Taxation (Budget Tax Measures) Bill
First Reading; Hon Dr Pita Sharples, Minister of Maori Affairs
Thursday 28 May 2009

The first seven words of the explanatory note to the Bill tell us all we need to know about Budget 2009. This day will be forever recognised as a response to a “difficult fiscal climate”.

The Minister of Finance has described the context to this Budget as sitting within a global economy which is experiencing the deepest, most synchronised recession since the 1930s.

What does this mean for us at home? We know that just in the last few weeks, there have been employers throughout the nation who have had to lay off workers in the timber, manufacturing, telecommunications and textile sectors.

Just how dire the situation is seen in the numbers of unemployment benefit recipients. There are now 44,000 New Zealanders actively seeking work, fourteen thousand of these being Maori. And close to a third of Maori job-seekers are in the 18 to 24 year age group.

It is that group of some 5000 young people that have been on our minds as we have embarked on the road to recovery articulated in Budget 2009.

These were not the lucky New Zealanders who benefited from the one billion dollars that was allocated from the Government’s first round of tax cuts.

But these are New Zealanders all the same, who deserve every opportunity for the light to shine in their eyes. They are New Zealanders who may well take up leadership positions in the future. They will be our scientists, our entrepreneurs, our teachers, our sportspeople, our tribal leaders, our parents.

This Budget recognises that every New Zealander is entitled to enjoy the basic rights of citizenship; to benefit from quality public services; to maintain a standard of living that we can defend despite the rigours of a global financial crisis.

The Maori Party will support this Taxation (Budget Tax Measures) Bill on behalf of the young people, and those to follow.

We celebrate the fact that despite worsening economic and fiscal conditions, the Maori Affairs portfolio has been maintained intact.

We believe the decision to defer the second and third tranches of personal tax cuts is a sign of responsible management, thinking of the collective wellbeing of all New Zealanders, and balancing the budget in a way which will protect the people from the sharpest edges of recession.

The Maori Affairs budget has been rigorously scrutinised to ensure a careful yet secure footing for whanau Maori to emerge from the recession. In many ways it mirrors the type of budgeting that we may see in Maori homes around the motu. It reflects a conservative approach to ensure bread and butter are on the table; while also enabling whanau to be opportunity-driven.

We have given priority to whanau as the social structure which best provided for protection and resilience during times of stress.

Investing in whanau is not about what “we will do to them”. Investing in whanau is about what they will do for each other.

As Minister of Maori Affairs I have heard the call from whanau, ‘let us create our own solutions’ and so in early July I will be looking to announce a network of whanau advocates who can work closely with our whanau, to ensure they have all the assistance they need to be strong.

Resilient whanau are those who can ride the storm, because they are supported to be the best they can be.

Resilient whanau need jobs; they need a spirit of optimism; they need education; they need healthy homes; they need a strong economic base to build their future on. This budget will help make that happen.

The fact that our whanau earning under $40,000 will not now be having to cope with extra taxation – up to something like an extra eight dollars a week – is something that we welcome.

The former approaches at taxation were based on a ‘trickle down’ economic theory which says that boosting the incomes of mid-high income earners through tax cuts will create economic benefits which will trickle down to lower income earners – from the spending which create jobs, demand for services, and the like.

But we always had concerns that those who are already vulnerable might never actually gain from the trickle down….because instead, they will be watching the ‘trickle up’ effect, which contributes to the growing income inequality – with the well off becoming wealthier, leaving lower income families in their wake.

Deferring tax cuts will instead save around $900 million a year which can be used to sustain and support New Zealanders in the times ahead.

We must look forward, to ensure that when a recovery begins, our people are ready to respond quickly. And so one of my first priorities as Minister of Maori Affairs was to establish the Maori Economic Development Taskforce to develop a Maori led response to the recession.

The task of that roopu is to advise me on how to protect existing jobs and businesses but also to think about the longterm vision. A vision in which our young will benefit from increased education and training, the investment made to maintain and build a skilled workforce ready to go when the economy recovers.

It would be great if the Taskforce was able to directly create jobs but my challenge to them is to take a longer term view of Maori economic development opportunities and look at systemic change across their own areas of expertise to ensure that Maori and Maori assets can take a role in leading Aotearoa out of the recession.

Encompassed in the journey towards economic self-determination is also the commitment that I have taken up, to strengthen the Maori economy by establishing the Maori Trustee as a strong, independent, accountable and sustainable trustee for Maori landowners and beneficiaries.

I would remind the House that this was the first Bill put through this Parliament from, the independent Maori voice of the Parliament, the Maori Party. Another important legacy of this time.

I want to point out just one more highlight from the Maori Affairs budget, and that’s the investment in whanau language development. This budget initiates $4.5 million over three years for the retention and revitalisation of te reo Maori; with another $1.2 million allocated to iwi radio operational funding.

All of these initiatives are ideas which are about creating opportunities for our people, for establishing a stable platform for growth to occur.

But there are other opportunities right throughout the appropriations which I would like to point out in my closing thoughts on this Bill.

In making the decision to defer further tax cuts, the Government has acted responsibly. Such an approach has also been reflected in the $22m allocated to speeding up the Treaty settlements.

Settling past injustice is an important part of any future constitutional reform for New Zealand, as is restoring an economic base for iwi. I want to acknowledge my colleague, Chris Finlayson, for the constructive working relationship we enjoy.

Similarly I have been proud to sign, alongside my colleague Phil Heatley, the Fisheries Aquaculture Settlement to which this Budget allocates $15.9 million.

Tena tatou katoa.

ENDS

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