The CHAIRPERSON (Ann Hartley): The House is in Committee on the Appropriation (2005/06 Estimates) Bill. The Standing Orders provide for 8 hours of debate on the estimates. Each member may have no more than two speeches of 5 minutes on each vote. The estimates debate should be relevant to the Government’s current spending plans as contained in the Estimates of Appropriations.

As each vote is reached, a question will be put that that vote be agreed to. If it is the wish of the Committee, I will put the question on groups of votes by a Minister until a vote is reached that members seek to debate. A separate question on that vote will then be proposed from the Chair. Should it be the wish of the Committee, a question may be proposed on two or more related votes for the purpose of debating them together. At the conclusion of the 8 hours of debate, any remaining votes and the remaining provisions of the bill will be put as one question.

The Government indicates which votes are available for debate. I understand that all votes are available in order of seniority of Ministers, commencing with the Speaker’s votes. Copies of the order of votes to be considered are available on the Table.

METIRIA TUREI (Green) : I raise a point of order, Madam Chairperson. Please excuse my confusion. I want to address Vote Parliamentary Commissioner for the Environment. Does that mean I should state that now, or wait until you raise that yourself? Please excuse my ignorance on this matter.

The CHAIRPERSON (Ann Hartley): It comes up later. There is a list here.

Hon KEN SHIRLEY (ACT) : The Parliamentary Service is unique as a Crown body in many respects. Its governing body is actually a commission of politicians. I think we all agree that politicians do not make a good governing body. The other, somewhat unique, aspect is that the equivalent of the Minister is the Speaker of this Parliament. In terms of the expenditure of taxpayers’ money, the Speaker is accountable on behalf of the Parliamentary Service.

It is in that light that I debate this particular item of the estimates. We have a Members’ Handbook of Services, prepared by Parliamentary Service staff, that specifies quite clearly what is appropriate for members of Parliament to spend taxpayers’ money on out of Vote Parliamentary Service, and what is inappropriate. It is spelt out very clearly.

I have to say that a few months ago I became very concerned when I saw advertising on bus stop shelters all over the countryside sprouting up, and I have a photograph of one. They were in Labour Party red, and had the message: “You’re better off with Labour”. That was the only message on the advertisement. The Labour website and the Labour Party’s logo were there in Labour Party red; and then, blow me down, I saw a parliamentary New Zealand House of Representatives crest on it. One could only assume that this was a means, on that basis, for the Labour Party to be dipping into the trough of the taxpayer to fund Labour’s electioneering campaign, with a basic message saying: “You’re better off with Labour”. I ask the Speaker in the chair whether that is appropriate.

I was so concerned that I wrote quite a long letter to the Speaker, who is in charge of the Parliamentary Service Commission, outlining my concern, and drawing her attention to the Members’ Handbook of Services. I refer the Committee to rule 1.33, and under 1(b) it defines parliamentary business very, very clearly. There are three bullet points. The first point covers what is not included in parliamentary business, which is “soliciting, subscriptions, or other financial support for a political party or candidate at an election.” The second bullet point, which is the one I draw the Committee’s attention to, states that parliamentary business is not “party political, promotional, or electioneering material for the purposes of supporting the election of any person or party.”

In my view the Labour Party’s hoardings—their bus-stop shelter advertisements around the countryside—paid for by the taxpayer, through Parliamentary Service, were clearly not parliamentary business; they fell fairly and squarely under that second bullet point about “party political, promotional, or electioneering material for the purposes of supporting the election of any person or party.” It is very clear, indeed.

I was disappointed that the Speaker took over a month to reply to my letter expressing concern. A number of issues arise from that, which I want to put to her now. Firstly, did she receive advice from Parliamentary Service staff following receipt of my letter of 8 June about Labour election advertising, because in her reply she indicated that it is normal to seek advice? Did she seek advice, and, if so, what was that advice? Is she prepared to tell us what that advice was? My second question is whether the Speaker received advice from Parliamentary Service staff following my letter to her of 8 June concerning Labour election advertising; if so, did she follow that advice? So I would like to know what the advice was, whether she followed the advice, and if not, why not.

With reference to my letter to her of 8 June, in her reply she referred to the matter as a marginal call. My question is whether that was Parliamentary Service staff labelling it a marginal call, or whether that was her interpretation? I would appreciate a response to those questions.

