did do something. The price of nails from China and the price of Gib board from Thailand will apparently come down because now those countries can dump those products in the market at a cost less than it costs to produce them. That is what the Government did. Is that going to be worth anything? No, because most first-home buyers are buying existing homes.

The Government says there will be $3,500 in cost savings. Where did it pluck that figure from, Mr Young? Where did the Government pluck that figure from? I will tell you this: there is no sound foundation for believing that that will be the saving. There is no proper estimate of that. There is no guarantee that one cent of that will be handed on from the builder to the consumer. It will do nothing to help those families desperate to buy their own homes. If the Government was right about that figure of $3,500 and every dollar was passed on to the consumer, that would be less than half the cost that house prices went up by in the month of April alone. This Government is a shocker. It has done nothing to help people realise that fundamental human desire to be homeowners.

I want to talk, in the time that I have got left, about the answers that Labour has, because I think that the Labour policy is offering hope. The first thing that you need to do is to recognise, as anyone can recognise when they go along to a housing auction, that the price of houses in New Zealand is being driven up by speculators and property investors. The answer to that is a capital gains tax on property investment. I have heard person after person—and Jacqui Dean is about to mouth it again—say it will not work. Well, I say to Jacqui Dean to look at what the Chief Economist from Westpac, Dominick Stephens, said this morning in the New Zealand Herald. What did he say? He said that a 15 percent capital gains tax would reduce the value of speculation by 23 percent. He said we should do it. The chief economist of the ANZ said we should do it. The Governor of the Reserve Bank says that we should do it. The chief executive officer of the Treasury said that we should do it. Take the speculation out of the housing market. Why will National not do that? Because there are vested interests in every one of them there. Look at the pecuniary interests register and you will see why the National MPs do not want to stop speculation, do not want to make housing easier for the first-home buying family. They want to make life better for themselves, and that is despicable.

Then there is an element of that speculation that is foreign speculation. Nick Smith says there are 22,000 owners—disingenuous. There are 22,000 owners, probably with 10 houses each. But the Inland Revenue Department says 11 percent of ownership is by foreign investors. I want to ask the next National speaker to explain to this House and to young New Zealanders what good it does New Zealand to have foreign speculators pushing up the price of our residential housing. Where is the benefit to New Zealand? There is no benefit to New Zealand; there is only a downside.

I want to come to Michael Woodhouse’s point. I happen to be pro-immigration, but I believe that immigration has to be managed in a way that it does not soar and put unnecessary costs on the housing market. That is why it needs to be controlled.

DAVID BENNETT (National—Hamilton East): This is a good Budget. It is a great Budget for New Zealand, and it is a Budget that New Zealanders can be very proud of. I think that we need to acknowledge the Hon Bill English and the work he has done in making this Budget work, all New Zealanders who have gone out there and sacrificed over the last few years to make sure that we were on the right economic track, and the Prime Minister for delivering the management and vision to see this Budget become a reality. When we look at the Opposition there, it is a very, very sad state of affairs. That last speaker, Phil Goff, spoke about immigration. I remind that member of what David Parker said on Q+A this weekend on TV. He said that over 40,000 people coming into New Zealand is wrong. He said that a positive 40,000 people immigrating into New Zealand is wrong in Labour’s eyes.

Hon Michael Woodhouse: Go campaign on that in South Auckland.

DAVID BENNETT: Go out there into any city in New Zealand and any town and campaign on that. Labour is telling New Zealanders who have come here recently—the 1 million people who have become New Zealanders over their lifetime—that they are not welcome. That is what Labour is saying.

Denis O’Rourke: That’s a misrepresentation. Nobody ever said that.

DAVID BENNETT: That is what New Zealand First is saying as well. It is not a misrepresentation, because how do you get to have those people come into New Zealand—[Interruption]

The ASSISTANT SPEAKER (Lindsay Tisch): Order! The member interjecting cannot use the phrase “Tell the truth.” It is out of order. There is Speaker’s ruling 42/3. I ask the member not to use that phrase in the future.

Jami-Lee Ross: Tell the truth about your boyfriend.

The ASSISTANT SPEAKER (Lindsay Tisch): Order! I have just ruled that that phrase is out of order and I will not have it again.

Denis O’Rourke: I raise a point of order, Mr Speaker. I take offence at that comment and would ask that the member be required to withdraw and apologise.

The ASSISTANT SPEAKER (Lindsay Tisch): The member has taken offence. I ask that the member withdraws.

Jami-Lee Ross: I withdraw and apologise.

DAVID BENNETT: To all those New Zealanders out there who have come into this country recently, to all those generations before who were migrants, and to all those people who see New Zealand as their future and their home, I say that they should remember that Labour is going to have a cap on immigration. Labour will cap immigration. If that is the case, then that will be a disaster for New Zealand going forward. All those people are New Zealanders—they may not have been born here, but they have made New Zealand their home. They have a future in this country, but Labour believes that they are not welcome here. That is the Labour Party of new. That is the Labour Party that has sold out to New Zealand First. That is not what this country stands for. That is not what the people of New Zealand want.

We want a free, open, and tidy society in which people can come and make their future in this country. We want a country where people who are educated can see the future of this beautiful, successful country as a place they want to be. We want to encourage those people to come here. I look around this House and I see many people who were not born in New Zealand. Would they be here under Labour policy? No. They would not get into New Zealand under Labour policy. That is the reality of what Labour is talking about.

Hon Ruth Dyson: How is this in the Budget?

DAVID BENNETT: Stick to the Budget. That is what David Parker talked about on Q+A. So it would be quite good if Ms Dyson actually read what her spokesman said. But you want to stick to some of the facts, OK? In 2008 New Zealand was in recession. Now we have got growth at 4 percent. Under Labour, mortgage interest rates were 10.9 percent; now they are 6 percent. Food prices were up 10.9 percent under Labour in its last year; now they are up 1.5 percent. House prices were up 96 percent over the 9 years of Labour. Let us say that again. House prices were up 96 percent in the last 9 years of Labour. They are up 28 percent under National. When we look at this debate here, Opposition members have talked about housing, housing, and housing. That has been their focus of debate. Well, I say to New Zealanders to look out there and look at the facts. Under Labour, house prices went up 96 percent—you did not see Labour members say that once in their speeches today, did you? House prices have gone up only 28 percent under the National Government.

When we go back to those interest rates—let us look at them again. Mortgage interest rates under Labour were 10.9 percent; now they are 6 percent. To all those people who own homes or intend to buy homes, or want to be homeowners in the future, I say they should remember that the biggest issue you will face as homeowners will be interest rates. Interest rates under Labour—10 percent. Under National—6 percent. For new homeowners, the biggest issue they will face is whether they can pay the interest on their debt. That is the point of difference between the two parties. This Budget is a Budget that delivers a surplus. By delivering a surplus, we have reinforced interest rates that are as low as possible in the New Zealand economy.

The other option was to have a borrow-and-spend Labour - New Zealand First Budget, which would have put interest rates back up to that 10 percent. That is what would have happened under an Opposition Budget. Under this Budget, New Zealanders get interest rates of 6 percent. Electricity prices were up 72 percent under Labour, but they are up 20 percent under National. The current account deficit was at 7.9 percent under Labour, but it is now 3.4 percent. And 3,000 New Zealanders a month were leaving this great country under a Labour Government, but they are all coming back now because they see the future in this country.

This is a good Budget for New Zealand. This is a Budget that delivers the economic credibility that New Zealanders have been looking for. It delivers a surplus in the most trying of economic times. It delivers the rebuild to Christchurch. It delivers the infrastructure to Auckland. It delivers the future for all New Zealanders here and for those yet to become New Zealanders. It is a progressive, forward-looking Budget from a Government that is looking to the future.

When I look at my great city of Hamilton, we do well out of this Budget. We get new schools for the north of my electorate. When Labour was in Government, it came and looked at bits of land and said “That would be a great place for a school.”, but never actually promised anything or did anything. Under National, we have rebuilt that hospital. Under National, we have made the roads of national significance a reality and the Waikato Expressway a reality. Julie Anne Genter and the Green Party and the Labour Party will not support that road, going past this election, and that is something the residents of Hamilton are very much aware of.

In this Budget there was spending on the southern motorway in Auckland. Every dollar spent on Auckland infrastructure is good for Hamilton. Every dollar spent up there is good for us because we get 10 percent of the growth out of Auckland. So as Auckland goes to 2 million people, Hamilton will overtake many of the other cities of New Zealand and become one of the biggest cities in this country, moving from fourth-biggest. And I say that one day we will be taking on Wellington for that third-placed position. That is the reality of a forward-looking future country. Auckland, Hamilton, Tauranga—that golden triangle will be part of what is a modern Pacific Rim world. It is a multicultural world that has an ambitious future and a future that will track towards success, growth, and development. It is not a future based on the Opposition trying to take it apart, as it looks across the table at other people in envy and hatred. It is a positive future, a positive Budget that delivers surpluses so that New Zealand can repay its debt, so that New Zealand can go forward and actually start handing out to its people the services that they demand—the services like the free medical care to under-13-year-olds. That is what people wanted to hear and that is what they are getting.

This is a good Budget. It delivers a surplus and it delivers a vision for New Zealand that is strong and prosperous and forward-thinking. It is a Budget that the people of Hamilton like. It is a Budget that the people of New Zealand will like too. Thank you.

JONATHAN YOUNG (National—New Plymouth): I am very pleased to stand in support of Budget 2014 and to be on the right side of the House and the right side of history regarding this Budget. Bill English and his team deserve the congratulations and, I would even say, the thanks of this country for his leadership over the last 6 years. Labour can bleat all day about how well it did in boom times, but, as we all know, true leadership is always tested through tough times. John Key and Bill English have led this country through some of its most difficult times. Not only have they led consistently well during those difficult years, protecting New Zealanders from the harsh edges of recession, but they are leading us into the prosperous and brighter future that they promised—one that Australians can only be envious of.

This is a very good Budget. It shows that New Zealand is heading in the right direction. It is a confident Budget for a confident nation. It is a Budget from seasoned leadership. I just want to address some of the comments that were made by the Hon Phil Goff. Normally, I would have considered him to be one of the better members on the other side of the House, but I could not understand how he could go on about housing affordability and say that it is much worse today than when Labour was in Government. We know, as the previous speaker, David Bennett, has just said, that under the 9 years of Labour’s leadership and governance the price of houses went up 96 percent. Under National’s governance it has gone up 28 percent.

So that you know and so that members of the public know, third-party people who study such statistics also make it very clear that today housing is more affordable, particularly in the city that I represent, New Plymouth. Let me read just briefly from the Roost Home Loan Affordability Report of March 2014: “It now takes 53.4 percent of one median income to pay the mortgage on a median priced house purchased in March”. It goes on to say: “The affordability index [for New Plymouth] reached its highest point of 89.4 percent in September 2007.” Guess who was in Government? Labour was in Government, and it took 89.4 percent of a median income to pay the mortgage on a median priced house. Today it takes 53.4 percent.

I tell you what. If you want to own a house, come to New Plymouth. This is the place that David Cunliffe said everybody was fleeing from. This is the problem, I think, with the members on the other side of the House. They say stuff that is not true. They make up stuff. If this election is going to be fought on anything, let it be credibility, because I believe—

Denis O’Rourke: I raise a point of order, Mr Speaker. The member said that members on this side of the House say things that are not true. You hauled me up for that and I—

The ASSISTANT SPEAKER (Lindsay Tisch): No, I did not. I told you that I pulled you up under Speaker’s ruling 42/3 when you yelled out twice “Tell the truth!”. That is an unparliamentary term because it is a reflection on members within the House and the dignity of the House, because all members are honourable. What the member was saying was completely different.

JONATHAN YOUNG: The Hon Steven Joyce aptly described Labour members this afternoon as panic merchants. They are panic merchants. Crisis and calamity have struck New Zealand! Let me tell you that the people out there who listen to this and read the newspapers scratch their heads when those sorts of statements are made: a regional crisis, a manufacturing crisis, an export crisis, housing crisis, immigration—everything is a crisis. Gee, Labour members wake up every morning feeling grumpy; you can tell. The headline on 15 October 2013 said: “Cunliffe blames Govt for Taranaki exodus”. Another crisis in the wonderful province and region of Taranaki! He said that “Taranakians are leaving the province in droves”—in droves—“because they’re being forgotten by the National Government”. Why I am raising this is because this Budget is solid and sensible.

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

JONATHAN YOUNG: I am very pleased to stand in support of Budget 2014. Let me just reiterate some of the comments I made just prior to the dinner break. I said that Bill English and his team deserve the congratulations and the thanks of this country for his leadership over the last 6 years. That leadership has not been just during great times but during very difficult times—the real test of leadership. Both the Prime Minister and the Deputy Prime Minister have shown that steady hand and that visionary insight into where this country needs to go. They have led us through the harsh times of recession and they are leading us into a prosperous and brighter future.

This is a very good Budget. I wanted to also just touch on words that the Hon Phil Goff said before the dinner break. He said that housing affordability has never been worse than it is right now. I reminded him of what some third-party independent analysts have said regarding, particularly, the fair city of New Plymouth, where I am the MP. They said that it now takes 53.4 percent of the median income to pay a mortgage on a median priced house purchased in March 2014—53.4 percent; just over half the median income. They went on to say that the affordability index reached its highest point of 89.4 percent in September 2007. We know that that was during the peak of the period of housing valuation increases under the previous Government, and also at the peak of interest rates. So to say that we are in a worse situation now is blatantly incorrect.

It is very obvious to see that things have improved for people who are looking for a house to buy. It is good to see that the management of the economy has enabled that. As Minister Joyce said in his speech on the Budget, what we have on the other side of the House are panic merchants, in comparison with a steady, thoughtful, measured, incrementally positive, and progressive Government. On the other side of the House are panic merchants who say that there is a crisis in the regions, there is a crisis in manufacturing, a crisis in exports, a crisis in housing, and a crisis in immigration. Everything, in fact, is a crisis. Getting up in the morning is a crisis for some of them, I understand. But it needs to be known, I think, out there in the electorate that we have a Government here that is doing well for New Zealanders. This Budget is evidence of that.

