Hon ANNE TOLLEY (Minister of Education) on behalf of the Minister of Health: I move, That the Alcohol Advisory Council Amendment Bill be now read a second time. This bill is a technical amendment to the Alcohol Advisory Council Act 1976 to address problems with the current levy-setting mechanisms by introducing an updated and simple calculation system that reflects the current alcohol market and future-proofs the levy against new types of alcohol products. The amendment bill also provides for regulations to be made by Order in Council to fix the rate of levy payable. This Government has chosen to progress this bill because it proposes a pragmatic improvement to the system that is long overdue. I will outline the rationale for the bill, discuss the select committee’s recommendations, and note a further very minor change to the bill that will be introduced by a Supplementary Order Paper.

The Alcohol Advisory Council (ALAC) was established under the Alcohol Advisory Council Act in 1976. ALAC’s primary objective is to encourage and promote moderation in the use of liquor, to discourage and reduce the misuse of liquor, and to minimise the personal, social, and economic harm resulting from the misuse of liquor. ALAC’s functions include research, dissemination of information, educational programmes, and innovative treatment programmes designed to achieve its objectives. It is important to acknowledge that ALAC has a significant role in reducing the significant burden of alcohol-related harm in New Zealand, and that this bill is not intended to contribute to reducing alcohol-related harm. This Government is very concerned about alcohol-related harm, but plans to address the harms through other mechanisms. A technical amendment to simplify the funding of a Crown entity is not the place to debate ways to reduce alcohol-related harm.

ALAC is funded by a levy on all alcoholic beverages manufactured in, and imported into New Zealand. The way the ALAC levy is calculated and apportioned is outlined in the Alcohol Advisory Council Act 1976. The total levy amount for ALAC during the 2007-08 financial year was $12.4 million. This is small in comparison with alcohol excise payable on alcohol manufactured in New Zealand, and excise-equivalent duty payable on alcohol imported into New Zealand, which was $795 million in the year ended June 2008.

In 2004 the Ministry of Health reviewed the current levy-setting mechanisms of the Alcohol Advisory Council Act 1976. The review found four major problems with the way the ALAC levy is calculated and apportioned. First, the levy-setting mechanism is outdated, as it is based on only four classes of liquor. The alcohol market has changed considerably since 1976 and the levy-setting provisions no longer reflect the diversity of alcohol consumed in New Zealand. For instance, the emergence of ready-to-drink—RTD—products of around 5 percent alcohol, and an increasing number of standard spirits of less than 42 percent alcohol by volume, are not readily accommodated by the way that the levy is currently struck. This highlights the need to future-proof the classification system by enabling the easier classification of emerging types of beverage. Second, the spirits category requires the calculation of proof letters—a concept that is no longer in use. Since 1986 New Zealand’s Customs Service has measured spirit volumes as litres of alcohol, and proof litres are no longer recorded. Third, the current levy-setting mechanism is unnecessarily complex when viewed alongside the way excise and excise-equivalent duties are set on the basis of alcohol content. Alcohol importers and producers have often noted that this procedure could be simplified. Fourth, section 27 of the Alcohol Advisory Council Act 1976 allows the levy to be set by the Minister of Health by Gazette notice. There is no process for Cabinet to be involved in the levy-setting procedure, which is inconsistent with more robust approaches to setting levies, such as the procedure for the problem-gambling levy.

This bill seeks to introduce a system of alcohol classification bands—an approach that aligns with the system the New Zealand Customs Service uses to collect alcohol excise duty and excise-equivalent duty. Under this system a dollar amount per litre of beverage for the ALAC levy could be set for each alcoholic beverage according to its deemed alcohol content or average alcohol content. This means that alcoholic beverages with a higher volume of alcohol would contribute a higher proportion to the levy. Two other options were considered: incorporating the levy into excise, and replacing the levy with funding through Vote Health. The Government and most stakeholders prefer the chosen option of retaining the levy but aligning it to excise, because it will be simpler than the status quo and more transparent and cheaper than the alternatives.

The new system will not affect the total sum collected for the levy, and the effect on price to consumers through shifts in the levy payable between beverage types will not be significant—approximately 2c less for a 750 ml bottle of spirits, and a difference of less than 1c for a bottle of wine, a six-pack of beer, or a four-pack of ready-to-drink beverages. Estimates from the 2006-07 levy round suggest that the beer industry will be affected most by the proposed change to the calculation of the levy, due to the high volume of imported and manufactured beer products in New Zealand. The spirit and wine sectors would both contribute a lower proportion of the levy under the proposed system. The change will have minimal impact on those who pay the levy, and industry groups are generally supportive of the bill.

After looking at the bill and considering submissions from six submitters, the Health Committee recommended that the bill proceed with two minor amendments. At the time, every committee member supported the changes. The first minor amendment is to insert a definition of “rate” to make it clear that it means the percentage figure given in the schedule of the bill. The second minor amendment is a replacement of the table set out in the schedule. The revised table includes a list of the applicable tariff items for each class of beverage. The purpose of this amended schedule is to address the concerns raised by New Zealand Winegrowers by making it clear what rates will be applicable to particular products. This will ensure that the bill continues to be in line with the excise and excise-equivalent regime.

The Ministry of Health engaged with industry groups prior to making the recommendation to the Health Committee in order to ensure that the recommended approach was easy to understand and accurate from the perspective of industry groups. The Minister of Health intends to propose a Supplementary Order Paper to correct a typographical error in the revised schedule of the bill that was discovered after the Health Committee had reported back to the House. One tariff item was drafted as 22.90.08 rather than the correct format of 2208.90.08. The error relates to the list of class F tariff items under the heading “Legal definition of class”. I recommend that the House supports the passage of this bill to the next stage.

Hon RUTH DYSON (Labour—Port Hills) : First of all, I commend the acting Minister, Anne Tolley, for that extraordinarily well-read speech, and I express my slight regret that the Hon Tony Ryall has not been able to join us in this particular part of the debate.

This Alcohol Advisory Council Amendment Bill was introduced to the House—

Hon Anne Tolley: I raise a point of order, Mr Speaker. I am sorry to interrupt the member’s speech, but she is an experienced member and she knows that under the Standing Orders she cannot comment on the absence from the House of any particular member.

Hon RUTH DYSON: Speaking to the point of order, Mr Assistant Speaker, I say that I understand the point the Minister has made, but that was not what I said. I said that the Minister of Health was unable to join us in the debate.

