General Debate

Hon STEVE MAHAREY (Minister of Education) Link to this

I move, That the House take note of miscellaneous business. This coming Saturday, 1 April 2006, will be yet another proud, red-letter day for those members of this House who are members of the Labour-Progressive Government. I say to each and every one on the Government side of the House that we came here not for all the trivialities of the last few weeks that have been debated here; we came here to make a difference. And on 1 April 2006 we will make another huge difference to families in this country. Already, because of Working for Families 200,000-plus families in this country have gained more childcare, more family support, and more accommodation support. They live a much better life because of that package. Now, on 1 April 2006, $900 million will be spread across people who need it for housing, to support their children, and to ensure that their children are in quality care while they go to work.

I want to give some examples of the effect of Working for Families. Let us take Sale and Barbara. They have three children, live on Auckland’s North Shore, earn $52,000 a year before tax, and pay a mortgage of $385 a week. On 1 April this year they will get $116 more per week. When the whole programme is rolled out, Sale and Barbara will get $245 per week. Let us take Kathryn, who is a sole parent. On 1 April 2006 she will be better off by $200 a week. There is $60 coming from the new in-work payment. Her take-home wages, by the time all of the package rolls out, will be $634, versus being on a benefit of $434. She will be better off; it pays to go to work. On 1 April 2006, Tania and Andrew in Christchurch, who have two children aged 4 and 11, and who work 60 hours a week and earn $37,000, will get $103 from the in-work payment. When the whole programme is rolled out, that family will be $211 better off every week.

Why do we have the Working for Families programme? Let me skip through the reasons. Firstly, the previous National Government left far too many New Zealanders in poverty. Thirty percent of all New Zealand children lived in poverty after 9 years of a National Government. The Working for Families programme alone will drive that figure down to 14 percent. Poverty, lack of security, and lack of opportunity—that was the legacy of that National Government. Why? Because National trapped too many people in welfare. Far too many people were dependent on welfare—415,000 New Zealanders were dependent on welfare when National had finished with them. We have already driven down that number to 289,000.

Secondly, we have driven unemployment down from 160,000 to 48,000, because we want people to have a chance. We are giving them an in-work payment now. We are making work pay. We are giving real opportunity and real security.

Thirdly, Labour supports families. The National Party thinks children are an individual lifestyle choice, and parents should pay for them themselves. We believe that children are a shared responsibility. That is why there are public schools; National wants to privatise schools. That is why there is public health; National wants to privatise it. That is why we have family support; National would not give it to families. That is why we support new parents; National would not do that.

The fourth reason is that under National the cost of housing became the single biggest contributor to poverty in this country. The cost of housing was the single biggest contributor to poverty. We have built State houses. We have had to replace 13,000 of those lost under National, and we pay an accommodation supplement for those living in private houses around this country.

We have introduced the Working for Families package because we are here to assist hard-working New Zealand families. For decades they were told they would get nothing. The rich got richer, and they got poorer. On 1 April they will get their fair share.

KEITH LOCKE (Green) Link to this

I want to talk today about the Iraq war. There has been an odd silence on this issue, particularly given its great importance not only for Iraqis, who are being killed and tortured in large numbers and having their homes destroyed, but also for the world, if we want peace and adherence to international law.

Daily media attention is given to the killings, the torture, and the mayhem in Iraq. But, unfortunately, there is now silence from our Government as Tony Blair visits this country. I think these last couple of days were a golden opportunity for Helen Clark to say a few home truths to the British Prime Minister. If we are true friends of Britain, as the Green Party is—as our Government is, I hope—then we should be able not only to talk about trade but to talk about important issues like the Iraq war, about which we strongly disagree. In doing so, we will be strengthening relations with Britain, because the overwhelming majority of British people did not want this war, still oppose this war, and want the British troops to be brought home. Tony Blair is standing out against the popular will in Britain, as George Bush is standing out against the popular will of the American people.

The war is clearly wrong, and I want to indicate some of the lessons that could be taught to Tony Blair by our Prime Minister. I tried to convey these lessons to Tony Blair yesterday. I passed him an open letter that was signed not only by myself but by Marion Hancock, Director of the Foundation for Peace Studies Aotearoa / New Zealand; Laila Harré, National Secretary of the National Distribution Union; Edwina Hughes, Coordinator of Peace Movement Aotearoa; and the President and the Vice-president of the Women’s International League for Peace and Freedom, Joan Macdonald and Megan Hutchings. In the letter we explained why it was important that the British Government withdraw its troops from Iraq.