This is a Budget that supports families. It is a Budget that goes a long way to help people into strong employment, and that is something that, of course, we are very mindful of. All I can say to those members opposite, many of whom I respect, is that their ongoing bleating of gloom and doom is eroding credibility—but please do not stop, because the electorate needs to know what you stand for.

Mr Cunliffe came to Taranaki in October 2013, just a number of months ago, and he said that he blamed the Government for the Taranaki exodus. He went on to say that median weekly incomes had dropped in Taranaki by $24. It is not right at all. The next day on the Taranaki Daily News front page Mr Joyce and I refuted that, and Mr Joyce said: “Mr Cunliffe claimed people were leaving regions such as Taranaki in droves. This couldn’t be further from the truth … Taranaki grew by 5.3 per cent between 2006 and 2013 and has 5,484 extra people now living in the region.” Instead of median weekly wages going down by $24, they went up by $85 a week. I do not understand how you can get it so wrong and actually say it so calmly at the same time.

I think that probably the other person who tends to talk down what is happening in Taranaki is my opponent Andrew Little, who is going to contest the seat there. Andrew gets it right a little bit. He made a statement that the GDP over the last 3 years had not been growing. To a certain extent that is true, even though we had the highest GDP per capita in the country—$75,000 per capita compared with $47,000 in the rest of the country—but what he did not understand is that when you have petroleum production, which starts off with a great surge and a rush, every well that produces oil depletes after a little while, so GDP may be affected by that.

But what he did not know was that those figures up to March 2013 excluded two-thirds of Methanex’s production, which has started up since that period of time. So we have got another $800 million to $900 million being earned out of the Taranaki economy. When you put that in, per capita GDP looks around about $80,000. So things are going well. Things are doing very well under this Government with this Budget. That side over there will continually try to talk us down, but that is not the truth of the story.

Hon Dr PITA SHARPLES (Māori Party—Tāmaki Makaurau): It gives me great pleasure to take a call on this very important Budget, and to celebrate some of the very significant gains that we have negotiated for the benefit of whānau, hapū, and iwi. Of course, we believe that what is good for Māori is also good for this nation. Last Friday’s Gisborne Herald headlines praised the 2014 annual accounts as providing all the evidence for the Māori Party “to position itself for another three years in Parliament as the roadrunner in stealth mode.” I think that everyone here knows that the roadrunner is the Warner Bros character that kept dodging the coyote no matter what the coyote threw in front of him as he was running away. So in many ways that is a good metaphor because we have had to keep to the straight and not go left or right too much as we work towards getting some benefits for Māori. Last Thursday’s Budget was ample proof that that race, the roadrunner race, was worth it.

We have concentrated on building resilient whānau. We are really proud that as a result of our involvement on the various committees, including the poverty committee, $90 million is to be invested over 4 years to provide free doctors visits and medicine for children aged under 13. That is huge for us. A healthy child is a healthy whānau. If we can make it easier for health care to be accessible and affordable, then we are talking about real things that do make a difference on the ground.

We have always been passionate about fighting for a living wage. Although we did not succeed in that, we nevertheless got some key determinants for well-being. Big things include boosting the paid parental leave scheme by 4 weeks, and, most important of all, focusing on the eligibility. The eligibility was a big thing for Māori and Pasifika women, because they are often overrepresented in the jobs or employment arrangements that tend to render them ineligible for paid parental leave. So we are really pleased that this loophole is being looked at.

We are also proud of the boost to increase the parental tax credit to $220 a week and to increase the entitlement to up to 10 weeks. Again, it is another strong incentive to support low-income parents in the most important role of their lives, which is being fabulous parents. Of course, there was $33 million allocated to help vulnerable children, and particularly to fight the increased incidence of rheumatic fever.

But I want to talk about one thing that I am really happy about, and that is an education programme that was supported called Reading Together. Four years ago we hunted for a programme that would help the literacy of young Māori and Pacific Islanders who were behind in their reading in the early years or first years of primary school. We discovered the Reading Together programme that was here and there in some schools, and found it to be really good in terms of involving the parents to come to school, learn how to teach their children to read—and, in some cases, learn to read—work with other parents, and so on. It just blossomed. So we had it set up in all decile 1, 2 and 3 schools for 3 years. With this Budget, we have now extended that programme into decile 4 and 5 schools. That is a big one for us, because if you can get that reading age up, then the children can go right through the system parallel with other children and not always lag behind.

Another thing was pointed out by the Tuia Group adviser Toko Kāpea. He graded the Budget eight out of 10 for Māori. There really were some things in there for Māori, and we are really pleased. They included support for Māori radio stations. This is really important for Māori and for us. The iwi Māori radio stations carry Te Reo Māori me ōna tikanga and what is happening amongst the community, so that Māori can be in touch with each other. So it is very much part of families in Māori houses and so on. So $13.7 million was funded by Te Māngai Pāho to service the running costs of 21 Māori radio stations, and also create the possibility of looking to establish new radio stations. We are really pleased about that.

On the other side, I have had the good fortune to lead five trips to Asia on Māori trade and economics. We have watched as our people have grown in terms of negotiating, producing the product, producing the quantity to go through, and so on. I am really pleased that $8 million has been provided for a Māori innovation and investment readiness fund, to go alongside the $6 million for Māori tourism. The Māori tourism unit has been really supportive of Māori going overseas and mixing and meeting with Ministers in different Asian countries, establishing relationships, and then, ultimately, trading, and so on.

I think a really key win for us was to resurrect the pūtea, or the money, for a centre of research excellence. We heard that Ngā Pae o te Māramatanga—the Māori research unit—had not been funded again, and was finally going to disappear. Ngā Pae o te Māramatanga was so important as a research centre—

Hon Maryan Street: It certainly was.

Hon Dr PITA SHARPLES: It was, was it not? It was a great thing to have. Way back in my day there were only five of us who had a PhD, and now there are 500 Māori with PhDs. A lot of them had the research support from Ngā Pae o te Māramatanga. So after support came in from the community, a hundred letters came from overseas urging the Government to reconsider the funding, and we joined in with that tono and ended up with a fund of $5 million a year to establish a new research centre. So it is kind of good, having a new one.

Hon Maryan Street: What was wrong with the old one?

Hon Dr PITA SHARPLES: It was partly because Māori were looking at it as a way of perhaps adapting it better to suit what they had. We worked through this with Ngā Pae o te Māramatanga, and it is keen, too, that there should be a brand new one.

Hon Maryan Street: Competing for the same money.

Hon Dr PITA SHARPLES: Well, then they are not competing against each other, you see. The second area of development was moving the nation. This is a possibility of sports getting some pūtea, so that we can sponsor Māori sportspeople and Māori sports such as ki-o-rahi and waka ama and the other sports that they are very active in, like netball and sevens and things like that, so all that is good.

It has been a really good Budget for us. Whānau Ora again succeeds, with $16 million to help getting kaiārahi appointed so that they can take the programme out amongst the community. So just to wind up, I was impressed by the analysis by KPMG partner Adrian Wimmers, who said that regardless of the election outcome, the Māori Party’s Whānau Ora approach is now an accepted part of how the Government interfaces with iwi. That is one of the reasons why we are here—to bring other options to whoever is in Government, based on Māori tikanga and culture and values, so that it can be part of the delivery of services from this Government or any Government, and so on. Adrian Wimmers said: “What I see in this Budget is a sea of change in the Government’s thinking and a move towards a more devolved set of arrangements as iwi’s capability to contract, to deliver, and manage social outcome provision increases.” To me, that is what it is all about. Thank you for the chance to have a short brief on this. Thank you.

KRIS FAAFOI (Labour—Mana): It is always a pleasure to follow the Hon Dr Pita Sharples, especially in this Budget debate. Dr Sharples used the analogy of the roadrunner in his speech to describe the Māori Party and the Budget. I would like to take a similar approach, because he has done that, and use a cartoon character to define this Budget. I would call this a mickey mouse Budget. I have got nothing against Mickey Mouse; he is a pretty good cartoon character. I am using the phrase “mickey mouse” in its slang usage, as, to me, being a bit of a pretender and something that it is not. This Budget is a mickey mouse Budget. It is a mickey mouse Budget. I say that because before the Budget was delivered—and I think it was in the Fairfax media—the polls said that 80 percent of New Zealanders wanted something to be done in this Budget around housing and for first-home buyers. This Budget has failed to deliver in that area. It has also failed to deliver in the social housing area.

Before I get on to housing—because I am going to spend most of my contribution talking about housing—I wanted to pick up on something that Dr Sharples said around health and the extra investment, apparently, that this Government has made around health funding. Well, Dr Sharples, David Cunliffe and I visited the Cannons Creek Pharmacy yesterday with the pharmacist Kas Govind, whom my colleague Maryan Street and I have visited a number of times. You should see the bulging prescriptions that have not been picked up by the people in my community who cannot afford to pick up their prescriptions because of the extra surcharge that this Government put on those people to pay more for their medicine. So it is fine to add more resources to making sure our youngsters can go to the doctor, but this is the same Government that made it more expensive for those families to pick up a prescription. Those families are not picking up those prescriptions because that extra couple of dollars for those prescriptions is making a huge difference and they cannot afford it. If you want the evidence, I will quite happily take anyone from that side of the House to that pharmacy to see just how many of those prescriptions are not getting picked up.

So do not believe the hype from this Government about what it is trying to do to help families around health care, because there are some fiddly things going on with the Budget numbers there. The reality is that this is the same Government that put up prescription charges, and families out in our communities—and that is the reality, if you want to go into that chemist or that pharmacy—are not picking up their medicine. They are not picking up their medicine that from day to day is meant to keep them healthy, usually when they have long-term illnesses. I do not want to see the Government members crowing about all the fantastic work they have done with health care, given the damage they have done with health care with some of the basic things, in terms of making sure families have got their medicine after they go to the doctor. I think what the party over that side is trying to say is disgraceful, when it says it has done good things around health care.

Housing is a big issue. New Zealanders wanted to see something in this Budget around housing, around housing affordability, and around making sure that there is enough social housing. This Government has not delivered one little bit. It was interesting to hear what the Prime Minister had to say when he was asked whether or not there was a housing crisis. He said that there is no fundamental underlying reason to believe that there is a problem in our housing market. Well, that is simply not the case. As I said, David Cunliffe and I were in Cannons Creek yesterday and we visited a great organisation, Wesley Community Action in Cannons Creek. That organisation told us of a number of examples about the stark reality that there is a massive housing crisis—certainly in my community that I represent, and not just there but around the country.

First, I want to talk about one story that one of the staff told us about one of their family members, who had been slaving away and doing the right thing to make sure that they could put together a deposit for a house. Then the loan-to-value ratio scheme came in, and they were shot. They basically put their hands up in the air and said: “Well, we can’t get to 20 percent. We won’t even bother looking at buying a house any more.” That is the reality of the situation in many, many families. They try to slog their guts out to get 10 percent. That is hard. Some families can call on their parents or other family members to put together a deposit, but this family were slogging their guts out, had almost got to where they needed to get for their 10 percent deposit, and then the bank said: “Well, we can’t deal with you any more because it is now a 20 percent deposit.” That was out of reach for that family.

Those kinds of families out there were looking for some relief in this Budget to make sure that the Kiwi dream of buying a house could come true for them, but there was nothing at all in this Budget to help those families. As I say, the Ipsos poll said that 80 percent of New Zealanders wanted something for those kinds of families, but not one measure in this Budget helped that family one little bit. They were looking for some hope, so that maybe the money that they had squirreled away might be useful again for them to get into a house, but, no, there was nothing whatsoever. And what did we get? We got a few changes around construction materials, which will save $3,500 for those who want to build a new house. That is 1 percent of what it costs to build a new house, and that Government over there thinks that that is going to be some kind of sea change for our housing crisis. Well, it just does not cut the mustard.

The other area that Wesley Community Action was concerned about was social housing, and we have seen this Government take a backward step in terms of its responsibility for social housing. Over the last 5½ years we have seen what it has done to Housing New Zealand. Certainly, in my area, because we have got such a large number of Housing New Zealand tenants, it used to have a big office, which serviced all the tenants. You could go in there and you could have an appointment, and make sure that all your matters were dealt with. That turned into an 0800 number, on which it sometimes took hours to get an answer. After a bit of a furore locally, we got a little booth that opened up in the smaller Housing New Zealand office, which was no longer—

Iain Lees-Galloway: You were lucky.

KRIS FAAFOI: Yes, we were the lucky ones. That is basically a service where they put your name on a piece of paper and someone from the 0800 number answers the call. The way that this Government has completely distanced itself from offering and providing social housing in those kinds of communities is a disgrace. It has said: “That’s not our responsibility any more.”, and, as we can see, it is starting to palm off that responsibility to other people in the community.

In theory, that should work if you resource it well, and I am a big fan of making sure that communities should be part of the solutions to issues in communities. But the big fear in our community—and we have seen this happen before, about 25 years ago—is that we will have a rerun of history. Those well-meaning organisations get into that sphere, they start up managing x number of former State houses, but over time that funding gets reduced and they put their hands up and say: “We can’t do this any more.” I was speaking to one of those providers about a month ago. We should learn from that lesson, and if we are going to give more responsibility to community organisations, we should do it properly for the sake of the people who are living in those houses—for the families who are living in those houses and will depend on those social agencies within our communities to do a good and decent job of providing social housing.

