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Taxation Bill - Hone Harawira Speech

Taxation (Annual Rates, Business Taxation, KiwiSaver, and Remedial Matters) Bill
Hone Harawira, Member of Parliament for Te Tai Tokerau
Tuesday 4 December 2007

Whenever governments propose legislation, they must also consider the views of those they purport to represent, and polls are a good indicator of those views.

So it was a very important revelation when a couple of weeks ago, the results of the Marae-Digipoll were released, and it was all bad news for Labour’s Maori MPs - with 55% of Maori choosing Maori Party candidates, and only 33% opting for Labour’s Maori MPs, and the Maori Party candidates winning hands down in six of the Maori seats and deadlocking in the seventh – when we didn’t even have a candidate!

It was also a very clear indicator of Maori opinion when they were asked who their preferred prime minister was, and they chose three Maori – two from the Maori Party, and nobody from Labour.

And that opinion was confirmed when Maori voters were asked who most effectively represented their views, and top of the list of 21 Maori MPs was the Maori Party’s Dr Pita Sharples, and three of the top four MPs were from the Maori Party, and again nobody from Labour.

In fact, the Minister of Maori Affairs, Labour’s most high profile Maori MP, could only scrape up 5% of the vote.

Now these statistics are extremely valuable, because they represent the views of that sector of the economy that Labour claims to represent – the working classes.

So it says a hell of a lot about how disconnected these Labour Maori MPs are from their own constituents when we find that when it comes to Labour’s flagship savings policy, Kiwisaver, promoted with hundreds of thousands of dollars of taxpayer-paid-advertising, 84% of Maori haven’t even joined.

Of course, when challenged about the shattering findings of the Marae Digipoll, the Maori Affairs Minister came up with the standard - blub, blub, blub -‘the only poll that matters is on election day’.

It’s all well and good introducing amendments about employer contributions and tax credits, but what’s the point of all the pontificating when Maori aren’t even going to bother with it anyway?

And why aren’t they? Well, because a lot of Maori, Pasifika, and Pakeha as well, simply can’t afford to get into Kiwisaver, that’s why.

We regularly get reports coming into this House highlighting the reality of food-banks getting swamped by people in need; of familieswho can’t even afford basic housing, heating, food and health care; facts highlighted by the national homelessness forum held to highlight the sheer scale of the homelessness problem, not just in American movies, but here in good old Aotearoa.

We know how poverty limits a child’s options, and we know only too well how many low-waged workers are teetering on the brink of survival.

And when a family is struggling to make the zero line, the possibility of saving 4% a week is just way beyond their horizons.

Family Budgeting’s Jarrod Rendle says that for many of his clients, $15 a week going into savings means $15 less being spent on essentials such as food.

For too many families even $10 is $10 too much, and so we support the recommendations from the Combined Trade Unions, the National Distribution Union, and the New Zealand Nursing Organisation about reducing the worker’s contribution to 2% to encourage workers to join.

We support too the submission from Ngai Tahu about amending the withdrawal criteria to be more flexible and more accessible for people in need, such as that already agreed upon to help second-chance home buyers.

We support changes in the tax structure to help working people to save, but we would also like to see real incentives to encourage poor people to save as well.

Taxation is an important issue for Maori, as evidenced in the Marae Digipoll, which showed that Maori roll voters ranked ‘tax cuts’ as the most significant issue for them right now, for the first time ever.

Unfortunately, this Bill will not deliver the necessary changes, and we would recommend further changes to enable that to happen.

In fact, the focus of this Bill is more about enhancements and amendments flowing from Budget decisions announced some time ago, which we are generally happy to support, such as voluntary tax compliance, tax exemptions for Pasifika trust funds, tax credits for Aotearoa-based research and development, and tax relief for charitable donations.

We also liked the provision to remove the Maori authority net deduction limit of 5% of net income, which will mean that Maori authorities with a charitable trust or purpose, will now be encouraged to put more money into organisations with a charitable purpose, and get a tax benefit from investing in things like education grants, and community support projects.

We noted with concern though, an issue raised by both the NDU and the New Zealand Nursing Organisation, that young workers above the compulsory school leaving age, or with an early release from school should be eligible to participate in Kiwisaver, and that to deny them would be discriminatory.

We note that the Select Committee did not support the proposal, which I guess is consistent with this government’s decision to discriminate against youth workers generally by paying them at only 80% of the average wage.

We will support this Bill at second reading, but we will continue to raise issues of equity for young workers, and support for those most in need in this country, as part of our wider commitment to a fair and just society.


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