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ACT's The Letter 30 May 2005

The Letter

JULY 30?

“Well-placed” sources told the Press Association last week that the election date is July 30. The PM is neither confirming nor denying. Following Doonegate that probably fingers her as the well- placed source. Labour Party history is already re-written as David Benson-Pope disappears down the same memory hole as Closing the Gaps, that painting, and John Tamihere’s Investigate interview.


Rodney Hide launched ACT’s tax policy last week calling for caps on spending. The caps would fix real government spending per capita and force government to live within a tough budget, just like everyone else. The next 5 years forecast is for Government spending to grow 40% faster than the economy.


ACT’s tax policy will immediately return $40 per week to the average worker. Cullen’s is for a packet of chewing gum - in 3 years’ time. ACT’s policy: two tax rates, 25% for company tax, 25 cents top personal tax, and 15 cents for all income up to $38,000. Treasury estimates cuts of this size would boost our growth rate by 1-1.5% a year.


Cullen’s argument against tax cuts is that they would increase interest rates. Memo to Cullen: tax cuts drop prices, including interest rates. It’s tax increases that force prices up, not tax cuts.


Following Cullen’s damp squib of a Budget National got the headline to die for. “Tax Cuts by Xmas:- Brash” read the front page of the Sunday Star-Times. But, once again the Nats backtracked. Their finance spokesman John Key added the caveat, tax cuts by Xmas “as long as the financial climate is conducive”. He then went on to declare that their tax cuts would not kick in until the next financial year. We have got used to National’s flip-flops. But this is the first time they have flip flopped before their policy has even been announced!


Like the PM, John Key blamed the journalists. He said the promise of tax cuts by Christmas “was their [the Sunday Star-Times’] line, not mine". But the Herald on Sunday ran the same story the same day. Besides, what’s wrong with tax cuts by Christmas? The Letter loves it. So why are National running away from it?


NZ’s High Commissioner in London Jonathan Hunt explained to the PM that he had to sit out the ANZAC Day Service at Whitehall in his chauffeur-driven limo because he didn’t bring his coat. What he didn’t tell her was that officials offered him a spare coat that they had brought along. Helen’s furious. “I made him High Commissioner. I made him ONZ. The least he can do is stand in the rain for 20 minutes once a year!”


The Police have declared themselves “very comfortable” with their handling of the mayday call from the Iron Maiden that sunk off the Northland coast in August last year. They are the only ones. The PM’s office has sent out the dictate - kill it! Clark doesn’t want Hawkins, her weakest minister, defending the indefensible in the run-up to the election. Bad call guys. Make up your own mind. Listen to the audio of the emergency response system and read the details on Rodney’s blog. Go to


Jim Sutton’s angry “betrayal” outburst against WTO Ambassador Tim Groser when he announced that he was standing for National was not about the country but the Labour Party. They had always counted Tim as one of their own. Besides, in 1975 Labour’s Hugh Watt was MP, Cabinet Minister and NZ High Commissioner in London. Back then Labour explained Watt’s multi-tasking as a good thing because it allowed better access to British Government Ministers. But Hugh Watt was different. He didn’t defect to National.


No surprises in National’s list. The stars were in short supply. Five list only places had been reserved. Only one “star” made it through -- Groser. The other two list only spots are taken by Don Brash and Georgina Te Heuheu. There is only one woman in the top 10 and she’s at 10 - Katherine Rich. Pansy Wong has taken a tumble - down to 20 from 10 in 2002. So to has Georgina from 6 to 19. The Letter was expecting a bit more excitement with Brash as leader and plenty of list spots to fill following National’s disastrous showing last election.


Richard Worth is one of the winners on the Nats list moving from 25 to 16 after spending the last 3 years travelling the world and obtaining a PhD. He is guaranteed a place in the next parliament on the list. This means Epsom voters can now vote for Rodney Hide knowing that Worth is safe.


Rodney Hide laid a breach of privilege against David Benson-Pope two weeks ago. As The Letter goes to press, Rodney still hasn’t heard back from Speaker Wilson. This is significant. A Speaker’s refusal to send a complaint to the Privileges Committee is advised by private letter any old day. A decision to refer the complaint on is made to all of Parliament. Last week was recess week. Look for the decision tomorrow.


Gerry Eckhoff is making a real impact as the only politician actively representing farmers’ views in parliament. Last week he launched ACT’s rural policy in Wanganui. Key points were: protecting property rights, reducing compliance costs and funding roads through fuel taxes, road user charges and tolls. Go to:


Last week 98% of readers declared Cullen’s Budget as bad. This week’s poll, “Should real government spending per capita be capped?” Vote on We will pass on your verdict in the budget debate.


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