Niggling errors undermine Nats

FIRST READING - By VERNON SMALL

National has been commendably sure-footed this week, correcting a grossly unfair anomaly in its KiwiSaver policy and atomising ACT's futile plans to relitigate the science of human-induced climate change.

That is more than can be said for its first few days in the House, where it has stumbled through processes and procedures as if the place is only vaguely familiar, even to its long- serving MPs.

Allowing savers earning less than $52,000 a year to access the full Government KiwiSaver employee subsidy of $20 a week, by changing it from a percentage of salary to a dollar-for-dollar amount, was the right way to go.

Being able to fund it from the $500 million-odd windfall, uncovered when Treasury costed National's tax policies, was a stroke of luck.

Topping that up with another $200 million by taking a little from everyone, cancelling the $40-a-year subsidy on fees, was probably the fairest fix if the Government was not prepared to throw any more money at the problem.

What came as a nasty surprise was the realisation that reducing the compulsory employer contribution from 4 per cent to 2 per cent would also rip away half the tax break currently available on the full 4 per cent.

To be fair, it was disclosed in National's original policy, but in an Alice in Wonderland inversion: "National will also keep the exemption from ESCT (employer superannuation contribution tax) on employers' minimum contributions. This directly benefits employees, who effectively do not pay tax on their employer's contribution to their KiwiSaver accounts."

This is not small beer. For someone on the average wage of $50,000, it represents about $300 a year in lost benefit if their employer is generous enough to maintain a contribution of 4 per cent.

The wording in National's policy was as obscure as the one that created the anomaly for low-income workers that was addressed this week. That had read: "National will keep the member tax credit . . . it will match their contributions at the minimum contribution rate, up to a maximum of $1040 a year".

What was not immediately obvious – but was rumbled by unions – was that someone on, say, $26,000 who saved $1040 a year would only qualify for a matching amount of $520 from the Government because that was capped at 2 per cent of their salary.

It is an indictment of Labour's campaign, as much as of National's slipperiness, that the tax impact of the cut to the compulsory employer contribution was not highlighted during the election.

National also handled with aplomb changes to ACT's draft terms of reference for the climate change select committee, dumping the embarrassing and internationally counterproductive attempt to assess the truth or otherwise of human-induced climate change and removing the pointless slur on the impartiality of officials.

Installing UnitedFuture leader Peter Dunne as committee chairman, who quickly ruled out second guessing the international scientific community, completed John Key's deft footwork.

In the debating chamber, though, National has tripped over itself and shadow leader of the house Michael Cullen has been enjoying himself far too much.

No one expects new Leader of the House Gerry Brownlee and his colleagues to have the encyclopaedic knowledge of a Cullen, who always took more pleasure in his House role than in any of his other portfolios.

But National has looked like a player on the bench who has been eating chips and drinking beer without taking much notice of the game.

MPs were barely in their seats on Tuesday before Mr Brownlee stood up twice to move motions and then sat down without speaking, risking forfeiting his right to have a say.

On the first occasion he was saved by Dr Cullen seeking leave for him to speak – which was granted but probably should have been ruled out of order by new Speaker Lockwood Smith – since one member cannot seek leave for another to speak.

National has also put wave-through motions, such as the one carrying over incomplete legislation from the previous government, into the urgency motion. That turned what could have been the work of a few minutes in to a long and unnecessary debate.

National has also adopted an annoying tactic of introducing bills one by one as they come up for debate, rather than introducing them in blocks so the public, the media and the Opposition can read them in advance.

Maybe the Government has not yet put in place its consultation arrangements with support parties, and this is one way to keep faith with them. But it is otherwise hard to see what it achieves, other than temporarily inconveniencing the Opposition.

Mr Brownlee has smiled through the gaffes and slips, cheerfully accepting that he is just an apprentice and learned everything he knows about House management and processes from the good doctor.

National has not committed any serious cock-ups yet, and such things are probably "beltway" preoccupations anyway. But the niggling errors undermine the impression of a smooth and confident transition to power.

- © Fairfax NZ News