Sick animals treated before people

At 74, Doug Rennie reckons that he can still outpace almost every younger man he has worked with on fencing and other agricultural contracting.

He's contemptuous of six young unemployed guys who rented a farmhouse near his home at Te Mawhai, south of Te Awamutu. Mr Rennie was helping the farmer to bale hay when rain threatened, so he asked the young men for help. They turned him down, saying they were going into town to buy some music.

"They were too lazy to earn a bit of extra cash," he scoffs.

He has supported New Zealand First in the past, but he's thinking of voting National this year even though he's "not impressed with their leader".

Mr Rennie is a man who is hard to impress. Yet he is not one of the National voters looking for tax cuts out of this election. Ask him how the Government should spend a $1 billion bonus and he answers straight up: "Health."

Recently he took a friend who was injured in a farm accident to Hamilton's Anglesea St Clinic at 11.30pm. It was 2.30am when the doctor saw them.

"If I have a sick animal, I can get a vet to it quicker than I can get to see a doctor," he says.

It's a story echoed from end to end of the country. In Dunedin, vet Nicola Pattison, 28, recalls a boy who came into her clinic on crutches with an injured dog. The dog and the boy needed the same knee operation. Ms Pattison operated immediately on the dog, but the boy was left on crutches for weeks.

Ms Pattison was home on holiday. She moved to Adelaide five months ago and plans to make her life there.

"I'm $12,000 a year better off there and the costs are similar to Dunedin," she says. "They have just cut taxes there for middle- to higher income-earners with kids, and the healthcare system is a lot better than here."

Twenty years after Australia began to pull ahead of New Zealand in incomes per person, the gap in wages, healthcare and in everything else that costs money is now almost irresistible for young Kiwis - especially if they have student loans to repay. Australia's average wage is now A$54,288 ($59,221) a year, compared with $41,698 in New Zealand.

Sarah Alexander, 21, of Tauranga, plans to cross the Ditch as soon as she finishes her marine studies degree next year.

"We can't afford to live in New Zealand because of its pay structure," she says. "I would love to go to Auckland and live there, but because I have a huge student debt it's easier for me to go to Australia and get paid $30 an hour rather than stay home at $10.50. That is a big motivation."

Aucklanders Richard Cotty, 28, and Caroline Rose, 24, paid off their student loans in Japan and have just come home.

"There is no way we could have done it here, especially with the taxes," says Rose, a laboratory technician. "The salaries were not much higher, but we got to keep our money."

But another Auckland couple, just married at 29 and heading off on their honeymoon, said "stuff the tax cut" and would prefer to see any extra money go into health, education and helping families into houses.

The couple, a landscaper and a retailer who want to be known just as Mr and Mrs Harawene, earn too much to get a Government-backed deposit-free mortgage from Kiwibank, but are paying off student loans and can't save to get a deposit together quickly any other way.

"It gets my wick," Mrs Harawene says. "If we were on the dole, we could get a house through Kiwibank. We ideally would be buying now. But if we are really good, it will probably take us five years."

This survey asked 600 New Zealanders from Kaitaia to Bluff: "If the Government takes in, say, $1 billion more in taxes this year than it needs, what do you think should be the top priority for the use of that money?"

Most people replied: health (50 per cent) and education (40 per cent).

Tax cuts were the next most popular (14 per cent), followed by roads and infrastructure (12 per cent), police (5 per cent), student loan relief (4 per cent), and housing and family assistance (both 3 per cent). (The question aimed to get a single answer, but many people gave more than one.)

People were then asked whether, if they had to choose between giving that $1 billion back in tax cuts or spending it on services such as health and education, would they give all or most of it in tax cuts, spend all or most of it on services, or split it half-and-half.

Fifty per cent replied that they would split it equally. Fifteen per cent would spend most of it, and 22 per cent all of it, on services. Only 5 per cent would give most of it, and 8 per cent all of it, in tax cuts.

People have various ideas about the kinds of tax cuts that might help, ranging from flatter tax rates to the opposite - making the first few thousand dollars tax-free as in Australia, where the first A$6000 ($6545) is untaxed apart from a 1.5 per cent Medicare levy.

This structure means low-income Australians pay lower taxes than New Zealanders, but those on average wages and above pay more.

But the 2 per cent tax advantage of living in New Zealand on the average wage is overwhelmed by the gap in wages. An Australian on the average wage still takes home A$41,328 ($45,085) a year, compared with $32,567 on the average wage in this country.

Tax cuts, therefore, make sense only as part of an economic package aimed at closing the gap in wages. Public debate on such a package may be sparked when National unveils its tax cuts in the next week or so.