6. JOHN BOSCAWEN (ACT) Link to this
to the Minister of Finance
Will increasing Government expenditure by 17 percent from 31.8 percent to 37.3 percent as a percentage of GDP over the next 2 years improve productivity and enable us to achieve the Government’s goal of closing the income gap with Australia by 2025; if so, how?
Hon BILL ENGLISH (Minister of Finance) Link to this
As I have said previously, the sharp increase in Government spending in recent Budgets has left us with a large deficit burden, which is not helpful to New Zealand’s economy and, at the moment, will take 10 years to clear. The Government believes, however, that reversing this trend in Government expenditure is essential if we are to achieve better long-term growth. We are going about this in a responsible and measured way. Budget 2009 halved future spending allocations to make it clear to the public sector, and to the public, that the rate of growth will be slowing right down. We are working with the Public Service on a range of initiatives to increase its productivity and provide more services for less money.
Does the Minister regard Michael Cullen as a fiscal conservative; if not, why had he, in just 2 years, increased Government spending by over $100 per week per household?
Mr SPEAKERI think I can anticipate the member’s point of order. I invite the member to rephrase that supplementary question, because the honourable Minister has no responsibility for the views of the previous Minister of Finance.
Hon Trevor Mallard Link to this
I raise a point of order, Mr Speaker. It might be slightly unusual, but I think Rodney Hide and I may be up on the same point of order. The Minister has no responsibility for Michael Cullen, but he can have an opinion on Michael Cullen’s spending habits. It would be absolutely wrong to say that Ministers cannot have a view. I am proud of the work of Michael Joseph Savage—
We will not get into debate by way of a point of order. The dilemma is that the supplementary question invites the Minister to comment on Labour Party policy. That is the dilemma with the question. I guess the Minister could tell the House what he understands that to have been, but he must not then climb into criticising it or commenting on it. I will hear the Hon Rodney Hide, though.
Hon Rodney HideI raise a point of order, Mr Speaker. It seems self-evident to me that a Minister of Finance can be asked to comment on previous Budgets, and therefore on former Ministers of Finance. Maybe the question should be regarded as being whether the Minister regards the previous Minister of Finance, Michael Cullen, as a fiscal conservative. Of course a Minister has to be able to take questions about previous Budgets. How else could we establish a comparison, over time?
Hon Peter DunneI think the point that has just been made is true up to a point, but that point is that it can be only with reference to policies that are of relevance today. Otherwise, we could start comparing this Minister of Finance with Richard John Seddon, Julius Vogel, or any historic figure. Surely it must be only where there is a link to something that is relevant to the circumstances of the time.
The way we normally handle these matters is that Ministers are asked whether they have reports on certain previous policies. The idea of phrasing it in that way is to try to avoid inviting Ministers to climb into the policies of other parties, which are not their responsibility. I invite John Boscawen to repeat the question and to try to avoid the risks of inviting the Minister to climb into another party’s policies.
I will make the question even simpler and ask: why has the Minister been prepared to increase Government spending by over $100 per household per week, in a period of just 2 years?
That is a much less interesting question. Michael Cullen might regard himself as a fiscal conservative, and compared with the current people who are leading the Labour Party, he certainly was, because this crowd want to send the pixies to the bottom of the garden to get the printing presses running flat out. The reason this Government has increased its spending is that we believe it is important to protect people from the sharpest edges of the recession, but the member should not take that as an indication that the Government thinks all existing Government spending is effective. Quite a bit of it is not, and over time we will find that ineffective Government spending and stop it.
Peseta Sam Lotu-IigaThe Government has been very busy taking steps to lift productivity. We are getting our regulatory regime right, so that business can thrive; we are setting out to lift performance in the public sector; we are investing in productive infrastructure; we are introducing national standards into our education system; and we are undertaking a stocktake of our taxation system, to ensure that it is world class.
Would the Minister like to hazard a guess as to what the average household is getting for the extra $100 a week, apart from the cycleway?
I am sure the householder is not getting the full $100 value for Government spending, because the way in which the Government has been run for the last 10 years means that it has not been focused on delivering value for money. It has not been focused on getting the best out of every dollar. That is one reason that New Zealanders changed the Government. They want the new Government to be careful with their money and to make sure it does protect the vulnerable and provide high-quality services.