Speech to House of Representatives, Address in Reply Debate

Mr Speaker,

I rise on behalf of the ACT Party in reply to the Governor General’s Speech.

Mr Speaker, we have seen the birth of E! Channel politics in New Zealand. The Prime Minister’s delivery was the best I have seen in this house. What a pity about the substance.

The substance is elsewhere. We have just seen one doddery man whose own electorate voted him out of office conduct a bizarre closed auction for the Treasury Benches.

There is a twist in this auction, though. Usually the winner of the auction foots the bill. In this auction, Winston Peters wins the prize, Labour gets to carry it home, and the Greens get to watch, and the taxpayer gets to pay and pay.

The Throne Speech contains a major contradiction. This Government is going to spend much, much more while paying down debt and keeping taxes the same. They are not offering to reduce spending on anything, anywhere.

How will they do it?

Bracket Creep. Last year New Zealanders paid $744 million in extra income tax thanks to bracket creep. The tax rates didn’t change, people just got pushed into higher tax brackets by inflation.

By the next election, New Zealanders will be paying another $3 billion in this term of Government. That’s a $1,500 tax bill for the average household. In the Epsom electorate, we’ll be paying a lot more than that.

But $3 billion is still not enough to cover even one of the Government’s major promises in health or education, though.

How else will they do it?

Surplus. This Government inherits an $18.5 billion-dollar four-year surplus. Their great contradiction means they will need to spend this too.

But it’s not going to work. The power behind to throne, Winston Peters, has already foretold the dark clouds on the economic horizon.

He’s probably right, how long will the ten-year post GFC expansion last, as Quantitative Easing eases and inflation returns along with higher interest rates?

New Zealanders have got used to low mortgage rates, low unemployment, and strong growth. The New Government seems to take it for granted, but history tells us we’re heading for a crash.

How will Grant Robertson balance a budget in just seven months’ time if the welfare bill is up, the Government’s cost of borrowing is up, and the tax take is down? We are going to experience Australian-style budget cuts and tax increases, foreign to New Zealanders, this term. The problem with socialism is that soon enough you run out of other people’s money.

But that’s not half of it. New Zealand’s real vulnerability is not on the Government’s balance sheet. We have one of the least indebted Governments in the world. We have some of the most indebted households in the world.

New Zealand cannot afford a profligate Government.

Who to blame?

Some people blame Winston Peters for forming a Government with the left.

Some people think MMP isn’t fair, allowing a coalition of the losers to form a Government.

Those aren’t the problem. The tragedy of the previous Government is not that it lost power. The tragedy was failing to use the power we had.

Almost all the incoming Government’s agenda is a response to one fundamental problem. It is too hard to build a house. In one of the most sparsely populated countries on earth, we just don’t build enough homes.

I have some hope for the New Government in this regard. Phil Twyford understands some aspects of the problem. Removing the Urban Growth Boundary is the one thing in this speech that is correct. Introducing new ways to fund infrastructure is essential if opening up land is to make a difference.

Solving the housing shortage will do much more to achieve the Government’s stated goal of a fair go for all, if they are able to solve it.

The Speech from the Throne says that this will be a Government with children at the centre of what it does, unless they and their families choose a Partnership School.

I am very grateful that the National Party are coming to the aid of Partnership Schools. However, let’s not succumb to historical amnesia the way politicians often do when the boot goes on the other foot.

Partnership Schools are core ACT policy that would not exist without ACT. We fought for them every step of the way. When I first got here and Hekia Parata said the then Government had no plans to open any more.

I have been extremely disappointed with the behavior of the new Minister of Education on this topic. He has not been a Minister for a couple of weeks, so maybe it hasn’t sunk in yet.

Let me spell it out for Mr Hipkins. You are entrusted great power as a Minister. When you talk to a Journalist and tell them there will be no more Partnership Schools, people think that is Government policy.

People enrolling their kids. People investing their livelihoods in setting up new schools for those kids. The Kids themselves who are supposed to be at the heart of everything this Government does.

What can you say to the cynicism of a Minister who is deliberately creating uncertainty to grind those schools down. What does he say to those kids?

My challenges to the Minister on Partnership Schools are these:

He must release an official statement to clear up the uncertainty around the Schools’ future. It should tell them what to expect for the 2018 School Year and what further discussions with what scope they are to expect.
He must undertake to visit any school he attends to alter the contract of so that he understands what he is dealing with.
He must stop spreading misinformation about the schools, such as that they are funded to a larger extent than other schools.
That would be a good start for a Minister committed to children.

ENDS

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