Madam SPEAKER: I thank the member for raising this matter. As he correctly said, he raised it with me. I apologise for the time that it took to respond, but it did take time, because I received several different streams of advice from several different parties, including Parliamentary Service. At the end of the day, the decision was mine to take. I took that decision.

As I said to the member, it was a marginal call, and I agree with the Auditor-General that certainly it is time that these whole guidelines, as they are characterised—not rules, but guidelines—need to be reviewed. Therefore, I hope that the Parliamentary Service Commission will see itself clear to be able to address this issue, if not before the election—unfortunately because time does not permit—but certainly in the new Parliament. It seems to me that that is a matter of urgency.

• Vote agreed to.

METIRIA TUREI (Green) : The Parliamentary Commissioner for the Environment has done some amazing work in the last financial year, and we look forward to more of his significant and very important reports in the coming year. At the end of last year, the Parliamentary Commissioner for the Environment produced a report called Growing for Good: Intensive farming, sustainability and New Zealand’s environment. This report followed other similar, major reports, such as . Those reports have challenged our collective failure to address farming sustainability, in particular, in this country. Clearly, the biggest threat to farming and to the environment on which farming is critically dependent is the degradation of our clean waters, rivers, and streams. The agriculture sector is still the cornerstone of our export economy, but the fundamental advantage that it enjoys today springs from the historical accident of New Zealand’s clean, green image. Consumers are not going to continue to accept food from a system that is degrading water quality and overusing water quantity, and the fact is that 95 percent of our rivers and streams are now unfit for human drinking and swimming.

Growing for Good clearly identifies these major risks. Farming is becoming more intensive. Between 1994 and 2002 the number of dairy cows increased by 34 percent but the area of land used for dairying increased by only 12 percent. Intensification leads to greater use of nitrogen fertilisers and chemical pesticides, and the dairy industry has increased its use of urea fertiliser by 162 percent in just 6 years. Nitrogen and phosphorous fertiliser runoff is poisoning our streams and causing algal blooms and oxygen depletion. We hear more and more reports of our lakes dying, such as Lake Taupō, which has been poisoned by runoff that is 50 years old. Effluent disposal, especially from meat processing plants, and land use intensification are all contributing to the poisoning of our fresh water. Long-finned eels are now endangered, and short-finned eels are not far behind. Loss of habitat from this poisoning is the primary cause of their decline.

The medium-term outlook for our waters is very bad. The long-term outlook is disastrous if we do not act now. Even those who care little for our environment, for the species that we share it with, and for the New Zealand way of life that is our beautiful outdoors might be spurred to action by the major economic implications that will arise from our declining water quality. The loss of our clean, green image—no longer really deserved, frankly—will degrade the competitiveness of our food exports and environmentally-conscious overseas markets. The cost of upgrading our water quality systems to render our water fit for human consumption will rise. Our tourism industry will face more difficulties as tourist attractions, such as our lakes, degrade and die, and there will be increasing health costs arising from ill-health from the drinking of dirty water.

We have no choice but to act now, and to follow the recommendations of the Parliamentary Commissioner for the Environment in his report in order to repair our freshwater systems, because ultimately the measure of how successful farmers are is not how hard they are trying but how clean the water in our rivers and lakes actually is. Practical indicators to measure the sustainability of farming and to monitor the state of the environment are critical. The Ministry for the Environment is working on this, but it needs to be done urgently.

Project Green, stream fencing and planting, shed effluent management, and nutrient budgeting are all good, sensible initiatives for farmers. Those who have adopted them should be congratulated. Sustainable land-use practices will add premiums to our food-export markets and increase our market share. That is all good for farmers who take action now and who do not lag behind.

We must face the possibility that some limits will have to be put on the rapidly growing dairy industry. The faster and better farmers respond to the need for sustainable farming practices, the more likely it is that we can postpone or avoid the inevitable decline. If farming is to become sustainable, it must be rethought on the basis of ecological systems, not just on the basis of short-term economics. Farming cannot be economic if it is destroying both its own resource base and the natural capital on which our future depends.

The Greens look forward to further challenging reports from the Parliamentary Commissioner for the Environment in the future, and we hope that our country finally sees sense and does this work, which urgently needs to be done.

DAVID PARKER (Labour—Otago) : I am pleased to rise in support of this estimate. I concur with a lot of what the last speaker said in relation to the importance of one of the Parliamentary Commissioner for the Environment’s reports last year, called Growing for Good: Intensive farming, sustainability and New Zealand’s environment, which highlighted the degradation of waterways caused by the increasing rate of application of fertilisers, and in particular by phosphates and nitrates finding their way into our waterways. I think there has been something like a six or sevenfold increase in the rate of application of nitrates in New Zealand over the last 20 years, and that is having adverse effects on waterways. It is quite notable in parts of my own electorate in Otago. It is not just associated with dairy farming; it is also associated with the increasing intensification of land use generally.