There is an alternative to what this Government is doing, which is nothing, and that is a number of the policies that we have already outlined over the last couple of years, to be honest. The first one is our KiwiBuild scheme. It is brave, ambitious, and absolutely needed to make sure that we can get Kiwis into good, affordable homes—100,000 homes over 10 years. Not only will that provide good, affordable homes to the Kiwis who need it but also it will give the shot to the system that our youngsters and our country need in terms of jobs. I think that there are certainly a lot of youngsters—and I know there are a lot of Pacific Island youngsters because our unemployment rate is twice the national average; it is about 13 percent at the moment—who would love that opportunity to get into that kind of scheme and to learn some basic skills. Gosh, I wish I had learnt some of those basic skills when I was younger, because some of the youngsters in our community are away laughing because they have got some of those basic skills.

But, again, this is a Government that cut apprenticeships about 2½ years ago. This is—

Jacqui Dean: Oh, nonsense.

KRIS FAAFOI: Nonsense? It is actually true.

Also, there will be the introduction of a capital gains tax to make sure we take the heat out of this inflated property market, because, as I say, it is hard for those first-home buyers to get into the market because the prices have gone up so much. Also, we will get that investment out of property speculation and into the companies that want it and need it, so that they can buy the capital and hire the Kiwis whom we know need and want the jobs, because that is what people really want. They want a good place to live, they want to make sure that they have got a good job to support their families, and that is what this Government has not done or given any hope for in our communities. This was a Government that once said it was ambitious for a brighter future, but what is in this Budget is mundane and it offers no hope to anyone, especially in housing.

JACQUI DEAN (National—Waitaki): This was not a mickey mouse Government Budget, but that sure was a goofy contribution from Kris Faafoi. So I was talking to people in—

Kris Faafoi: Ha, ha!

Maggie Barry: It didn’t take long.

JACQUI DEAN: Ah, yes, not my best work, but, you know—

Tim Macindoe: What a great line.

JACQUI DEAN: Yes, a great line. I want to give thanks, first of all, to the senior whip for providing me with my best lines.

Tim Macindoe: It was actually the junior whip.

JACQUI DEAN: Oh, it was the junior whip, yes. I was talking to the people in my electorate of Waitaki about the Budget on the weekend—in fact, I did not have to talk to them about the Budget because people were pretty keen to come to talk to me about the Budget—and some of the feedback was pretty interesting. What people were saying to me was that this Budget, delivered by Bill English, was pretty much what they had come to expect from this Government. So what they were seeing was, again, a focus on sensibly managing the economy and doing what we said we would do. That has been a consistent message for the past six Budgets, and again it was the message in this Budget.

We said that we would return the economy to surplus, and we did. We said that, overall, we would get crime down, and, yes, that is what we have done. We said that we would put the victims of crime at the centre of justice policy, and that is exactly what we have done. We said that we would provide more, and more timely, elective surgery and cancer treatment, and we have. We said that we would invest in improving education outcomes for all New Zealand children, and we have done that. We said that we would build a more productive and competitive economy, and we have done that.

I also heard lots of congratulations for Bill English on his sixth Budget. One gentleman whom I know quite well, and who has quite a salty turn of phrase—and I will leave the saltiness out of it, but I will give you the essence—said: “You don’t get a fiery Budget speech from Bill English, but my, it is worth listening to.” So that has been the reaction from my wonderful electorate of Waitaki. And what about Labour? Well, we have not heard terribly many policy announcements from those members.

Iain Lees-Galloway: Ha!

JACQUI DEAN: Oh, yes—actually, we have. We have—the trucks. So Labour has announced that it is going to ban trucks—

Hon Nathan Guy: Any four-lanes in the south?

JACQUI DEAN: —on any four-lane motorways. The question I have, and it has just been raised by the Hon Nathan Guy, is this: what is the impact going to be on the South Island of this marvellous policy, for all New Zealanders on behalf of Labour, to ban trucks from four-lane highways? Well, the answer is that there are not any four-lane highways in the South Island.

Hon Nathan Guy: Ah! They don’t care about the South Island.

JACQUI DEAN: So those members do not care about the South Island, and once again, they show that they really have no understanding, interest, or care for rural New Zealand.

On that note I want to acknowledge the farming community, which is a large part of my electorate, for being the true backbone of the New Zealand economy. I may be biased, but I hold that view. The Business Growth Agenda has truly backed up the farming community in this Budget. We are developing new markets. There is $69 million extra for New Zealand Trade and Enterprise to grow New Zealand’s presence in China, South America, and the Middle East, and there is funding to enable 200 more firms to break into those overseas markets. It is one thing to create the markets, but then the next step—the good step—is to enable New Zealand businesses to take advantage of those opportunities.

There is $57 million in contestable funding for science and innovation. Have those members not gone awfully quiet on their shonky research and development tax credit proposals? There is $53 million to establish three more centres of research excellence. There is $83 million to lift tuition subsidies in science, agriculture, and health services. There is $20 million extra going into apprenticeships.

We are looking at 4 percent economic growth in the next 4 years. That is growth in the cities; that is growth in the regions. The Otago region is growing strongly. That growth is based on agriculture. It is based on tourism. It is based on viticulture. It is based on education. It is based on manufacturing. And it is based on a good southern can-do attitude. The Otago region is absolutely picking up the challenge with the cycle trails. The cycle trails are absolutely transforming the South Island, and the South Island is quickly becoming a bucket list destination, unrivalled anywhere else in New Zealand. Others might have a different view on that, but that is the view that I hold—unrivalled in New Zealand.

We should not lose sight of Labour’s record in Government. I think it is important to remind ourselves. In 2008 the country was in recession, on the back of a decade of the best of economic times. That is what National inherited. Mortgage rates were touching 11 percent. How quickly Labour members have forgotten that. House prices went up 96 percent—96 percent—under Labour, and now those members are talking about housing. What short memories Labour members have—there was a 96 percent rise in house prices under a Labour Government. Electricity prices went up 72 percent under Labour. That is David Parker’s legacy. Woe betide the country if David Parker ever gets in charge of electricity policy again, because we will have a single buyer for electricity absolutely killing off any innovation in the electricity sector. But I think that Waitaki learnt that lesson about David Parker, and the rest of New Zealand has, as well.

This is a Budget that focuses on issues that matter. This is a family-friendly Budget. We are putting the well-being of young families and children at the heart of our new spending. We are spending $500 million to help families and to help children, including vulnerable children—those children who are most in need. There will be free general practitioner visits and free prescriptions for all children under the age of 13. It took National to do that. There will be 4 weeks’ extra paid parental leave, and we will extend it to caregivers other than parents. Who did that? It took National to do that. We will increase the parental tax—

Sue Moroney: Oh, that mother there didn’t need it.

JACQUI DEAN: They hate this—they hate this. Sue Moroney is sitting on the other side of the House absolutely spitting. Why? I would have thought it was a good thing for the Government to support families. Why does Labour not support families?

Maggie Barry: Angry and bitter.

JACQUI DEAN: Well, angry and bitter. Maybe they just talk the talk. We will increase the parental tax credit by $70 a week to $220 a week and we will increase the length of that support to 10 weeks. Who did it take to do that? It took a National Government to do that. We have put $155.7 million more into early childhood education to get even more children participating and to keep the costs down for parents. Who did that? It took a National Government to do that.

There is $33.5 million extra to support vulnerable children. That includes eight new Children’s Teams to work with at-risk children and their families and to support children in care. It took Paula Bennett to do that. Paula Bennett is a Minister who understands children and who understands the needs of families.

When I look at my own part of the country, it does very well out of the Budget. Older folk will get more hip and knee operations. Should we need cancer treatment, we will get that in a more timely fashion. There will be more support for people with dementia. There will be a further $20 million for the battle against rheumatic fever and another $6 million for cochlear implants for children. All of those measures will have a good impact on my electorate of Waitaki, as they will for the whole of New Zealand.

This is a good Budget. It was delivered by a Prime Minister who wants the best for all New Zealanders. This is a confident Budget delivered for a confident country. Thank you.

SUE MORONEY (Labour): I think that last speech by Jacqui Dean just proved what we know—that the Budget showed the Government is out of touch and out of ideas. It is out of ideas because the things that the Government is trumpeting here tonight are things that it took from what Labour was on about and watered them down. The Government watered them down substantially—in fact, so much so that 26 weeks’ paid parental leave became just 16 weeks’ paid parental leave. So next year there will be only 2 additional weeks of paid parental leave, and then not until the following year will there be another additional 2 weeks. That is what you call next to nothing. The only thing less than that that the Government could have done with paid parental leave is to do nothing. That clearly was not an option for the Government because of the Labour Party’s Parental Leave and Employment Protection (Six Months’ Paid Leave) Amendment Bill, which is in front of Parliament right now and commands a majority in Parliament. So the Government did the very least it thought it could get away with.

No one believes that it is authentic for the National Government to have New Zealanders believe that this is something it wanted to do or that this was the Government’s idea. The truth is that the New Zealand public has witnessed National being dragged, kicking and screaming, towards extending paid parental leave at all, and it is not authentic for the Government to argue any other way. So the Government is out of ideas, and it is having to come to this side of Parliament to look for the way forward. Well, look, New Zealanders can just cut out the middleman and actually get a Labour-led Government in place. Cut out the middleman, get a Labour-led Government in place, and we will do it properly. We will actually do it properly and make sure that families are properly resourced.

All of the information, evidence, and research tell us that it is not a little election-year gimmick like 16 weeks’ paid parental leave that will make a difference for families; it is actually listening to the research and evidence, and understanding that 26 weeks’ paid parental leave is what we need to get to. Twenty-six weeks is when the health benefits come in. That is when we know that children have had that opportunity to form that really good close bond and attachment with their parents that will turn them into resilient and well-balanced citizens. That is when we know that parents will feel better about returning to the paid workforce, knowing that they have actually had that valuable time with their newborn baby. Sadly, turning that into an election-year gimmick like National has done actually undervalues it. It diminishes families and it diminishes the views of all the people and organisations, like Plunket and Barnardos, that have come forward and come out in support of getting it right—doing it properly and getting 26 weeks’ paid parental leave.

So we know that National is out of ideas, but we also now know that it is out of touch. How do we know that it is out of touch? Because the big problems that New Zealanders are struggling with day to day were not even mentioned in this Budget. There was no attempt to deal with the issues that matter—no attempt to deal with the issues that matter. Issues of housing are of deep concern to New Zealanders who are trying to enter into the housing market and get their first house. It is a deep issue for people who actually are wanting to get into any sort of decent house at all.

In Hamilton we are facing a situation right now where we have got vacant State houses lying around while people cannot even get on the waiting list of Housing New Zealand. They are having to stay with relatives, having to go into camping grounds, and having to sleep in their cars and in other people’s garages because they cannot get on the waiting list for Housing New Zealand in Hamilton, yet there are empty State houses littering our neighbourhoods. The people of Hamilton are asking what is going on. What is going on is that that Government is reneging on its responsibilities to provide decent housing. That is what is going on, and nothing in this Budget—in this “fudge-it Budget”—will do anything to address those very immediate and very real concerns.

We also know that the Government is out of touch, because when it did move—when it was pushed into putting some money into supporting families—it was not for all families. Not all families benefit from this Budget. The Government chose to leave out the most vulnerable children in the lowest-income families.

Tim Macindoe: $492 million is lots of money.

SUE MORONEY: Well, Tim Macindoe, you did.

Tim Macindoe: That’s not right.

SUE MORONEY: Your Government did. It is absolutely correct. Who misses out on the parental tax credit?

Maggie Barry: You.

SUE MORONEY: Well, Maggie Barry probably does, because she is not having children any more. I am not having children any more. I am going to declare it: my child-bearing days are over, all right? This has nothing to do with self-interest here. I am going to declare it. My child-bearing days are over, but this is for others. I am not concerned about myself; I am concerned about the generations that come beneath us and the generations still to come. Yes, I want my grandchildren to have access to decent family support. That is what I want. It is not about me.

This is about that Government being out of touch. It left out the lowest-income families from its package for families. The children of beneficiaries—no, they do not count. They are not valued by a National Government. They can go sing for it under a National Government. The children of students—so it might be mature students or second-time-round students—will not get anything out of National’s package. And what about the children of those who are actually on ACC at the time that they give birth? No, they are not going to get a look-in, either. So this package was not for all families. What does that do? It grows inequality. It grows inequality. It is not even as if the National Government has turned a blind eye to the current set of inequality settings; it is deliberately growing inequality. This is how it works: put up the parental tax credit, extend it for a bit longer, but do not give it to the families who need it most. What that does is it leaves them even further behind.

That leaves them even further behind, but it can be fixed. It can be fixed by Labour’s Best Start policy, because Labour’s Best Start policy is for all families. All families will benefit from an additional $60 a week if they have a newborn child—all families. Well, in fact, they will benefit from at least that, because if they qualify for paid parental leave, they will get that extended to 26 weeks under a Labour Government, and they will get it extended at a much faster rate than that Government is prepared to do. So by 1 July next year, under the election-year gimmick that the National Party has reduced it to, paid parental leave will be only 16 weeks under a National Government. Under Labour, on 1 July next year, 22 weeks’ paid parental leave will already be in place. That is the commitment under the Best Start policy, so it is not hard to work out—16 weeks under a National-led Government next year versus 22 weeks under a Labour-led Government next year. It is not a hard choice for the electorate to make.

But wait, there is more. By 2017 Labour will extend paid parental leave by a further 4 weeks to get to that critical number of 26 weeks. There is nothing magical about that number except that the development of a baby at 6 months old is so much more advanced. If they have had that time to actually advance their child development, brain development, and bonding and attachment while they have had parents who have had that financial stress and worry removed from them so that they can focus on bonding with that newborn baby for that 6-month period, then all of us get to win. All of us get to win.

I just want to come back to what happened last week with that very underwhelming and disappointing Budget. It shows us that a Government that was once ambitious for New Zealand has completely lost that sense of ambition. Any old thing will do. Any old election-year gimmick will do for the National Party. Well, that is not good enough for the Labour Party. National is out of touch, it is out of ideas, and come 20 September it will be out of office.

