Matt McCarten: Dishonest talk by Nats obscures fact Budget not too bad

Hats off to Michael Cullen. I know that it's the opposition's job to orchestrate the wailing and gnashing of teeth. But, if they were honest, they would have to concede that the Budget's not bad.

The Government had, of course, intended the unbundling of Telecom as the lead item to define this budget. The wee man who picked up the mail at the Beehive stuffed that strategy up.

So that's given the Nats an opportunity to get tax cuts back on the agenda. We had that drama last year and there isn't much new to argue about. You're either for spending more on public services or tax cuts.

Despite the Nats' claims, you can't have both. In fact, this phoney debate obscures many things in the Budget that will affect our lives.

Here's my take on the Budget, for what it's worth.

Forget about tax cuts for now. All this Australia talk by the Nats is dishonest. Over the ditch, the highest tax rate is 48 per cent and they tax their poor less than we do ours.

In addition, they have a health tax. I don't see the wealthy here demanding we impose the Aussies' capital gains tax or their land tax either.

Most people do want more money spent on infrastructure, health services and education and this is what the Budget does. For Labour to have a fourth term, they may have to throw us tax cuts either next year or in election year.

Labour have clearly proven to us that they can manage capitalism better than the Nats.

That must hurt.

Despite the whingeing from some bosses with political agendas, the economy is in good shape.

We dip next year to one per cent growth but then back up to an average three per cent for the next three years. Hardly the stuff of panic.

Even our worst unemployment predictions have it remaining lower than most other OECD countries.

The Government is expected to run surpluses for years to come.

This year's surplus of $8.5 billion alone works out at more than $2000 for each of us and close to $7000 each over the next five years.

Little understood is that, in the past 10 years, government debt has dropped from 60 per cent of GDP to 23 per cent.

More remarkably, when we include assets and the superannuation fund, we are actually in the black.

It's the first time this has happened since parliament was formed 150 years ago.

According to Cullen, only seven other western countries share this triumph. If our Minister of Finance was a business CEO, he would, no doubt, receive a huge bonus this year from his shareholders.

I think one of Cullen's coups has been his decision to push through the superannuation fund. This fund has consistingly outperformed private sector competitors, earning more than double the market average since it was established in 1993.

Last year it made a profit of over 17 per cent - making each of us $800 richer. In four years, they reckon it will have saved us nearly $6000 each.

We are now one of the few countries in the world positioned to look after our oldies and we have this fund to thank for that.

In terms of the environment, the Government clearly came down on the side of the roading lobby and ignored the Greens.

Of course, we all say we support the environment and give lip service to public transport.

But we want others to use the bus, while we drive in our nice, warm car listening to our favourite music. This budget helps us stay in our cars.

It's politically smart of the Government to take all the petrol taxes and put it into roads. They have promised to spend $6500 per car driver over the next five years on roads.

On that sort of money we could, of course, have free public transport in our cities and not build any roads.

So I can see why the Greens are choking.

The Government already spends more than $2350 a year on health for each of us and has promised to whack in another $180.

The obesity of our next generations is an alarming problem and the budget pours in $76m to fight fat.

I worked out that if each of us ate six fewer Big Macs a year, it would equal the same sum of money. We would weigh a pound less too. Soft drinks are rotting more of our children's teeth so we are bringing the school dental nurses back. But we won't fix these problems unless we offer alternatives and regulate the corporates which peddle junk to our children.

Remember when we had classes of more than 30 pupils? One or two new teachers in our primary schools to get classes down to 15 is great. I used to think getting down to 20 students was a pipe dream. The extra money for tertiary education is no doubt welcome, but I'll never buy into the user-pays education model.

The extra money to 75 per cent of our working families will be received gratefully. But there's the rub.

Don't get me wrong. This is a pretty good budget for ordinary New Zealanders. But the success of the economy has been possible because hundreds of thousands of Kiwi workers are grossly underpaid and don't have the power to insist on a fair wage from their employer.

The Government has a record surplus and can spend more because tax revenue is up. Tax revenue is up because profits are up. Profits are up because wages are down. And that is the real basis for the Government's ability to produce a budget with a surplus.