The Letter

The Haps

Parliament resumes. Clark is expected to announce the Election Day today. Labour's campaign shows signs of total panic. Brash shows he does not know what he thinks about Iraq or the USA. National is winning votes by promising middle class welfare.

Parliamentary Session

The House is due to meet for three weeks unless Clark totally panics and calls a 3 September election. The first debate will be the third reading of the budget, which means the parties will give their election positions and their attacks. Parliament will send Bradford's Smacking Bill to committee. It's possible Ken Shirley's Nuclear Bill may be debated, something the Nats will not want. It will be difficult to debate the biggest scandal, Labour's misuse of their parliamentary funding to campaign, as it was only possible through the Speaker bending the rules and displaying outrageous favouritism.

He was told to quack

Clark's spin that she is angry at Mallard is nonsense. Clark is just angry that the attack backfired. Both Mallard and Clark are on a campaign committee that meets daily. Clark approved Mallard's personal attack on Brash. Labour had expected to outspend National as they did in 2002. Their President Mike Williams boasted earlier this year they would outspend National when Owen Glenn, an ex pat Kiwi who made his multi millions in America through owning transport company NACA group, gave them $500,000 - money that would have initially come from the USA. Now business thinks National can win, the money has flooded in and the money for Labour is drying up.

State Favouritism

Labour will still receive the most TV advertising and taxpayer funding. The so-called independent allocation of money now looks absurd. Those involved in the tawdry process should be ashamed.

Middle Class Welfare

Labour's campaign strategists never imagined Brash was so keen to be PM that he would promise tax rebates. As part of the Roger / Ruth reforms (that Brash claims to be so strongly in favour of, and when delusional claims he devised GST) an informal bipartisan agreement was reached not to distort the tax system with rebates. National has now offered two rebates: for pre school fees and for student debt. The Letter has been told there are more rebates to come.

Bad tax policy

Tax rebates are bad policy. It is the government over- taxing and giving back our own money. It distorts behaviour. Take student loans. Labour making loans interest free resulted in a doubling of student debt. We know of wealthy people who encouraged their children to take the maximum loan, invest in shares and then gave their children the money to repay it. Many did not because it is a low interest rate for an unsecured loan. Under National's tax rebate for interest you would be mad to repay your student loan. It is middle class welfare that will reward rorting the system. The principled position is not to levy the tax in the first place. See Rodney Hide's press release www.act.org.nz/ rebates.

Can He Count?

The architect of the rebate policy, John Key is a bit of a worry. He stunned the Superannuation Association last week by assuring them that thanks to the Cullen Fund, National Superannuation is now affordable. Even Cullen does not claim that!

Govt's first responsibility

While Labour's claim that National would conscript to send troops to Iraq are absurd, National's foreign policy to put issues to a referendum shows an alarming lack of leadership. National voters are assuming that Brash does not really mean any of these evasions and in government would reveal his true colours. It is the Letter's experience that one is safer to assume politicians mean what they say and National really thinks our country's defence should be decided by a populist referendum.

Two ticks, suicide

National MPs, trying to justify asking for two ticks, have been telling audiences that after the election the Governor General must go to the biggest party. Not so Mr Carter. The convention is the G G must take advice from the PM, which will still be Clark. The G G is entitled to ask Clark if she says she can form a government to prove it by a vote of confidence from parliament. If Clark cannot form a government she must resign and advise the G G who to invite to form a government. If National has no coalition allies it wont be Brash.

Capital Gains tax

The IRD has put out a discussion document recommending that foreign investment funds earned by Kiwis be subject to a capital gains tax. The only way to avoid the tax would be to bring your money back and invest in this country. While such a tax may bring money home and put all our eggs in one basket, it is part of a long term strategy to have a capital gains tax. See www.taxpolicy.ird.govt.nz.

Pay it back Helen

99% of readers thought Speaker Wilson was wrong to allow the PM to use $90,000 of taxpayers money to tell us on bus stops "we are better off with Labour". Our highest poll ever! We are sending our results to the Auditor General whose wishy washy report on Labour's rorting of the taxpayer to spend $20 million advertising the families package was used by the Speaker to justify Clark's illegal spending. An independent auditor would deliver a damning report condemning Clark's spending as illegal, demanding she personally repay the $90,000 and refer the matter to the Serious Fraud Office. It would only take 48 hours. The Auditor General can find the draft Parliamentary Commission Report to the Speaker that examined the expenditure, and the rules and concluded it was improper.

Poll

This weeks poll "Would you prefer to have lower income tax rather than tax rebates?"We will give your answer in tomorrow's budget debate. Vote at www.act.org.nz/poll.

ENDS

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