MAGGIE BARRY (National—North Shore): I rise to speak on the Budget debate. This sixth Budget from our Minister of Finance, the Hon Bill English, delivers where it matters most for our children and for their families. [Interruption] Thank you. Shall I start that again? What do you think—start the clock?

Mr DEPUTY SPEAKER: All right.

MAGGIE BARRY: Start the clock. OK. This is a Budget that delivers where it matters for families and for vulnerable New Zealanders. There are a lot of measures I could talk about in my contribution to this Budget debate. I will concentrate on just three of our priority areas: health, education, and how we have helped vulnerable children. No Minister or member of Prime Minister John Key’s caucus is ever allowed to indulge in the kind of rubbish and rhetoric that we have heard from the Opposition so far. Its big-spending, big-borrowing squandering of taxpayers’ hard-earned money—no way. We have a plan, we have targets, we work towards them, and we have a very disciplined approach. When we reach the targets and when we reach the savings, then and only then do we allocate money to invest in our priorities.

Tony Ryall is a very good example of his kind—a canny manager of the public health purse strings. Our Minister of Health’s very careful control over the health budget in the past 5 years has seen district health boards reduce their deficits from an estimated $200 million overboard to around $25 million. Clawing that back has helped free up some $412 million of savings, which is now available to invest in new health initiatives. That is a stark contrast to the incompetent management by Labour’s Annette King, when she bumbled her way through far too many years of mismanagement of our health system, borrowing and spending up large in all the wrong places. Waiting lists grew. We had people going overseas for cancer treatment. We had endless examples of people who were very ill on stretchers in corridors. I am talking about only my own electorate, in North Shore Hospital. The district health board in Waitematā has been turned round. Under Tony Ryall’s governance and Lester Levy and the rest of the team, it is now a world-class, top-performing district health board, and one I am very proud to have in my community. Again, that is a stark contrast to the hopeless bumbling we saw from the Minister of Health in the Labour administration, Annette King.

Under Tony Ryall’s watch, 40,000 more patients every year now receive hip and knee replacements, and we will be spending another $110 million on those sorts of elective surgeries. These are the sorts of operations that really are priceless to the patients who receive that new knee or that new hip. It reduces their pain, it restores their independence, and it really does improve their quality of life. Under Tony Ryall, for the first time ever, our health spending will top a record $15.6 billion. That has allowed the Minister of Health to target the spending at where it will make the most difference. He has invested $33 million into better cancer services. The 20,000 New Zealanders each year who receive the terrible news that they have cancer will have better and faster diagnostic and treatment services. Again, that is priceless.

In my North Shore electorate, people have come up to me in the last few days since the Budget and they have said how delighted they are with the extension of free general practitioner visits and free prescriptions, which is now being rolled out to all children under 13. That $19 million investment has been welcomed by agencies like Plunket and all of the parents I have spoken to, who have said they will not hesitate any more to take their children to the doctor as soon as the children start to show signs of illness. That means that the children will not get as ill. It gives peace of mind to the parents and saves a lot of misery for the children. It is expected that some 400,000 primary school - aged children will benefit from that measure alone. An extra $112 million for disability support services to meet rising needs and costs will make a huge difference to the one in five New Zealanders who suffers from disability. Our seniors will also really appreciate the $96 million for home-based support services and the $40 million for additional support for elderly people, including those with dementia. There are more details to be announced on that a little later.

There is also going to be spent in this Budget a further $20 million for the rheumatic fever prevention programme and $4 million to increase the number of renal transplants performed. I know about that firsthand in my own electorate. A couple of weeks ago I represented Tony Ryall and opened a new community dialysis centre in Mairangi Bay—a state-of-the-art, world-class facility that is going to make a phenomenal difference to the quality of life of the people who suffer and have to do renal dialysis all the time. It is a marvellous facility, and the stories were absolutely heart-wrenching—the joy that those people felt at being able to have such a facility within their own community so they no longer have to travel long distances to get the treatment they require.

When it comes to education, our Minister of Education, Hekia Parata, and Associate Minister of Education Nikki Kaye have really delivered for our children in places that matter. Our spending on early childhood education is excellent, and combining that with primary and secondary education, spending is going to be about $10.1 billion in this financial year. We are investing $155.7 million of that in early childhood education services, and that is really going to help the parents who have to make the choice to go back to work and the parents who need to know that their children are being looked after well. We all know, I think, that early childhood education plays a crucial role in giving children the right start in life, particularly in our most vulnerable communities. I know that Hekia Parata is particularly proud of the gains we have made for Pasifika and Māori children in that regard. It has gone from a very poor turnout and a very poor uptake of early childhood care services and early childhood education, to a much more robust participation.

As many of you know—we have talked about it in the House often enough—we have targeted that 98 percent of New Zealand children will participate in early childhood education, and that will be by 2016. We are already delivering, at 93 percent, and are very likely to reach the target beforehand. When you look at where money has been spent, Labour managed about $800 million on early childhood education back in 2008, and we have put in $1.5 billion. That is how much we care, and that is how much we believe that we put our money where it counts—with our young and with our vulnerable children.

That brings me to the Hon Paula Bennett. This Budget has also invested to protect our most vulnerable children. The tragic statistics are indeed sobering. On average there are around 22,000 cases of abuse and neglect of New Zealand children each year, and more than 50 children have died in the past 5 years because of extreme abuse. That is intolerable, that is unconscionable, and it must not continue.

Tim Macindoe: Horrific.

MAGGIE BARRY: It is horrific, as the junior whip has just said. It is sobering for all of us to be reminded of the statistics, to know the names of the Nia Glassies, to know the names of those children who represent the tragic face of these terrible figures. We really need to put some money into that and to make a real and practical difference by committing to the most vulnerable children. We are doing that. The protection of children from abuse and neglect has been further strengthened in this Budget by $33 million in operating funding. The Budget has committed $16.5 million to continue to develop new ways of working together, implementing the new services, and ensuring greater monitoring of at-risk children and young people.

One of the things I really like about the way the Hon Paula Bennett operates in this space is that she knows it so well. She has an enormous enthusiasm for it. She came to my electorate, and we went into the Work and Income office and the Child, Youth and Family office. These were unannounced visits. She certainly made an impact when we went in there. She has a way of bringing people together. I think one of the very successful things she does is encourage the various agencies to work together in a way that is cooperative. They do not share private details unless they need to, but talking together and working together on a common cause has really worked. I think that with the good progress she is making on implementing the Children’s Action Plan, with two Children’s Teams up and running already—one in Rotorua and one in Whangarei—the new funding is going to mean that eight extra Children’s Teams will be rolled out in the next financial year.

These are the measures that are making a phenomenal difference to families, to children, and to vulnerable people in New Zealand society. We are not sidetracked by the sideshow, the muckraking, and the ludicrous antics of a desperate Opposition. Those members are braying, and their unhappiness is evident. You look across the Chamber—they are unhappy people. They do not like their leader. They do not like their policies. They do not like their chances of getting the Treasury benches any time soon, and for the good of the country I am very grateful about that. When I look at this Budget, I see a family-friendly Budget that makes a huge difference to people’s lives, where it matters. We will put aside the trivia, the nonsense, and, I suppose, the desperate posturing of our political opponents and instead focus on the extraordinarily good benefits that have been handed down in this Budget. I am very proud of this Budget and I commend it. Thank you.

IAIN LEES-GALLOWAY (Labour—Palmerston North): I find that the best way for finding out what is important to people in my electorate is to head down to our local markets every weekend. We have got the Albert Street market on Saturday and the Cloverlea market on Sunday. When I talk with people at those markets I hear some pretty clear things about what it is people want out of life. They want a place to live. Most people want to own their own home, but everybody wants a warm, dry, safe place to live. They want a job. They want a decent job that pays decent wages. They want to know that that job is secure and that that job will be available for them tomorrow, next week, next month, next year. They want to know that their family is safe. They want to know that their family will be healthy. They want to know that their family is going to get a good education. They want to know that their family has opportunities in life. They want a future for themselves. They want the opportunity to get ahead. They want the opportunity to advance in life, and they want their kids to have better opportunities than they had when they were growing up.

Those are some pretty basic things, but I think that is pretty much what everybody in New Zealand wants. That is what people want out of life, and those are the kinds of things that people expect their Government to support them in. Labour backs them in that. Labour has the policies to help people get ahead in life. But before we can do all of that stuff we have got to make sure that the books are balanced, that the country is being run in a sensible manner, and that the Government’s books are in good shape. Labour has a good history on that with 9 years in Government under Helen Clark, and 9 years of surpluses. There was zero net debt by the beginning of 2008. Labour ran surpluses and Labour paid off the debt. Labour got the Government’s books into a position where, when the rainy day came, there was room for the National Government to move. There was room for the National Government to borrow, and it borrowed $54 million over 5 years—

Dr Rajen Prasad: $54 billion.

IAIN LEES-GALLOWAY: —$54 billion, I should say. If only it was only $54 million. That had to happen—it had to happen—but, of course, the Government squandered a lot of that on tax cuts for the very rich. It put GST up for ordinary working people, it put the prescription charges up for ordinary working people, and it put the general practitioner fees up for ordinary working people to pay for those tax cuts that went to the top 10 percent. That is what happened while the Government was borrowing that $54 billion.

What people were looking for in this Budget was a sign that the Government had control over the finances. That is why this Government has been so keen to try to convince people that there is actually a surplus. But we know the surplus is made up. We know the surplus is absolutely made up, because if the surplus was not made up the Government would be making cuts to the ACC levies this year, not waiting until next year, not putting them off until the following year. In this Budget year there would be ACC levy cuts. Of course there should be cuts to the ACC levy because the Government put your ACC levies up when it claimed that there was a crisis. National created a phoney crisis when it came into Government, and what was the result of that? ACC made a $5 billion surplus. That is your money, New Zealand. That is your money that the Government has taken from you to try to create its phoney surplus this year, with its fudged numbers. That is where your money has gone.

Most of this surplus has come from the motor vehicle account. Everybody who owns a car, everybody who owns a motorbike, and everybody who drives for a living is being overtaxed by this Government so that it can create its phoney surplus. New Zealanders want the Government to get the books back into good order, but they want to see real evidence. They want to see the economy growing. That is how they want to see the Government get the books back into surplus, not by overtaxing them and overcharging them in every manner it possibly can. The poor old paper boys—remember that? The Government decided to tip the poor old paper boys on their heads and get every little bit of loose change out of their pockets. That is how this Government has created its phoney surplus.

What this Government failed to address with this Budget was the issue of housing. Housing affects absolutely everybody. If you own your own house, then you are going to be pretty worried about interest rates going up, even though general inflation—if you take the tax increases on cigarettes out of general inflation—is absolutely nil. The only thing that is driving prices up is the tax increase on cigarettes, and, yet, interest rates are going up. Why? Because that Government has failed to address the housing crisis in Auckland. If you are planning to buy your first home, then the Government has just made that a lot harder as well because we have got these loan-to-value ratios whereby people now have to get a 20 percent deposit to buy their own home. It is not just in Auckland, where there is a housing inflation crisis, and not just in Christchurch where, because of the rebuild, house prices are going up, but all across New Zealand. In my own city of Palmerston North people cannot afford to buy their first home now because they have to put that 20 percent deposit together.

I was talking to someone about a month ago who has just moved into a senior management role. They are in their early 40s. They have got a couple of kids. They studied, they got a good job, they worked all their life, and they have done everything right. They have tried to put the money together for a deposit for a first home. They thought they were just about there. They were just about there and then the rules changed, and the dream of homeownership for that family, who have done everything right, is again just out of reach—thanks very much to this National Government.

If you are in a rental house, then the quality of rental housing has been completely overlooked by this Government. Yes, it has done a little bit of work around State housing, but most people live in private rental accommodation and the quality of that is going down while the rents keep heading up. Woe betide if you live in a State house, because you are probably just about to get kicked out of your State house, and, of course, what we know is that up and down the country this Government is getting rid of State houses. Five hundred State houses are to be taken out of the city of Palmerston North and an extra 100 are to be taken out of Ian McKelvie’s electorate in the wider Manawatu.

If you drive down Rugby Street in Palmerston North at the moment, you will see State houses being knocked down. If you drive along Botanical Road in Palmerston North right now, you will see land that has been empty for years where State houses were taken away and nothing has ever been done with that land by this Government. If you drive around Farnham Avenue in Palmerston North right now, you will see boarded up, empty State houses that are deteriorating in quality—having the hot-water cylinders stolen out of them, and being covered in graffiti because that Government over there has shut down so many State houses across the country, is doing absolutely nothing with them, and is devaluing one of the largest State-owned assets in this country. That is the record of that National Government.

It can be a lot better. It can be a lot better, and under a Labour Government things will be a lot better. We have our KiwiBuild plan to build 100,000 homes across the country. That will take the pressure off housing affordability in Auckland. It will mean that the loan-to-value ratios will not have to be applied in the provinces, where people are being hammered by them. That is a bold plan and that is what Labour wants to do. We have some bold plans for monetary policy as well. It is not good enough that interest rates are being driven up when there is no inflation in New Zealand. That is not good enough, but David Parker has actually been thinking about this—thinking is not something that is the strong point over in National—and he has come up with this brilliant idea of making sure that KiwiSaver is compulsory, first of all, so that can be used rather than increasing interest rates to take some heat out of the economy, but also there would be variable KiwiSaver rates. Rather than having to pay more money to the bank, you actually get to put more money into your savings and that will be available when you retire. That is smart policy. That is thinking policy, and those are the kinds of policies that we are coming up with over here in Labour.

