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Earthquake levy fair; WFF cuts perverse

3 March 2011

Earthquake levy fair; WFF cuts perverse

A small, temporary levy is the fairest way to fund the rebuilding of Christchurch, not cuts to Working for Families, the Green Party said today.

“A temporary levy on those who can most afford it is the fastest and fairest way to fund the rebuilding of Christchurch,” Green Party Co-leader Russel Norman said.

“Cuts to Working for Families in the ‘high income’ brackets won’t generate anywhere near enough money.

“What’s more, cutting from Working for Families sends the perverse message that higher income families with children should pay for the earthquake, but higher income earners without children should not.

“A targeted levy would involve small contributions from individuals earning over $48,000, and a slightly greater but still small contribution from those earning over $70,000. It would apply across the board and would generate hundreds of millions of dollars a year.

“On the other hand, cutting from the top brackets of Working for Families would target families whose combined income supports three or more children.

“Bill English himself stated in 2008 that cutting Working for Families from the highest income bracket would save only around $1.1 million per year.

“That is a tiny amount in the context of the billions needed to rebuild Christchurch.

“To generate any kind of significant savings from Working for Families, you would have to cut right down into the low- and middle-income brackets, and that would hurt families who rely on that support,” Dr Norman said.

Dr Norman said it was also important to note that an earthquake levy would be temporary, whereas cuts to Working for Families would be permanent.

“There is broad public support for a small, temporary levy and it would generate significantly more funds for the rebuild,” Dr Norman said.

“A small, temporary levy as proposed by the Green Party is by far the fairest and most economically prudent way to generate significant funds for the rebuilding of Christchurch.

“We have written to the Government offering our support for such a levy. There is a real opportunity here for cross-party support for a constructive solution, and I hope it is taken up,” Dr Norman said.

References:
How an earthquake levy could look: http://www.greens.org.nz/sites/default/files/how_an_earthquake_levy_could_look_green_party_research_1.pdf
Bill English’s comments from 2008: http://www.billenglish.co.nz/archives/326-NEWS-Giving-certainty-to-family-incomes.html

ENDS

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