The Nation: National Party leader Simon Bridges
On Newshub Nation: Emma Jolliff interviews National Party leader Simon Bridges
Emma Jolliff: National leader Simon Bridges is adamant a capital gains tax would take thousands from people's KiwiSavers and threaten the Kiwi way of life. I began by asking him if he's simply scaremongering and muddying a sensible debate.
Simon Bridges: No, I think if you look at it seriously, Jacinda Ardern, Grant Robertson and Sir Michael Cullen are being very tricky. I mean, If you look at what they’ve done with the report, actually, it’s very much his description of himself, and that is that they have presented options as recommendations, recommendations as options. I can give you many examples. But for example, Grant Robertson on Maori and a capital gains tax, he’s literally denied when first asked that there were recommendations about that. Well, page 15, recommendations 2C and D of volume 1. Volume 2, page 15. It’s there in black and white. Sir Michael Cullen, effectively, on the KiwiSaver, trying to say that I’m wrong, that I’m misleading, that we’re hysterical. And yet he is presenting what are options – and he can’t do them all because he can’t spend the money three times – as clear recommendations that will definitely be offsets of KiwiSaver. He cannot say that on the actual words of the report. And then Jacinda Ardern doing exactly the same thing in Parliament when I have outlined to her the words of the report. And she denies that they’re even in there in Question Time in Parliament. So it’s not me being misleading, it’s not me being tricky. I say it’s them.
Emma Jolliff: Are you muddying what is a sensible debate, though?
I want a sensible debate. But let’s be clear – I feel, National feels, I think the vast majority of New Zealanders feel strongly about that. And by the way, we’re allowed to have those feelings. I think, on Sir Michael Cullen, there has been a corrupting of the process. Because we have someone now who has moved from being chair of a tax working group to being a Labour Party politician who is doing the dirty work for Jacinda Ardern and Grant Robertson that they don’t want to do. And what’s more, he’s doing it at a thousand dollars a day.
But he is saying that he is defending the policy, not the politics. He’s saying he’s only billing for four days over February and March, and that he is wanting to clear up misinformation that people like you are putting into the debate.
Well, it may well be that now he does rather fewer days than he was going to, given that he’s been caught out in the game. But I think he’s been rather sly. He said that National’s hysterical. He’s effectively inferred on Morning Report that I should not be believed. I call it as it is – that’s political, and it’s a corrupting of the process here, post the report.
Well let’s look at your claim that people with KiwiSaver funds will lose $64,000 over a working life of 45 years. Aren’t you cherry-picking parts of those reports to suit your own political gain?
No, that’s exactly what Sir Michael Cullen is doing when he says that all of the KiwiSaver savings will be there from one of a number of options that he’s choosing – and promising, effectively, will happen. My $64,000 stacks up. If anything, it’s conservative. We’ve used conservative assumptions. Over the lifetime of your average KiwiSaver account, that average person will lose 64 grand.
Cullen has said, though, that actually up to $70,000 you’ll be better off and he acknowledges that maybe over 70,000 you’ll be 13,000 worse off. Aren’t you ignoring any possible offsets from cuts in other places?
You’re right, that is what he says, but he is being tricky in doing that. Because as I say, he wants to paint, as a recommendation, as something the government certainly will do, one of a number of options to make this thing fiscally neutral. How can he say that that’s the one they will go with? I’m perfectly entitled to say that they may not, and that if they don’t it’s 64,000 – more than that, I’m telling you now, and I’m telling New Zealanders now. Read my lips and watch what happens. This thing will not be fiscally neutral. If it is, pigs will fly.
But it’s the whole package that’s fiscally neutral, not the KiwiSaver component and we’ve got to remember that the government is considering the recommendations of an independent tax working group and it has to build consensus within its Coalition Government. So none of them are actually a given yet, are they.
That’s the point. But Michael Cullen, when he talks about it, makes precisely the opposite case. Of the several options there are to make this fiscally neutral, he hones in on one and presents it as gospel truth that it is happening, and that suddenly everyone under 48K is going to be so much better off. Forty eight to 70, actually, they won’t be. 70 they’ll be worse off. I think he’s being very misleading.
He would say that he’s defending the findings of the report; he’s making sure that accurate information is in the public domain. He is the spokesman for a group that is no longer together, but we’ve spoken to one other member of that working group, and they’re happy for him to make sure that there is accurate information. They don’t want it to get political either, but they want to make sure that accurate information is in the public domain.
It’s naïve to say this won’t get political, I’m sorry. This is the most radical, hairy-chested capital gains tax and tax reform New Zealand has probably ever seen, and National is entitled to take a view on it. Now, if Jacinda Ardern and Grant Robertson were also out there putting their views forward, that would be one thing. But to have Sir Michael Cullen at a thousand dollars a day pretending to be objective yet really doing their political dirty work is entirely wrong.