One of the things that has happened as a consequence of increasing the profitability of farms is that land prices have more than doubled in rural areas. It then becomes more economic for a farmer to increase production by way of increasing the intensity of production from existing farm units, rather than by purchasing a bit more land to expand production in that way. The more intensive land use requires irrigation, high-energy usage to make that irrigation work, and higher labour utilisation, as well. Those higher cost structures, in turn, demand a higher return per hectare for the farmer, in order for that farm to be economic. That entails having more livestock per hectare, and, in order to feed them, more grass is needed per hectare, and therefore more fertiliser. So in the end that has created an enormous pressure on our rivers, because we are seeing that astronomical increase in the rate of nitrate application, in particular, on sheep farms, on deer farms, and, most noticeably, on dairy farms.

That meant that the Parliamentary Commissioner for the Environment became concerned about the issue and wrote his very good report, noting how fertiliser use was not just affecting fresh water on the surface but it was also becoming problematic in ground-water. I think the Parliamentary Commissioner quite rightly pointed out to the Local Government and Environment Committee and this Parliament that although we do not need very many things to live on this planet, we do need clean water, food, and shelter. Clean water is a most necessary part of that, and if we in a country like New Zealand, which is blessed by quite substantial water resources, cannot get it right and produce clean water by the time it flows into our oceans, what chance is there for the rest of the world to keep our oceans relatively clean and free from pollution? So the Office of the Parliamentary Commissioner for the Environment is an office that is showing its value, and I am very supportive of the provisions in this appropriation for the office to continue with that good work.

I note some of the remedies that are required to address this issue, but I do not think it is a case of the end of farming as we know it. I disagree with the Green member to that extent. I think that with better management of riparian margins, fencing of waterways, and greater care with the use of fertiliser, we will see a return to some health in our waterways. But we will also see an economic advantage to farmers, because at present they lose much of the nitrate they apply in the form of urea, through that being washed off their farms and lost from their farm production into waterways.

I am pleased that we are supporting the work of this office, and I recommend the appropriation to the Committee.

• Vote agreed to.

DEBORAH CODDINGTON (ACT) : The Government is seeking to spend $240 million in the coming year on arts, culture, and heritage. The Prime Minister made herself the Minister for Arts, Culture and Heritage, and the Associate Minister, who is now taking the chair, is the one who is usually poked out on a stick by the Minister herself to take the flack that comes with that portfolio. We have seen the funding go up and up every year. There was $17.2 million this year for Creative New Zealand. That is taxpayers’ money—up another million dollars on last year, and over a million dollars on the year before. It is just vote-buying from the politically correct, arty-farty, pompous, precious, self-appointed, elitist experts, who spent half a million dollars sending a pile of rubbish to the Venice Biennale and making us the laughing stock of the art world. As I said, Creative New Zealand received $17.2 million.

What did the Prime Minister say this time last year when the controversy first arose? The Prime Minister, the Minister for Arts, Culture and Heritage, said she was not happy with that selection. She believed that the conditions and selection criteria had been breached, and that in the future it might affect her thinking. What did she say? “It might affect my thinking about future funding for Creative New Zealand.” Did she go back and order a review? Has she ordered a report? Are we any the wiser? No! We now see that another million dollars will go into Creative New Zealand.

Just a few minutes ago in question time another Minister stood up and boasted that the Government is spending $14 million on cancer prevention, but we are spending $17 million of taxpayers’ money on arts and culture and we are not allowed to know where it goes. Why are we not allowed to know where it goes? Because the Minister for Arts, Culture and Heritage allows her Creative New Zealand to get away with not forcing the recipient of that money to front up to taxpayers, and she allows Creative New Zealand to breach the selection criteria.

In 2003 when we sent a pile of Land Rovers to the Venice Biennale, the Minister was not amused at that, either. She made it known to Creative New Zealand that in future the recipient of that funding of half a million dollars must act in an ambassadorial role. So what did they send this year? They sent something called Fundamental Practice, which is a pile of fences and old computers, said to be “menacing wire fences, computers, Dalek-like moving sheds, images, and sound recordings”, for half a million dollars! And that is while 111 calls are abandoned by New Zealanders, and while people die on waiting lists.