We need to make sure that we put a bit of a lid on offshore speculation in the housing market in New Zealand. There is no value in having foreign capital go into residential housing. Where foreign capital creates innovation, where foreign capital creates jobs, or where foreign capital creates better opportunities for New Zealand, that is a good thing, but there is no value from foreign capital being poured into our houses. It just pushes the prices up and it makes the dream of owning your own home that much further out of reach for ordinary Kiwis. There is a clear difference here between a Budget that delivers nothing for ordinary New Zealanders and a Labour Party that wants to put people first and put people at the centre of our policies—

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

JOHN HAYES (National—Wairarapa): I was in Iain Lees-Galloway’s electorate about 3 weeks ago at a women’s expo, and I was astonished that there were no members of the Labour Party there. Hundreds of people came up to the National Party stall at that fair, and they made it very clear to me that that member will not be in the next Parliament, because Jono Naylor, the Mayor of Palmerston North, is going to wipe the floor with him.

Iain Lees-Galloway: Hardly.

JOHN HAYES: If you are thinking that I am not telling the truth, have a look at IPredict, because you are at less than 50 percent.

I have listened to speech after speech after speech from that side of the House—

Hon Trevor Mallard: I raise a point of order, Mr Speaker. I thought you were going to intervene on your own behalf. To suggest that you might be thinking that the member is not telling the truth is certainly not parliamentary.

Mr DEPUTY SPEAKER: The member is correct, but he is not the first contributor to this debate who has made that error. I have been even-handed in admonishing people—[Interruption] Order! I am on my feet. Do not interject. It is timely to just remind people again about pronouns and not bringing the Speaker into it.

JOHN HAYES: Mr Deputy Speaker, I was not bringing you into this debate at all. Speaker after speaker after speaker tonight has raised the issue of house prices. I will be straightforward. The record is very clear. In 9 years of a Labour Government, house prices went up 96 percent—96 percent. In 6 years of a National Government, they have gone up only 28 percent.

Then we had Mr Faafoi, who could not get past Walt Disney, referring to a mickey mouse Budget, because he does not understand the whole Budget process. And we have just listened to a man talking more about his electorate, but that will be the last Budget speech he ever gives because he will not be in the next Parliament as the electorate member for Palmerston North.

Budgeting is very little different from running a household bank account. It is very simple. Money comes in from everybody’s pocket, which is called taxes; money goes out, which is expenditure. If there is a gap, there is only one thing to do: constrain the expenditure, increase the income, or borrow. At least if you borrow, you can transfer costs over to future generations. This Budget, I am very pleased to say—and for the first time in the 9 years I have been in this Parliament—is predicting a surplus of about $370 million. That means that more money will come into the Government’s coffers than goes out. It means that for the first time in 9 years, and with future, larger surpluses, the Government is going to get an opportunity to repay debt or to engage in some extra spending, but not as much as the Labour Party or the Green members would. We do not want to push interest rates up because of the impact that that would have on people’s home mortgages. We are conscious of that.

Last week’s Budget demonstrates that New Zealand is heading in the right direction. The economy is growing and creating new jobs. Average wages are rising faster than inflation. Budget forecasts predict New Zealand growth of 4 percent next year, the creation of around 170,000 new jobs, and a $7,600 increase in the real average wage over the next 4 years. This Budget provides for $1 billion of new spending. That is based on a judgment call on the amount the Government thinks it can spend without putting pressure on interest rates. Half of this money will be used as a comprehensive, $500 million package to help families, and, for the first time, spending on health exceeds $15 billion a year. Spending on early childhood and primary and secondary education will reach $10 billion, with an additional $3 billion on tertiary education. Each of these commitments will help New Zealanders in practical ways in times of need and in support of a growing economy.

We are in an enviable position compared with many other countries. Just look at the Australian Budget, in contrast, which was announced the day before our one. New Zealanders have shown considerable resilience since the domestic recession that Labour left us with, which was followed by the global financial crisis and the Canterbury earthquakes. Responsible management will see Government debt reduce to 20 percent of GDP by 2019-20, when full contributions to the New Zealand Superannuation Fund can resume.

All of us have faced some tough years, but moving about my electorate in the Wairarapa I keep meeting optimistic people. They are in a buoyant mood now that things are looking up. That is not to say that some people in the electorate do not have other views. For example, a couple of ideas have been advanced locally by the Child Poverty Action Group. One was that a child’s first birth certificate should be provided free of charge. Currently, it is $26 per birth certificate for the 60,000-plus children—and, Mr Mallard, I know that it has sought your advice on this issue—born each year in our country. But what people do not sort out is that, OK, if we give people free birth certificates when they are born, there is a cost, and the cost is about $1.8 million a year. To recover that money, what is going to be cut to allow that to happen?

On a larger scale, I was interested in the comments of Wren Green, Chair of the Council for International Development, who on the one hand while on the radio last week praised the Government for increasing our aid programme by $200 million over the next 3 years to $600 million a year, or north of that, but then said: “Oh, but the programme needs to be increased to $1 billion a year. We must get to 0.7 percent of gross national income.” This is a typical example of people demanding particular outcomes but never saying what expenditure should be cut, just like the Opposition. Which taxes should be increased? The Opposition is quite straightforward about that. It wants to bring in a capital gains tax.

Money could also be raised by borrowing to meet the cost of an alternative policy. But the Government has to make these decisions, and it has to operate in the real world for the collective benefit of the whole community. That is what the election in September is about. It is about choosing representatives who are engaged with the community and who understand the balance of where community advantage is. In our case we are pushing health, education, security, and public welfare very hard because it is really important that the community is driven by those things. We know, as a Government engaged with the community, that those are the areas that the community wants the Government to be providing services in. I would say to voters in the next election that that means that they must find candidates who are engaged with the community, not like the list members of Parliament across the Chamber and those members of Parliament on that side of the House who will not even go on the list. We need to find people in our electorates who are engaged with the community to come into this Parliament to reflect the community view.

Tracey Martin: Like Hekia Parata, Steven Joyce, Alfred Ngaro, Melissa Lee, Bakshi—those list members?

JOHN HAYES: While I am on that subject—and there is a lot of twittering from the tweeter in New Zealand First—it is the party vote that determines who governs this country. That is the most important vote—it is the party vote. Do not waste it on xenophobic parties like New Zealand First, which would shut every immigrant out of this country. I am not prepared to stand by and watch this xenophobia from those people, and I am very glad I am not a Labour, Green, or New Zealand First candidate in the next election. Thank you.

Su’a WILLIAM SIO (Labour—Māngere): That was a wasted space in the speaking slots of this House from Mr Hayes, and I say goodbye to you, Mr Hayes. That is the last Budget speech he will ever give in this House. He is gone. He is gone, along with 16 other members of that National Party.

Hon Trevor Mallard: Rejected by the leader.

Su’a WILLIAM SIO: That is right—ejected by the leader and rejected by the leader, he will never ever return to this House or speak ever again in this House whatsoever.

After last year’s Budget I was asked by the Samoan community what I thought of that year’s Budget and what they got. I said to them that we were promised a brighter future; what we got was a slice of toast where we did not get any butter and we did not get any jam. That would be for the next year, which is this year. This year I was asked again what they would get out of this Government’s Budget. I said we were promised the butter and jam but we are not getting it this year. It comes next year and the following year, and in the meantime the Government has burnt the toast. It has burnt the toast. We are $56 billion in debt, paying $10 million a day in interest rates for that Government debt. It is costing us $1.2 billion because of the tax switch that favours the very, very wealthy—that group’s lot.

I want to tell you another story. When Mr Key first became the Prime Minister of New Zealand, many New Zealanders welcomed him as someone who was seen as not so buried in politics. They liked his rags-to-riches life story. They liked the fact that he had $50 million in his bank account. He was a seductive proposition to many New Zealanders who themselves wanted their own rags-to-riches stories to come true. He appeared to be easy-going, with a good sense of humour. Even our media loved him so much that they were giving him all the time in the world.

After 5½ years of his being the Prime Minister and of National being the Government, more and more New Zealanders now see for themselves the kind of Prime Minister he is and the kind of Government it really is. He made promises he did not keep. He promised not to raise GST and then went ahead and did it anyway. He made deals with the top end of town—backroom, multimillion-dollar pokie machine deals for convention centres and the casino Skycity. He gave the top 10 percent of income earners the lion’s share of the tax cuts while the rest of New Zealand paid increased GST. He refused to listen to the thousands of New Zealanders who opposed the selling off of our State assets. The Government sold them to the very few high rollers, instead of to mums and dads, as he had promised.

In the last 5½ years we have gradually seen the man and his Government for what they really are: a Government that does not care one iota about New Zealand and its people. It cares only about the sport of politics, power, and its mates, the high rollers. We have seen his arrogance and his refusal to listen to New Zealanders in the last 5½ years of his Government. We have also seen, last week during the Budget debate, the political animal he is, when he spent a major part of his speech attacking Labour and attacking our Labour leader instead of talking about why he did not make the well-being of New Zealanders the centre of this Budget. He does not care. The Government does not care about people. It does not care one iota about people. Instead, it cares about the sport of politics and holding on to power. It has revealed that in this Budget, because this Budget fails to address the most basic and fundamental challenges that New Zealanders all over this country of ours face.

There is no vision for how to address high unemployment, no vision for how to address income inequalities, and no vision for addressing unaffordable housing and access to tertiary education for the next generation. There is no vision for how our communities can develop themselves and achieve prosperity for all our families. People do not matter to this Government. When there is no vision, the people perish. This Government is wrong—people do matter. It should have focused on the well-being of all Kiwis in this Budget; it did not. This Government failed to eliminate the high unemployment rate that the majority of working New Zealanders are forced to endure. We all know that unemployment is a modern-day scourge on our society, and this Government is content to allow that to be so now and in future years of its Budgets. It intends to maintain high unemployment at 5 to 7 percent now and in future years of its Budgets. People do not matter to this Government. When there is high unemployment, people struggle to put food on the table and pay their bills. It is wrong for this Government to feed the workforce the crumbs off their employer’s table—low wages.

People’s dignity matters to us. Although this Government does not care about that, we in Labour do. People matter to us. This Government failed to attack poverty and the income inequality that is growing between the top end of town and the rest of New Zealand. It seems content to allow continued growth in the inequality gap between the few who have and the many who have not. Shockingly, income inequality for Pacific people is the worst I have ever seen since the days of the winners and losers. We were all promised a brighter future by this Government in the 2011 general election, yet since 2009 the real median weekly income for all New Zealanders has fallen by $10 a week to $575 a week. For Pasifika adults nationwide, it has dropped by $77 a week to $381. What is frightening about these statistics is that 50 percent of all Pasifika adults are attempting to scrape a living earning less than $19,812 per annum. This is during a period that this Government says is a so-called rock star economy. It is much worse for Pasifika people living in Auckland, where the majority of Pasifika communities reside. Since 2009 their median weekly income has dropped by $88 a week to $379, while the overall weekly income for Aucklanders is $575 a week.

I doubt very much that any of the MPs of this Government have seen the look on a mother’s face when she cannot feed her children a proper meal. I doubt very much that members of this Government can look those 285,000 hungry children in the eye, look at the sores on their feet from walking without shoes, and say that this is the brighter future they promised them. More and more New Zealanders are now realising how uncaring this Government really is. It is a sure sign that it does not care about people when it refuses to acknowledge its part in the growing inequality that is infecting all of New Zealand like a plague. It is no wonder that Pacific homeownership is at an all-time low of 18.5 percent under this Government. It is at a low of 18.5 percent under this Government.

Hon Trevor Mallard: That’s shocking.

Su’a WILLIAM SIO: It is shocking, but those members do not care one iota. This is not what Pasifika communities were expecting when National promised everyone a brighter future. Pacific people, like all New Zealanders, have a right to own their own home, and Labour will keep that dream alive and real. Housing unaffordability is increasing, even more so for first home owners. It is so difficult for so many families to pay rent to private landlords. This Government is content to keep the rest of New Zealanders who cannot afford to buy their own home renting from overseas-based landlords, because that is who is buying up our housing stock. In order for working people to buy their own homes and afford rental payments, they have got to have decent jobs and fair wages. This Government has failed in its Budget to provide any vision of hope and confidence to working New Zealanders. There is no vision of hope and confidence for New Zealanders.

We stand for full employment. We want to see every person who is able to work having secure, meaningful job opportunities. People matter to us. People being in decent jobs matters. That is why we will target a 4 percent unemployment rate for the end of our first term of Government. People matter to us. People earning a living wage matters. That is why Labour will lift wages to a more meaningful amount in our first 100 days, to make sure that workers have money in their pockets to support their families and give their children the best start in their education. I have often heard Ministers on that side say, from time to time, that when Pasifika people succeed, the rest of New Zealand succeeds. Well, they are failing Pacific communities right now. They are failing Pacific communities. That means the rest of New Zealand fails, especially under this Budget. Come 20 September, we will get rid of this Government. We have to do that for the sake of all New Zealanders.

IAN McKELVIE (National—Rangitīkei): I am not surprised Opposition members are applauding that speech from Su’a William Sio. I do not dislike anyone much in life, but I certainly think some of the things they say are odd. If the previous speaker thinks that the Government is going to lift people out of poverty, he has got another think coming. Unfortunately, it is not the Government that lifts people out of poverty; it is an economy that is driven by sound policy that lifts people out of poverty. So he has got his foot firmly in the wrong hole. Last year I started addressing this very same debate with the statement that we in the Rangitīkei support the return to surplus, and now we are there. I also said we needed to grow production, not consumption, and we are getting there. The other thing I talked about was that we must support families, and we are certainly getting there as well.

It is a privilege to be part of a Government led by John Key and Bill English. Firstly, we have performed better than any other Western economy in the past 5 years, have produced an economy that is growing at a rate of 2 to 4 percent—and 4 percent this year—over the next 5 years, and restrained Government debt to 26 percent of GDP. Again, it is a great performance by any standard, especially given the fact that we have maintained support to our beneficiaries in every respect during the course of that recession. We have put significant extra resource into the education and health sectors and continue to support New Zealand’s most needy families.

