2. CHARLES CHAUVEL (Labour) Link to this
to the Minister of Finance
What reports has he received on patterns of wage growth in Australia and New Zealand?
Hon Dr MICHAEL CULLEN (Minister of Finance) Link to this
I have seen a report from John Key stating that the wage gap between Australia and New Zealand has “blown out” during the term of this Government. This is not correct. The blowout was between 1990 and 1999 when the gap increased from 18.9 percent to 28.4 percent. Those are the official figures. Since then it has barely moved. Under the last National Government, average real weekly earnings increased by a total of $1.31 a week in 1990 dollars, over a 9-year period. Under the 8 years of a Labour-led Government, the rate of increase has been 30 times that level.
Has the Minister seen any other reports on the merits of pursuing higher wages for New Zealand workers?
Hon Dr MICHAEL CULLEN Link to this
I have seen a report from Mr Key saying “We would love to see wages drop.” I have seen subsequent reports trying to explain away the comment as, firstly, light-hearted, then he tried to say it was Australian wages he wanted to reduce, and later he tried to say it did not count as it was said only in a cafe. When none of those efforts worked, efforts were also made to bully the editor into sacking the reporter. I seek leave to table a transcript that says “Look, I’ve spoken to the editor.”
Hon Bill EnglishIs the Minister aware that the newspaper concerned is going to publish a retraction, and can the Minister answer this question: if he was right, and there is no wage gap between New Zealand and Australia, can he confirm that New Zealanders are leaving in record numbers because of a self-absorbed Labour Government that cannot manage any political issues and does not care about the future of the country?
Hon Dr MICHAEL CULLEN Link to this
That question shows why he should have been Leader of the Opposition, and not Mr Key. He is not as slippery as Mr Key. No, I cannot. What I can confirm is that I did not say—
Gerry BrownleeI raise a point of order, Madam Speaker. I feel that Dr Cullen may well have been slipping into “Cunliffian” language at the start of his reply. Perhaps he too, like Mr Cunliffe, should be required to withdraw that remark he made about the National Party leader. It was inappropriate, and it is most unparliamentary.
Hon Dr MICHAEL CULLEN Link to this
If the word “slippery” is now to be unparliamentary, I think we should publish a very short dictionary of about five pages long, for use by members of Parliament.
Madam SPEAKERRuling on that matter, I say that we do run the difficulty of having a very short and small vocabulary if we are not careful, as a result of taking objection on all matters. What I would prefer to do on this occasion is ask members to be careful when they are asking and answering questions—that in fact they stick to the point they are making—rather than rule that that was unparliamentary.
Hon Dr MICHAEL CULLEN Link to this
Not to adopt the language of my colleague, but clearly the member who asked the question did not hear my answer to the first question. I did not say there was no wage gap. What I said was that Mr Key was completely wrong in saying that that wage gap grew between the years 1999 and 2008. The big growth was between 1990 and 1999, under a National Government that Mr English, Mr Ryall, Dr Lockwood Smith, Mr McCully, and Mr Williamson were all part of.
R Doug WoolertonWhat impact does selling New Zealand assets to overseas investors and the resulting outflow of profits offshore have on wages in New Zealand, and would he agree that the sell-off of more than 30 major State assets by Labour and National Governments between 1984 and 1996 was a major factor in the very low wage growth over the same period?
Hon Dr MICHAEL CULLEN Link to this
Clearly some asset sales and some matters that relate to overseas investment can help the growth of the New Zealand economy. I think what is very clear is that a number of asset sales, under both Governments, of strategic assets did not aid the development of this economy, particularly when the interests of overseas owners of institutions like Telecom and Tranz Rail did not align with the interests of the New Zealand economy or New Zealand as a whole, and this Government has had to take both regulatory remedial action and repurchasing action to address some of those matters.
Hon Peter DunneIs it of concern to the Minister that around 30 percent of New Zealanders living overseas are earning salaries in excess of NZ$100,000, compared with only 3 percent of New Zealanders resident in this country; if it is of concern to him, what plans does he have to boost middle incomes by world standards in this country, thus increasing prosperity and opportunity for the wide range of New Zealanders?
Hon Dr MICHAEL CULLEN Link to this
Firstly, very clearly, this Government does not believe wages should drop—unlike Mr Key, who has said so on a number of occasions. Secondly, we believe very firmly that it is only by improvements in productivity growth—[ Interruption]
Hon Dr MICHAEL CULLEN Link to this
It is clear that it is only by improvements in productivity growth that we will see stronger long-term income growth in New Zealand. I note that the National Party voted against improving depreciation for business, the National Party voted against tax credits for research and development, and the National Party voted against a corporate tax rate cut for New Zealand—all of which are likely to improve the rate of productivity growth in this country.