I do not want to live in a country that does not have any arts. A person like me is considered a Philistine when I criticise the selection of that rubbish to go to the Venice Biennale—something I think is actually irrelevant. What is relevant is that it is half a million dollars of taxpayers’ money that we are spending while people are dying on waiting lists, and while schools have fund-raising to buy things like basic maths text books. To buy dictionaries, schools have to have sausage sizzles, and the Minister for Arts, Culture and Heritage tut-tuts about it. Of course, she could not tut-tut too loudly, because the person who received that money—et al, p mule, the et al collective, or whoever we are led to believe is the recipient of the money, was actually quoted in one of the reports as saying that the artist is the very person who is allowed to mislead the public. So, of course, that, translated to the Minister for Arts, Culture and Heritage, goes all the way down to misleading the public about who actually painted a painting that was signed and handed over for an art auction.

That is the whole culture of this arts, culture and heritage portfolio—another million dollars of it. It is a typical example of the “we know best”, “we know what’s good for you”, politically correct attitude. That is why this Government will not be around to spend up large on piles of rubbish after 17 September.

Hon PAREKURA HOROMIA (Minister of Māori Affairs) : I am not sure where that member has been, but there is a terrific celebration in relation to arts and culture in this country. On becoming the Government we injected $145 million into the arts through the Cultural Recovery Package, and placed the creative sector back on a secure financial footing after a decade of neglect under the previous National Government. In relation to Māori aspirations, the globalisation of Māori art in the last 5 to 6 years has been phenomenal. The Toi Iho trademark has been established. We are celebrating not just the fact that this country has the No. 1 economy in the OECD but also the fact that Māori cultural performances are being highly recognised by the representatives of hundreds of countries who are touring through the Aichi forum at the moment.

The Film Production Fund has been set up to boost the development of local films. Anyone who has been watching film development in this country over the last 5 or 6 years will surely give credence and credit to the Minister for pushing, shoving, and making sure that local films have a better platform in this country. The New Zealand film industry has attracted huge international interest and has certainly put this country on the international stage. Whether it is Two Cars, One Night, and whatever else—

Hon Ken Shirley: Oh, it’s a tax regime.

Hon PAREKURA HOROMIA: That member knows that this Government has provided a great injection. New Zealand On Air’s budget has nearly doubled. It had been left floundering. Members will have seen the targeted T-shirts worn in every town and city in this country in relation to the music resurgence—music engineered, written, and produced by New Zealand artists. It is just phenomenal, again. The music industry is to develop a voluntary New Zealand music quota, and that is dead right.

Brent Catchpole: Another Sound of Music coming up!

Hon PAREKURA HOROMIA: That is old hat. The reality of this Government’s performance in relation to this portfolio is that we have really shaken it up, and a lot of people are celebrating. The theatres and halls around this country that were dead and quiet are now ringing with a whole lot of activity, and that is no small thanks to a whole lot of effort from this Government. In relation to Māori and Pacific Island arts, the earning capacity—the increase in international recognition, in quality, and in sales that is going on—is huge. That has become a key, integral part of Māori moving forward.

I commend the fine performance by the Ministers in this portfolio.

Hon JUDITH TIZARD (Associate Minister for Arts, Culture and Heritage) : I am delighted to take a call in this estimates examination, and I am delighted to work with the Prime Minister, the first Prime Minister in New Zealand’s history who has chosen to be the Minister for Arts, Culture and Heritage. As she often says, in our small trading nation at the end of a globalising world, the debate about what is for sale and what is not for sale in this nation is the cultural debate. It is about what we value and who we are. It is about the attitudes we want our children to develop and take out into the world, as we all work together to make a prosperous, inclusive society. The arts are absolutely how we say who we are, and it is our culture—the debate about New Zealand identity and about how we make our living—that is being encouraged by this Government.

