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What's Not In The Budget? Bugs and Bandwidth

WHAT’S NOT IN THE BUDGET? BUGS & BANDWIDTH

Friday 16th Jun 2000 Richard Prebble Media Release -- Economy

WHAT’S NOT IN THE BUDGET? BUGS & BANDWIDTH Extracts from Hon Richard Prebble’s post-budget speech Auckland Centra, 12-2pm June 16 2000

WHAT’S NOT IN IT #1: BIOSECURITY “What’s significant about this budget is what’s not in it. There is nothing in the Budget about funding a campaign to eradicate the varroa bee mite.

Under the Fiscal Responsibility Act, every Cabinet decision must be included in the Budget. It would appear the beekeepers and agriculture generally are the big losers from this Budget.

This will come as a surprise to the agricultural sector who in briefings to ACT said the cost of the varroa bee mite may pose a billion dollar threat to exports. They were confident that a government that could find $146 million for the arts would find $70 million for a key export industry.

It appears they are wrong.

If the Cabinet changes it’s mind, then nearly half of the total contingency fund in the Budget will have gone, raising questions about the credibility of a contingency fund of only $200million.”

WHAT’S NOT IN IT #2: SPECTRUM REVENUE “Where has the $650 million radio spectrum money gone?

Perhaps the most glaring gap in the Budget is the failure to state what the government intends doing with the proceeds of the two-gigahertz spectrum sale. The sale is expected to earn a minimum of $650 million and perhaps significantly more.

Many of the world’s leading telecommunications companies have indicated their intention to actively bid for this asset. In the past, successive governments have stated that revenue from the sale of assets must go to debt repayment.

The only attempt to use asset sales for spending was by David Caygill in 1990 when the then Labour government put aside a portion of the Telecom sale for spending on schools. This policy was condemned by everyone and reversed by National.

It’s highly significant that none of the Budget statements contain a clear policy of what will happen to what is a very large capital sum of money.

In a post-Budget press conference, the Minister of Finance made a bid for the money. Dr Cullen said he would like to use it for his superannuation investment fund.

One of the Maori Ministers, Tariana Turia, in a post-Budget statement, made a bid for all of the money to go to “capital seed money for iwi”.

ACT understands that Trevor Mallard wants to revive David Caygill’s policy and have the money go to new schools, and Annette King believes the money should go to pay for new hospitals in Wellington and Auckland.

It’s extraordinary that the government should be proceeding with the sale without having determined where the proceeds are to go.

As the Minister who first conceived the policy that auctioning airwaves was the way to promote more innovative uses of the spectrum, a New Zealand policy that has been copied world-wide, I see the spectrum auction leading to significant improvements, particularly in cellphone technology.

I’m appalled at this squabble between Ministers. I remind them that it was a Labour government that first established a policy that the proceeds of selling off State assets can only go towards debt repayment.

The approach by the government towards this sale is intellectually and morally wrong.” ENDS

For more information visit ACT online at http://www.act.org.nz or contact the ACT Parliamentary Office at act@parliament.govt.nz.


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