The ASSISTANT SPEAKER (Hon Rick Barker): It is a fine point, and the member raising the point of order could normally be entitled to draw that conclusion, but it is not the only conclusion that could have been drawn. Let us be fair: people have raised these issues before, and Ruth Dyson did not specifically say the person was absent from the Chamber. Now that the member has raised a point of order, I think that her conclusion was the only conclusion one could have drawn, but it was not necessarily so at the time. The member will continue her speech.

Could I just say there seems to be a bit of confusion on the drill sheet. I should have said to the House before I called the Hon Ruth Dyson that the question is that the motion be agreed to. Just for the sake of precision, I mention that that is the question before the House.

Hon RUTH DYSON: Mr Assistant Speaker, it gives me great pleasure to speak to the motion that you have just put before the House and it is one that Labour will be supporting strongly, because the Alcohol Advisory Council Amendment Bill was introduced to the House by the previous Labour-led Government. I commend my friend and former colleague the Hon Damien O’Connor for introducing this legislation.

As Minister Anne Tolley indicated, this bill is a technical amendment bill. There are no party politics involved in it, and, as such, our speakers will not be taking up the time of the House, but we are a little concerned that if we were to do what the public would think appropriate, and just say: we do not oppose this bill, we agree with the Supplementary Order Paper that is about as technical as it can get; we contributed strongly through the select committee, there is cross-party agreement on this; and then sat down, I would be very anxious about the health and well-being of the Government whips. I can imagine that Chris Tremain and Nathan Guy would be scrambling around for a bit more work to put on the Order Paper, because, once again, no bills have been introduced into the House. The only issue we are debating tonight is yet another bill that was introduced by the previous Government. Would I wish ill health and the wrath of Gerry Brownlee on those two young men? The answer is no to both of those questions. I wish them good health and an easy life but I fear that, despite my good wishes, they are not about to get them.

As I said earlier, this bill is primarily technical. It provides for an updated levy system that is fair, that is simple to calculate, and that everyone understands. Minister Anne Tolley went through the details of that at quite some length, as did the Health Committee, even though it heard only six submissions. That should be an indication of the fact that the industry, the key health players, the New Zealand Customs Service, and the legal advisers all agreed with the basis—and, in fact, the legal writing—of this amendment bill. Advice was received from the Ministry of Health, the Customs Service, and parliamentary counsel, in addition to the six submissions. It does not sound to me like it was a very contentious process.

The report from the select committee outlined the reasons for updating and changing the rating regime: to ensure that the rating fairly reflects the alcohol content, and to ensure that the public are supportive of it. This is a very common-sense move, introduced by the Hon Damien O’Connor in his capacity as a previous Associate Minister of Health. The then National Opposition supported the first reading of the bill. I am delighted that this bill is one of the many bills introduced by the previous Labour Government that remain on the Order Paper—

Hon Darren Hughes: Time for a change!

Hon RUTH DYSON: I am not sure how much of a breather we will be giving the Leader of the House and those Ministers, because this bill is another example of legislation that was introduced under the previous regime. We will continue to support the bill, nevertheless, and I commend its speedy progress through the House.

Dr PAUL HUTCHISON (National—Hunua) : Thank you, Mr Assistant Speaker, for the opportunity to speak on the Alcohol Advisory Council Amendment Bill. I note that this bill is about simplifying and bringing into line the levy paid to the Alcohol Advisory Council (ALAC) with the excise duties that are otherwise collected. It is interesting, after the somewhat partisan contribution from the Hon Ruth Dyson, to see that the legislative history began with the introduction of the bill on 11 December 2007—a long time ago. It was quite fascinating to hear Ruth Dyson say that surely this bill is non-contentious and could go through expeditiously. Why did the Labour Government not get this bill through the House, if it was to simplify legislation? But, no, that was not the way of the Labour Government, because, after all, its legacy is one of cementing in an enmeshed and entwined conglomeration of bureaucracy over the last 9 years.

It is refreshing that a new National Government has come into office, taken up this bill in the first few months, and is passing it with alacrity, as it should have been passed by that somewhat lazy Labour Government over those long 9 years. It is very refreshing that there is bipartisan agreement on this bill, because clearly it is sensible, and the sector was supportive of it. The sector had concerns, of course, about various technical aspects, but I did note it was generally very supportive and helpful in terms of ensuring that the technical aspects were progressed.

It is important to make mention that the bill is not intended to contribute to reducing alcohol-related harm, but, instead, it aims to simplify the calculation of the levy. The Government, of course, is extremely concerned about alcohol-related harm in New Zealand. However, this bill is purely a technical amendment to simplify legislation. I note that ALAC does some tremendous work in its role of reducing harm from the use of alcohol, and its various other efforts in terms of education and research. The council is dependent on the $12 million that it receives each year, and I understand that about a third of it comes from these levies.

The aim of the bill is to bring the levy-setting regime into line with the excise-setting regime, and I think it has done that very comfortably. I note that in the schedule there is now quite a clear description of what percentage of alcohol by volume in most item classes relates to the rate. It is important that the method for determining the variable rates is set out in the schedule for a given financial year. The variable rate for a class is the average alcohol content by volume of all the liquor of that class that was imported into, or manufactured in, New Zealand in the preceding statistical year.

Four major problems noted by ALAC were that the levy-setting mechanism was outdated, ready-to-drink beverages did not exist at the time the law was introduced, proof litres have not been used to measure spirits since 1986, and the current levy-setting mechanism was extremely complex. Although the current Act allows the levy to be set by the Minister of Health by Gazette notice, there is no process for Cabinet to be involved, which is inconsistent with many of the other levy-setting approaches.

There is no doubt that the proposed regime is up to date and very simple to calculate. There is no doubt—

Hon Ruth Dyson: Why are you filibustering, Paul?

Dr PAUL HUTCHISON: It is very important that members opposite realise the virtues of this bill, which at last has been taken up by a forward-looking National Government.