I will go over some of the lessons that our Prime Minister should be conveying to Tony Blair on this day. The first lesson is that politicians should tell the truth and not pretend there are weapons of mass destruction in a place like Iraq when they know there are not. It is interesting that this week a leaked memo was published in the New York Times that described a meeting between Tony Blair and George Bush on 31 January 2003—prior to the invasion—where they agreed that the war would proceed whether or not weapons of mass destruction were in Iraq. George Bush told Tony Blair that perhaps they should provoke a war. One of his suggestions in this official memo was to paint a US surveillance plane in UN colours, and to provoke an attack so that the war could start.

The second lesson is that we should not violate international law. Elizabeth Wilmshurst, who was the Foreign and Commonwealth Office’s Deputy Legal Adviser, advised prior to the invasion that the unlawful use of military force on such a scale amounted to a crime of aggression. Yet the British Government and Tony Blair took no notice.

The third lesson is that although nobody—particularly the Iraqi people—has any love for the deposed dictator, Saddam Hussein, no country likes to be subjected to a military occupation, particularly a prolonged one. The fourth lesson is that when outside nations impose their will on another country, it disrupts the process of nation-building. The memo that was in the New York Times stated Tony Blair and George Bush thought that if the invasion took place in Iraq, it was “unlikely there would be internecine warfare between the different religious and ethnic groups.”—and we all know how wrong that statement is.

The fifth lesson that could be conveyed to Tony Blair is that the British and American forces cannot win. Their presence in Iraq only makes things worse, and we saw even in this morning’s New Zealand Herald how more and more of the country is going out of those forces’ control. The headline of the article in the states: “British soldiers sidelined as Basra crime gangs tighten grip on police force”, and that is what happens when there is an occupation force. It produces only mayhem.

The sixth lesson is that the violation of human rights by occupation forces is unacceptable. Violations by British troops have taken place, and there have been numerous instances of that happening. Ben Griffin, a member of the British SAS, recently departed the force for that reason.

JOHN KEY (National—Helensville) Link to this

We all learn something new every day. I came down to the House today and learnt something very, very special indeed. I learnt that a New Zealand family earning $385,000 a year is still considered needy by the Labour Government. Labour considers a family earning $385,000 to be in need of a tax cut.

I am proud to be part of a National Party that campaigned, and campaigned hard, for the right of all New Zealanders, from all walks of life, to pay less tax and to keep more of what they earn. I am proud to be part of that party, and I am proud to be in one of the parties that form the majority in this Parliament—one of the parties that voted for tax cuts. We are not in the minority, like Labour, which promised tax cuts to a chosen few who were selected in a last-minute electoral bribe before Labour went down the electoral gurgler. We did not promise one or two selected groups of people tax cuts as Labour did in a gasp of desperation before the Government was taken out. We did not select a group of people as Labour did because Labour had made such a hash of the Budget and had to make up for it. I am proud to be part of the National Party, which campaigned for all New Zealanders to have a tax cut.

I feel very sorry for those many New Zealanders who, on 1 April, will look across and miss out, even though they earn so much less than some of the people earning as much as $385,000 a year who will receive something. That package, Working for Families, should rightfully be named “Welfare for Families”. It is a policy based on a very simple principle—those who, in many cases, can afford to give the least are being asked to give money to those who very often need it the least. No one in this Parliament can argue that someone earning $385,000 a year deserves to take the taxes of a young person earning $25,000 a year. That is simply not right, and it robs New Zealanders of a rightful and logical system. It also robs New Zealanders of their dignity.

Overwhelmingly, New Zealanders have responded in surveys to the fact that they want to keep more of what they earn. They do not want to become beneficiaries of the State, and they do not want to risk being in debt to the State. They do not want to have to estimate their income and potentially become a debtor of the Inland Revenue Department. New Zealanders have asked for a simple thing: just to have left in their pockets more of what they work so hard for every day. What is wrong with that? What is wrong with people having the ambition and the goal of wanting to make the most of their lives? What is wrong with people believing that the skills they have, the overtime they work, the training they go through, or their acceptance of more responsibilities in their jobs will lead to them having more in their pockets rather than being the pawns of Michael Cullen and Helen Clark who may or may not feel desperate enough to give them something on election day and that is it?

