26 May 2015

Govt denies breaking pre-election promises

6:22 pm on 26 May 2015

The Government has rejected accusations it has broken pre-election promises by introducing new taxes in the Budget.

John Key responds to the Labour Party's Budget reply speech.

John Key responds to the Labour Party's Budget reply speech. Photo: RNZ / Alexander Robertson

In response to questions in Parliament the Finance Minister Bill English said the new levy on international travellers was not a tax; it was a user charge.

Questions about the tax first came up when the Labour Party leader Andrew Little asked Prime Minister John Key about breaking the Government's promise not to introduce new taxes.

But Mr Key rejected Mr Little's proposition.

"We haven't broken our promise. What we have done is ensure there'll be more money for biosecurity.

"But Mr Speaker, Mr Speaker, Mr Little can spend all his time in Question Time asking his questions if he wants but the real question is: will he get back onside with his caucus who now hate him because he's polling 25 percent because he wants to means test New Zealand super," Mr Key said.

During the urgency debate on the Budget measures over the weekend National and Labour MPs had argued over whether the levy on international travellers was a tax.

In response to a question this afternoon the Finance Minister Bill English gave this explanation:

"The levy at the airports is a user charge and we would expect to expand the use of user charges," Mr English said.

Ministers were also asked about the decision to scrap the $1000 KiwiSaver kickstart payment.

Bill English giving his Post Budget 2015 speech.

Bill English Photo: RNZ / Alexander Robertson

First, Green Party co-leader Metiria Turei asked Mr Key about the impact on low income workers of scrapping the payment.

Prime Minister did not think it would make any difference.

"It's important to remember that KiwiSaver is a scheme that after you put in your 3 percent contribution employers put in 3 percent...and the Government puts in the member's tax credit.

"If you look at all of those numbers Mr Speaker over the normal sort of 45 year working period for most people a thousand dollars is immaterial."

Mr Little also asked about the changes to KiwiSaver, prompting a supplementary question from New Zealand First leader Winston Peters.

But Parliament's Speaker David Carter interrupted Mr Peters, telling him he did not have to refer to Mr Little's original question.

That prompted a rebuke from the New Zealand First leader, who reminded the Speaker he had been in Parliament longer than Mr Carter.

Winston Peters giving his 2015 Budget speech.

Photo: RNZ / Alexander Robertson

Mr Peters then lost his right to ask a supplementary question as he continued to challenge the Speaker's authority.

When he would not stop interrupting, Mr Carter then kicked him out of the debating chamber.

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