Budget foes fire first shots

By Andrew Laxon

political reporter

Political opponents last night began a war of words aimed at this week's Budget, describing Government plans to offer tax cuts as a desperate bid to capture votes.

Labour's finance spokesman, Michael Cullen, accused National - which has made it clear that it plans to signal future tax cuts on Thursday - of handing out bribes for votes "in a desperate attempt to hang on to power."

He said a 2c cut to both personal and corporate tax rates was likely in the 2000-2001 financial year, with a further 1c cut the following year to 30c in the dollar.

Alliance leader Jim Anderton said if the predictions were correct, the public should be outraged. "The New Zealanders who need relief are on low incomes."

Act favours tax cuts but nevertheless also attacked the Budget as likely to confirm National's image as a party "that throws money at social problems."

Labour released a list of 35 Budget tips, which mostly match predictions by other commentators.

The party expects the Government will:

* Abolish the $110-a-year broadcasting fee and fund television and radio programmes from general taxation instead.

* Scrap stamp, cheque and credit card duty, at a cost of $186 million a year.

* Remove lawyers' monopoly on conveyancing.

* Introduce tax-funded parental leave.

* Give "token concessions" to Maori in education, forestry and prisoner rehabilitation.

* Make schools spend some of their operating grants on computer education and make schools pay for capital works - such as new buildings - themselves.

One "possible initiative" against youth offending would be reducing the age of criminal responsibility from 14 to 12.

Many other items on Labour's list have already been announced, such as $250 million for the new Auckland Hospital project and $222 million on elective surgery over the next two years to reduce the waiting lists.

Other pre-announced Government moves expected to reappear in the Budget include: $3.5 million to promote New Zealand to overseas investors; $600,000 over two years for Plunketline; $6 million over three years announced yesterday for stoat control; $3.2 million over two years to extend storage at the National Archives; $1.3 million over three years for an anti-bullying campaign in schools; $7.6 million over three years for the Commerce Commission; and $1 million over three years for the Securities Commission.

Meanwhile Alliance MP Laila Harre said public demand for paid parental leave would not be satisfied by a "sham baby bonus" in the Budget.

The Government is expected to introduce a six-week tax-funded parent support benefit, targeted at poorer families.

Laila Harre said six weeks was not enough time for a mother to spend with her baby. Parental leave should be funded by employers and targeting would be pointlessly complex as most young families were not high-income earners anyway.

The Alliance MP's bill, due back in Parliament the week after the Budget, would introduce 12 weeks' paid parental leave, funded by an average employer levy of $1.50 a week a worker.

The Treasurer, Bill Birch, could not be contacted last night. A spokesman said he was flying back from an Apec finance ministers' meeting in Malaysia.