1. SHANE JONES (Labour) Link to this
to the Minister of Finance
What reports, if any, has he received on the appropriate settings for good fiscal management?
Hon Dr MICHAEL CULLEN (Minister of Finance) Link to this
[ Interruption] I am so pleased to see the National Party applauding Labour Party questions. I have received numerous such reports. Standard and Poor’s Asia-Pacific Sovereign Report Card highlights the Government’s solid fiscal profile. It follows on from Standard and Poor’s report last year that concluded the Government’s programme of debt reduction provision for future superannuation costs has made us one of the best placed nations in the world to cope with the costs of an ageing population. The report also noted that large-scale tax cuts would be “very short-sighted”, and questioned whether they would be sustainable.
Hon Dr MICHAEL CULLEN Link to this
I have seen reports suggesting the Government runs far too tight a fiscal position, reflected in excessively large Budget surpluses, and it should be significantly loosened up to $11 billion a year. I have also seen reports suggesting that the current fiscal position is far too loose and should be tightened, meaning we should be aiming for much larger surpluses. The first of those reports is from John Key and the second is from his co-leader Bill English.
Hon Bill EnglishDoes the Minister agree with the assessment of the Governor of the Reserve Bank that his current fiscal policy is, and I quote from the Reserve Bank’s statement, “quite expansionary”, and can he confirm to the House that this means his big spending plans in the run-up to the next election are one of the things that will cause interest rates to rise for householders?
Hon Dr MICHAEL CULLEN Link to this
I note, first of all, that the member has already called, in a statement only last week, for the Governor of the Reserve Bank to increase interest rates further. I note further that the member has promised a $200 million a year reduction in spending on tertiary education, without saying where it will come from, and I note that it is completely at odds with his leader, who not only promised large tax cuts but today promised another $60 million to $90 million a year.
Gordon CopelandHon Dr MICHAEL CULLEN Link to this
Just today I have seen reports suggesting that a major new policy on welfare would be released. I was somewhat surprised when I read the actual reports of this major new policy, which is simply the National Party’s submission on the tax and charities discussion document released by my colleague the Hon Peter Dunne earlier this month. It is, of course, Mr Dunne who has been leading the charge in terms of changes to the charities taxation regime.