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The 2002 Election Issues - Prebble Speech


Thursday 21 Feb 2002 Richard Prebble Speeches -- Governance & Constitution

Speech by the Hon Richard Prebble, Leader ACT New Zealand, to the Waikato Chamber of Commerce, at the Ferrybank Reception Centre, Grantham Street, Hamilton. Thursday 21 February at 7.30am

The issues in this year's election campaign are already clear. The issue voters are most concerned about is health, followed by education and then law and order. The economy, usually the issue in an election, appears to be number four- but coupled with tax it rises as a concern.

Sixty percent of voters think New Zealand is heading in the right direction. We have a coalition government that polls on everything - the government even polled on whether to support the United States after September 11, and Helen Clark even polls on what air-brushed photo to use. So the Prime Minister's speech last week to open Parliament and, in effect, the election campaign, was a surprise.

There was nothing in the speech about how Labour will tackle the problems in health and education. The Prime Minister's one sentence on law and order was, to be polite, spin.

Instead we had an over-hyped release on the economy. When you analyse it, it was an announcement that the government was setting up a committee. Paralysis by analysis.

Why ignore the public's concern about health, education and law and order, and give a speech that shows the government has no practical, workable solutions to get New Zealand to 4 percent growth - the figure all parties now agree New Zealand must reach to get back into the first world.

There are three answers.

Yes, polling says we are most concerned about the state of our health and education systems. But focus groups show voters don't believe any party has any solutions - and they don't believe National would be any better.

The two old parties' policies in health and education are the same - spend more money. Labour has decided it can ignore health and education because it is completely bereft of fresh ideas.

In law and order, the Labour/Alliance/Green MPs believe that the 92 percent of us who voted for tougher sentences for violent criminals, were wrong.

Today a rapist sent to jail for nine years must, by law, be released after six years. ACT says that's wrong. We should have Truth-in-Sentencing and zero tolerance for violent crime. Offenders should serve the sentence the court imposes.

The coalition government has in front of Parliament a major bill - the Sentencing and Parole Reform Bill - that says rapists sentenced to nine years can be released after just three years.

It's true that the Bill increases a few hard-line sentences - so judges can sentence a murderer to 17 years without parole. But it's also true that life under the Bill - which today is usually 10 years - becomes just seven years.

The coalition government has contempt for voters. It thinks we are so stupid and the government is so clever that it can pass a law saying, as Helen Clark said in her speech: "(the Bill) addresses the public's legitimate concerns about longer sentences for the most serious crimes and about parole reform ...".

She thinks we'll believe we actually voted to reduce sentences for violent crime.

Helen Clark can call ACT's policy of zero tolerance for crime a slogan - but it's a policy that worked in New York. You are more likely to be mugged, raped or robbed in Hamilton than in New York. That information is from the Parliamentary Library.

Over this summer we had a murder a week. Palmerston North is a city under siege from gangs, with Ministers of the Crown going to public meetings asking the gangs what they want from the taxpayer. Why anyone in Palmerston North would vote Labour is a mystery to me.

ACT has the clearest policies on crime and I believe ACT will win on the issue.

I think Helen Clark is also making a mistake on health. There are practical alternatives to Labour and National's solution of just throwing more money. The reason our health system does not work is because we have the Soviet government monopoly system. Government monopolies have never worked anywhere, not in Russia and not in New Zealand.

The answer is the private sector. Let me give an example. As MP for Wellington Central, I realised that the hospital waiting list in Wellington was the longest in New Zealand. People were waiting over the critical six months. I made enquiries and found there was spare capacity at the private hospitals. "Why not send public patients to the private hospital?" I asked.

"We are scared of the political reaction of using taxpayers' money to pay for operations at a private hospital," said the administrators.

"Is it more expensive?" I asked.

"Well no, it's a bit cheaper," they said.

I said: "I'll call on you to do it and then defend you from attacks from the state unions and the Labour/Alliance MPs." That's what we did. Wellington's waiting list halved.

Under Labour, the contract with Bowen Hospital has been cancelled. Wellington's waiting list is the longest in New Zealand - again. People are dying.

Only ACT says - the solution to the problems in health is to make more use of the private sector.

In education, Labour is also vulnerable. Part of the concern is the student loan scheme. Over half of all new education spending is on the student loan scheme but student debt has doubled. The problem was never student loans - they were all too easy to get - but student debt.