Further, the new regime is flexible enough to allow for the emergence of the new types of beverages that do not easily fit into any liquor class in the current system. The definition of “wine” itself was something that was important for the committee to consider, because “wine” has many definitions. The Oxford Dictionary describes it as an alcoholic drink made from fermented grape juice, or as a fermented alcoholic drink made from other fruits. But the verb is slightly different; apparently it is an Indian dance with gyratory movements of the pelvis. Maybe that it is an after-effect of the wine, but it is very important that the definition is clearly made. Hence the bill repeals previous definitions, and replaces them with one definition, that of “wine”, which means “the product of the complete or partial fermentation of any fruit (including grapes), vegetable, or honey, and—(a) includes—(i) cider, perry,”—if members have not heard of perry, it is wine from pears—“and mead; and (ii) fortified wines such as sherry, port, and fruit or vegetable-based liquors;”. But the definition does not include beer or spirits, or any liquor containing more than 1.15 percent volume of alcohol. It was important to make sure that those definitions were clearly incorporated into the bill.

It is also very important that there is minimal impact on those who pay the levy, and, indeed, the sector has agreed that that is the case. As I said before, the sector has been very helpful with the evolution of this bill, and very supportive also of ALAC. Price changes will be very small. The estimates are less than 1c for a bottle of wine, a six-pack of beer, or a four-pack of “RTDs”, and less than 2c for a 750 ml—

Hon Members: What’s an “RTD”?

Dr PAUL HUTCHISON: Well, I have already told members about “RTDs”. They should remember; they should think back and see whether their attention spans are more than 60 seconds. It is a shame that the members of the previous Labour Government not only failed to pass expeditiously legislation that was necessary, but have also lost their retentive memory spans—they are less than 60 seconds. I tell them that “RTD” means ready-to-drink—you know, an alcopop. They might not have heard of that either; they should come into the new millennium. But it is important to point out that price changes will be very small—less than 2c for a 750 ml bottle of spirits.

The new schedule addresses the concerns raised by New Zealand Winegrowers about the clarity of what rates will be applicable to particular products, and ALAC will continue to receive the necessary funding to continue its work: research, dissemination of information, educational programmes, and innovative treatment programmes. So it is with much pleasure that I support the second reading of this bill.

IAIN LEES-GALLOWAY (Labour—Palmerston North) : I intend to take a very short call on the Alcohol Advisory Council Amendment Bill this evening.

Hon Ruth Dyson: You don’t need to filibuster on a bill we already support.

IAIN LEES-GALLOWAY: Ha, ha! I found it quite amusing that the previous speaker decided to start off by having a crack at the previous Government over the length of time taken to progress the bill as far as this reading. I am a young fella and I am just learning my way around this place, so I thought I would have a look at its wisdom—

Paul Quinn: Those grey hairs don’t show.

IAIN LEES-GALLOWAY: —its wisdom, I tell Mr Quinn. So I thought I would look at the Hansard of the first reading. What did I see? I saw that an utter diatribe was given by members on the National benches at that time, as well. For reasons known only to themselves, the National members have chosen to do that again tonight. I am not sure why that is; I am sure we have other business we can get to tonight. I do not know how many times I read in Hansard that the Alcohol Advisory Council (ALAC) was established by an Act of Parliament in 1976. We all know that. We know that this legislation is a technical adjustment; we know that it is about streamlining the funding for ALAC. This is a good bill. It has cross-party support, and there is no real need to spend much time on it.

I will briefly reflect on why we still need ALAC today, and why it is important that the funding is sorted out so that it is nice and easy for that body and is not something it has to worry about. There is plenty of other work for ALAC to deal with. We know that New Zealand still has a problem with its drinking culture, but cultures can change. We have seen that with the drink-driving culture, and we have seen that with the smoking culture, although there is still more work to be done on that. Plenty of things need to be done, and the issues involve the drinking age, the prevalence of cheap booze, the act of loss-leading by supermarkets, the availability of alcohol, the advertising of alcohol, the recent invention of alcopops or “RTDs”—

Hon Ruth Dyson: What are “RTDs” again?

IAIN LEES-GALLOWAY: —ready-to-drinks, yes—and enforcement issues to do with the Sale of Liquor Act. All of those things need to be seen to, and we need an independent body like ALAC to keep us, as politicians, reminded that those issues need to stay in the forefront of our minds. I am heartened to know that Parliament will be looking at those things later on this year.

As I said, this bill does not require too much talk; there is plenty to get on with. This is a good bill; let us get on with it. I commend the bill to the House.

MICHAEL WOODHOUSE (National) : I rise in support of the Alcohol Advisory Council Amendment Bill. It is yet another example of a good idea spinning round and round in the Labour Party’s spin-dryer. I am sure those members appreciate but do not act on the fact that bills become law only once they are passed. This bill amends an Act that, after 33 years of existence, is a bit tired and out of date in terms of current needs and, indeed, drinking habits—something some members of the House may well empathise with.

Examples of the dated nature of the present legislation can be found in the fact that the Act deals with only beer, wine, and spirits, and clearly there is no accommodation for more modern drinking products, including ready-to-drink products, or “RTDs” as they are known. There are some quite quaint descriptions in the 1976 Act, including this pearl of wisdom about wine, which states that grape wine “means wine manufactured . . . from grapes.” One presumes that is as distinct from other wines that are not produced from grapes. Indeed, there is a definition of fruit wine, which states: “Fruit wine means manufactured in New Zealand from any product other than grapes”. So it is time that the legislation is updated to reflect those current drinking products.

As my colleague Dr Hutchison pointed out, the purpose of this legislation is not to contribute to debates about reducing alcohol harm, but it is appropriate, I think, to reflect on the need for an organisation like the Alcohol Advisory Council, and that need is as great now as it ever was. There is a Kiwi culture, I think, of binge boozing, which appears to be more prevalent and more prominent than it was in the past. We have had many examples of this.

Recently—last Tuesday night—in my home town of Dunedin, the freshers’ toga parade, which is a traditional event, and the contribution of significant quantities of alcohol created a climate of lawlessness in the city. Students frightened bystanders and trashed the main street of the city. People were going about their business in the middle of the throwing of some unseemly and pretty dangerous items, frankly. Of course there is a degree of larrikinism in all student behaviour, and many of us, I am sure, have been involved in the odd student prank or two, but this was well beyond anything that could have been described as harmless fun.

There is no doubt that alcohol played a material part in the behaviour that was evident that night, and that demonstrates yet again that we, as a nation, by and large do not have a responsible approach to the consumption of alcohol. There is an immaturity about that approach. It behoves us to continue to support the excellent work that the Alcohol Advisory Council does, to make the levy-setting process current with New Zealanders’ drinking habits, and to line that process up with the excise duty collection process.

