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Speech - Prebble: The Real Issues

The real issues

Wednesday 30th Jun 1999

Richard Prebble

Speech -- Governance & Constitution


19 Princes Street Auckland 7.15am Wednesday 30 June 1999


The real issues

I found the events of the last week very depressing. When looking at the great issues facing New Zealand, whether or not the Prime Minister was making a flippant remark about a news reader's compensation package, matters not one iota.

I find the Crossfire programme to be disappointing. I believe that CNN, who invented the original Crossfire programme, should take a court case for passing off. The original CNN programme has as its concept an interviewer from the right, often many-times Republican candidate Pat Buchanan, and on the left Mike Kinsey the man who wrote 'Primary Colours'. The guest is hit with a question out of left field such as "When are social welfare benefits going to be increased?", only to be followed by a question out of right field "When are all these bludgers on social welfare going to be reintroduced to work?"

TVNZ, by deciding to use their staffers, who claim to be non-political, have lost the whole effect. I could see no difference between the questioners. Indeed, they are both preoccupied with the trivia of politics.

Perhaps the programme is an accurate reflection of how most political parties are currently operating. I cannot remember an election where there has been such a dearth of new ideas and vision.

The blame can be shared across most parties, but the Government should wear most of it. The Government has the best opportunity to set the agenda. This Government has been trying to clear everything off the agenda. An impossible task. If the Government does not fill the news at six, it's not cancelled, someone else fills it.

This year's Budget was just a book-keepers budget.

The Labour Opposition has decided to run on no policy and to campaign on sleaze. The so called sleaze could not even rate in most democracies. Indeed without the active assistance of state television and radio, Labour's campaign would have failed.

The media coverage of this year's election has been disappointing so far. The Opposition parties have been subjected to no scrutiny at all.

Let me give an illustration - Labour's proposal to increase income tax. Three weeks ago the Labour Prime Minister of Britain and Chancellor Gerhard Schroeder of Germany issued a new charter calling for lower taxes to stimulate growth and jobs.

Michael Cullen, when asked to explain why a Labour Prime Minister in Britain was wrong to say that taxes must come down, said that government expenditure in Europe was far higher than New Zealand.

The media reported this as a fact. Any amount of research would have shown that government expenditure as a percentage of GDP in New Zealand is higher than the UK.

Did Michael Cullen not know this? If he did, was he misleading us? If he does not know, how great is his knowledge? Why was he not challenged? But there is a more important issue - how is Labour being allowed to get away with the suggestion that throwing money at problems is the answer.

It seems we are doomed to a depressing election about personality attacks and claims of sleaze.

It could be so different from this depressing prospect. The world is in a golden moment. The cold war is over. The risk of world war has never been lower. The world's largest economy, the United States of America, is now in its longest boom ever. The worst of the Asian crisis is over and there are signs that Japan and South Korea are recovering. We are in the middle of the greatest technological revolution in human history, greater than the industrial revolution. Huge forces have been unleashed.

This election should be about the great issues that our country faces. Let me run through some of them.

Just because it's a cliché does not mean it's not true that there is a knowledge revolution. The countries that succeed in the new century will be the countries that educate their populations.

My youngest boy is still at school. Last year he did a project on ancient Egypt. I was amazed when I read it - he had extraordinary research, all of which he had got from the Internet. As an adult university student in the 1960s, I could not have written an essay that can now be written by a 16 year old, because the Auckland University library does not contain the research that he is able to access via the Internet.

How we take advantage of this knowledge as a society needs to be debated. What is not debatable is that we, as a nation, are losing this race. Our competitors in the global economy have made much greater progress in introducing students to the computer age.

This same revolution is transforming medicine. Operations not dreamed of a decade ago are transforming medicine. I was talking with one of our senior local body politicians who told me that he is retiring next election. "What are you going to do?" I asked him.

His eyes then lit up and he said "golf". He then told me that because of rugby injuries he has not been able to swing a golf club for forty years. Now, thanks to modern medicine and a new hip and fused spine he's playing golf again and he was delighted to tell me that he'd just been awarded a handicap of 36.