I am delighted to say that our statement of intent for the next 4 years includes some work around making sure that we get value for money in this area. I commend the Ministry for Culture and Heritage for the work it has done in a number of areas as we have expanded the Budget, but also as employment in and exports from this sector have expanded out of all proportion. These are the jobs and exports of the future. Every member of this House should understand that the creative industries—film, music, the visual arts, the design arts, and all of those areas—are how New Zealanders make their living, in many cases. Cultural tourism is a vital part of how we export New Zealand ideas and get New Zealand jobs. Our Cultural Diplomacy International Programme recognises that it is all very well to take fabulous New Zealand food and wine overseas, but that it is actually wearable art that brands New Zealand and gets people to come and spend their hard-earned dollars here, to make jobs for New Zealanders. I am delighted at the way this Government has worked through our major institutions. Te Papa has one of its most successful touring exhibitions, on The, travelling internationally, and has a number of major exhibitions going on, including a fabulous follow-up—on which it has worked with Toi Māori Aotearoa—to the Toi Māori exhibition that will go to San Francisco in the next couple of weeks. The work in Aichi at the World Exposition, and the whole area of the export of New Zealand artists’ work, is an important part of providing creative industry opportunities for all New Zealanders.

The films that are coming through will just amaze many New Zealanders. The $22 million this Government invested in 2000 not only produced Whale Rider and but will also bring us films like , which the ACT member who has just made her valedictory speech was abusing this time last year. It is an absolutely extraordinary film that will, I believe, make real waves and real opportunities for New Zealand film makers, including Vincent Ward. We will see celebrate Invercargill—celebrate New Zealand ingenuity, New Zealand courage, New Zealand energy, and the New Zealand sense of humour. It is a fabulous film. We should thank expatriate New Zealanders like Roger Donaldson and Vincent Ward, who have come back to make movies that they can only make as New Zealanders and make here. Many, many other films are in production and post-production, and they will be let loose on the world to go out there and sell New Zealand.

This portfolio is about how we make our living and how we make jobs for the future. I am very proud to front up to taxpayers on every dollar that is spent in this portfolio. I want to point out again that the member who made her valedictory speech was not listening. Creative New Zealand’s council said that it would do a comprehensive report after three efforts at the Venice Biennale. I was in Brisbane recently, and what was on the front page of the major arts newspaper in Brisbane? It was New Zealand’s show at the Venice Biennale. It is getting international coverage. I may not like it, but the whole point is that we do not live in Soviet Russia, and politicians do not decide what art should be out there. I say that we should let the creative people do that, and I will do my work as the Associate Minister for Arts, Culture and Heritage. I believe that a prosperous, decent, well-educated, stimulating society that includes all New Zealanders is what we are aiming for, and that is what we are doing with this vote.

• Vote agreed to.

STEPHEN FRANKS (ACT) : I have been a lawyer since 1976. Essentially, that is all my working life. I cannot remember any time when the independence of the courts and the openness, or the sunlight, we expect to be the disinfectant for our courts has been more at risk. The Attorney-General, I believe, is completely uninterested in this portfolio. The Attorney-General was put into this portfolio because the Labour Government could not find anyone else it could trust, but the Attorney-General needs to look into what the useless Minister of Courts is doing to uphold justice in this country.

At the moment I have a case where I have been trying to gain access to a court file since 4 July. My office called the Auckland District Court and asked whether it could find the reasons for a judge’s sentencing. I should explain the case very briefly. A young man with four children and no criminal record caught a burglar at night. He caught the burglar after a fight. He took the burglar to a service station—he dragged him there, in fact—and the service station workers called the police. He confidently expected that the police would interview them and deal with the burglar. It turns out that the burglar has never been charged or even questioned. Instead, our man was arrested. After seven court appearances, and missing work each day he appeared, he was discharged without conviction on the condition that he pay a fine or pay an amount to the Salvation Army, I believe. This is what I understand to have happened, because I have not been able to see the file.

Our justice system once boasted that it was open and transparent, and that everyone could see that justice was being done. When I asked for the file, the court registry told me that it would have to refer the request to the Minister for Courts—political vetting of access to justice. I waited and, 5 days later, I asked the Minister for Courts when this protocol or policy had been adopted. Ten days after the first request, I was told that the question would be referred to the judge. I still do not have either the file or an answer.

I went to the District Court in Auckland to try to gain access to the file, and I was denied. I was told that the judge was considering the request. Why do I want to find out? It is because it appears to me that both the police and the judge omitted to consider one of the fundamental rights of New Zealanders: the right of self-defence. It appears to me that the judge forgot completely about the right of citizen arrest, which is clearly set out in the Crimes Act and has never been repealed. It appears to me that the judge is part of the justice establishment that this Government feeds and that thinks people cannot be trusted with the rights they once had, that believes that only the police should be allowed to stop crime, that says people are foolhardy and tells them “Don’t be a hero.”, and that urges them to allow the crime wave to go unabated.