I support this bill for that purpose. It future-proofs changes in the drinking habits of New Zealanders going forward, and it simplifies the calculation of the levy that funds the Alcohol Advisory Council. I support this bill.

TE URUROA FLAVELL (Māori Party—Waiariki) :Tēnā koe, Mr Assistant Speaker. Kia ora tātou katoa i tēnei pō, tātou kua hoki mai ki roto i te Whare Pāremata.

[Greetings to you, Mr Assistant Speaker, and to us all this evening who have returned to Parliament House.]

I am told that today’s Christchurch Press has all of the reasons why we need to amend the Alcohol Advisory Council Act in relation to the levy imposed on all alcoholic beverages manufactured in or imported into Aotearoa. The paper talked about a study of 12,000 young people that found that the onset of drinking “goes up very steeply from age 12”, and that children as young as the age of 4 are trying alcohol—4 years old, for goodness’ sake. It seems that child’s play now extends to having a drink or a glug of liquor that is meant for adult lips. In response to these shocking headlines, Tuari Pōtiki, a spokesperson for the Alcohol Advisory Council (ALAC), confirmed that the age at which people first drink has been steadily decreasing.

That was not just an isolated headline or a one-off story. On any weekend, in most towns in the nation—and Rotorua is no different—we find our young people out drinking themselves to drunkenness, to a level where they probably would describe themselves as “wasted”. That is what they call it: getting “wasted”. We say that it is probably more wasted potential. We think it is pretty outrageous that alcohol and drugs are involved to such a large extent in youth crisis situations, as has been spoken about and has been written about in newspapers, particularly in more recent times. The lowered purchasing age and the prevailing attitude of a society that associates alcohol with fun and freedom are having an impact on our communities. The Māori Party, along with our colleagues in the House tonight, says that we need to look at and instigate strategies to address matters to do with getting “wasted”.

The negative consequences associated with under-age drinking, especially the pattern of heavy binge drinking that many minors engage in, are pretty substantial. The Māori Party has always suggested that there should be a variety of strategies, both legislative and non-legislative, to reduce the overall supply of alcohol to young people in order to limit their drinking and its associated harms. As other speakers have said, we know that in order to stem the tide of this desperate problem of binge drinking by young people, we cannot just put up ad hoc proposals in isolation from the overall drinking culture of the nation. We think the Alcohol Advisory Council Amendment Bill is heading in the right direction in terms of putting in place different approaches to address those who have the responsibility of purchasing alcohol and supplying it to our young people.

The bill proposes to calculate the levy for each product according to an alcohol classification band stream similar to the approach used by the New Zealand Customs Service to collect alcohol excise and excise-equivalent duty. A dollar amount per litre would be set according to the beverage’s alcohol content or deemed alcohol content. Beverages with higher alcohol content will contribute a higher proportion of the levy. It is not a quick fix or a one-stop catch-all to improve industry compliance and responsibility and to put the focus squarely at the feet of alcohol barons and the alcohol industry; in many ways, it is just tidying up the regulations and making the new system easier to operate.

Five years ago the 2004 Ministry of Health review of the levy-setting mechanisms found that the way the levy is calculated and apportioned is outdated and overly complex. The levy calculation system used to be very complex; some levies were calculated by volume in litres and some by the percentage of alcohol per beverage. The purpose of this legislative amendment is to get the levies all calculated on the basis of alcohol by volume in order to achieve a standard measure and a consistent approach applied across all alcoholic beverages. What is good for wine and cider will be good for beer and spirits. It is not about the brand that we are drinking, but about the amount of alcoholic content that we are consuming. We believe that these changes are for the good.

In essence, the changes will ensure that alcoholic beverages with a higher volume of alcohol will contribute a higher proportion to the levy, but they do little to address 4-year-olds replacing Fresh Up with Lion Red. They do little to address the fact that young people are more than twice as likely to suffer from alcohol-related harm as other age groups. We know that the issues are pretty overwhelming. The drinking behaviour of young people all too frequently ends up with road trauma, violence, depression, suicide, disruptive relationships, high-risk sexual activity, delinquent behaviour, decreased productivity at work, increased absenteeism, and educational failure. Some of the images on TV recently about what young people get up to adds fuel to the fire. Updating and simplifying the current mechanisms for setting ALAC’s levy will not solve all this raft of problems; they cannot be addressed by one solution. They require a multifaceted, multi-pronged, holistic approach.

ALAC itself has plenty more ideas to share with the House, which we should listen to if we are truly committed to doing something about the complex problems associated with alcohol misuse and abuse. ALAC was established over three decades ago in 1976 following the report of the Royal Commission of Inquiry into the Sale of Liquor. That commission recommended establishing a permanent council to encourage responsible use of alcohol and minimise its misuse—and so it has come to pass. ALAC’s key objectives in all of its activities are to promote moderation in the use of alcohol, discourage and reduce the misuse of alcohol, and minimise harm resulting from the misuse of alcohol.

We hope that the amendments recommended by the Health Committee and the new system of alcohol classification bands may have some impact on the range of alcoholic beverages manufactured in or imported into Aotearoa. As we understand it, the revised standard provisions for the ALAC levy will not necessarily affect the price that consumers currently pay for alcoholic beverages, but the changes may influence the proportion that each type of alcoholic beverage contributes towards the ALAC levy. We in the Māori Party will be interested to hear from the Minister of Health as to exactly what impact—and the scale of the impact—we can expect of the changes introduced today. We intend to continue to talk of the impact that alcohol abuse is having on our communities, along with the dreaded P epidemic and, of course, smoking.

We believe that significant changes to the Sale of Liquor Act are needed. The Act has a predominantly business focus, where alcohol is a mere commodity that can be bought or sold. It is our firm belief in the Māori Party that the Act needs an increased public health focus and a focus on reducing alcohol-related harm—that is, addressing the physical and sexual violence, accidents, crime, and arrests that have been mentioned before.

We note the statement from the Minister of Justice that connects alcohol to the rising tide of crime, and we go further and suggest that addressing alcohol misuse and abuse must go across all sectors, all portfolios, and all age groups. The Māori Party will support changes to the proposed regime, but we signal our concern about many other issues, such as excess quantities of alcohol being consumed by our young people. We know that fixing the levy is a partial solution; real solutions are likely to be more effective when coordinated across the board with a multilevel approach in society. Real solutions will involve stakeholders at all levels. Most of all, real solutions will involve our families and must engage our whānau. We support this bill at the second reading and look forward to a prompt and effective hearing of the wider issues in front of the House.

