Newsletter #100
In marking my 100th newsletter I am excited to include news relating to a priority I spoke of in my maiden speech when entering Parliament, water storage and irrigation.
This last week has seen a number of announcements made prior to the delivery of Budget 2011 this coming Thursday, 19 May. I would like to focus on some of those in this newsletter.
Irrigation Funding a Step Forward
An expanded irrigation fund to support the development of new water harvesting, storage and distribution infrastructure is a great step forward for the farming industry in Mid and South Canterbury.
Last week's announcement that Budget 2011 will allocate $35 million over five years for the Irrigation Acceleration Fund, to support the development of irrigation infrastructure proposals to the 'investment-ready' prospectus stage will be welcomed in the Rangitata Electorate.
The expanded fund is the first stage of the process; for the second stage, the Government will consider in a future Budget investing up to $400 million of equity in the construction of regional-scale schemes to encourage third-party capital investment.
While funding of this Crown investment vehicle is yet to be finalised, it is expected to be available from 2013/14. The Crown will be a minority partner, investing on commercial terms, to give confidence to capital markets to invest in large scale irrigation schemes.
The irrigation funding was part of a Fresh Water Package which also covered water quality through a National Policy Statement (NPS).
The NPS, which gives clear direction to local councils on fresh water management, sets limits on fresh water quality, and sets limits on how much fresh water can be used. It would help local councils improve their water management and takes effect from July 2011. It will be reviewed within five years.
Water is New Zealand's most plentiful natural resource. It gives us a competitive advantage over other countries, particularly in our primary and tourism industries. We're making sure New Zealand has a plentiful supply of good quality fresh water.
KiwiSaver, Working For Families, Student Loans
Prime Minister John Key has said Budget 2011 will be responsible and measured, and ensure expensive programmes like KiwiSaver, Working for Families and interest-free student loans are affordable into the future.
Budget 2011 will set a credible path back to surplus while at the same time continuing to protect the most vulnerable New Zealanders, boosting frontline health and education services, and helping to pay for the rebuilding of Christchurch.
It will contain significant savings, but will by no means be a slash and burn Budget. It will be a responsible Budget which helps ensure growth is built on the solid foundation of savings, exports and productive investment.
The Budget will contain changes to KiwiSaver, Working for Families and interest-free student loans - programmes which collectively cost almost $5 billion a year.
These programmes were introduced during a debt and consumption-driven economic bubble, and it is clear that they are unaffordable.
None of the changes we will be making will affect people before the election so New Zealanders will be voting with all the information they need and can make their own choices.
The Government intends to reduce the amount of money it has to borrow from overseas to put into KiwiSaver, and increase the amount of genuine savings from the private sector.
The mix of contributions to KiwiSaver accounts will change, with less coming from the Member Tax Credit and more coming from both individuals and employers. The $1,000 kick-start for new KiwiSaver members will remain as it is now.
The changes to KiwiSaver won't happen immediately, and this will give people and businesses time to adjust.
Increased contributions from people and businesses will happen at a time when the economy will have well and truly recovered, and both wages and employment will be increasing.
The changes will maintain total contributions into KiwiSaver funds, which are expected to accumulate rapidly. Officials have advised that the KiwiSaver changes will modestly improve the rate of national savings.
Working for Families will also be better targeted at lower-income families, who have a much greater need for assistance, and a little less generous to families higher up the Working for Families scale.
We will do this gradually, in a way that minimises the impact on families.
The student loan scheme will also be adjusted but will remain interest-free.
The changes we are making in the Budget will make all of these programmes more affordable and ensure they survive into the future.
Here in New Zealand we have a chance, now the economy is gathering steam again, to build a solid platform for future growth.
Budget 2011 will make the most of this opportunity for New Zealanders.
Insulation project sees 100,000 homes insulated
100,000 homes have now benefited from the Government's home insulation and heating programme, Warm Up New Zealand: Heat Smart.
The milestone figure is a significant achievement from a programme that is seeing a record number of houses completed each year.
The programme forms a key part of the Memorandum of Understanding between National and the Green Party.
100,000 homes are now warmer, drier and healthier. That's roughly 300,000 people across the country who will be enjoying better living conditions as a direct result of the improvements made.
EECA estimates around 2,000 people will be directly employed as a result of this programme over its four-year duration.
The Government has allocated $347 million to retrofit at least 188,500 homes over four years from July 2009, with insulation and clean, efficient heaters such as high-efficiency heat pumps and efficient gas heaters.
Vet Bonding
The Government's voluntary bonding scheme has proved a success for New Zealand's rural veterinary businesses, including in the Rangitata electorate.
Introduced to help address the shortage of veterinarians working with production animals, the scheme provides a taxable payment of $11,000 for every year up to five years that vets work in eligible veterinary practices. To qualify the practices have to have an overall production animal focus, support graduate's career development and be at risk of a workforce shortage.
Since the scheme started 30 places have been available each year. Twenty-two graduates were recruited into the scheme in both 2009 and 2010 and this year the cap of 30 places was reached for the first time.
Budget Breakfasts
I am holding several post-budget breakfasts throughout the electorate to discuss Budget 2011 and its impact for New Zealand. If you would like to attend one please phone either of my electorate offices to book (Ashburton 03 3087510 or Timaru 03 6831386).
The venues and dates are 30 May at Timaru, 1 June at Temuka, 2 June at Rakaia and 3 June at Methven.
Snippets
16 May Attend refurbishment celebrations, Margaret Wilson Home, Timaru
23 May Attend Craighead Diocesan School Centennial Founders service (Timaru)
25 May Guest speaker at Methven Lions & Ashburton Ladies Probus meetings, hosting afternoon tea for seniors in Hampstead, Ashburton
27 May Guest speaker at Ashburton Business breakfast; opening New Zealand Round Table Convention (Ashburton)
30 May - 3 June Post-Budget Breakfasts, venues & dates as above
