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Home / Politics

<i>Bill Ralston</i>: It all comes down to money

By Bill Ralston
5 Jan, 2008 04:00 PM4 mins to read

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Opinion

KEY POINTS:

My vote is for sale this year. In fact, all of us are open to the right kind of deal from a political party come the next election. As the campaign comes closer, expect a barrage of special offers from politicians in the kind of "send no money now but wait, there's more" babble you find in those dreadful infomercials on telly.

Instead of steak knives or abdominal exercise machines, the parties will be offering tax cuts and subsidies on a wide variety of welfare goodies. National has the clearest message so far, vote for us and we will give you some of your hard-earned cash back. Simple but effective.

Labour's pitch is somewhat more convoluted. "We might give you some of your own money back but then again we may not. Instead we are generously offering juicy packages like Working for Families, Early Childhood Education grants and Affordable Homes schemes."

Helen Clark has been doing a bizarre two-step dance on the question of tax cuts. At last year's Labour Party conference she held out the prospect of long overdue, meaningful tax cuts but, no sooner did this year begin, then Clark went on the record ominously stating cuts might be "part of the mix, but their importance may have been overstated".

This is a clear signal that Michael Cullen will only tinker with some of the rates and instead of reducing the fat Government surplus by the simple expedient of giving us back the extra money he doesn't need. He will, instead, spend it.

Labour governments like to think they can spend our money more wisely than we can. This tactic carries the added benefit that it can target the spending to win the gratitude of gullible and greedy voters.

It worked at the last election when Labour seemed doomed but was rescued at the last minute by the South Auckland vote as the recipients of a plethora of Government handouts voted with their wallets.

Heaven knows what bribe Helen will come up with this year, but stand by for a host of grand-sounding schemes that will promise to make your life so much better if you have a family and don't earn a lot. The theory being, those people feeling the financial pinch will rise to the proffered bait and re-elect Labour.

Most people will fail to realise that it is Cullen's regime of heavy taxation that is eroding their standard of living and if they got a tax cut they might not need the handout.

National's John Key made that point last week, saying taxpayers are hurting, "The cost of living continues to rise but the harder they work, the more they pay and Michael Cullen's surplus just gets bigger and bigger."

He's hammering the point that National intends to have a credible programme of ongoing cuts. His big problem is that Labour will pick away at the suspicious minds of voters, arguing that National will revert to type and the price of tax cuts will be the axing of public services.

To be honest, I am still uncertain as to whether National has a secret ideological agenda that would see us back on the Rogernomic/Ruthanasia track again. However, I cling to the hope that it may realise that it is possible to dramatically reduce our tax bill without selling the family silver. There is plenty of waste in the overstaffed, big-budget public sector.

A minor but classic example of idiotic waste is news last week that the Corrections Department spent more than $45,000 of taxpayers' money buying LCD TVs and PlayStations for prisoners. God knows what games the jailbirds were playing but my bet is they would have been great at Grand Theft Auto.

It gets better. Having twigged that it might not look good if news got out that it was buying PlayStations for inmates, the Corrections Department promptly decided to withdraw them. It is not clear what happened to the eight game consoles and 58 games, presumably they now festoon the offices of the Corrections Department and staff spend their morning tea time blasting away at aliens.

Another fact that should make Helen Clark think twice about her handout strategy is the debt mountain in the Ministry of Social Development. More than 500 people are now employed by the MSD to try to control the $761 million of beneficiary debt. While it must be hard, at times, to get blood out of a stone, you do have to wonder about the competence of the MSD in failing so abysmally to manage its own affairs.

Here's a thought - that $761 million, if recovered, would make a nice start in tax cuts for people who work for a living.

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