Michael Joseph Savage would be turning in his grave if he believed that his treasured welfare State—

Hon DAVID CUNLIFFE (Minister of Immigration) Link to this

It is interesting to follow that member—a member who has eloquently stated the case. He was raised in a State house, went to a State school, and has dedicated his professional career to making sure that the next generation does not get the chances he had—which put him here in this House with a good education. I ask: what about the next generation of John Keys? Are we to use the excuse that social services rob them of their dignity? I see sitting opposite Tariana Turia, who said she does not want to see a world where any Māori needs welfare and, on the face of it, I agree. But the sad thing is that we live in a world where not everybody yet does have the skills, the qualifications, the house to live in, and the good job—and until people do we will stop Kiwi children from falling between the cracks. We will ensure that Kiwi children get the chance that John Key got.

Dr the Hon LOCKWOOD SMITH (National—Rodney) Link to this

My colleague John Key has just interjected by pointing out that 5 minutes can be a long time when one has to listen to someone like Minister Cunliffe. This Labour Government’s Working for Families package is a serious issue. One of what the Government claims to be its main aims is exactly this: “Make work pay by ensuring that people are better off by being in work.” I want David Cunliffe to reflect on these facts—and I will quote figures from the annual report of the Inland Revenue Department—given that aim of making work pay by ensuring that people are better off by being in work—

JILL PETTIS (Labour) Link to this

At the beginning of the year the Prime Minister said in her statement: “There is a world of difference between Labour’s “New Zealand way” of promoting higher wages, based on higher skills, innovation, productivity, and sustainability and the right-wing parties’ standard prescriptions of slashing the tax base in public spending, cutting back on employees’ rights and protections, sacrificing the environment, and deregulating and privatising. That was the agenda New Zealanders revolted against in 1999 and have rejected ever since that time.” This is a day when we in Labour are very proud to be part of Labour, because today we are talking about a fabulous range of policies that will be implemented on Saturday. We are proud to be members of a party that is progressive, forward-looking, and inclusive and that still believes in universality—as did our first Prime Minister, Michael Joseph Savage, a man of whom we are very proud.

I also remind members opposite of what their current but temporary leader, Don Brash, has said in the past that refers particularly to universality, and I think it is particularly important to put it on the record again. In March 2004 he said: “I’m saying there are racial components in the allocation of healthcare and education funding—in that sense, I suppose you can say I’m saying Māori are given too much.” Given the comments National members made this afternoon during question time and their obvious lack of enthusiasm during the debate this afternoon on the Working for Families package, I ask them what parts will they cut? Which families will they cut income from? This is the Government that has got more people off benefits than any National Government did in recent years—and $11 billion worth of tax cuts would not deliver the kind of money this Government’s policies will deliver to working New Zealanders.

Labour listened very carefully last year to what New Zealanders said they most wanted. They said that what they wanted most was more help for New Zealand families, more help for working families, and more help for people when they need financial assistance the most, which is when they are raising their children. We all know that raising our children is the most expensive time of our life. Labour listened; Labour is delivering. And I am proud we are delivering.

I am very proud to live in the Wanganui-Taranaki area, and I am very proud of what we have done for families in that area. We are already providing $49 million extra in financial assistance to families who are working and helping to raise their families. We are also assisting more than 2,500 families who are receiving $12 million in family assistance. Six hundred working families are getting more than $1 million through the accommodation supplement, and 500 families, and more, are receiving assistance through the accommodation supplement. These are fabulous sums of money that are going directly into families’ pockets.

Where are those families spending this increased income? They are spending it on their children and in their local towns. An example of how that is benefiting our local towns is that in 2001 Wanganui had 36 vacant shops. Today only eight are vacant, and development plans are under way for five of those, so now only three shops remain empty in the Wanganui main street business district. What has happened since 2001? We have had a Labour Government whose policies have provided a direct form of assistance to the whole community in which I live, and to communities throughout New Zealand from North Cape to the Bluff. Families spend their money locally. Money is made round to go round, as they say, and this money is going back into the communities where families throughout New Zealand live. This is not just about assisting families through the Working for Families package; this is about a whole suite of policies that will benefit New Zealand.