In the past 4 days—and I heard Jacqui Dean talking about this—I have travelled extensively in my electorate, as I do on a weekly basis. I have an electorate where it takes even longer than in John Hayes’ electorate to drive from one end to the other, because he has got straight roads. I have travelled extensively in the electorate, but not since the days of fertiliser subsidies have I seen a positive reception to anything that has happened in New Zealand like the one I have seen in the Rangitīkei in the last few days. Of course, we in the Rangitīkei were very keen on those fertiliser subsidies back in the 1960s.

John Hayes: I did the numbers for that.

IAN McKELVIE: Did you, John? Thank you. That was very good of you. Anyway, the interesting thing about this Budget and fertiliser subsidies is that a lot of the aspiration in this Budget will achieve exactly what the fertiliser subsidies of the 1960s did. It will increase productivity. It will increase the country’s wealth. It will increase families’ security.

The difference between this Budget and those of the last Labour Government is that this Government very clearly spends money where it will get a great return for the people of New Zealand. Children’s health lasts for a lifetime. The family tax credit puts money where it is needed: in the families of newborns in New Zealand. This Government in the past 5 years has achieved some amazing results in law and order. There has been a 26 percent reduction in youth crime, a 20 percent reduction in overall crime, and reoffending has reduced to 12.6 percent. This, in fact, means some 9,300 fewer victims on an annual basis. That is very significant. The Government has also put another $10 million into helping the fight against sexual violence, which is certainly an issue that blights a large number of New Zealand families. I heard Mr Goff speaking earlier about the law and order sector. He fails to accept that the modernisation that has been undertaken in the law and order sector in the last 5 years has made huge differences to the efficiencies of that sector. This Government has maintained the number of police on the streets of New Zealand. It has done a wonderful job, in my view, of upgrading and modernising our prison service. We now have people leaving prison with some real hope of work and of not going back to prison.

These are some of the reasons why the people of the Rangitīkei are so positive about this Budget. I called in to buy a bit of lunch at my local takeaway shop yesterday. Oddly enough, I knew the owner. The boss literally ran out and shook my hand, telling me what a great Budget it was. I immediately knew what Bill English felt like. That man was excited about the Budget. He has a young family and he knew that the actions undertaken in this Budget will make a difference to his future and to his family’s future. Defence plays a very important role in the Rangitīkei. Another $535 million is being injected into the defence forces. In my electorate I have the Linton, Ōhākea, and the Waiōuru army bases, all of which will benefit significantly from the extra resource that is being put into the defence forces. That will make a big difference to my part of the world and I am sure it will give our defence forces a whole lot of new confidence.

I want to touch briefly on housing too, because I have a very different issue in my electorate and I know a large number of my rural compatriots have the same. We have no shortage of housing, and we certainly welcome anyone to our region who would like to come and live there. The policies of this Government are giving people incentives to come back and live in rural New Zealand. Jobs in tourism, agriculture, and the service sectors around those two major industries are creating new opportunities for people in our electorates. There is plenty of opportunity for those people who find it difficult living elsewhere to come and live in our electorates and make the most of it. I also want to talk very briefly about the Manawatu Community Trust, which runs all of the ex-council houses in Feilding. It has done an amazing job with those 212 houses in Feilding. It has got them all up to date, working very well, and fully tenanted. I think that there is a lot of merit in community housing trusts being set up and continuing, as our Minister of Housing has indeed encouraged in many parts of New Zealand.

I also want to talk briefly about science funding, which I am particularly pleased about—in particular, the addition of $57 million to contestable research funding. That will make a big difference to the activities of the research institutes around Massey University, which, of course, is in the heart of my electorate. Also, I want to talk about the investment of $83 million to raise tuition subsidies in science, health, and agriculture. They are three parts of our economy that are critical to our future and, particularly in the science and agriculture departments, are producing great results in terms of an export income potential—and, of course, health is going to be critical to the future of us all.

This Government is one that invests where the most benefit accrues to the people of New Zealand. We invest in areas that pay a dividend for the future. We invest in the long-term gain for future generations. The single most encouraging item for me in this Budget is the projected household income growth over the next 4 years. I think this is the single most important thing we can achieve in New Zealand: to grow people’s incomes and their ability to earn. I think that the projected increase of some $7,000 by 2018 in the average take-home pay is a pretty significant effort, and I think it will probably improve further on that, given the growth our economy is expecting and certainly given the performance of our export sector at the moment. So I think we can look forward with a great deal of confidence to the result that this Government has achieved, particularly around increasing people’s take-home pay and their ability to live better than they could before.

One of the challenges our agriculture sector has faced over the years has been inconsistency of income, and hence profit, leading to a boom-and-bust mentality where we have very high taxation one year and the potential for a refund the next—not conducive to good business. I know that for years the agricultural sector has battled with this. This Government faces the same challenges with economic growth, and one of the challenges our Minister of Finance has chosen to do battle with during the course of this Budget is the fact that we have to get some sustainability into our growth patterns, rather than having dramatic growth spells and then losing that growth potential. So I think he has done very well with that. The sustainable Budget does not dramatically increase Government expenditure. Of course, Government expenditure has a great influence on what happens with inflation, interest rates, and all sorts of other things, so having very moderate increases in Government expenditure is extremely important. I think the Minister of Finance has done extremely well with that.

This party in Government believes in empowering individuals and families to do better, to achieve their aspirations, and to compete in the modern world. The parties on the other side of the House aspire to capture individuals and families and trap them in a sea of State dependence. I think that is definitely the wrong attitude. The people of New Zealand understand this now and will support a Government that frees them to seize the opportunities available to them and keep interference in their lives to a minimum. Finally, I want to congratulate Minister English on a very competent Budget. I hope, for New Zealand’s sake, that he gets the opportunity to produce many more of them. Thank you.

MEKA WHAITIRI (Labour—Ikaroa-Rāwhiti): Tēnā koe, Mr Assistant Speaker. Tēnā tātou katoa. I want to take some time, because this will be just the beginning, to acknowledge the OK parts of this Budget—the OK parts of the Budget. The OK parts for me are Whānau Ora and the Government’s commitment to additional funding of $15 million over 3 years. I want to acknowledge the Government for that. I also want to acknowledge, in all seriousness, the raising the age of eligibility for free health care from under 6 year olds up to under 13 year olds. I do want to acknowledge that. But apart from that, there is no joy in this Budget.

This Budget is so underwhelming. I heard my deputy leader, David Parker, talking earlier this afternoon about how underwhelming it is. When I sat in this House and heard Bill English read that speech, I too was looking for a commitment to the regions of New Zealand. I was listening for the commitment to job creation where it is needed—in the regions. I was listening for and hoping for our families to get a fair go in this country, and I was listening for a much-needed injection of resources into housing for our people throughout this country, and I was disappointed.

I sat there and I listened, and I saw that there was no vision. I saw that there was no vision and that there was clearly no obvious long-term plan for creating an inclusive, progressive, and innovative New Zealand where we all benefit. No, no, no. What we saw was the same old, same old—looking after their mates and the people at the high end of town at the expense of everybody else. That is what we heard. From my point of view, how disappointed I was that I could not even begin to see the benefits that this Budget would deliver to the people throughout Ikaroa-Rāwhiti and in all the other regions in the far north, in the Bay of Plenty, and in Waiariki, who will not be jumping up for joy with this Budget.

Let us look at the Budget. I heard some congratulations offered to National’s coalition partner, the Māori Party, for what it has been able to produce. When we leave this House, when the House rises in the middle of July and we start campaigning, it will all come out in the wash. There will be nowhere for anybody to hide when we stand up and try to get back into this place as members of this House.

When I look at what Māori have got in this Budget, it is so disappointing. Three initiatives were announced around the Māori Economic Development Strategy, and I heard comments in this House, which I have heard since I have come into this House, around how advantageous it is to sit at the table. Can I make it really clear for our listeners out there that the Māori Party does not sit at the table. It does not sit at a table. There is no Minister who sits at the Cabinet table, where, as we all know, the decisions are made. When I look at what we have got, we have $8 million over a 4-year period going to a Māori innovation fund. That is all this Government thinks Māori are worth in terms of innovation—$2 million a year.

There is $6 million over 4 years for Māori tourism. Look, I move amongst my local Māori tourism operators, and I can tell that side of the House that there are no Māori tourism ventures that are happening in my electorate that I can get alongside who have not done it off their own bat. For me, they will be disappointed that their initiatives and their innovation have not been fairly reflected by what has been put in this Budget. That is $6 million, like I said, over 4 years.

Surprise, surprise—I could not figure this one out. There is $1 million for joint New Zealand Māori and Chinese work to build on cultural and economic relations, or what they have called a stage production. There are many whānaus out there who would love to have a million dollars to put a play together. My point to the Treasury benches on that side is that the Māori economy and the opportunities it could bring to grow wealth in this country has been completely missed out by this Government.

John Hayes: Have you heard of Treaty settlements?

MEKA WHAITIRI: No, it has—it has. When I look at this, this is a poor contribution for a $30 billion - plus economy.

John Hayes: I don’t know what planet you’re on.

MEKA WHAITIRI: You cannot defend this. You cannot defend this, because it is poor and it misses the point of unlocking the potential of the Māori economy. It misses it—it misses it. But do you know what? When Labour comes into Government you will see a pumping Māori economic policy that leverages off Treaty settlements and will leverage off export relationships that are already taking place. That side of the House, one, does not know it; two, does not acknowledge it; and, three, does not value it. But Labour will.

So here we go. The Māori wardens programme is another significant programme involving people who are out there doing the hard yards on the smell of an oily rag. The Māori wardens, who have got by on the smell of an oily rag, do some wonderful work for us, some wonderful work around the country. There is not an iwi throughout this country that does not acknowledge the role of the Māori wardens. And what do we have here? Oh, a small cut—a cut. It is not a contribution; it is a cut. That is what this Government thinks of the Māori wardens.

Of course, we have got Māori Trade Training. For a lot of Māori people, their success in life has come through the Māori Trade Training schemes and the Modern Apprenticeships, which this side of the House—the Labour Party—introduced. But that side has not acknowledged or valued it, and has simply ignored it. This is at a time when the nation is crying out—particularly in Christchurch, with the rebuild—for skilled tradespeople, but no, no. There is an opportunity to train, but we do not see that because—I do not know; National has got a better plan for our people, apparently. [Interruption] Oh no, it does not, because it does not have a plan.

When I looked at this Budget, I wanted to see and hear about jobs, whānau, and houses. In fact, I remember that when I first came into this House one of the first questions I asked was to the Minister for Economic Development, Mr Joyce. I asked what the National Government was doing for our people in Ikaroa-Rāwhiti in terms of growing jobs. These were the three answers that he gave me. He talked about oil exploration, he talked about a dam, and he talked about a cycle track. That was the Minister for Economic Development’s plan for Ikaroa-Rāwhiti: oil exploration, a dam, and a cycle track. It is tired, it is out of touch, and it is not delivering what he said it would do in terms of sustainable jobs in Ikaroa-Rāwhiti.

What will Labour do? Labour has got some innovative, progressive, and inclusive policies that will create jobs in the regions, where they are much needed. It will look after families in terms of our Best Start policy. This side, when we are on that side of the House, will commit to building 100,000 homes with our KiwiBuild policy. There is no argument. This side is progressive. This side is inclusive. This side is about sharing the wealth of this country, and that side is not. This side is and that side is not. That will be your legacy as you haere atu from this whare come September. It has been one of those shameful moments when you look at something like a Budget and you know that your people, our people, have missed out. Tēnā tātou katoa.

SIMON O’CONNOR (National—Tāmaki): It is a real pleasure to stand in this debate. I thought I would just touch on a quick few points of retort to the previous speaker, Meka Whaitiri. I think, actually, National is and remains very proud of its working and track record with Māori. I want to acknowledge the work of the Māori caucus. In fact, I have two of my colleagues, the Hon Tau Henare and Claudette Hauiti, beside me as I talk tonight. Also—

Hon Hekia Parata: Hear, hear.

SIMON O’CONNOR: —and Hekia Parata, Minister Parata, down the front. I also want to acknowledge, of course, the great work that the Māori Party does. It is interesting that the previous speakers were talking about how little money was invested in Māori. That is not quite true when you begin to look at all the work that is going on around things like the Business Growth Agenda. Of course we have the Treaty settlements that are ongoing, and things like Whānau Ora that have been done. I think it is important to acknowledge that.

The only other thing that I wanted to note was also from an earlier speaker who was getting all very upset that the National Party might be having a rejuvenation in its ranks. It is funny, when you look at the other side of the House, that some people have been on the Labour Party side for so long that not only were they there when my predecessor in Tāmaki sat in this House, and even there when my predecessor’s predecessor sat in the House, but, in fact, it was when my predecessor’s predecessor’s predecessor was in this House that a number of the Labour members were there. We are not afraid to have rejuvenation.

Dr David Clark: A lot of turnover in Tāmaki. That’s what he’s saying.

SIMON O’CONNOR: Not at all. No. In fact, Tāmaki has a very slow turnover, which I am quite happy about.

Last week two Budgets were delivered in the South Pacific, one on either side of the Tasman Sea. The Australian Budget was one of enforced restraint, of hard choices, sharp realities, and deep cutbacks. The other, delivered here by the Minister of Finance, Bill English, was measured and thoughtful. It was responsible, and, best of all, it was balanced. What would Charles Dickens have said of this tale of two Budgets? I think he would have said that it was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the age and spring of hope, and it was the winter of despair. Australia is now suffering through a winter of despair as its expenses come in. The new Government in Australia is working hard to dig itself out of a financial quagmire it inherited from a Labor Government—something that we on these National benches can sympathise with.

