Budget Policy Statement

I have been wondering whether this Budget Policy Statement 2008 will be top of the pops in the six o’clock bulletin, or will the real pressing issue for New Zealand be on naming the MPs who are travelling on a so-called taxpayer junket to Eastern Europe?

Meanwhile, across the world, all eyes are on a controversial list published in L’Osservatore Romano, the Vatican newspaper.

After fifteen hundred years, the Vatican has added seven new sins as having appeared on the horizon of humanity.

Alongside lust, gluttony, avarice, sloth, anger, envy and pride we now have

ruining the environment;
carrying out morally debatable scientific experiments;
social injustice which causes poverty;
or the excessive accumulation of wealth by a few.


When I looked at this report of the Budget Policy Statement for 2008, I did wonder whether Pope Benedict XVI may have received an advance copy.

For there are certainly areas within the small print which make us query whether this Budget statement has got the balance right.

The Maori Party was particularly concerned at the information in the report relating to the supposed growth in household incomes.

Earlier this morning, the Minister of Maori Affairs issued a release in which he said, and I quote:

“What we need to do is get out into Maori communities and show whanau the real benefits of saving”.

In the interests of cross-party communication, I would like to suggest some pointers to the Minister about this critical issue of savings.

There is absolutely no point going out there, scolding Maori whanau and telling them what to do, how to save for a rainy day, if there’s nothing in the piggy bank to start with.

Because the reality is that income levels for Maori come nowhere near the new deadly sin of excessive accumulations of wealth.

The New Zealand Income Survey shows that Maori aged over fifteen years old earn just 73% of what Pakeha earn – in dollar terms, that’s a massive $197 a week less.

So while this Labour government may crow about the participation rates for Maori now growing to 68% we always have to ask for the fine print– what does it mean in terms of putting bread on the table.

The fine print, for example means, that when on another day Labour puts out their policy on affordable housing, requiring home-buyers to earn at least $70,000 a year to service a mortgage in an “affordable home”, the constituents in my electorate just laugh or cry.

For it comes down to who is being factored in to the ‘average’.

What New Zealanders comprise the ‘low and modest income earners’?

The 2006 income data for the Tamaki Makaurau electorate counts us out – median family incomes in my electorate are just $60,000. Ten thousand dollars short of meeting the grade for ‘low and modest income earners’.

Why does all this matter?

Remember the Pope’s new sin - the social injustice which causes poverty?

A month ago the Early Childhood Council came out and agreed with the Salvation Army that the availability of early childhood education is heavily biased against poorer urban communities – adding that it was “madness that we are not targeting more substantial resources at these children”.

The Council’s Chief Executive, Sue Thorne, was outraged that what she described as “pathetically little” of the money being given to early childhood education was targeted at the most needy of children, making the clear link between the fact that low access to early childhood education in the most needy areas, was connected to the fact that Maori children are 2.7 times more likely than Pakeha to be stood down from school for disciplinary problems, and that there were wide achievement gaps between low and high decile schools.

A fortnight after those comments, Canterbury DHB Maori and Pacific Health Director, Hector Matthews, declared that the gross disparity between Maori and non-Maori health was largely due to socio-economic conditions.

It was his analysis that more than half of all Maori are located in the poorest three deciles in Aotearoa, meaning that the cost of primary health care for conditions like asthma could be out of their reach.

Maori children were also more likely to live in cold, damp homes – and as a consequence, hospital admissions for very young Maori asthmatic children were about 60% higher than for non-Maori.

So when it comes to the Minister’s wisdom in showing Maori families the benefit of saving, he may like to tread more carefully.

I return again to the comments in the Budget Policy Statement which outline three different scenarios in just one paragraph, related to the growth in household incomes.

We have the :

Prime Minister’s promise that household incomes would increase by 25 percent over the next four years
The Half Yearly Economic Fiscal Update, which indicates a real increase in wages of two percent over the same period;
And the Salvation Army forecast of five percent growth over ten years.


What is it? Pick and choose? Best offer on the day? Mr Speaker, there’s a world of difference between two, five and 25 percent when you are looking at whether you can afford to get the car registered or to stay living in a house where the rental has dramatically increased.

It is exactly these types of questions that we, the Maori Party, will continue to raise in differentiating between the fiscal priorities of how much total income we seek from taxation, and the expenditure.

We have always argued that the pattern of expenditure, and the allocation of monies should be fair and determined by both signatories of Te Tiriti o Waitangi.

And in determining whether we have a surplus or a deficit, it is incumbent on both parties to take account of the methodology we have promoted within the Genuine Progress Index.

Such an approach would question the scope of negative expenditure say on monitoring, punishing and constraining youths as opposed to investing in their development prospects.

It would throw into question establishing a new entity, Maori Business Aotearoa New Zealand, financed out of the wallets of the Maori Trust beneficiaries, but for the benefit of Government ratings.

It would ask why the Government is exerting considerable efforts into offering iwi assets such as forests to top up funding in line with the relativity clause of settlements, or making a huge deal out of new arrangements for foreshore and seabed territorial deals, when in the first instance, the basic foundations of either policy are fundamentally flawed.

The fact that iwi have made the best of the current legal situation, and have negotiated agreements under the law, does not alter the fact that the law is unjust and should be repealed.

It is quite consistent to support iwi agreements under the Foreshore and Seabed Act while at the same time seeking repeal of the Act.

The Maori Party already supports iwi to get the best deal they can from the Treaty Settlements process, even though it believes the process itself breaches the Treaty.

Mr Speaker, budgets are times for weighing up both sides of the ledger, for attaining a true and accurate record of the state of the nation, a genuine indicator of the health and wellbeing of the people.

Mr Speaker, we cannot escape the irony that the Budget Policy Statement gives lip service to the concept of our unique national identity, and states a commitment to foster a cohesive society, when in the actual realities of the lives of tangata whenua, the inequities are painfully apparent and ongoing.

It is not acceptable. It is unjust. It is unfair.

We know that the incomes of low income families have been allowed to erode, that our youngest and most vulnerable citizens are continuing to live in severe or significant hardship.

We agree with the Child Poverty Action Group that what we most need is a poverty prevention success story. This Budget Policy statement isn’t it.