The ASSISTANT SPEAKER (Hon Rick Barker): Thank you. I just remind members that cellphones are not to be ringing in the Chamber. The usual tariff is morning tea. With 122 members, the Clerk’s Office, the Hansard reporters, and the messengers, members could end up with a worryingly large Bellamy’s bill at the end of the month.

SUE KEDGLEY (Green) : The Green Party will be supporting this Alcohol Advisory Council Amendment Bill but without huge enthusiasm. The previous speaker, Te Ururoa Flavell, asked the rhetorical question of what impact the bill would have on the huge problem of alcohol abuse in New Zealand. The answer is sadly very little, if any. It seems ironic that we have a huge and growing problem of alcohol abuse and a culture that absolutely tolerates alcohol in New Zealand, yet this Parliament, rather than addressing that issue, has come up with a bill that does some technical amendments to calculate the levy on alcohol content, which, frankly, will have very little, if any, impact on the consumption of alcohol in New Zealand.

I certainly agree with the previous speaker that we have a huge culture of abuse in New Zealand, particularly amongst our young. One of the issues we raised when this bill was being considered at the Health Committee was alcopops. Why is this bill not dealing with the issue of alcopops? We know they are drinks that are almost predatory, in my view. They are targeted at young New Zealanders. They are very, very cheap. Young New Zealanders are made to think that they are drinking just lemonade and soda, but, in fact, they are drinking alcohol. If there was one single thing that we could be doing to try to reduce the amount of binge drinking amongst young people it would be dealing with the issue of alcopops. We tried to get this issue dealt with when we were considering this bill, and we were told that it was absolutely outside the scope of the bill and we were not able to deal with it.

The other issue we should be discussing, if we are really serious about addressing the culture of alcohol abuse in New Zealand, is the fact that alcohol is on sale virtually everywhere we turn in our society—in every supermarket and dairy in the land. So how can we say we are seriously trying to reduce the amount of consumption of alcohol by young people and wring our hands about the culture of abuse if we are going to have alcohol available, advertised, and on display in every dairy and supermarket everywhere we turn in New Zealand? These are the issues we ought to be addressing today, and I am very, very sad to say that, frankly, we have come up with, I think, a rather irrelevant bill—a technical amendment. All it does is calculate the levy on alcohol content. It is not going to affect the amount of consumption of alcohol in New Zealand. The Green Party is very sad that we are not able to use the opportunity of legislation on an important issue—alcohol abuse—to actually tackle the real problems and the causes of the problems instead of this rather trivial technical amendment.

Finally, there is no question that if we are concerned about drug abuse in New Zealand then we must accept that alcohol is overwhelmingly the issue we should be concerned about. We have to ask ourselves why we have such a culture of tolerance. Why do we encourage young people to drink this stuff and then all wring our hands and carry on about how terrible it is that they get dressed up in togas and get drunk in the streets down in Dunedin? That is the inevitable consequence of our culture of tolerance and of the fact that alcohol is available everywhere we turn and that everything is encouraging the consumption of alcohol. There is no point in being hypocritical. Until we address the causes, there is no point in just wringing our hands about alcohol abuse. What a sad day it is that this Parliament could not deal with the real causes of alcohol abuse rather than with just some technical amendment. Thank you.

Dr JACKIE BLUE (National) : I am pleased to rise to support the second reading of the Alcohol Advisory Council Amendment Bill. This bill amends a 30-year-old Act, the Alcohol Advisory Council Act 1976. The bill in front of the House is a technical amendment to the Act. In 2004 the Ministry of Health reviewed the levy-setting mechanisms of the Alcohol Advisory Council Act 1976 and found four major problems, which are dealt with by the new bill.

The first problem was that the levy-setting mechanism is outdated and based on only four classes of liquor. The old Act uses proof litres, which have not been used to measure spirits since 1986. The New Zealand Customs Service measures spirit volumes as litres of alcohol. The review also found that the current levy-setting mechanism is unnecessarily complex when compared with the method of setting excise and excise-equivalent duty based on alcohol content. Finally, the review noted that although the current Act allows the levy to be set by the Minister of Health by Gazette, there is no process for Cabinet to be involved. The Ministry of Health review felt that this was inconsistent with other levy-setting approaches. This bill updates and simplifies the current mechanisms for setting the Alcohol Advisory Council (ALAC) levy, which is imposed on all alcoholic beverages manufactured or imported into New Zealand. The original bill when it was introduced in the previous Parliament proposed to align the ALAC levy according to alcohol classification bands, which is similar to the approach used by the New Zealand Customs Service. In essence, this means that higher-volume alcohol drinks would have a greater levy than lower-volume alcohol drinks.

There is no doubt that the proposed legislation is fairer and modernises current practice. The proposed regime is also simple to calculate and has been worded in such a way that new composition alcohol drinks not yet thought about or designed, other than beer, wine, fortified wine, or spirits, can be accommodated. Who would have thought back in 1976 that ready to drinks would be one of the biggest growth markets, particularly with young people? The new regime is flexible enough to allow for the emergence of new types of beverages that would not easily fit into any liquor class in the current system, such as ready to drinks. This is not a contentious bill. It was heard by the Health Committee of which I was a member in the previous Parliament. The Health Committee was sure that this bill would have minimal impact and would be far easier to operate. Indeed, it was evident from submissions that industry groups, including producers and importers, were generally supportive of simplifying the process of calculating the levy. We were told that the price changes would be very small. The estimates were less than 1c per bottle of wine, six-pack of beer, or four-pack of ready to drinks, and 2c for a 750ml bottle of spirits.

The Health Committee recommended some changes to the original bill. We were concerned that there was inconsistency between the excise and the ALAC levy-collection systems. For example, in the original table of the original bill, table wine with more than 14 percent alcohol would have incurred a higher ALAC levy than table wine of lower than 14 percent alcohol, but under the current excise both would incur the same levy. The Health Committee felt that this was inconsistent. As an example, the new table provided ensures that there is consistency between the two systems. For the table wine example I just gave, in the new table there are six classes. Class C is for drinks of more than 6 percent alcohol but not more than 9 percent. Class D is for drinks of more than 14 percent alcohol but not more than 23 percent. Retaining the levy but aligning it to excise was the option supported by the Government and most stakeholders, as it is simpler than the current method, as well as cheaper and more transparent than other alternatives.