But he’s only doing four days. He has said he’s only doing four days. So let’s look at the other claims.
Can I just come back on that? That’s what he says? Well, I happen to know. I got an email inviting me – he probably didn’t want me there – to a tax working group special run by KPMG and him in Tauranga, my home electorate. Is he doing those around the country? Is he on a roadshow? Now maybe he’s dialed that back. But you bet your bottom dollar when he signed up to that, he thought he was being paid a thousand dollars a day to do the government’s dirty work for it.
You’ll have to ask him about that. Let’s move on for a moment. Let’s look at the other claims you’ve been making – that Kiwis will leave the country for Australia. Why would they do that when Australia already has a capital gains tax?
Pretty simple. Because their capital gains tax, broadly speaking, is half of ours; because they have a bigger, stronger economy. All things being equal, when you make one side of the incentives in one country – that is, ours – worse, that does incentivise people to leave. We’ve already seen it under this government.
Except we also know in Australia you are denied access to various welfare, tertiary funding, health care.
Yes, but on average they earn more. There are, in some cases, more career opportunities. Here, we have a situation where the incentive to get ahead in this country, relative to Australia, is getting worse. It will mean more Kiwis moving to Aussie. But can I make this point? It’s very relevant this week, when we’ve had an anniversary, I think it is, from the Census. We will never know. And you know why we will never know? Because this government got rid of the statistic this year – or end of last year, I think it was – that tells us how many New Zealanders are moving to Australia.
We’re going to know that in April, I think.
We’re not. They did away with the statistic.
Would you support a capital gains tax in any form? For example, if it was lowered to something like 15 per cent?
No. But of course, that would be dramatically less worse, if I can use that bad English, in doing that. I think what is true is that all of the things here in terms of destroying incentives – KiwiSaver, other investment, homes, baches, small businesses – overall is terrible. You get rid of some of those things, you make it less worse. But is it still bad and should we be grateful if/when the government dials it back? No, I don’t think so. And I’ll blame Winston Peters.
Would you extend the bright-line test, for example?
No. It’s gone from two to five, and no, I wouldn’t.
Do you think our tax system is fair as it stands? This is equity, about creating equity in wealth, in our country, in our tax system. Do you think our tax system is fair as it stands?
That’s the battleground that Jacinda Ardern seeks to put it on. Everything now is about fairness. Actually if you look back in the past, she’s made it about many other things. She said they needed more cash. That’s what she said a couple of years ago in Parliament.
So is it fair? Yes or no?
No. It’s unfair. What is fair about someone in Oriental Bay in Wellington with a million-dollar property paying no capital gains tax and someone with a $700,000 property, a lifestyle block out in Wairarapa paying full capital gains tax? I could go on and give you example after example.
That’s the new capital gains tax. But as it stands now, is it fair?
At two years it was. Because really all it was was an evidential test that said if you were involved in rampant property speculation, you were flipping houses over every year, then you shouldn’t be doing that. Or rather, if you did do it, you should pay tax on that. But of course, what we’re talking about now is not a bright-line test; this is for all time you’ll pay 33 cents in the dollar. That’s very unfair.
But there is a huge wealth gap in New Zealand. That does indicate that our system isn’t fair. Oxfam last year said the richest 1 per cent own 28 per cent of the country’s wealth. We’ve seen Salvation Army figures from the State of the Nation report say demand from food banks jumped 12 per cent. We know state housing waiting lists are growing, welfare beneficiaries are growing. How can we make that fairer?
They’re all really serious issues. But Michael Cullen, well who knows what he’ll say tomorrow or the next day, because he seems prepared to say anything in defence of this report. But in the report itself, they make quite clear it’s not going to solve housing inequality issues; it won’t address those issues that you are talking about in that report. Look if we want to build more houses, let’s have comprehensive reform of the RMA, of the planning systems, let’s free up land and get into it. But a capital gains tax is not going to do the deal on those issues that you, that I, that New Zealanders care about.
You released your tax policy earlier this year, which pegs tax thresholds to inflation. How much is that going to cost?
I think from memory we were saying $600 million a year.
It’s not $6 billion a year, which this capital gains tax, when fully implemented, will cost New Zealanders in tax. So I think if you look at it, we all agree, and I certainly believe in a very heartfelt way, we need to make sure we’re prioritising health, education, and infrastructure. But once you’ve done that, Kiwis actually deserve to keep their hard-earned money. They deserve more in their pocket to deal with the cost of living that’s rising. And so the government isn’t increasing their tax-take by stealth, which is exactly what they’re doing now and they want to do yet more of with this capital gains tax.