What lessons can New Zealand learn from this awful spectacle? For those of us on this side of the House, it reinforces that nothing comes for free. No matter what Labour and the Greens tell you, everything must be paid for eventually. New Zealanders know this. They can see what is happening to our closest neighbour, and they do not want it to happen here. They know that Labour and the Greens offer a short-term gain for a lot of long-term pain. In Australia the left spent recklessly for years, buying favour with anyone it could. You have heard similarly from speakers of the left tonight. They are wanting to buy more and more favours. Their credit cards ran red-hot and cash flowed like water. But, of course, eventually the desires outstripped their resources and it all came crashing down. We look to Australia, and, judging by the hangover they have now, it must have been quite a party.

Yet Labour and the Greens here in New Zealand seem completely unaware of the mess that their comrades made next door. Their solution to every problem, their answer to any question, is to spend more money. Raise wages with a magic wand. Raise money from someone else. Labour is your magic genie. If you have a wish, Labour will make it come true; just do not read the fine print, and, wow, there is a lot of fine print when you begin to consider the Labour-Greens agenda.

What are these little gems? We have heard a lot tonight about KiwiBuild from Labour. It is going to build 100,000 houses. If you add up all the costs of that, if it is meant to be under $400,000 each, it is something like $40 billion in total. You know, it is just a quarter of the nation’s GDP, just like that, that is going to be built somehow. As has rightly been pointed out by colleagues on this side of the House, this Government is already well on to its target of opening up 39,000 sections. We are about action, not talk.

We hear about Best Start. We heard from the Labour Party—which is again not looking at the fine print—that this was money for all children, but actually it is not for all children when you start to read the fine print. The Labour-Greens grouping wants a capital gains tax to fund its spending. But that will not make money for years, if at all, and it is filled with so many caveats and regulations that it will be almost impossible to put together. In more recent days there was a shocking, effectively racist plan to block tens of thousands of migrants to this country—but, then again, perhaps not when you talk to another member of the party. Then, of course, it is all about the internet, with access to all, but it is happy to ban Facebook. And my favourite—my favourite—element of the fine print is the Labour Party’s vaunted commitment to equality for all, except, of course, for the on-again off-again man ban. So Labour will go to the election in September with many marvellous promises and enough fine print to blind a barn owl.

Contrast that duplicity with the common-sense policy that National is offering New Zealand. We—and you have seen it in the Budget—are responsibly managing this economy, with 2 percent to 4 percent economic growth and a Budget surplus. I noted before the Budget was delivered that it was something we were promising, and we have delivered on it. In 2014 there is $1 billion of new spending and in 2015 there is $1.5 billion of new spending—a prudent, responsible, and balanced approach. We are going to be peaking Government debt at just over 26 percent, but looking to bring that down to that responsible 20 percent.

That is a Government that knows about balancing its debt commitments and downing its expenses there. And also—

Hon Tau Henare: That’s right. Have to pay for Working for Families.

SIMON O’CONNOR: Absolutely. The things that we were keen on, as my colleague has noted, things like Working for Families, we chose to keep in order to support those middle to low income families. We decided to keep things like interest-free student loans. We have kept the support. We have increased the welfare spending and support, and we are quite prepared to do that.

We are looking to cut ACC levies. We have heard tremendous news today and in the Budget about—[Interruption] All of a sudden, yes, I say to my colleague Judith Collins in the House, we are reducing fees. Kiwis are going to find, as they go to reregister their vehicles—if that is even a correct word; to register their vehicles once again—that they are going to be getting substantial discounts. This a Government of financial prudence.

We are a Government that is also investing in education. I have a note here with $858 million of new spending over 4 years—$858 million. Much of this is to improve school property. In fact, about $284 million of that is to improve school property. There is more money for early childhood education. There is a $2.5 million boost for things like home computing and so on. This is making a real and substantial impact in my electorate, the great electorate of Tāmaki. We have seen recently $3 million invested into St Thomas’ School for its new buildings. If you have never visited there, it is well worth it. Not only is it a fantastic school but it has one of the best outlooks in the country over the Waitematā.

We have, of course, ultra-fast broadband being rolled out. I think of something like Glendowie College, a real innovator in this area, which has been recently connected and is looking forward to the Network for Learning. Then, of course, we have the wonderful Selwyn College, which is currently a finalist in the Prime Minister’s Education Excellence Awards. Through the great work of the school and of its teachers, principals, parents, and board of trustees—but the wider community and the Government too, I would like to think it has seen its pass rates increase substantially. Selwyn College has seen its level 1 pass rate rise from 39 to 93 percent in just 7 years. What a fantastic turn-round that is in education.

Of course, we are doing amazing work supporting and helping children and families. That is something that my electorate welcomes. The different constituents who have rung, emailed, used Facebook, tweeted, or turned up at the front door have really supported that $500 million going to support families and children.

So here in this House we have the best and the worst of times. We have a Government of wisdom and an Opposition of foolishness, Ministers of prudence and profligate pretenders, great policies and reckless promises. The contrast could not be clearer and I look forward to the National Government implementing this Budget and retaining the Treasury benches.

The ASSISTANT SPEAKER (Lindsay Tisch): I understand that the next call is a split call.

CATHERINE DELAHUNTY (Green): Tēnā koe, Mr Assistant Speaker. Tēnā koutou e te Whare. I would like to follow on from the previous speaker, Simon O’Connor, who evoked a Dickensian universe, which is somehow suitable, given what the Government’s Budget does to beneficiary families by ignoring their needs. Now is the winter of our discontent, and the Budget has not relieved it for many people. It was, as I think one educator described it, underwhelming. I think that is quite a good description. But we can be grateful that we are not in Australia under Tony Abbott.

In the last couple of weeks I have been visiting many schools and communities, in between listening to submissions on the Education Council of Aotearoa New Zealand Bill, and that is a bizarre experience on its own. That bill is about creating a professional body without involving actual professionals on it, when it is about them. I have been asking parents, teachers, and principals from Invercargill to Whangarei about their views on the money that has been confirmed in the Budget—it was not news; we knew that there was going to be $359 million spent on executive principals and expert teachers etc.—and asking them what they feel about it.

What was interesting was that nobody was opposed to professional pathways for teachers, improving schools, and collaboration—not at all. They had very nuanced ideas. But all of them were dubious about the idea of a principal spending 2 days a week in 10 different schools, instead of in their own schools. I think that principals in the mainly decile 1 schools that I visited realise that their schools are very dependent on their leadership and it is important that they are there. They are not against valuing and enhancing the profession, but, interestingly, virtually everybody said that if we are going spend $359 million, the top priority is dealing with inequality.

I guess it would be no surprise in a decile 1 school that its top priority is the fact that their children are sometimes coming to school without food and with inadequate clothing, and with transience from school to school being a major issue. I talked to two principals who said that children are bouncing back between their two schools as their parents lose housing, and this is in the supposedly wealthy city of Tauranga.

What these principals told me was that they are all for improving the education system, but let us make it equitable so that we can improve it. Without equity, we have no improvement. What they talked about was the fact that if you are going to spend a large sum of money, they would love to see school support staff paid a living wage from a centralised fund rather than from their desperately stretched operations grants. Yes, they were grateful that the operations grant had a small amount put into it that would just keep up with inflation—

Hon Hekia Parata: Well, it was ahead of CPI, actually.

CATHERINE DELAHUNTY: —actually, it would just keep up—but they would rather see school support staff properly paid a living wage, and more of them, because then all children, all parents, and all teachers will be able to work together on improving learning. School support staff do not support only vulnerable children with learning disabilities; they also support teachers by allowing them to then focus on other children.

There is a real logic to what these principals and teachers were saying about the necessity of putting money into the issues of equity first. They were not at all negative about the idea of collaboration. They want to collaborate, but they are collaborating right now around addressing extreme poverty in some of their communities. Many of these decile 1 schools are fantastic schools. I am so impressed with these schools, and especially with their commitment to Te Reo Māori and their commitment to culture. The struggle that they have is that in some schools virtually every single child is a special-needs child, because they do not have enough food on the table and they do not have enough money in the home for that child to be able to participate fully in school life. That is an indictment on any Government. It is an indictment on all of us.

What I would like to talk about is the Greens’ good idea. Our good idea is to focus that money instead—which is $100 million, and a lot less than $359 million or $800 million—on making schools the hubs of our communities: giving a school lunch to all children in decile 1 to 4 schools; making sure that they can have out-of-school care and recreation and after-school holiday care programmes for free; having a schools coordinator to coordinate programmes that will engage parents with the school and help the school meet the parents’ needs for services; and building a positive model based on schools like Victory and other schools, which have succeeded in changing the conditions for their students, not through some expert external process but through an internal, community-building process. That is the positive solution, and that is where the money should go. Kia ora tātou.

KEVIN HAGUE (Green): I want to begin by praising what I thought was one of the few positive aspects of the Government’s treatment of health in the Budget, and that is the stated intention to, in future years, fully subsidise visits to general practitioners and dispensing fees for children under the age of 13. It is a good initiative. It seems to have been a little rushed in its preparation, and certainly stands at odds with National’s previous position, which was that there were no financial barriers to primary care, but it is none the less welcome.

However, it is a bit like we have invited Bill English around to our house for our birthday and he has brought a birthday present, but while he was in the house he has ripped off a whole lot of our stuff. Because that particular bauble—the free doctors visits and the free dispensing—is there to disguise the deeper message in the Budget. That deeper message is one of actually underfunding the health sector by a very serious amount. Only a fool or a charlatan would look to the CPI as being the benchmark against which health increases should be measured, but, unfortunately, that is what the Government has done. The reality is that health need increases by factors that are not just about inflation. There are more of us every year. On average we are older and on average our health services need to deal with a more complex pattern of, particularly, chronic conditions like cardiovascular disease and type 2 diabetes. Also, whenever there is a new medicine approved, it typically costs more than the medicine it is replacing. A new bit of imaging kit usually costs more than the equipment it replaces. So health services funding needs to increase by substantially more than the CPI.

In this year’s Budget, district health board - provided services were short-funded by almost $100 million, on just the demographic factors alone. If we take into account technology changes, district health board services and non - district health board services alike are, in combination, short-funded by about $350 million on what is required just to be able to tread water against that pattern of increasing need. This is not the first year that this has happened. That has actually been the pattern—the Government short-changing health services on what they require in order to be able to tread water—in every Budget under this Government. No wonder that in our newspapers every day we are reading about health services worn thin, worn threadbare, services being stopped, and service quality being compromised. That is the kind of situation that our district health board services and, in particular, our community-based services have to deal with.

The simple fact is that although the one-off gems like these free doctors visits and like the genuine increases to elective surgery have been winners, there have been losers too. Those losers have typically been in the primary care services, in the community-based services, which we all know actually need to be increased in order for this country to try to deal with the pattern of increasing disease, particularly increasing chronic disease.

The fact is that this Government is robbing the services that we know are required to deal with our long-term health needs to fund services—mainly for political gain, actually—for political risk management with a short-term focus. Every child in this country and every New Zealander deserves to live a good, healthy, happy life. That requires long-term investment. It needs prudent decisions made in the long-term interests of New Zealanders. That is the reverse of the way that this Government has approached the health budget.

CLAUDETTE HAUITI (National): Kia ora, Mr Assistant Speaker. This is a very good Budget, and it shows that New Zealand is heading in the right direction. It is a confident Budget for a confident nation, and it is a great Budget for Māori. Budget 2014 reflects 6 years of hard work by this Government, its coalition partner the Māori Party, and by iwi and hapū from one end of the motu to the other. Budget 2014 looks ahead to build on the hard mahi done by all New Zealand households, including Māori iwi, hapū, and businesses over the last 6 years. This Budget resources Māori to assert their rangatiratanga for them, their hapū, and their whānau. We are putting the rangatiratanga into whānau for all our families in New Zealand with our new spending of a $500 million package to help families and tamariki. In addition, $15 million has been invested in Whānau Ora navigators to increase capability and capacity.

Māori whānau, along with every other New Zealand family with tamariki and children under 13, will receive free general practitioner visits and free prescriptions. Our pēpi and tamariki, along with every other child, will be able to participate in the extension of the rheumatic fever prevention programme. There is $20 million in additional funding for more drop-in sore throat clinics. Every eligible whānau, as well as Māori whānau, will benefit from the parental tax credit, the extension of paid parental leave, and the $33 million extra going to vulnerable children.

In addition, there is the area of housing. I hear the Opposition talk about housing and saying that there is not enough housing. Well, this Government is investing $16 million over the next 4 years in repairing and rebuilding whare in hau kāinga, including those of our whānau in Rēkohu, Wharekauri—the Chatham Islands. This is over and above the housing partnerships between iwi and other entities like the collective tribes of Auckland, Kirikiriroa in Hamilton, Ngāti Whātua at Takaparawhau, and Te Pio Kawe in Western Bay of Plenty. This is motuhake in action. In 6 short years this is what Māori have achieved under this Government. We aspire, like all other Kiwis, to see our dreams and aspirations—our moemoeā— realised under this Government.

Looking ahead, there are significant opportunities for New Zealand and Māori in countries around the Asia-Pacific region that are developing rapidly and demanding more of what we can produce. Make no mistake about it, our Business Growth Agenda is a Māori growth agenda. We are putting in place reforms to help businesses perform well, particularly in the trade and export sectors. This Government is investing $8 million over the next 4 years to establish a fund to support Māori innovation and investment readiness. So when the Opposition talks about jobs, this is where the jobs will come from. When the Opposition talks about housing, Māori whānau are already benefiting from the housing initiatives that we have established, and they are already benefiting from the housing collectives between our tribes and the Government and also private companies. So our whānau are benefiting.

In addition to those export initiatives that I talked about earlier, there is $69 million extra for New Zealand Trade and Enterprise to grow New Zealand’s presence in China, South America, and the Middle East, and to help 200 more firms break into overseas markets. Well, that may very well be companies like the Chatham Island Food Co., Taha Valley Wines, Torere Macadamias, Hema Water, or Mesa Meats. These are Māori companies serving our country. This Budget is good for New Zealand. It is good for Māori. It is a forward-looking Budget that speaks to the heart of Māori motuhake. There is $12 million going to Te Māngai Pāho to enable iwi radio to continue its fantastic mahi in promoting Te Reo, promoting dialectical reo and mai i tērā iwi, mai i tērā iwi [from that tribe and that one].