The judge in this case still has not come back to me, so I got in touch with the—

The CHAIRPERSON (H V Ross Robertson): The member needs to deal with the proposed expenditure of this vote.

STEPHEN FRANKS: This vote is Vote Attorney-General. The Attorney-General is the chief law officer of the Crown and is responsible for making sure that politicians do not trash the rule of law. What I see is that politicians in this Parliament, including the Minister for Courts, are presiding over political censorship of access to court files. The Minister gave me no answer when I wrote to him and asked where this protocol was, and why it was being invoked. The Chief District Court Judge has tried to persuade me that it is a mistake, but I have received nothing in writing from the Chief District Court Judge. I have received nothing whatsoever to satisfy me that this is not something that is endemic throughout this Government.

RUSSELL FAIRBROTHER (Labour—Napier) : Elections are exciting times, because sometimes we put an end to the meaningless drivel that passes under the guise of informed knowledge. If that man had had any legal training at all he would know that, since time immemorial, files and court decisions are the property of the judge. So one goes to the registrar, or now the court manager, and makes an application.

Stephen Franks: Which is exactly what we did.

RUSSELL FAIRBROTHER: No, one makes an application to the judge—not to the registrar, not to the Minister for Courts, not to the Minister of Finance, not to Rodney Hide, not to the Truth newspaper, not to one’s wife, but to the judge—and one asks to peruse the file. One states one’s grounds, and the judge considers whether one is being a nosy parker, a political troublemaker, or someone who has a legitimate interest and concern.

Of course that man, who once claimed to have a practising certificate—and in a few months’ time he may need it again, but he may find he has trouble in having it awarded, what with the drivel that now seems to emerge from his mouth, because there are standards these days for practising in law—will learn when he goes back to the Bar that legal aid may well be the only source of income he will find. His erstwhile clients, who previously paid out large bills without having insight into the advice they were getting, will no longer cough up after having read the parliamentary debates and the contribution made to them by that man. Instead, he will have to front up. The public will hear every word he utters in open court and they will say they will not have that man on legal aid, because they can do a better job themselves. They will say that there is no merit in the defences advanced on their behalf by that man, and that he should usher himself back off to the Securities Commission.

The CHAIRPERSON (H V Ross Robertson): Order!

RUSSELL FAIRBROTHER: But this is an important debate about the estimates for the Attorney-General. It is not one that should be trivialised by the meanderings of a lost left-winger, looking for a soul on which to attach his conscience. The Attorney-General sits as the titular head of the Law Society. He is not answerable to every want and every scurrilous, prurient concern of a constituentless member of ACT; he is there to administer the law in a political sense and in a titular, legal sense. The Attorney-General takes advice, of course, from the Solicitor-General. He discusses matters of operational efficiency with the judges, but he leaves the running of the judiciary entirely alone.

The fact that the member knows nothing of the separation of powers is a reflection on him, not on the Attorney-General. The fact that the member needs an education on the role of the Attorney-General should not be a charge on the estimates of the Attorney-General. The Attorney-General should not be required to come to this Chamber to teach that member what he should have learnt 45 years ago in law school—that is, assuming he went there at the age of 30. When I read through the report on Vote Attorney-General, I note that the member was on the Justice and Electoral Committee, which considered the vote. The matters he raises now, of course, were not raised boldly by that member when the Attorney-General came to the select committee. They were not raised boldly when the staff from the Solicitor-General’s office were there to answer those penetrating questions. No, the member carefully avoided the embarrassment of being told what the law is by people who know the law. Instead he stands up in this Chamber, while some people in New Zealand are listening to these proceedings by radio, and he expounds a line of drivel that the Truth newspaper stopped printing many years ago, when its circulation dropped to below 2 percent.

I endorse Vote Attorney-General. The previous speaker, who was once a lawyer, can point to no area in this vote that is unjustified. If he were to bring himself to the issues, he would find that he would be better off to sit down and retain what seat he has left. I support the vote.

Hon RICHARD PREBBLE (ACT) : I was not going to take a call on this vote, but I listened to Mr Fairbrother, who is a lawyer. I, too, am a lawyer, and I can see that Mr Fairbrother is actually incredulous about what has occurred, so let me spell it out.

Mr Fairbrother is absolutely right. Judges in New Zealand should not take instruction from Ministers. We have a separation. We have the executive, we have a legislative branch, and we have the courts. What happened in this case is that a member of Parliament, quite properly I tell Mr Fairbrother, applied for a court record of a case. Now, that record does belong to the judge. But the tradition in this country is that we have open justice, so judges make court files available. They do not turn a request down because the person who asked for it is, as Mr Fairbrother said, a troublemaker. Because that would mean that the media, for example, should not be able to get it.

