KEY POINTS:
The Government will cut taxes and Finance Minister Michael Cullen will deliver them, Prime Minister Helen Clark told the Labour Party's annual conference here today.
It was the first hard confirmation that personal tax cuts are on the agenda, and she has dealt with speculation that Dr Cullen might be replaced before next year's election.
"It will happen because the time is right and the money is thereto do it without cutting services, and without borrowing for tax cuts," she said in her keynote speech to the conference in Takapuna.
"And when it happens, the National Party will stand exposed as the one trick pony it is."
Miss Clark said budget surpluses were now structural after eight years of economic growth.
"That gives Labour more choices - not to break the bank and sacrifice our country's macro stability, but to deliver budgets which continue to strengthen the economy and services and deliver hard working New Zealanders a direct dividend through a personal tax cut," Miss Clark said.
"That will happen under Labour. It will happen under Michael Cullen who has built the economy so it can happen."
Miss Clark's announcement ended months of speculation and strong hints from ministers that there will be tax cuts in next year's budget.
Speaking later to reporters, Miss Clark would not say how much taxes would be cut by.
Her announcement was loudly applauded by more than 700 delegates at the conference, who gave Miss Clark a standing ovation when she came into the auditorium of the Bruce Mason Centre.
They also applauded her comments on the Government's environmental policies, which, she said, were in some cases leading the world.
"Eighty five per cent of New Zealanders surveyed said they want the Government to act on climate change. That's an overwhelming mandate," she said.
Miss Clark told the conference the Government could stay in office and continue the work it had done with its social policies.
She indicated there would be more progress on affordable housing.
- NZPA