This Budget has families and whānau at its heart. Māori are critical to New Zealand’s growth. This Budget is good for New Zealand and it is good for Māori. This Government is paying more than just lip-service to honouring our responsibility as Treaty partners. This Government has settled 69 claims, compared with the six settled while Labour was in Government for 9 years—69 versus six. We have a $36 billion Māori economy under this Government, compared with what we got from Labour, which was the seabed and foreshore legislation and the raids on Tūhoe. This Budget is for a country that knows where it is going and from a Government that knows what it is doing, supported by iwi around the motu. That is rangatiratanga. That is kotahitanga. Thank you.

Hon TAU HENARE (National): As we move around the tracks, people are saying “We’re voting National.” Why? Because what we heard last week from the Minister of Finance was a Budget for the times.

Dr David Clark: Is that at the Cabinet club traps?

Hon TAU HENARE: And that guy over there from down south, who keeps mouthing off about 50 years of this and 50 years of that—well, listen up. That is the worst Opposition in 50 years. It is not like when Helen Clark was in Opposition. She had all the troops lined up. That is the worst Opposition in 50 years. How do we know that? Mr Cunliffe got up on his feet last week and, first of all, railed against Bill English’s Budget. He railed against National’s Budget, and then said, without a blink of an eye, that the ideas came from David Parker. How do you work that one out? It was the worst Budget in 50 years but the ideas came from David Parker. I do not know how the Opposition works that out.

Free health care and free prescriptions for under-13-year-olds—if there was nothing else in the Budget, that in itself says to me and to the rest of the country that we are putting families first. Opposition members bleat on about the amount of money that we borrow. Well, somebody had to have some money during the—

Dr David Clark: More than Muldoon.

Hon TAU HENARE: Oh, here we go. Oh, come on! The fact of the matter is that this country was nailed to the cross—nailed to the cross—when we took over, because of the global economy. Nobody argues about that. Here is the rub: if we had done what the Opposition wanted, which was to get rid of Working for Families—how much is that worth? How much is Working for Families worth? My goodness me! There would have been an uproar, and my cousin Darien Fenton knows it. So what did we do? Well, we kept the benefit. We did not slash and burn. We did not get rid of Working for Families—

Hon Damien O’Connor: You cut taxes for your mates.

Hon TAU HENARE:—we paid for it. Oh, our mates on Working for Families! Our mates on the benefit! Oh, my goodness me! It is no wonder that the Labour Party is on 29 percent.

While I am at it, let me take a pot-shot at the Labour organisers in Tāmaki-makau-rau. First of all, they wanted Shane Taurima, and then they thought “Oh well, we better leave that boy alone.” So they said no to him and let the nominations ride. They wanted Julian Wilcox, who is a very, very good operator, but he came to his senses and said no. The only other nominee for Tāmaki-makau-rau was poor old Will Flavell from Rutherford College. Do you think they gave it to him? No. What they are thinking of doing is extending the nomination time for—

Sue Moroney: I raise a point of order, Mr Speaker. I know that the member may have run out of good things to say about his own Budget, but this is in fact the Budget debate and I think the speaker should—

The ASSISTANT SPEAKER (Lindsay Tisch): No, look—[Interruption] Order! This is quite wide-ranging—[Interruption] Order! I am listening very carefully to what the member is saying, and I will rule accordingly if it comes to that.

Hon TAU HENARE: So Labour put up Will Flavell on Marae or on Native Affairs the other night, and what happened? Poor old Will talked about housing and transport. Yeah, that is going to be really good for Māori!

I will tell you what this Government has done for Māori. It has put in place some real standards in education. It said to Māori whānau out there that what we need to do is educate our people. More Māori are now getting a better education than they ever did under Labour.

Sue Moroney: That’s not true.

Hon TAU HENARE: It is absolutely true.

Sue Moroney: No, it’s not true.

Hon TAU HENARE: It is absolutely true. The Public Service Association (PSA) the other day organised a protest—if you can call it a protest. Fifty people—50 people—turned up.

Darien Fenton: Where?

Hon TAU HENARE: Out here—fifty people, for goodness’ sake, when there are thirty thousand - odd people in the public service. In my day there would have been 100,000 people out there. There would have been protests in the streets. The Labour Party tried to organise a little gathering, shall we say, of fifty signed-up, paid-up members of the PSA. That is all the Labour Party could get. That is diabolical. In the good old days when Darien was working the streets and organising the workers in Auckland, you could get thousands upon thousands of people at a protest, especially in Budget week. But what did we get? Fifty people from the Ministry for the Environment who were not doing anything that day.

This is a good Budget. This is a Budget that steadies the ship. I tell you what, we are moving into surplus—we are moving into surplus. In fact, tonight I saw something really, really interesting. I would have thought that with only 4 months to the election all hands would be to the pump in the Labour Party, as they are with National, and as they are with most parties.

Dr David Clark: They’re all jumping ship.

Hon TAU HENARE: Well, let us talk about jumping ship, shall we? Because what I observed with my good colleague John Hayes not more than 10 minutes ago was the leader of the Labour Party going home. He was going home. It was half past 9, for goodness’ sake! You would have thought that the leader of the Labour Party, who wanted to be Prime Minister, would be here burning the midnight oil while his—

The ASSISTANT SPEAKER (Lindsay Tisch): Order! The member cannot mention someone who is absent from the House.

Hon TAU HENARE: My apologies, Mr Assistant Speaker. You would have thought that the go would have been to be working hard for his Prime Ministership. He wants the job. Anybody who wants the job should be working all hours of the night, not just going for a stroll home.

This is a good Budget. This is a good Budget because it got people, like AC/DC’s song, back in black. I am sure some of the members over there know the words to that song. Darien knows the words to that song, “Back in Black”. That is what this Budget and this Government promised so many years ago. We said years ago—

Sue Moroney: Nine years in a row under Labour.

Hon TAU HENARE: Yeah, if you want to say 9 years, madam whip from the Labour Party, that is not a problem. We will accept that, because I will tell you what—it will not be only 9 years. Add another 3 years on to that. Add another 3 years on to that. And when members are getting up in 3 or 4 years’ time when Bill English delivers his ninth and tenth Budgets, none of these fellows will be here. None of them will be here.

Hon Hekia Parata: None of them are here now.

Hon TAU HENARE: Yes. Well, I was going to say that none of them are here now, but I am not allowed to say that.

This is a Budget that gets at the heart of Kiwis. It is about food on the table, it is about shelter over the head, and it is about making sure that decent, honest, hard-working, battling New Zealanders can send their under-13-year-old kids to the doctor for free. That is what it is about. It is pretty simple. That is what Kiwis want: the ability to be able to bring their kids up and be able to send them to the doctor when a crisis arises in that whānau. I am overjoyed. In fact, I am immensely happy—immensely happy—about this Government’s way and where it is going. It is a Budget for all New Zealanders. It is a Budget for working class people. It is a Budget for those who earn a bit more than the minimum wage. It is a Budget to make sure that we—

Darien Fenton: What about those who earn the minimum wage, though?

Hon TAU HENARE: Oh, look. The fact of the matter is that people are coming home to work. People are coming home from Australia, from England, from South Africa, and from all over the world to be able to partake in a country that is going ahead. They know it and we know it.

JAMI-LEE ROSS (Junior Whip—National): I seek leave for the House to adjourn at the conclusion of the next speech.

The ASSISTANT SPEAKER (Lindsay Tisch): Leave is sought for that purpose. Is there any objection? There is no objection.

DARIEN FENTON (Labour): Thank you very much to the previous speaker, Tau Henare. I wish him well in his retirement, but may I say do not go looking for a job in the union movement, because I do not think there is going to be a vacancy any time soon. I want to talk about the real problems, the underlying problems, that are facing our country—that is, the growing inequality gap. It is the crisis of the 21st century. It is the 1 percent by the 1 percent for the 1 percent. The widening gap between rich and poor is having a deadly impact on our society and its democratic institutions. We have no idea of the impact this is having in this century.

This is the crisis that the Government has committed to entrenching with this Budget—the domination of a few in the interests of the many. The tragedy for me is that the Government cannot see it, or, if it can, it chooses to ignore it and not own it. I cannot see how it can continue to ignore income inequality when there are huge salaries for those at the big end of town and nothing much at the other end. We even have chief executive officers like Mr Powell, Chief Executive Officer of The Warehouse, saying that his $1.7 million pay packet is ridiculous. Good on him for saying that. He is not the first business leader to speak out. There are other ongoing examples of obscene payments. Take, for example, the $4.1 million paid to ANZ’s top boss, David Hisco, and the $3.5 million - plus received by Fonterra’s Chief Executive, Theo Spierings. But going back to Mr Powell, what is concerning him particularly is that although he gets this massive chief executive officer’s salary, is it being paid to his staff on the shop floor within his company? His total pay packet is around 50 times that of his average staff member and 31 times the average wage. What has gone wrong in the last 6 years under this Government? What has gone wrong? There is something deadly, deadly obscene about that.

Good on The Warehouse. It has signed on to a living wage—a miserly $18.80 an hour, which Tau Henare and his mates on the other side object to. They object to it. Organisations like The Warehouse have a little way to go, but good on it for owning up to the debate that needs to happen. Where is the Government in this debate? Where is the Government in this debate? What does Bill English really think about this? We do not know. He said nothing about it in the Budget. What we do know is that Bill English pays the cleaners who clean his home a lot more than the cleaners who clean his office in this place. What we do know is that 46 percent of wage earners have had no wage increase in the last year, yet to listen to this Government they should just be grateful to have a job. Minimum wage workers are supposed to live on a pittance. The minimum wage has actually gone backwards under this Government, in real terms, particularly for young workers. The dream of a family home is on the back-burner for future generations, and those leading this Government have no regard, it seems to me, for the struggles of ordinary people and particularly the younger generations. No wonder many of them are choosing other options, like living in other countries.

The other thing about inequality is the 285,000 children living in poverty. That figure is undeniable. The impact on them and their families is that future generations will be entrenched into a level of poverty that the wealthy cannot even imagine, and there are consequences for all of us in the longer term. If we think about that, if we think about what we are rearing today, in the 21st century, we are rearing the generations of children who grew up under the impact of structural adjustment under the National Government of the 1990s. That is what we are rearing, and that is why we have inequality today.

It is also inequality for the workers in this Parliament who are on their way to work right now, as we speak, from Porirua. They are on the bus, after having paid a fare that they probably cannot afford. They will come here to work tonight for the minimum wage plus a tiny little bit. The tiny little bit extra they get is only down to their union, which this Government would like to see completely removed, which bargains on the margins of a cutthroat, competitive tendering process. Once those workers have finished at Parliament tonight, sometime around 3 o’clock in the morning, they will go on to their next job somewhere else in this city. Somewhere else in this city they will have to find transport, and they will go on to that other minimum wage job somewhere across the city.

I want to talk about inequality for workers, like those at Hutt Valley High School. The cleaners there have just had their work taken over by another contractor and have already been notified, within 1 week of that takeover, that 18 staff who do the cleaning will be cut down to 12 staff, and their hours will be cut down by 61 a week. Imagine that. The cleaners have been doing that job at Hutt Valley High School, keeping the toilets clean, keeping the place immaculate so that the children of Hutt Valley High School are protected, and somehow they are expected to do this job under a new contract from a new contractor. I wonder whether members on the other side of the House have any idea what it means for those people, apart from the fact that they are going to have to do more with less. They are going to have to clean for many more hours.

I do wonder about the Minister of Education and whether she takes any notice of the cleaning services in our schools. I have to say that probably the Government does not, because it wants to weaken the only protection the cleaners have under the Employment Relations Act. That is Part 6A of the Employment Relations Act—Part 6A—which would take away the only protection those workers have. It means that when they go home every week at the end of the week they will have their minimum income, their minimum wage plus a little bit of income, reduced. It means that those who survive the wage cuts will have to work harder than ever to keep the school clean for our kids, because they care. We should never underestimate how much they care about the work they do. They are diligent about their work and they will keep on regardless.

When I am talking about inequality I am talking about New Zealand today. The top 10 percent own 50 percent of our wealth—the top 10 percent own 50 percent of our wealth—and the bottom 5 percent own just 5 percent of it. The gap has been growing over the last 20 years. Between 1984 and 2011 the income of the top 1 percent rose nearly 10 times faster than that of the bottom 10 percent. How did that happen? What sort of country have we become where we allow this to happen? To be fair, it is a worldwide trend. Governments and communities are facing the new phenomenon of extremes of wealth and those left behind, and it is a conversation taking place right throughout the world. In fact, we have had that conversation taking place this week with Wilkinson and Pickett, who wrote the book about income inequality and pointed out that New Zealand has one of the fastest rates of growth in inequality. But it is indefensible. It is indefensible internationally and it is indefensible in this country.

I grew up in a country where I believed that we thought there was a fair go for all. I grew up in a country where I thought that Jack or Jill was as good as his or her master. I grew up in a country where we would reach down and give a hand up to those who were worse off than us, rather than blame them. What has happened to that? Instead, we seemed to have vilified and blamed those worse off than us, and the Government does not even accept that there is a problem. Yes, there is a grudging increase in this Budget for paid parental leave, really grudging—let us face it, the Government was forced to—and the extension of free doctors visits for under-13-year-olds. But where is the plan to improve housing inequality? The Government’s only plan is to force poor people to live in far-flung, newly built suburbs where the cost of houses may be lower but there will be no transport, so affordable living is just a dream.

Under this Government, things have gone backwards. Under a Labour Government, things will change. We will address the issue of income inequality. We will address the issue of wages. So before Christmas, if Labour is elected, many, many minimum wage workers will have a pay rise.

Debate interrupted.

The House adjourned at 9.57 p.m.