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Finance, Minister—Confidence

Wednesday 21 May 2008 Hansard source (external site)

Key1. JOHN KEY (Leader of the Opposition) Link to this
to the Prime Minister

Does she have confidence in the Minister of Finance; if so, why?

ClarkRt Hon HELEN CLARK (Prime Minister) Link to this

Yes; because he is a hard-working and conscientious Minister.

KeyJohn Key Link to this

Has the Prime Minister seen the migration figures released yesterday showing that 79,000 people left New Zealand permanently to live overseas in the last year, and that 44,000 of those people went to Australia; and if Michael Cullen is managing the economy so well, why are more people leaving New Zealand than at any other time since 1970?

ClarkRt Hon HELEN CLARK Link to this

I also note that overall migration is positive in net terms, because people come to New Zealand to seek their fortune and a good life, as well.

KeyJohn Key Link to this

What does it say about Michael Cullen’s stewardship of the economy when, at the time he became Minister of Finance, floating interest rates were 6.7 percent, and now, after 8 years of Michael Cullen’s economic management, they are around 10.7 percent, so someone with a mortgage of $200,000 is now paying $150 a week extra in interest payments; and is she satisfied with that performance from Michael Cullen?

ClarkRt Hon HELEN CLARK Link to this

Exacerbating interest rates is something that the Government is very mindful not to do, which is why we will not follow Mr Key in promising billions and billions of dollars in tax cuts before he has even seen the Budget fiscal update.

KeyJohn Key Link to this

What does it say about the finance Minister’s performance when, under his stewardship, New Zealand has moved from being the 20th highest-taxed country in the OECD to being the 12th highest-taxed country in the OECD; and does it worry her that in terms of OECD economic rankings, about the only one we are in the top half for now is for being highly taxed?

ClarkRt Hon HELEN CLARK Link to this

That most certainly is not true. I am very proud that under the Labour Government the rate of unemployment is one of the lowest in the OECD. That matters to our people.

KeyJohn Key Link to this

Does the Prime Minister remember that on the election of her Government in November 1999, Labour moved quickly to increase the top personal rate—in fact, the period from the moment the election was held to the moment the provision was in law was 125 days—and on that basis, notwithstanding that New Zealanders have had to wait 9 years for a personal tax cut, can she assure New Zealanders today that they will not have to wait any longer than 125 days to see the first of their tax cuts?

ClarkRt Hon HELEN CLARK Link to this

When Labour was elected in 1999 it immediately legislated for its policy on taxation. At least we had one, and stuck to it. On Breakfast TV this morning Mr Key would not confirm the headlines earlier in the week that he was offering $50 a week, because Bill English has told him that the IMF report says he should not be as silly as that.

KeyJohn Key Link to this

Does the Prime Minister agree with Michael Cullen when he said: “to cut taxes when the current account deficit is already above 6 percent of gross domestic product is to commit economic sabotage.”; if she does agree with Michael Cullen, is she concerned at all that the current account deficit is running at about 8 percent of GDP?

ClarkRt Hon HELEN CLARK Link to this

I am very pleased to see that the current account deficit is coming down. I hope it continues to do so.

KeyJohn Key Link to this

Well, if the Minister of Finance is doing such a stunning job and has the Prime Minister’s complete confidence, what does she say to the 1,700 people who have lost their jobs in the last 2 months?

ClarkRt Hon HELEN CLARK Link to this

In respect of the restructuring in the meat industry, it may have escaped the Leader of the Opposition’s attention that there has been considerable conversion to dairy farming, and therefore restructuring across the pastoral industry. What I am happy to say is that under a Labour Government, with very low unemployment, we have a far better chance of seeing that our people continue to be in work.

PetersRt Hon Winston Peters Link to this

Has the Prime Minister considered changing her finance spokesperson once every year—so she would have had three for the last 3 years—and would that lead to stability of economic advice?

ClarkRt Hon HELEN CLARK Link to this

No macroeconomic stability can come from the gambling instincts of Mr Key being applied to the New Zealand economy.

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