Hon MAURICE WILLIAMSON (National—Pakuranga) Link to this

There are a number of things that one can prophesy and forecast in the world and at the time people do not listen at all, and then many years later when those things happen, everyone asks why someone did not say something about it. I can remember in the 1990s, coming back from seeing some of the research laboratories in the United States that were looking at things like DVDs. I would go along to Cabinet and talk about those things called DVDs, and everyone thought they were some sort of a disease that penicillin would cure. Now, DVD is just a common, everyday occurrence.

I remember talking about the Internet. I had seen a trial of the Internet with email flowing into it. I came back so excited. I remember several of the senior Cabinet members saying that no one would even have a personal computer on his or her desk, because it was so hot. The reason I am saying this is that I am sending another warning today, and I hope it will be recorded in Hansard properly so that the media and the talkback hosts will refer to this speech of mine, made on 29 March, about Auckland’s infrastructure deficit problems and the nightmare that people will face during all the years running up to, but specifically at the time of, the 2011 Rugby World Cup. I say that because the Prime Minister raced off to Ireland and gave assurances, as part of the bid, that infrastructure would be dealt with. So I want to raise with this House some specifics about what I think are the problems and how they will emerge.

First, I take members back to the Transit document of August last year. Remember, this has been superseded by a new plan that wipes out half of that stuff and completely ridicules it, but I will take Dr Cullen at his word: “We will find the money to go back to the August update.”

MOANA MACKEY (Labour) Link to this

This has been a very interesting debate. National is obviously and clearly rattled by the Government’s Working for Families package, the next stages of which are going to be rolled out on 1 April 2006. It is very amusing to be lectured on beneficiary numbers and how to get people off benefits and into work by a party that saw beneficiary numbers spiral out of control, and saw those people who were living on a benefit pushed further and further into poverty. This Government has a phenomenal record of moving people off benefits and into work. I wonder whether the $11 billion worth of tax cuts that National promised at the last election would have come at the cost of cutting many of the good programmes. They might not suit National Party rhetoric, but they are actually delivering results. At the end of the day that is what we are here for.

But I want to talk today about the student loan policy, because 1 April 2006 will be a red-letter day for students. This is something that students have fought for for a long time. It will benefit students who have already been through the system, it will benefit students who are currently in the system, and it will benefit future students. This Government thinks that one should definitely pay back the loan that one has borrowed, but one should not be crippled by the burden of the interest that is charged upon it. I endorse that policy. I remember what it was like to be a student under Dr the Hon Lockwood Smith, who was so proud of his student support policy that he was climbing out of windows at universities to avoid talking to students about it. But I do hear in recent times that he has felt a little bit of remorse, perhaps, about the way the student support policy was introduced. Although I welcome that I say that it is too little too late.

The student loan policy and the interest charged on student debt have caused a number of sociological problems that, if not dealt with now, will cause big headaches for Governments in the future. We make a number of presumptions when we look at issues such as superannuation. One presumption is that people will own a freehold home by the time they reach superannuation so that they can survive on the level of superannuation that we afford to all superannuitants. With the advent of the student loan debt we have seen young people—single, couples, or families—delaying, first, having a family, and, second, buying a home, to the point where there is concern that they may never own a freehold house, and that that would severely impact on future Governments. I am very, very pleased that this Government has decided to take charge and to make a bold move today to nip that in the bud.

It is very interesting when one hears members on the opposite side of the House constantly bleating at the Government about the brain drain. They are constantly saying that we have all these people going overseas and asking what are we are doing about it. I have a lot of friends who are overseas. Most of them left during the National Government—I do not know whether that was deliberate; it was probably just because they graduated and went on their OEs, if I am to be fair—but they have not come back. Why have they not come back? Because they have not set up student loan payments. This Government is putting in place an amnesty that will allow students, without penalty, to set up loan repayments from overseas. Many people I know who are overseas will do that. But what is particularly good is that they are talking about coming home. While they were overseas they could escape their student debt.

Members opposite seem to think that graduates think more of tax cuts than they do of the fact that they pay 10c in every dollar that they earn straight over to the Inland Revenue Department. National has no idea about the incentives involved in repaying a student loan. The biggest incentive to repay your student loan is when you see that there is finally light at the end of the tunnel; when you make your repayments and you see—

GORDON COPELAND (United Future) Link to this

Your mailbag, Mr Assistant Speaker, like those of many other members will, I know, be full of letters from New Zealanders appealing to this House to get away from malicious personalised attacks and to debate instead the many serious issues that confront our nation, its families, and its people. United Future wholeheartedly agrees with those sentiments.