To give proof of this, Mr Franks has just handed me a paper, which is the acknowledgment of the application made quite properly by Mr Franks. What happened in this case was that it was an embarrassing one for the judiciary. It was a particular case where a person took action to protect property and as a result ended up being arrested. The villain who was stealing the property was let off by the police.

I can see that the judge might have been embarrassed about that becoming public, but that was not a reason not to make it public. But what happened in this case was that the registrar, no doubt acting on instructions from the judge, wrote to the Minister for Courts and asked: “Can I release a file to a member of Parliament?”. That was a direction. Now the question we are asking is, what has the Attorney-General done about it? What the Attorney-General, Mr Cullen, should have done—and he is not a lawyer, and perhaps he does not know this—was say to Mr Barker, who is also not a lawyer, “This letter is quite improper.” He should have asked Mr Barker whether the Minister for Courts was now directing how justice in New Zealand was being run. Because justice in New Zealand should not only be done, but it should be seen to be done.

Instead, what we had was a junior backbencher getting up and saying: “These allegations are so outrageous they couldn’t have happened.” Well, actually, I tell Mr Fairbrother—I realise he was thrown into this matter—if he comes across here he will see documentation that shows that what Mr Franks has said is absolutely correct. He asked for the file—and the registrar of the court, instead of making it available, wrote to a Labour Minister for Courts and asked: “Can I hand over a file to a member of Parliament?”. That is constitutionally an outrage.

What is even more outrageous is what happened when we raised this matter in Parliament. Mr Fairbrother gets up, and in effect defends the indefensible. Where is the Attorney-General? What is the point of an Attorney-General if he is not prepared to uphold the constitution? I think it is a sign that when one makes the Minister of Finance, who is totally overloaded—he cannot even write a decent Budget—the Attorney-General, one sees the quality of law in New Zealand, the fundamental obligation of the Government, being undermined.

I cannot imagine, or cannot think of, a former Attorney-General who would not have taken the first opportunity to get up in the House and say that this was constitutionally improper, apologise to Mr Franks, apologise to this Parliament, and then apologise to the people of New Zealand that we now have Mugabe-type justice being done in secret, and when the Opposition asks questions, they then get directions from a Minister. I say to Mr Fairbrother: “Shame on you for defending such outrageous behaviour!”

RUSSELL FAIRBROTHER (Labour—Napier) : Of course what that member skilfully avoided saying was that the Minister for Courts did not reply, as Mr Franks told us in his preceding speech. So there was no interference by the Minister in the actions of the court. The fact that a clerk may be mistaken, if the allegation is correct, and write a letter that is not acted on by the Minister does not make for interference by a Minister in the judicial process. If this was, in fact, a well-intentioned inquiry by the member of Parliament, he would have then written to the head of bench. Because the member sat on the Justice and Electoral Committee when the whole issue of judicial performance was considered, he knows entirely the steps to take in order to get that which he requires. Of course, judges, after due consideration, are not obliged to make available to the public for their prurient interests, or their political interests, that which takes place in a court. The fact that the matter was dealt with in court, and was not appealed or reviewed by the prosecution, suggests that the issue that that man is now trying to build is quite out of proportion to the facts of the case known by both the prosecutor and, clearly, the defence, and by the judge. So we have once more an issue of perception and of factual reality that is quite different from that now being advanced in this Committee.

STEPHEN FRANKS (ACT) : I seek leave to table the documents that Mr Fairbrother has just asked for, including a letter to the Chief District Court Judge, raising exactly the points that the member urged be raised.

• Documents, by leave, laid on the Table of the House.
• Vote agreed to.

JOHN KEY (National—Helensville) : Vote Finance is an appropriation in the order of $49 million—$48,877,000 to be precise. I know that this is a Government that likes to spend a lot of money. I know that it is a Government that likes to waste a lot of money. I know that this is a Government that likes to hire a lot of consultants, despite the fact that the Minister of State Services has been telling us for years that the reason we have had such a large build-up in the State sector was that all of that knowledge was coming in-house and there would be no need for consultants. Lo and behold, the Minister of Finance kindly released that information to the Finance and Expenditure Committee a few weeks ago, and what did we see? Labour used to criticise the National Government for spending around $90 million a year on consultants. Lo and behold, there it was in black and white, that Labour is spending $137 million a year on consultants, and that is in addition to the extra 8,000-10,000 core bureaucrats it has added here in Wellington.

