2. CRAIG FOSS (National—Tukituki) Link to this
to the Minister of Finance
What were the main decisions taken in Budget 2009?
Hon BILL ENGLISH (Minister of Finance) Link to this
The Government inherited a New Zealand economy in recession because of 9 years of bad economic management.
Hon David Cunliffe Link to this
I raise a point of order, Mr Speaker. Given that the question was a Government question and was expressed in very straight and simple terms, there can be no excuse for the Minister to begin his answer with a political soliloquy about the previous Government, as he has done in every response today, with either a personal attack or a strange recounting of history.
Hon Rodney HideMr Speaker, the Minister of Finance had got about four words of the answer out before David Cunliffe jumped to his feet. What the Minister of Finance was saying was that the Government inherited a recession, which I suspect was giving the context to the decisions of the Budget. I do not think there is any doubt that the Government did inherit a recession. I do not see how you could possibly prevent a Minister of Finance from saying what the situation was when a Government delivered a Budget.
Mr SPEAKERI appreciate the honourable member’s raising the point, but I think that the point of order raised by the Hon David Cunliffe is a valid point. The question was very straight. It asked what the main decisions in Budget 2009 were. I think that the answer should start at least by addressing that question and not by rehearsing matters to do with the previous Government. They may be part of an explanation, but the question was very straight. It asked what the main decisions in the Budget were.
The Government had to consider a very wide range of options in the Budget because it had inherited an economy in recession after 9 years of economic mismanagement. We focused on promoting jobs, cleaning up the Government’s books, getting debt under control, and setting New Zealand on the road to recovery. In the Budget the Government decided to maintain public services despite the poor fiscal outlook, maintain entitlements, invest in a way that supported thousands of jobs, clean up the reckless fiscal mess left by the previous Government, and get Government debt back under control.
We asked officials to put a wide range of options on the table because of the difficult circumstances the Government inherited, and we welcomed their free and frank advice. Treasury is this afternoon issuing the documents related to the Budget that set out those early options. These are all available on Treasury’s website, and they confirm that if we had continued with the previous reckless growth in ineffective Government spending by the Labour Government, debt would have spiralled out of control.
Hon David Cunliffe Link to this
What does the Minister say to the 73 percent of New Zealanders identified in a Research New Zealand poll who think that his decade of deferrals to the New Zealand Superannuation Fund in Budget 2009 has jeopardised the entire future of superannuation; and does he agree with Bernard Hickey that generations X and Y need to wake up to the massive intergenerational theft that is happening before their eyes?
I would tell them that the intergenerational theft occurred when the Labour Government mismanaged this economy so badly that it left us with a legacy of 10 years of deficits and a doubling of public debt even after the best efforts of a competent National Government.
The outcome of the Budget is that the Government has found the right balance between protecting New Zealanders from the sharpest edges of recession in the short term while setting New Zealand on the road to recovery in the longer term. The Budget will support thousands of jobs, investment in infrastructure will clear economic bottlenecks, and we will improve New Zealand’s international competitiveness, and, as a sign of external confidence in the Budget, New Zealand is the only developed country that has experienced a mild upgrade in its credit rating.
Hon David Cunliffe Link to this
Has the Minister seen reports that the Superannuation Fund, ironically, made $587 million in profit for the month of May and is now back in the black, and will he concede that his decision to strip the Superannuation Fund of Government contributions for the next decade was short-sighted?
I have seen reports about the progress of the Superannuation Fund. I have also seen reported commitments by the Labour Opposition saying that if Labour is running for office in 2011, apparently it will borrow something like $6 billion in catch-up payments, so that it can fill that hole. The fact is that when we have some surpluses to save, we will save them. But partly because of the recklessness of the previous Labour Government, which squandered 10 years of surpluses, we do not have any.