Today I want to utilise my time to talk about a number of those important issues. Following 21 consecutive quarters of economic expansion, the New Zealand economy contracted by 0.1 percent in the quarter ended December 2005. That news coincided with the announcement that our balance of payments deficit was no less than $13.7 billion for the year ended December 2005, 8.9 percent of GDP, and coincidentally also the worst December year result since 1984 exactly 21 years previously. These figures should act as a wake-up call to every single party, and every single member of this Parliament. We should be collectively applying our minds to work constructively and together towards the goal of improving, and improving rapidly, the strength of the New Zealand economy.

I want to turn to a couple of specific examples. Last week a group of wool growers called by my office to report that in real terms, the price of wool is now at an historic low. In addition the existing industry structures are, they believe, dysfunctional and beyond the point of no return. Indeed, returns to growers are now so bad that they told me some wool growers have decided to change their farming practices because it no longer pays to worry about wool quality. Rather, sheep are being farmed simply for their meat.

I well remember that the meat industry was in a similar perilous state in the early 1980s. I was one of a number of consultants taken on at that stage by the Hon Bill Birch in his capacity as Minister of National Development to find a new pathway forward for the meat industry. Our conclusion was that it needed nothing short of a reformation. We called for that reformation, action was taken, and that industry has gone on to success. Nothing short of a reformation for the wool industry is now necessary. So today I call on the Minister for Economic Development, the Hon Trevor Mallard, to emulate Bill Birch’s example, call together the best brains in the nation, and build a cross-party consensus to undertake a total reformation of the wool industry in this country. It is tragic. We produce wool, and our wool growers get less than 1 percent, normally, of the retail price of carpets or wool at the other end of the scale. It is simply still in the colonial era and needs to come out of it.

Forestry is similarly in a slump. The current problems are again acute, serious, and urgent. We have a stand-off between the New Zealand Forest Owners Association and the Government at a time when the industry is already under pressure because of international wood prices. The stand-off is specifically about the Government’s Kyoto Protocol - driven deforestation cap, which aims to hugely penalise forest growers if the cap is broken, but steadfastly refuses to contemplate providing any incentive at all for replanting following harvest or, indeed, for new greenfields planting. That needs to change, and change fast.

In December 2005 the Hon Nick Smith wrote to the Hon David Parker, then the Minister responsible for Climate Change Issues, offering National’s cooperation in a bipartisan approach to this issue. I am disappointed to learn that to date that letter has not even been acknowledged. That is simply not good enough. Today United Future appeals to both Labour and National to park politicking for a bit and agree to cooperate in a bipartisan and, indeed, a multiparty attempt to resolve the serious issues.

In the late 1950s, early 1960s, in the United States of America, Lyndon Johnson became very popular and subsequently became Vice-President, because when he was leader of the Democratic Party he said: “We have some serious problems. I’m prepared to put party politics aside for a while and work with the Republicans for the good of our country.” It was immensely popular.

CRAIG FOSS (National—Tukituki) Link to this

This current Labour Government is arrogant, tired, and out of touch. This current Labour Government is starting to resemble the socialist Governments of old, but, perhaps, with a bit more lipstick. As a senior Labour MP said to me just the other day: “This is starting to feel like 1997 all over again, but this time we’re on the other side.” Well, I say: “My friend, history has a tendency to repeat itself. The trend is your friend.” That senior Labour MP knows what is going on.

DARIEN FENTON (Labour) Link to this

What a pathetic contribution from that member! I have heard of wishful thinking, but I have to say that that takes the cake.

I am very, very proud to be part of a Government that is making a serious commitment to families, the low-paid, those with children, and those who are trying to get ahead. We are in Government to make a difference, and up and down the country New Zealand families, young and old, will this weekend be celebrating the measures that this Government is delivering for a better New Zealand.