One other change was recommended by the Health Committee. The definition of rate has been inserted into the bill to clarify that it is a percentage figure given in the schedule of the bill. Importantly, this bill does not address measures to reduce alcohol-related harm. That is not its intention; that will be for future debate and legislation. This bill aims to simplify the calculation of the levy that funds ALAC, which has a significant role in reducing the burden of alcohol-related harm. I acknowledge the important work that ALAC does, and it will continue to receive the necessary funding to continue its important work in encouraging responsible consumption of alcohol and minimising abuse. ALAC has existed since 1976 when a royal commission recommended its establishment following an inquiry into the Sale of Liquor Act. Its budget for the 2007-08 year is $12.5 million.

There is no doubt that in the community there is a growing concern about the effect of alcohol, and the community wants to say more. This has been clearly evident in Mount Roskill. Last year the community in Roskill South came together to oppose the imminent opening of a liquor outlet store that was 100 metres from two schools, a kindergarten, and a church. If the proposal had been successful, it would have meant there would be 10 outlets in the Roskill South area. The community was very concerned about the serious and growing incidence of youth crime and violence in the area, and it felt that alcohol would only fuel that trend. The community was extremely concerned that the current legislation, the Sale of Liquor Act 1989, had no teeth to stop licences being granted where density and location were major concerns. Members of the community were concerned about research that showed a direct link between the number of alcohol outlets in a community and alcohol-related harm and violence. They were very concerned that the local body alcohol strategy, the Auckland strategy, had no legal status. I was very impressed by their passion and the fact that they were united.

Rarely has a community come together in such a united way. I am pleased to report to the House that the community was successful and that the proposed outlet did not go ahead. The activism from this small community has given me hope for the future. But my community is not alone. Many communities all over New Zealand are up in arms and are determined to have a say. That will be for the House to consider in future debate and in future legislation. In summary, in the second reading of this bill, the Government supports this bill and the amendments that have come through after the bill’s consideration by the Health Committee. Thank you.

STUART NASH (Labour) : Like everyone in this House, I rise to speak in support of the Alcohol Advisory Council Amendment Bill, and, like my colleagues before me, I welcome the change that this bill will facilitate. Any bill that provides a level of consistency across any form of industry and/or product can be only a positive step in the right direction.

Even though this bill is technical in nature, we must, as parliamentarians, always work to ensure that all legislation is fair, up to date, and simple to calculate. Not only this but also we must work to ensure that as far as possible we work to future-proof legislation, to take into account possibilities imagined that have not been realised.

I think we all know that the Alcohol Advisory Council (ALAC) does a magnificent job and is a very important body in the delivery of social outcomes to our diverse communities. ALAC was set up by Norman Kirk’s third Labour Government and is just one of the many examples of how Labour has put in place checks and balances through having workable, credible councils to help mitigate the risks of social harms through education, advice, and counselling.

When we think about the harm carried out through the excessive consumption of alcohol by those who lose control when under the influence we understand how necessary it is for an organisation such as ALAC to exist. One of the most famous and public falls from grace under the influence of the demon drink was that of the Rt Hon Sir Robert Muldoon when he called a snap election in 1984 while rather inebriated. That was not damaging to the country; in fact, the outcome was hugely positive. But one cannot help but wonder what might have happened if Sir Robert had taken the advice and had seen the educational material put out by ALAC.

We probably should be thankful that Sir Robert did not mothball ALAC as he did Big Norm Kirk’s superannuation scheme, which, if kept in place, would today be worth billions and billions of dollars, and we would not have had to debate legislation around capital markets, as we did earlier this evening.

Now let us fast forward to the 21st century and leave behind notable alcoholic politicians. Well, in fact, we cannot go past this serious topic without injecting a note of humour into the debate. The most famous quote from an inebriated politician comes from one Winston Churchill in a conversation with a Mrs Braddock, who said: “You are drunk, Sir Winston. You are disgustingly drunk.” “Yes, Mrs Braddock, I am drunk, but you, Mrs Braddock, are ugly. Tomorrow morning I, Winston Churchill, will be sober.” Perhaps Sir Winston’s New Zealand political namesake, who left this Parliament at the previous election, took too much notice of that great man’s habits.

On a more serious note, as I was saying, let us move into the 21st century. ALAC does a fantastic job with a very limited budget of only about $13 million. As members of Parliament we have all heard stories from victims who have felt and experienced the effects of the misuse of alcohol, and from councillors and organisations that are there to deal with the effects of the misuse of alcohol. ALAC’s role is extremely important and will become more so as this economic crisis starts to deepen even further into the bowels of society, and for those for whom life has lost its purpose and are tempted to turn to alcohol for solace and company.

Families suffer, communities are polarised, and public health services are stretched. It is in times like these—which we will, unfortunately, experience over the next couple of years—when organisations like ALAC come to the fore. ALAC does a fantastic job in the areas of strategy formulation and implementation around the use of sensible drinking and work to minimise alcohol misuse and abuse. ALAC also undertook valuable research—

Paul Quinn: According to the previous speaker, they’re not.

STUART NASH: I ask that member when Louisa Wall is to represent New Zealand rugby in this House. I think she might have played for the All Blacks, did she not? Anyway, I am sorry about that; I digress. ALAC also undertakes valuable research, disseminates information, and runs educational programmes and innovative treatments for programmes designed to target those who are at risk.

Paul Quinn: Do you know what rugby is? Have you played the game?

STUART NASH: Louisa Wall was a great rugby player—probably the best rugby player this House has seen since Grahame Thorne. There is still a long way to go, however. We, as public representatives, must not only ensure that ALAC survives but also that it is provided with the resources necessary to make a difference at a time when some people in this House, while playing rugby, took too many knocks to the head and drank too much alcohol at the after-match function.

Hon Member: Paul was all right.

STUART NASH: Yes, he was. But I must admit that it is on that note that I will register my support for the Alcohol Advisory Council Amendment Bill. Thank you very much.

NICKY WAGNER (National) : I rise to support the second reading of the Alcohol Advisory Council Amendment Bill. As we are all aware after tonight’s debate, this is only a technical amendment to the Alcohol Advisory Council Act 1976.

