Stephen Whittington Speech to Wesley Methodist Church

act-new-zealand

Wed Nov 23 2011 13:00:00 GMT+1300 (New Zealand Daylight Time)

Stephen Whittington Speech to Wesley Methodist Church

Wednesday, 23 November 2011, 3:09 pm
Speech: ACT New Zealand

ACT Wellington Central Candidate Stephen Whittington

Sunday, November 20 2011

Good evening everyone, I'm Stephen Whittington, ACT's Candidate for Wellington Central.

I was born in Wellington, grew up in Paparangi, a suburb in North Wellington, went to Wellington College, studied at Victoria University, and now work in this city. I'm 25, most of my friends are also fairly young, and most of them sincerely want to live and work in this country.

The candidates up here on stage tonight have been doing these candidate forums for weeks now. I have heard all their stump speeches at least 10 times. And, after a while, it becomes quite concerning. Because none of what the other candidates say tonight will have any significant impact on the long-term issues facing New Zealand.

If you look at a country like Greece, it is the failure to deal with long term issues which require sudden and harsh measures in order to correct path.

New Zealand has a proud historical tradition of actually thinking about the long term, and making the required changes.

The fourth Labour Government realised that providing privilege to a select number of businesses in the form of trade tariffs, quotas, or subsidies, was not a path to prosperity. People like Sir Roger Douglas realised that government-run businesses were losing that taxpayer billions of dollars, and needed to be corporatized or privatised.

That Government was part of a reforming trend that, in the longer term, enabled New Zealand to have strong economic growth through the 1990s and early 2000s.

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The National Government from 1990 - 1993 was similarly concerned about the long-term, and so made our superannuation system more affordable by moving the age of entitlement from 60 to 65, and restraining the growth in government to ensure that job growth was driven by the private sector.

Those reformers left and set up the ACT Party. And the other parties on stage do not even care to look at the long term issues facing New Zealand. Tonight I want to outline the problems, and then I want you to seriously consider whether any of the other parties are even talking about these issues.

Let's start with superannuation.

Our age of eligibility for superannuation is the same age as it was when the system was first set up - in 1940. Despite 71 years of improved medicine, bringing a massive increase in life expectancy, the age of eligibility is the same. And that simple fact is what drives its unsustainability.

If you turn 65 today, and live for a further 20 years, you will collect in superannuation payments alone, 88 per cent of all the taxes you ever paid in your life. Considering that those taxes also had to pay for all the services you received throughout your life - education, police services, other welfare services, and healthcare - it doesn't take a genius to figure out that the system is unsustainable.

If we make changes now, we can make the system affordable. If we delay the inevitable, as John Key has staked his job on doing, the changes will be swift and harsh.

Labour, to their credit, have recognised the problem. But they are timid. Their changes would only effect the post-baby boomer generation - too late to actually make the system sustainable. We need to move the age to 67 a lot sooner.

Let's move on to welfare. In 1972, there were 42 working people for every person of working age receiving a benefit. Today, there are just seven. And if you include superannuitants, there are just two people working for every person receiving a benefit from the state.

Where's the tipping point in this process, where people decide it's no longer worth working, because they are taxed to support so many others? New Zealand has grown far wealthier as a country in the last 40 years - so how come so many rely on income support?

There are many people who are unable to work, and they deserve our support. But those who can work need to be in a job. National's plan on welfare mainly seems to involve changing the name of the benefits the government provides. The only way out of this welfare problem is faster economic growth, and faster job growth.

Let's talk now about Government debt. Most of you will know that the Government is today borrowing over $300 million a week. But what does that mean? It's difficult to comprehend on that level. To give you an indication, if the Government sent each and every one of you a bill for the debt it has run up in the past three years, it would amount to almost $20,000 each. Do you have $20,000 to pay it? Does the prospect of paying taxes over the coming years to repay your share of the debt, plus interest, make you more or less likely to stay in New Zealand?

This isn't theoretical. We do have to repay this debt.

So why has Government debt grown so quickly? The simple answer is that the Government spends significantly more money than before. Back in 2005, after six years of big-spending Labour Government, the Government spend 29 per cent of GDP. Today, the Government spends 36 per cent of GDP.

Now, there's only two ways to balance the books. One way is through higher taxes. Labour and the Greens want the Government to spend even more, but they are also planning to introduce new taxes to help pay for part of it. Few countries have sustained high rates of economic growth with high levels of government expenditure and high taxes to pay for it - although some of those that have typically relied on exploiting their natural resources to sustain it - something both Labour and the Greens oppose. Higher government expenditure and higher taxes will come at the expense of a growing economy.

The other way to balance the books is to lower Government expenditure. And on this count, National have been an absolute failure. Government expenditure has surged under National. Why is this? The answer is very simple. The National Party of today does not actually believe in anything. They're a true conservative party, seeking to conserve what exists. That explains why, in opposition, they opposed Working for Families and interest-free student loans. They wanted to conserve the other programs that existed.

It also explains why, once those programs have been introduced, National have done nothing to change them in any significant way. The long-term outcome of this political process is as follows: Labour and the Greens will expand the size and scope of Government. At the time, National will oppose those expansions. When in Government, National will defend those expansions. The result will be ever-larger Government, paid for with higher and new taxes.

If that's what you want for New Zealand, then vote for any of those three parties, because that's what you'll get. But if you want a Government that is forced to live within a budget; a Government that cannot simply increase expenditure and figure out how to pay for it later; if you want lower taxes and a vibrant private sector, then the only option is to party vote ACT.

Thank you.

ENDS

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