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ACT's budget does not cover one year or three years. Based on Treasury's latest Economic and Fiscal Update, using explicitly stated assumptions that are conservative rather than radical, it looks as an integrated unit at the 18 years from 1998 to 2015. No other party has done that.

We saw that process as essential to test and establish the sustainability of ACT policies against very rigorous criteria. The spreadsheets, which embody our fiscal analysis and the impact of our policies on individuals and families in every variation at every income level, occupy more than 50 megabytes of hard-disk space.

Our Budget was made available to economic and financial analysts in five of the nation's leading financial consultancies for review against their own professional expertise. The organisations were asked to review, not endorse the policies.

What they looked at was the quality of ACT's work on this new party's budget and policy, as a safeguard against miscalculation or technical error. Their reports provided a great deal of detailed and helpful comment, along with an over from all five organisations.

They confirm the arithmetical accuracy of the ACT Budget.

Price Waterhouse:
"The calculations in the ACT New Zealand Budget are accurate."

Coopers & Lybrand:
"We confirm the mathematical accuracy of the ACT New Zealand Budget tables."

Economic Assumptions Valid

ACT's economic assumptions were also validated.

Ord Minett:
"The under-pinning growth assumptions are reasonable."

Infometrics:
"The economic linkages hold up well."

Bankers' Trust:
"If expenditure is controlled under ACT, then the only question is when all of our public debt will be paid off."

I challenge you to tell me of any other party that has submitted its proposed Budget and policy to such rigorous professional scrutiny before launching it to the New Zealand public.

Let me take you step-by-step through the budgeting logic of the ACT programme

Step One

Step one describes how ACT proposes without any recourse to income tax whatsoever to fund the debt of the community to the 484,800 people who will be retired at 1 July 1997. The money the taxpayer is committed to pay the number of them we can expect to be drawing superannuation from 1997 to the year 2015 is a total sum of $84 billion.

ACT will fund that $84 billion by two new means of raising Government revenue.

• A settlement fee to be paid by new immigrants into this country.

• A new superannuation levy on employers.

Taken together, those new measures raise revenue projected at $98 billion in the period from 1997 to 2015. That revenue dedicated to the existing retired population, fully covers the $84 billion owed to those people and, in addition, provides a $14 billion surplus for other purposes.

Any immigrant arriving in New Zealand at the moment automatically inherits, at zero cost, the total infrastructure of roads, electricity, water, schools, hospitals and so on, built up by generations of New Zealanders.

New Zealand is already an attractive destination. Given the reforms in the ACT programme, this country will become a magnet for would be settlers from every corner of the globe. Unprecedented demand for future entry can be expected. There is and will continue to be, a compelling need for rational means of selection, based fairly and squarely on benefit to the citizens of this country.

No change whatsoever is proposed in existing rights of entry on humanitarian grounds. All present treaty obligations will be honoured.

As we see it, the total number of immigrants entering New Zealand per year is roughly right and the balance, by country of origin is also about right. No significant changes are envisaged in those areas. Within that number, however, 5000 places will be tendered yearly.

Under ACT, those immigrants pay a settlement fee, an up-front charge for their share of our facilities. Also, under that programme, if a New Zealand firm should be unable to find some specialised skill it needs in this country, that firm could tender for temporary fee-paying work visas, to import the skills they required. All revenue raised will be allocated to the existing retired.

ACT will abolish all company income tax. A new superannuation levy will, however, be imposed on New Zealand employers. That measure is budgeted to provide less than 50% of the burden presently imposed on the business community by company income tax.

The whole of that $2.1 billion, along with the revenue from the immigrant settlement fee, is dedicated to fund our debt to existing retired people. In the first instance, revenue from this levy on employers will grow with the economy. Over time, as our debt to presently retired people reduces, the levy on employers will decline to zero and the levy will be abolished.

As a result of those two measures, no personal income tax whatever is required to provide funding for the existing retired.

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