SPEECH TO WELLINGTON ROTARY

Air New Zealand Suite 2nd Floor Ilot Chamber Wellington Town Hall

12.15pm Monday 5th July 1999

HON. RICHARD PREBBLE, MP

LEADER OF ACT NEW ZEALAND

Thank you for the invitation to speak again to my local Rotary Club and to say how much I appreciate being an honorary member of Rotary. I apologise for my appalling attendance record. Monday is the day I devote to constituency issues and here in Wellington we have many that absorb my time.

I want to share with you my concern over the way this election is being fought.

Over the last two weeks we have had the media and the Labour Party tell us that the most important issue facing the nation is whether or not our Prime Minister made a flippant remark in a conversation that was off-the-record.

Last week in Parliament I heard successive Labour MPs say that Mrs Shipley was not fit to be Prime Minister because in October last year she said, in frustration, that she might hold a snap election. Helen Clark calls for a snap election every week. Where does that leave their leader?

Mrs Shipley's second sin is confessing that at a private dinner party she discusses politics. So we have a workaholic for the Premier - so what?

Her third sin is getting the timing of John Hawkesby's million dollar cheque wrong.

I have served under Prime Ministers who have wrecked the economy. I've been in Parliament under Prime Ministers who have divided the nation, indeed divided the Commonwealth.

If, after a year, the worst Mrs Shipley has done is speculate about an early election, talk politics at a dinner party and prematurely announce a golden handshake, then the rest of the country must be in pretty good shape. And of course it is.

We are holding this year's election in a golden moment in human history. For the first time in my lifetime the threat of total global nuclear war seems very remote. New Zealand has no enemy threats. Even the war in Kosovo is an optimistic event. The world is now saying to dictators that ethnic cleansing, even if it is within a nation, is not acceptable. The indictment of General Pinochet, the oil embargo on Iraq, and the NATO action in Kosovo, are sending dictators a very clear message. The world is holding dictators accountable for their actions.

Economically it's a golden moment. The US economy, the world's largest, is in the longest economic boom ever. The sharemarket is at record highs. There are encouraging signs that Asia is coming out of its slump. Here at home we have strong economic growth, job numbers are rising.

In the development of human knowledge, it is a golden moment. The world is in the middle of a knowledge revolution that is more profound than the industrial revolution. New inventions and new technology are profoundly changing the world for the better.

This should be an election about the new challenges that this golden moment presents. Instead it's an election about personalities and no vision at all.

Part of the blame lies with National. National sees Jenny Shipley as their advantage over Labour. They want to put up Jenny as Leader, but also as a mother and ordinary New Zealander up against Helen Clark who has failed to establish any empathy with the public.

National has seen policy issues as a distraction and has been busy all year trying to 'clear the decks' of any controversial issue. This is an exercise in futility. The TV News at six will last an hour, no matter what the Government does. If government does not set the agenda to fill the news, something else will.

In the past Labour would have welcomed the chance to set the agenda. The Clark/Cullen Labour Party is determined to also fight a no policy campaign, so we see the absurd focus on so-called sleaze. The golden handshakes are unjustified, and outrageous but they are not sleaze.

Labour is equally to blame. The idea that disgruntled former employees are entitled to large cash payouts, finds its source in the bizarre rulings of the Employment Tribunal. Labour, and its ally the Alliance, have made it clear they are totally opposed to reforming the Employment Tribunal and so now should be in the dock with National over the issue.

Labour's no policy campaign would not be possible without the active support of state television. Television staff leaked the Shipley story to MPs to manufacture a controversy to publicise their new current affairs programme.

State TV's use of telephoto photography of the private offices of the Prime Minister's Department show how unbalanced our television coverage has become. Even the British tabloids have agreed that telephoto photography of individuals, in private, without their consent, is not acceptable. State TV in New Zealand now has standards lower than the London Tabloids.

Not only is TV obsessed by its pursuit of the Prime Minister, there is no scrutiny of the Opposition. Last week I pointed out that Labour is advocating tax increases, when the British Labour leader Tony Blair and the German Social Democratic Chancellor Gerhard Schroeder have called for lower taxes to promote growth and jobs. Blair and Schroeder have said that high taxes destroy jobs. When Michael Cullen was asked "How can New Zealand Labour claim higher taxes will promote jobs, when a British Labour Government says high taxes destroy jobs?"

Dr Cullen claimed that New Zealand can increase taxes because the British government's expenditure is higher than New Zealand. His statement is just wrong. The latest OECD figures on General Government total outlays puts the British Government's spending at 40.3 percent of GDP and New Zealand at 41.4 percent. But his explanation why he is right, and British and German Social Democrats are wrong, is accepted without scrutiny by the media.

Last week I was in Marlborough where I read in the local paper with incredulity a statement by Michael Cullen that he 'favoured the removal of excise duty in wine.' Excise tax on alcohol raises about $500 million.

Michael Cullen's statement means that a sum of money greater than the $300 million extra Labour claims it will get from increasing income tax, will be spent lowering the price of wine.

It gives the name "Chardonnay socialists" a completely new meaning. The man who would be our next finance minister can make such a statement in the full knowledge that the media will not subject it, or him, to any critical review.

This lack of media scrutiny of the Opposition is why I think this year's campaign will be a pointless personality contest.

This election should be about the great issues that our country faces. Let me run through some of them.

Just because it's a cliché does not mean it's not true that there is a knowledge revolution. The countries that succeed in the new century will be the countries that educate their populations. My youngest boy is still at school. Last year he did a project on ancient Egypt. I was amazed when I read it - he had extraordinary research, all of which he had got from the Internet. As an adult university student in the 1960s, I could not have written that essay that can now be written by a 16 year old, because the Auckland University library does not contain the research that he was able to access via the Internet.

