3. Dr DON BRASH (Leader of the Opposition) Link to this
to the Prime Minister
Does she agree with the Hon Dr Michael Cullen’s comments that tax cuts may be affordable “in a year or two’s time, depending on forecasts of revenue.”; if so, what action will she take as Prime Minister to ensure New Zealanders can benefit from tax cuts?
Rt Hon HELEN CLARK (Prime Minister) Link to this
I agree that the affordability of any initiative in future Budgets depends on forecasts of revenue. As Prime Minister I am proud to lead a Government that has already provided for $6.1 billion of tax relief to families over the next few years.
If tax cuts are unaffordable when we are running an $8.5 billion surplus, with a further $14 billion worth of surpluses conservatively projected for the next 3 years, just how big a Budget surplus does she think New Zealand would need to run before tax cuts, according to her yardstick, would be affordable?
Rt Hon HELEN CLARK Link to this
Family tax relief is indeed affordable, and it is much appreciated. I have a letter from a woman who writes: “Today I received confirmation we’re entitled to family assistance of $85 a week. Now we can go to the doctor when we need to, get a haircut when needed, and don’t have to go without meat and the groceries. Thank you for Working for Families.”
Peter BrownCan we take it from that answer that the Prime Minister agrees with a constituent who rang me the other day and declared himself to be a National Party voter at the last election—[ Interruption]
Madam SPEAKERMembers know the rules when members are asking questions. They are on their last warning. Would the member please start again.
Does the Prime—by noting those answers, does the Prime Minister agree with the constituent who telephoned me the other day—
Gerry BrownleeI raise a point of order, Madam Speaker. While we are enforcing the Standing Orders, Mr Brown should ask his question by starting with a question word.
Hon Dr Michael Cullen Link to this
The question started with the word “does”. That is quite a normal start to a question.
Well, Madam Speaker, you will have to adjudicate. The member said: “Does—noting the Prime Minister’s comments …”, so that is hardly starting with a question.
I do not mind if that is the attitude of the National Party when it comes to asking questions, but I would just point out that it is childish, petty, and it does this House no good whatsoever.
Does the Prime Minister agree with the constituent who telephoned me the other day and declared himself a National Party voter, saying he voted for Bob Clarkson, that Working for Families is no more and no less than targeted tax relief for a very worthwhile sector of our community?
Rt Hon HELEN CLARK Link to this
Absolutely, I agree with that constituent. That point of view is substantiated by many messages I have received, including this one that states: “In our household the extra $132 that is received each week has eased the financial pressure substantially. Now when I go to the supermarket I shop knowing there is room in the budget to buy a reasonable amount of groceries for the week.” The National Party might not care about families; this side of the House does.
Does the Prime Minister understand that every dollar of tax her Government needlessly takes from hard-working New Zealanders results in weaker and weaker incentives to work harder, gain skills, and get ahead—precisely the behaviour that New Zealand needs if we are to effect her economic transformation?
Rt Hon HELEN CLARK Link to this
No. What I accept is that the substantial investments being made in health, education, policing, and infrastructure are taking this country ahead. I also accept that there is a place for Dr Brash: it is in a retirement home in Australia.
Has she seen Dr Cullen’s public statement that tax cuts would be affordable only if the Government were running an operating surplus of “around 3 percent of GDP”, and can she explain why, when she herself is on record as saying that her Government would aim to run surpluses of “just 1 percent of GDP”, there have been no tax cuts, given that surpluses have been running above that level for at least 3 years?
Rt Hon HELEN CLARK Link to this
Yes, I have seen the statement and I shall always defer to the prudence and wisdom of my colleague.
Hon Dr Michael Cullen Link to this
In light of the previous question, is the Prime Minister aware that under the National Government of the 1990s the target operating surplus was 3 percent of GDP, despite the fact that there was no superannuation fund to make transfers into?
Rt Hon HELEN CLARK Link to this
I am certainly aware of that, and I am also aware of the utterly reckless attitude the National Party takes towards fiscal policy.
Why has her Government backtracked on proposed changes to income tax thresholds that less than a year ago Dr Cullen said would “make the tax system fairer over time”?
Rt Hon HELEN CLARK Link to this
The simple answer is that it has not. Dr Brash should read the Budget.