The Greens are disappointed that this bill does not tackle the problems of alcohol in the community. That is not the purpose of this bill, and that is not part of the scope of this bill. This amendment is designed to produce an updated, streamlined, and cheaper calculation system for the levy that funds the Alcohol Advisory Council (ALAC). ALAC was established in 1976. It was set up following a report by the Royal Commission of Inquiry into the Sale of Liquor. The commission recommended the establishment of a permanent council that aimed to encourage the responsible use of alcohol—which is just as relevant today as it was in 1976—and to minimise the misuse of alcohol, and ALAC has been doing that useful work ever since.

This amendment retains the existing levy, but it aligns the levy with the separate excise and excise equivalent duties that are also calculated on alcohol. This will make the levy easier to calculate and more transparent. The amendment is also designed to reflect the current alcohol market. For example, it repeals four different definitions of wine and replaces them with only one. It is also designed to future-proof the levy calculation process, so that it automatically includes future new types of alcohol products—things that we may not have thought about quite yet. It will also catch the present newest products, such as ready to drinks—the ready-to-drink alcohol mixes. Yes, they have been considered a difficult thing for young people to deal with, and they are commonly known as alcopops. They will be caught in this levy, as well.

Operationally, the changes will not significantly affect those who pay the levy, and the price changes will be minor. They will be less than a cent on a bottle of wine, a six-pack of beer, or a four-pack of ready to drinks. The changes are all supported by industry groups, producers, and importers. The levy funds ALAC, and ALAC has a significant role in educating New Zealanders to use alcohol sensibly and reduce alcohol-related harm. The money will be used to support ALAC’s work in four different areas: to fund research, to help disseminate information, to support education programmes, and to look into innovative new treatment programmes. ALAC leads research in alcohol and alcohol-related subjects in New Zealand. The ALAC website is a repository of numerous research documents, publications, and web links. It provides useful guidelines, supports training and community groups, and provides advice on managing events.

ALAC is absolutely focused on educating New Zealanders about alcohol and how to manage alcohol. Most members will be aware of ALAC’s controversial binge-drinking advertisements. These advertisements show graphic examples of excessive drinking that leads to harm. The advertisements are so hard-hitting and shocking to the public that they have actually won an award for effective advertising, and for cutting through the clutter of the advertising space. The ALAC chair, Peter Glensor, acknowledges that the commercials are unpleasant, but, as he says, “so are the consequences of binge drinking”. The ads mirror what is unfortunately happening every week around the country, and these ads have proved to be enormously high profile. Research shows that 94 percent of adults remember seeing at least one of the ads, and many members in the House tonight will also remember them. Members might recall the ads featuring the young woman who gets drunker and drunker over a long evening of drinking in the pub and at clubs, or the two men who come to violent ends—one after spending the night, round after round, in the pub, and the other after socialising at a barbecue with family and friends. I do not know about others in the House, but I cannot watch the ad that shows a dad playing with his boy. Early in the evening, the games are full of fun and laughter, but later in the evening, the drunkard dad swings his young kid round and smashes the boy against the furniture. There is an absolutely sickening thud as the son hits the sideboard, and then, of course, there is chaos in the family. They are shocking and graphic ads, but they are incredibly memorable.

Again, the research tells us that nearly all adults are aware of the “It’s not the drinking. It’s how we’re drinking.” message that accompanies the ads. Interestingly enough, over half of the drinkers surveyed reported that after seeing the ads, they thought about how much they drank and discussed it with their families or friends, or thought about how much they drank and started to drink less.

ALAC is doing very effective work in our community. We want to see more of it; therefore, the Alcohol Advisory Council Amendment Bill will ensure that the levy that underpins ALAC’s work will be collected in the most cost-effective, simple, and efficient way. I therefore support this bill.

Hon SHANE JONES (Labour) : Kia ora anō tatou. I stand to support the Alcohol Advisory Council Amendment Bill. The word in Māori for alcohol is waipiro—rotten water, or nauseating water. Of course, we do not need to look at alcohol; we can look at sights around this House to feel nauseated. I feel the need to add some clarity to what Mr Nash said in respect of the current Māori representative in this House of New Zealand rugby. He was asking when that member will stand down and let Louisa Wall, a fearless Māori advocate for the Māori All Blacks, take his place. That is what he was saying. She has more time, and does not have a history of drinking far too much after the game.

But let us come back to this well-crafted bill. This bill is a timely reminder to parents, families, and the House that we can never stamp out the drinking of too much alcohol, but we must ensure that one area remains heavily regulated. It is what I call the lollipop alcohol drinks. Those drinks have created utter havoc, in particular in our own community, Te Ao Māori, amongst our rangatahi. After Michael Erceg’s sale of his alcohol empire to a private equity company—and, boy, I bet that company is sweating and wishing it never paid that much for it now—no company can plan to go on selling these lollipop alcohol drinks, which create carnage and destruction amongst families etc., without contributing to the need to have our families educated, and to challenge our parents, our schools, ourselves, and the community to use alcohol moderately: “Unumia te inu engari kaua e tuku ko te inu hei rangatira mōu—drink with pleasure, but don’t allow the drink to be the rangatira for you.”

That is why this bill contains some sensible suggestions, why it should go ahead, and why it will no doubt be focused on those areas in which alcohol is changing its shape and form, although its ability to make the consumer feel very piro has never changed. The bill should go ahead. Kia ora tātou katoa.

Hon MAURICE WILLIAMSON (Minister for Building and Construction) : Thank you, Mr Assistant Speaker—[Interruption] I thank members of both sides of the House for their warm accolades. I am really happy to take a brief call on the Alcohol Advisory Council Amendment Bill, because I think there is some merit to the bill. But I heard some comments while I was in my office that made me come down. As Minister of Customs, I am responsible for enforcing some of the excise—

Hon Annette King: What? Are you Minister of Customs?

Hon MAURICE WILLIAMSON: So they tell me, I say to Mrs King. I thought tonight I would go through some factual bases to give a counterfactual. I say to members that this is not meant to be rude nor meant to be embarrassingly nasty or anything, but I heard Sue Kedgley talking before about the damage that the high number of alcohol outlets can do to our society.