How we take advantage of this knowledge as a society needs to be debated. What is not debatable is that we, as a nation, are losing this race. Our competitors in the global economy have made much greater progress in introducing students to the computer age.

This same revolution is transforming medicine. Operations not dreamed of a decade ago are transforming medicine. I was talking with one of our senior local body politicians who told me that he is retiring next election. "What are you going to do?" I asked him.

His eyes then lit up and he said "golf". He then told me that because of rugby injuries he has not been able to swing a golf club for forty years. Now, thanks to modern medicine and a new hip and fused spine he's playing golf again and he was delighted to tell me that he'd just been awarded a handicap of 36. I, of course, told him to keep that handicap, and he will win a few tournaments.

The demand for elective surgery, quality of life medicine, is going to rise exponentially. We already have a hospital waiting list larger than the population of Dunedin. How we ensure access to this medical revolution is one of the issues we should be debating.

We need to debate it. The suggestion of Labour that all private health is bad and that it's just a matter of a few cents more in tax to eliminate hospital waiting lists is intellectually dishonest.

In a real election campaign, issues that both National and Labour do not wish to debate should be given an airing. Neither party wants to discuss our runaway social welfare costs. With one voter in three on welfare, it's become a 'no go' area.

The terrible social cost of having one of the highest rate of single parent households in the world is a taboo subject. My party is attempting to lead a debate in how we can lower the numbers of children growing up in benefit-led households.

Most of us want to live in a compassionate society that looks after the truly vulnerable and provide a safety net for those in temporary financial distress. What we have created is a system of welfare that traps people into generations of dependency. We ought to debate it.

Another issue where policy has gone off the rails, is Waitangi treaty settlements. Labour and National have virtually identical policies which they have stumbled into. We ought to be debating how we can end this grievance industry. How we can be a nation with one law for all. My party is the only one prepared to debate this issue but we are holding a one sided debate as the other parties would rather talk about sleaze.

The only economic debate so far has been the politics of envy. No-one pretends that Labour's sock-the-rich tax policy has any economic rationale. National, with its constant teasing of possible tax cuts is also engaged in a totally political game. There is no vision of what this country could achieve.

I now regret that ACT put forward a three cent tax package to the Government. People think that that's ACT's policy and it is not. ACT just took the Government's announced pre-requisite for tax cuts - no deficit and no cutting of social spending - and pointed out that the country could have a three cent tax cut today. A three cent tax cut would create about 40,000 jobs. Even though the Treasurer's office publicly agrees that ACT's figures are correct, the Government still thinks even three cents is too bold.

I think the proposal of 3 cents is far too conservative. I also do not approve of the Government teasing us with the possibility of tax cuts. It's clear that for National, tax cuts are just seen as a vote-winning device. ACT has been advocating tax cuts because the economy needs it and middle NZ deserves a tax cut.

ACT has a vision of a much more successful New Zealand.

If New Zealand is to succeed as a trading nation in a global economy, we need to get a competitive advantage. If we are to stop the flight of our best young people, of professional people and the drift across the Tasman of business we must do better.

In the mail this morning I received this letter:

"Dear Mr Prebble,

I am a Kiwi who has returned to NZ after an absence of 36 years. I am rather dismayed at the standards I find. The political scene is a mess, the civil service is anarchic and the standard of healthcare has slipped to 17th in the world.

I have previously always voted conservatively but am singularly unimpressed by the two major parties…."

He asks me some questions about student debt and the closed shop attitude of the medical and other specialists and then says

"It is not surprising that NZers are leaving the country in droves. My wife and I will be looking at Queensland next August. If we move there permanently we will take the whole family with us as well as taking more than a million dollars out of the economy. In our immediate family of 10 citizens, we have an oral surgeon (myself), a nurse, an optometrist, a computer programmer, a marketing consultant and a teacher. There are four grandchildren."

If he and his family leave they won't just take the million dollars. With the skills they have, the real loss is closer to three million dollars.

To keep people like this in New Zealand we need some imagination and bold policy.

Just imagine how our economy would be transformed if we had a flat rate of tax of just 20 cents, with a low income rebate rate of 15 cents. New Zealand would be a magnet for investment. Overnight the Trans Tasman drift would become a Trans Tasman rush to invest here.

It is completely practical. If Government held expenditure to the level it was last year, next year we could afford it without making a single cut.

The media who criticise this as utopian failed to report Chancellor Schroeder of Germany's announcement last week that by next year he hopes to reduce the corporate tax rate of Germany to 24 cents.

Why would anyone invest in New Zealand when other countries can offer lower corporate tax rates? If Germany can lower its tax rate why can't we? If Ireland can have a corporate rate of 10 cents then why can't New Zealand have a flat rate of 20 cents?

Of course tax cuts by themselves are not enough. We have covered this country in red tape and bureaucracy. In the 1990's alone over 5,200 new laws and regulations affecting business have been passed. Again this election our politicians are promising more laws and even more regulations. Let's have a debate about why we cannot have less. Hong Kong has, I understand, just 1,000 laws affecting business.

I guess it's fair enough for you to say, well why doesn't ACT lead this debate?

Every one of these issues I have devoted a chapter to in my book "I've been writing". In the few book reviews I have received, the critics have said it's my 'best book yet'.

I note with envy that in Australia, the UK and the USA books about public policy are taken seriously. The books are reviewed, dissected and the ideas discussed.

The public I know is crying out for such debate because my book is a best seller.

We are at a golden moment. Let's have an election campaign that such a moment cries out for.

There is a party willing to lead the debate on the real issues. All we need is a media prepared to report matters of substance and for others who seek your vote to rise to the challenge that ACT has laid down.

ENDS

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