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Source: New Zealand Parliament – Hansard

Question No. 6—Finance

6. NICOLA WILLIS (Deputy Leader—National) to the Minister of Finance: Does he agree with ASB’s assessments that “higher consumer prices and debt servicing costs could raise household weekly outgoings by an average of around $150 per week over 2022” with income growth unlikely to keep pace?

Hon GRANT ROBERTSON (Minister of Finance): There are many parts of the ASB report that I agree with. These include the report’s acknowledgment that higher global food commodity prices, higher global oil prices, and the impact of the war in Ukraine are all having an effect on the inflation being experienced by New Zealanders. I acknowledge that a number of New Zealanders are facing a cost of living crisis due to these factors. That’s why the Government has moved quickly to ease the pressure on New Zealand families by, for example, cutting fuel excise by 25c, which has flowed through immediately to prices at the pump. With respect to the number quoted by the member, it is hypothetical and relies on a number of factors and calculations that are highly uncertain. In response to the second part of the member’s question, I would note that the ASB forecasts that, on average, over 2022, household disposable incomes will be higher than consumer spending, giving a positive savings rate over the year. And as the House may already be aware, the report indicates that since the end of 2017, when Labour came into Government, disposable incomes have been, and will remain, higher than consumer spending in 20 out of 21 quarters through to the end of 2022.

Nicola Willis: Does he deny calculations showing a typical New Zealand household experienced a $5,000 increase in costs last year and is he concerned about the difficult choices households will face this year as they struggle to absorb an estimated additional $7,800 in costs?

Hon GRANT ROBERTSON: In answer to the first part of the member’s question, I note that the ASB report is not actually a typical household but, rather, a “stylised average”, which includes the household paying both mortgage and rental costs. So those numbers do need to be carefully looked at. As I said in my original answer, we acknowledge that many New Zealand families are doing it tough, and that’s why we’re supporting them.

Nicola Willis: Does he acknowledge that there are hundreds of thousands of taxpaying New Zealanders who are not eligible for Working for Families or Government benefits but who also face a cost of living crisis, and why doesn’t he think they deserve income tax relief?

Hon GRANT ROBERTSON: Because the package that the member’s party is offering up would see those on the highest incomes benefit the most, would see a benefit to property speculators, and would see those on lower incomes getting $2 a week—all, at the same time, putting in danger investment in health, education, housing, and other Government services. The member’s plan doesn’t add up.

Nicola Willis: Well, what does he say to Kris, who wrote to me, saying—

Hon Members: Ha, ha!

SPEAKER: Order! Order!

Nicola Willis: Shall I start again, Mr Speaker?

SPEAKER: I’m sure it wasn’t Hipkins, but carry on.

Nicola Willis: What does he say to Kris, who wrote to me saying—”Kris” with a K—”I can’t get Working for Families. I earn too much for any help. The Government is making it harder and harder for people on an average wage to live. I am angry and upset that I have to work harder and harder every week just to live.”?

Hon GRANT ROBERTSON: What I would say to Kris and to other New Zealanders is that this Government is making sure that we continue to invest in health, in education, and in housing and all of the public services that they rely upon, and that if they were to take the National Party’s tax proposal, those on the highest incomes would benefit the most, those who are speculating in housing would get a tax break, and those on the lowest incomes would get $2. There are always difficult choices to be made in households and in Governments. On this side of the House, we believe we’ve got the balance right. A balance doesn’t come from $8,000 to that member and $2 to somebody on the minimum wage.

Nicola Willis: Why does he continue to argue that wages are keeping up with the cost of living and why is it that so many Kiwis are feeling worse off, including Porirua resident Mykie Sagar, who was reported by Stuff this weekend as saying, “I thought with all the extra work we’ve had that I would have a small fortune somewhere, but I don’t, I just don’t know where it’s gone.”?

Hon GRANT ROBERTSON: On this side of the House, we’re committed to making sure that we do the long-term things we need to do right: to invest in our roads, to invest in our public transport, to make sure that we build houses—not to sell the houses off like the previous Government did. The member’s proposal will benefit the wealthiest the most. It’s just the same old National Party; New Zealanders wouldn’t be better off with it.

Nicola Willis: Well, what does he say to Jamie, who wrote to me saying, “Now I’m 40, still doing 50 to 60 hours a week, struggling to survive, and starting to wonder if I’d be better off on a benefit.”, and why won’t the Minister deliver income tax relief for hard-working New Zealanders like Jamie?

Hon GRANT ROBERTSON: On this side of the House, we know that New Zealanders want and need good quality public health, good quality education, good quality housing. For the nine years the National Party were in office, every single one of those was undermined. The member can’t have it all ways. She can’t say she’s going to reduce debt, cut taxes, and keep up that spending. It’s the same Bermuda Triangle that Paul Goldsmith was in, and unless the National Party come up with new ideas, it’s just same old National again.