I hope members will listen to this, because it really is from the heart. I will give members two absolutely gospel stories, and then let them think about whether this makes a difference. I go back to the year of 1981, when I was working for British Airways. I was seconded to work for Aeroflot Soviet Airlines in Moscow. I went to Moscow under the Brezhnev regime, and I arrived one grey, very cloudy, awful day in the afternoon. As we got into downtown Moscow and were pulling into the hotel, I asked my driver: “What is that big queue over there? Is that for the Bolshoi Ballet?”. He said: “No, sir. That queue right there?”, and I said: “Yeah, the one that goes round the corner from that big, old concrete building.” He said that it was for the liquor outlet. My ears pricked up and I asked whether the shop had a special on today, thinking that could be the only reason for a queue. He said no. I ask members to listen. The only alcohol that people could buy in Moscow was from a Government-owned store that opened from 3 in the afternoon until 6. It was open for only 3 hours.

There were no ads anywhere in Moscow. People would not see ads on TV, on billboards, or in the newspaper. The existence of alcohol was not even mentioned. Yet while I was there over the next few months I witnessed the worst level of alcohol abuse and drunkenness I have ever seen. People on the bus coming home from Aeroflot flights some nights were so absolutely blotto, and throwing up on the bus, that one actually got off the bus and tried to get on another one. In the park across the road from the hotel where I was staying people were on the park benches throwing up. It is no good telling me whether it is right or wrong. This is just a factual statement about the fact that booze was available only from 3 p.m. until 6 p.m. from a Government outlet, and I have never seen such abuse of it in my life.

Thank God I was then transferred to do some work at Airbus in Toulouse. The difference was stunning. As one drove in from the airport into the city of Toulouse, there were billboards as far as the eye could see, with beautiful ladies draped over the bonnet of a Daimler or a Bentley, drinking Rémy Martin, Kahlua, or Moët et Chandon. Every newspaper one picked up would have adverts. Every magazine had stunning, glossy pictures. In every shop in Toulouse, the little town where I was living, one could buy alcohol. Every family I knew had alcohol available. Even the kids of the French family that I was staying with at Airbus were allowed a glass of wine—

The ASSISTANT SPEAKER (Hon Rick Barker): I have a point of order.

Hon MAURICE WILLIAMSON: —and there was no alcoholism whatsoever.

The ASSISTANT SPEAKER (Hon Rick Barker): I have called for order. The member heard; he should stop speaking immediately.

Hon MAURICE WILLIAMSON: I did.

The ASSISTANT SPEAKER (Hon Rick Barker): Excuse me; the member did not stop speaking. He should not say he did, when he did not.

Stuart Nash: I raise a point of order, Mr Speaker. I thought we were talking about the Alcohol Advisory Council Amendment Bill, not about Mr Williamson’s overseas travel experiences in Russia. I am just wondering what the relevance to this bill is.

The ASSISTANT SPEAKER (Hon Rick Barker): I just say to the member that it has been quite a friendly and wide-ranging debate. We have heard about football matches. We have heard about representation. We have heard all sorts of things. If we were to take that point we would have done it a lot earlier. Let us continue with the debate, please.

Hon MAURICE WILLIAMSON: Thank you, Mr Assistant Speaker. I came to the conclusion—and obviously Mr Nash does not like the idea of what the conclusion is—and the conclusion is simply this. In one place, alcohol was totally regulated, totally controlled, limited in access, not advertised, and not even spoken about, and the actual social outcomes were appalling. In the other place, it was as freely available as anyone could imagine. It was openly promoted. It was an ordinary, everyday product, and I never once saw a drunk person in Toulouse—ever. Members can take that story anyway they like. All I am asking is for members to compare those two societies and decide which one they would rather have.

I know that some of the hard-line lefties on the opposite side of the House still think the Brezhnev regime was great. They still think that Moscow in 1981, with everything locked and regulated, was the way to go. I feel sorry that there are still people who think like that in Parliament. But I ask members to think very seriously about that matter.

The intention of this bill is to get some funding from the excise on alcohol for the Alcohol Advisory Council (ALAC) to do what I think has some merit. Alcohol has a major downside to it—we all know that. While ALAC is involved in promoting harm minimisation, in trying to encourage responsible use, and in trying to encourage post-intervention and server intervention along with the other programmes it offers, I am very willing to sign up to legislation that lets us take a small sum of money as an excise tax from the alcohol being sold, and to use that to fund those sensible, moderation-type programmes.

I want members to think about this as a last question. One society—it was not Russia, and it was not Toulouse—decided that alcohol was so evil that it would ban it altogether. I want members of this House tonight to give me a score between one and 10 as to how they think prohibition went, with one being really awful and shocking, and 10 being stunningly successful and the way to go.

Paul Quinn: Zero.

Hon MAURICE WILLIAMSON: I hear my friend Paul Quinn say “zero”. I think that zero is too high. I should not say this about some members of the Labour Party, but I do not believe that anybody with half a brain in his or her head thinks that prohibition was a successful way to go.

Hon Phil Heatley: Al Capone.

Hon MAURICE WILLIAMSON: My good friend and colleague and the member from Whangarei, Phil Heatley, reminds me that some people did think it was a good idea—Al Capone, for example. He thought that prohibition was a cracker. My worry about this whole alcohol debate is that some neo-prohibitionists out there believe—

Grant Robertson: Where?

Hon MAURICE WILLIAMSON: I say to Mr “Whatever his name is”—I am hard pressed to give names and electorates for some of the new members; I am not trying to be smart—that there are even some neo-prohibitionists in this Parliament who think that the best thing we could do is to lock up the alcohol and throw away the key, and that everything will be all right.

I say to members of this House that the exact opposite is the truth. The more responsible our attitude is and the more we encourage education, server intervention, host responsibility, and harm minimisation—all the good things associated with the work that ALAC does, and I am delighted that it is there and doing that work—then the more likely it is that we can look forward in hope that New Zealanders will have an attitude to alcohol that is sensible and sane. We are more likely to have a good attitude than one of pulling down the blinds, going with prohibition, and wreaking the worst havoc we can.

I say again that I support this bill. I think that having the level of excise related to the alcohol content is a sensible way to go. Some alcoholic drinks are very strong and require very small volumes for people to get out of them whatever it is they are seeking. Other drinks have very low volumes of alcohol relative to their volume, and I think that such a levy is the right way to go. I repeat, just as a counterfactual, that if members of this House think this problem will be fixed by locking up the number of outlets and blocking this activity and making it illegal, then I ask them to please look at history. It has not ever happened anywhere else.

• Bill read a second time.