The Working for Families package is one of the most significant poverty-reducing measures any Government has taken in decades. Bringing up the next generation is the most important thing we have to do as a nation, and almost three in every four New Zealand families with dependent children will be entitled to extra financial support under our Government’s Working for Families package. On the North Shore, for example, 9,000 working families are already receiving a total of $51.5 million in family assistance, 4,800 working families are getting $24.2 million through the accommodation supplement, and 1,100 families are receiving childcare assistance. That is $259.6 million in extra financial assistance going to thousands of North Shore residents and parents who are working to raise their families. From 1 April even more families will be able to get their share of Government support to help bring up their children.

This Government has already delivered a lot to families. We have the lowest unemployment rate in the OECD. We have built more State houses and made them affordable. We have provided 14 weeks’ paid parental leave, and we have increased the minimum wage by 8 percent from Monday of this week. We are also introducing 4 weeks’ annual leave from next year.

We have taken some giant steps towards tackling the lingering social deficit from the 1990s, when National’s policies were all about economic gains for the better-off at the expense of the not so better-off—and nothing seems to have changed. During that time there was no progress in recognising the costs and demands of raising families. New Zealand in the 1990s was one of the meanest countries in the OECD when it came to financial support for working families or families with children. Families increasingly found themselves on the wrong side of a growing divide between rich and poor, with serious consequences for children. We remember the market rents from 1991, when the Housing Corporation progressively increased rents on housing from 25 percent of income to market rates, which forced overcrowding, sub-standard housing, and Third World diseases. This Government has fixed that, and we are delivering on our commitments to our country’s future.

Another lost generation under National were students, who, if they wanted to improve their chances of a decent life through tertiary education, had to mortgage their futures. On 1 April tens of thousands of students will welcome the scrapping of interest on student loans for those who live in New Zealand. That will reduce the debt burden on students, and knock years off repayment times. It means that more families can plan for their children to enter tertiary education, because Labour is making it more affordable.

Of course, there is more: 490,000 senior citizens will receive a boost in their standard of living through the increase in the rates of superannuation and the veterans pension. As my colleague the Hon David Cunliffe said, businesses will benefit from the biggest cuts to business taxes since the late 1980s.

Meanwhile, what is National up to? Its members have no new ideas. They continue to bang on about tax cuts, but New Zealanders know that tax cuts do not deliver better education and improved health systems. They are so devoid of ideas that they have resorted to personal attacks, smear campaigns, and witch-hunts—and I appreciate the comments of my colleague Gordon Copeland on those matters—which are not what the people of New Zealand want to see. But National is doing that because it cannot think of anything new to say to the New Zealand public. I say that the public did not vote for the muckraking and character assassination that we have seen in our Parliament in recent weeks. People want to see us getting on with the serious business of building New Zealand and helping it succeed.

Labour is making a difference. It is changing lives for the better, and that is what responsible Governments do. We are in Government to deliver. I am proud to be part of a Government that is focused on its programme for families young and old, for economic transformation, and for our national identity. Through Labour, New Zealand families are getting ahead, and I feel privileged to be part of a Government that continues to deliver.

CHRIS TREMAIN (National—Napier) Link to this

There is an old mantra in this country—in this fine New Zealand of ours—in our communities, and in our families, and it goes something like this: when times get tough, one pulls in one’s belt, spends less, works harder, and looks for greater efficiencies. Times are tough in this country. The rate of growth has almost halved in the past year, with pain now spreading from the export sector into the domestic markets.

I will talk about the export sector for a minute. We have all known what the situation has been like in the horticultural sector and the fishing and forestry industries for the last 6 months to a couple of years. Now we are seeing farming being brought into that situation. We have seen dairying suppressed for 2005 and 2006, and the outlook for 2006-07 is bad, as well. Sheep prices are down 25 percent. We will no longer be able to rely on those high commodity prices that this Government has depended on for the last 3 to 6 years. Tourism is also feeling the pinch. The number of visitors in the 3 months to January was down 1.4 percent on last year. Tourism is an industry that should be growing year on year.

We now have solid data showing that the domestic market has slowed down considerably. Growth in retail revenues has stopped. The housing market has slowed, if not stopped altogether. What is more, overall economic growth has flattened out to nothing.

GORDON COPELAND (United Future) Link to this

I seek the leave of the House to table a letter I mentioned in my contribution to the debate, which is from the Hon Nick Smith to the Hon David Parker and dated December 2005, regarding National’s willingness to work with the Government on climate change issues.