Offering young people interest-free loans is too much temptation. ACT says government assistance should be targeted at the debt, at how to pay off the loans, not on encouraging students to get into debt. And the answer? The tax system. Tax relief. And lower tax rates is the best relief.

So Labour is vulnerable on health and education because even if National does not have any fresh ideas, the ACT Party does.

But let me turn to the government's innovation package. This is a government that prides itself on having the best media management of any government ever. And they are good. But last week's package was not good PR. The package was over-hyped. The Press Gallery were put in a media lock up - only to discover the only secret was there was no policy.

The package also shows signs of being rushed. Let me quote from the booklet, Growing an Innovative New Zealand: "They recognise the system as a complex web of relationships and interdependences rather than a collection of atomised institutions whose effectiveness derives from the interactions, linkages and coherence of the relationships, rather than just the excellence of any one aspect." The booklet is, as a journalist has admitted to me, unreadable.

The idea that New Zealand can grow at 4 percent a year if the government adopts a strategic partnership with business, is not new. It's one of New Zealand politics' oldest policies - one usually associated with National.

The Rt Hon Keith Holyoake did it first in the 1960s with the National Development Conference. The goals, the language are all the same.

Of course, it didn't work. Every three years National and Labour have told us they have found the easy way to prosperity - a committee of government and business. Last election it was National's "Bright Future".

I have re-examined that document and you have to say that National's policy is better presented, more coherent, and the strategic partnership better thought-through. Some of the names are the same - the same business leaders praising the government. Of course it's rubbish.

Holyoake's National Development Conference, Sir Robert Muldoon's Planning Council, Jenny Shipley's Bright Future and Helen Clark's innovation package won't give us 4 percent growth per annum.

That's not just my view - it's the Treasury's. The Treasury is required by law to issue five-year growth projections based on present government policies. The Treasury says, given the present policy framework, New Zealand will never reach 4 percent growth - New Zealand will not return to first world prosperity.

Already New Zealand's standard of living is 40 percent below Australia's.

Can we be a prosperous first world nation again? Of course we can. Can we record 4 percent growth sustainably? Of course. We did it for three years in the 1990s. In 1993 - total growth 5.2%; 1994 - total growth 5.8%; 1995 - total growth 4.3%.

The Rogernomics/Ruth Richardson reforms worked. New Zealand's growth only collapsed when Winston Peters became Treasurer. We know what to do. Lower taxes than Australia. Australia's company tax rate is 30 percent, so New Zealand's must be lowered to at least 28 percent. Lower taxes will add at least 1 percent to the current 2 percent growth.

A free labour market is worth another 0.5 percent. That's the cost of the Employment Relations Act. So we need another half a per cent to reach 4 percent.

The answer is a bonfire of regulations and red tape. Scrapping red tape would be worth at least another half percent in the growth rate.

We don't need another 4 cents a litre tax on petrol to upgrade New Zealand roads. We need to scrap the Resource Management Act.

Helen Clark announced last week that the Grafton Gully motorway extension in Auckland would commence this year. It will take three years to build. The Grafton Gully motorway extension got Transit approval six years ago. It has taken six years for planning approval for a road to which there is no opposition. And objectors can now basically halt indefinitely a controversial road.

Every day, small businesses abandon new investments once they find that Resource Management Act approval will cost $250,000. That's for a straightforward proposal.

Slashing red tape has got to be worth half a per cent. What I have outlined may not sound much. But if New Zealand grew at 4 percent per annum instead of the predicted 2 percent - in 10 years the average household's wealth would be doubled. New Zealand's wealth would be doubled. That's twice as much available for, say, health, education and superannuation.

That's the choice we really have. Over the last two years New Zealand has enjoyed the most favourable economic conditions imaginable.

Ø A lower dollar

Ø Good commodity prices

Ø Grass growth

Ø Foot and mouth disease affecting our competition.

Despite this, New Zealand has only achieved 2.1 percent growth, well below Australia's growth.

All we have learned last week from the Labour/Alliance government is that they have no practical policies to achieve the growth rate needed to restore New Zealand to first world prosperity. Labour has no fresh ideas to resolve the problems in health and education, and intends to ignore public concern about crime.

Only the ACT Party has practical workable solutions. That's why every election, ACT's support rises.

I believe ACT's approach of not just being an effective Opposition but also the party that puts forward new ideas to old problems, is the reason ACT will again do very well at this election.

When you think about it, there's no other choice for the intelligent voter.


For more information visit ACT online at or contact the ACT Parliamentary Office at

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