So, the tax working group recommends better use of environmental taxes to address some of the big challenges we face and help the transition to a more sustainable economy. Do you support that?
Unlike the government, I don’t believe that the solution to everything is taxes. I think New Zealanders can do the right thing; we can have a better environment; we can make sure we’re dealing with biodiversity, with climate change, without necessarily heaping on more taxes in a radical fashion, as you say, the tax working group is proposing.
But we haven’t been doing the right thing, have we? When you say leave people to do the right thing, we are in a bad environmental state. So it hasn’t been right so far, has it?
You can make the case about all sorts of things, but if you take climate change, I don’t think anyone in the world has solved that perfectly yet. Of course they haven’t. I was the minister in the last government that was there signing us up to the Paris Agreement. It is a journey where we continuously have to do more and do better in that area. The same is true in many environmental issues. I get that.
So you did sign up to that Paris Agreement, agreeing to two degrees. But two degrees is now considered the threshold of catastrophe, and the UN says that would mean 200 million climate refugees by 2050. Is a measured approach enough?
We’re working with the government very closely at the moment – myself and my colleague – with both Jacinda Ardern and James Shaw. I believe we should have an independent Climate Commission that advises this government and Parliament on what needs to happen. And I’m committed to following that through.
Students are going on strike next Friday, calling for urgent action on climate change. Do you support them?
Well nothing about climate change is unimportant. So I’m certainly not saying that, and don’t mistake what I say for that. But I do think look there may be some students out there who passionately have followed this debate, who’ve read up on it, and for them it may be right. But I do worry as a parent, as a citizen, that actually there will be a bunch of others who say, ‘Way-hey! Day off school, whatever the cause.’ And so I do worry that it sends the wrong signal if we say, ‘it’s okay here. The ends justify the means. Have a day off just because it’s a good cause.’
Judith Collins told us in April last year she still doesn’t really care about the wetlands. She’s a senior member of your party. How can you convince that National actually cares?
National’s a broad church. We’ve got a range of views on all manner of issues. But there is no doubt; we’ve just put out a discussion document on the environment, we care deeply about these things. We want New Zealanders to trust us as much as they do with the economy, with the environment. And I made clear when I became leader, before and during the race and afterwards, that the environment would get a refreshed, a renewed strong priority from me.
Is this where Vernon Tava’s Sustainable New Zealand Party comes in? Will they give you the green credentials that you need?
I don’t know. I think if I listen to Vernon, what he is saying is he’s not a blue-green; he’s a true green party. I genuinely have had nothing to do with that. Let’s kind of see where they get to. I can say this to you, though. If you look at the current government and the current Green Party, we’ve got a situation where we’re not getting cameras on fishing vessels; they won’t do the Kermadecs; and a raft of other areas they’re not making sufficient progress. So to those who voted for Labour and the Greens because they thought they’d get a greener government, I’m not seeing evidence of that today.
You’ve got seven or eight more policies coming out this year, the next one in May. What can we expect from that?
Potentially in foreign policy. Obviously an important area, a lot going on in that space, whether it’s in relation to China…
Can you tell us specifics?
No, because we’re still writing it and thinking it through. I said earlier this year that I want to set the agenda in policy debate in New Zealand. I think the government’s been all working groups and vague talk of kindness and the like. Well we want to be the contrast to that. We’ve done tax indexation, giving people back more of their money; we’ve done an environment document, which I hope people will engage with, read and think about. As I say, probably foreign policy coming up. And then after that, no doubt education, health, infrastructure, economy. Some big issues to come. We will want New Zealanders’ views. And we will want to give them a very clear sense of where we’re going if we have the privilege to lead.
What are you going to do to turn around your poor personal polling, Simon?
I think actually, just what I’ve said to you. It’s two things. Firstly, elections are a referendum on the government. It’s governments that lose elections. At the moment, I think they’re going about that pretty well, from my perspective, with some of the things that they are doing and not doing. What I need to make sure National is doing…
People do say that Jacinda actually won the last election, though.
Well, I think Winston Peters won the last election. I think there’s quite a few that say that as well. He won it for her, and now Michael Cullen’s doing a good job to try and win it for her again – or lose it for her, perhaps. But I’ll hold the government to account. I’ll make sure that National is developing plans so people have got a real choice at the election, and they’ll make up their minds when that election comes.
At what point do you decide you need to step down for the good of the party?
I won’t be. And I know that will disappoint your commentators today such as David Slack and Tova O’Brien, but I’m here to stay. I believe in what I’m doing, I think I’m the best person for the job, and I lead a terrific team that is putting out policy, that is leading the debates. We’re going to continue doing that.
So we’ll definitely see you as leader at the next election?
You sure will.
Transcript provided by Able. www.able.co.nz