I of course told him that with that handicap he's going to win a few tournaments.

The demand for elective surgery, quality of life medicine is going to rise exponentially. We already have a hospital waiting list larger than the population of Dunedin. How do we ensure access to this medical revolution is one of the issues we should be debating.

We need to debate it. The suggestion of Labour that all private health is bad and that it's just a matter of a few cents more in tax to eliminate hospital waiting lists is intellectually dishonest.

In a real election campaign, issues that both National and Labour do not wish to debate should be given an airing. Neither party wants to discuss our runaway social welfare costs. With one voter in three on welfare, it's become a 'no go' area.

The terrible social cost of having one of the highest rate of single parent households in the world is a taboo subject. My party is attempting to lead a debate in how we can lower the numbers of children growing up in benefit-led households.

Most of us want to live in a compassionate society that looks after the truly vulnerable and provide a safety net for those in temporary financial distress. What we have created is a system of welfare that traps people into generations of dependency. We ought to debate it.

Another issue where policy has gone off the rails, is Waitangi treaty settlements. Labour and National have virtually identical policies which they have stumbled into. We ought to be debating how we can end this grievance industry. How we can be a nation with one law for all. My party is the only one prepared to debate this issue but we are holding a one sided debate as the other parties would rather talk about sleaze.

The only economic debate so far has been the politics of envy. No-one pretends that Labour's sock-the-rich tax policy has any economic rationale. National, with its constant teasing of possible tax cuts is also engaged in a totally political game. There is no vision of what this country could achieve.

I now regret that ACT put forward a three cent tax package to the Government. People think that that's ACT's policy and it is not. ACT just took the Government's announced pre-requisite for tax cuts - no deficit and no cutting of social spending - and pointed out that the country could have a three cent tax cut today. A three cent tax cut would create about 40,000 jobs. Even though the Treasurer's office publicly agrees that ACT's figures are correct, the Government still thinks even three cents is too bold.

I think the proposal of 3 cents is far too conservative. I also do not approve of the Government teasing us with the possibility of tax cuts. It's clear that for National, tax cuts are just seen as a vote-winning device. ACT has been advocating tax cuts because the economy needs it and middle NZ deserves a tax cut.

ACT has a vision of a much more successful New Zealand.

If New Zealand is to succeed as a trading nation in a global economy, we need to get a competitive advantage. If we are to stop the flight of our best young people, of professional people and the drift across the Tasman of business, we need some imagination and bold policy.

Just imagine how our economy would be transformed if we had a flat rate of tax of just 20 cents, with a low income rebate of 15 cents. New Zealand would be a magnet for investment. Overnight the Trans Tasman drift would become a Trans Tasman rush to invest here.

It is completely practical. If Government held expenditure to the level it was last year, next year we could afford it without making a single cut.

The media who criticise this as utopian failed to report Chancellor Schroeder of Germany's announcement last week that by next year he hopes to reduce the corporate tax rate of Germany to 24 cents.

Why would anyone invest in New Zealand when other countries can offer lower corporate tax rates? If Germany can lower its tax rate why can't we? If Ireland can have a corporate rate of 10 cents then why can't New Zealand have a flat rate of 20 cents?

Of course tax cuts by themselves are not enough. We have covered this country in red tape and bureaucracy. In the 1990's alone over 5,200 new laws and regulations affecting business have been passed. Again this election our politicians are promising more laws and even more regulations. Let's have a debate about why we cannot have less. Hong Kong has, I understand, just 1,000 laws affecting business.

I guess it's fair enough for you to say, well why doesn't ACT lead this debate?

Every one of these issues I have devoted a chapter to in my book "I've been writing". In the few book reviews I have received, the critics have said it's my 'best book yet.'

I note with envy that in Australia, the UK and the USA books about public policy are taken seriously. The books are reviewed, dissected and the ideas discussed.

The public I know is crying out for such debate because the book is a best seller.

We are at a golden moment.

There is a party willing to lead the debate on the real issues. All we need is a media prepared to report matters of substance and for others who seek your vote to rise to the challenge that ACT has laid down.


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