But that is not what I want to talk about in terms of Vote Finance. I want to talk in relation to what must now be the biggest waste of $2.742 million in New Zealand’s history. It will go down with the Nordmeyer “Black” Budget and Michael Cullen’s “Black” Budget, which are rather synonymous now with one another. Six percent of the departmental vote—$2.742 million—was spent on purchasing advice on tax. We see what a waste of money that was when we look at what has come out of this Government recently.

Let us start with the Budget’s alignment of GST and provisional tax, costing $760 million. That was a very interesting scenario, because when I went into the Budget lock-up and asked Treasury officials why that issue was costing $760 million, why there was a $760 million loss of income in that financial year, the Treasury officials were at a loss. But they did eventually provide someone who gave me the answer. The answer was, of course, that under GST payments there is no accrual accounting, so, because it moves into an income period that is some 20 days forward, they cannot be counted.

Well, that is quite interesting except that Dr Michael Cullen, the Minister of Finance, made an interesting revelation, I thought, at a KPMG seminar that I heard him speak at recently. He said that he was not told of this fact until weeks before the Budget was produced. Weeks before the Budget was produced he did not know that $760 million was not coming into the Government’s coffers in that year, and that is despite the fact that he spent $2.742 million for advice for taxation.

What is even better, of course, is that his lapdog sidekick, David Cunliffe, has been out there, running around the country—

Dr the Hon Lockwood Smith: Who?

JOHN KEY: His sidekick—the Dewey of Huey and Dewey—has been telling the country: “We’re doing great things for business because we’re giving you $760 million as part of a $1.4 billion package.” That is quite interesting, except that I am sure Mr Cunliffe, when he has a bit of time on the back bench in the years ahead, will be able to reflect on the fact that of course it is not worth $760 million to business. I see that Mr Cunliffe has his calculator out and he has already worked it out. He is a reasonably smart Associate Minister of Finance, I am sure. The use of money for 20 days cannot possibly add up to $760 million worth of costs, unless we are talking about billions and billions of dollars, and we are not. So it is just a hoax that the business community is getting $760 million worth of benefit. It is, for the record, getting about 20 days’ use of money. That was not worth spending $2.742 million on advice.

I will move on to the next point, which is Labour’s intention to put a capital gains tax on foreign-held shares owned by New Zealanders. This comes from a Minister of Finance who last night had the audacity to go to the property investors’ seminar and tell them that diversification is a good thing. He said that last night, but, when it came to the Budget, part of his $2.742 million worth of tax advice was telling New Zealanders that it is not a good thing to diversify. He said: “We don’t want you to own foreign-held shares.”, even though the Cullen fund sends three-quarters of its money offshore, even though foreign-held shares are a relatively small proportion of shares owned by New Zealand investors, and even though those investors already have money here in New Zealand and on the stock market, and the money is likely to go further into the property market—which is the thing Michael Cullen was having a go at 6 months ago, when he was thinking more logically.

Hon DAVID CUNLIFFE (Associate Minister of Finance) : It is sad to see a promising political career, like Mr Key’s, snuffed out so early. If that is the best the member can do in an appropriation speech on vote Finance, the National Party is shorter of talent than I thought. With all the issues around: the global economy; oil prices; exchange rates; even, one might argue, the current account; what does that member come up with? The same old saw: “consultant advice”. That is the best he could do—consultant advice on tax. [Interruption]

That is very interesting. He disputes the fact that there have been substantial business tax cuts in this year’s Budget. The reality is that there are about $1.4 billion worth. I am happy to recite them again—fringe benefit tax thresholds raised, provisional tax payments aligned with GST and an option to pay on the basis of current-year cash flows, PAYE intermediaries subsidised, a 6.7 percent tax discount for small businesses in their first year, and so on and so forth. [Interruption]

The CHAIRPERSON (H V Ross Robertson): I am sorry to interrupt the honourable Minister but there is a barrage of interjection from my left. Of course, it means that that person has an unfair advantage at the microphone. I ask the member on my left to realise that interjections are to be rare and reasonable, and—I have given up on this one—hopefully witty.

Hon DAVID CUNLIFFE: The net effect of these provisions is equivalent to roughly a 2c cut in the corporate tax rate.

John Key: Rubbish.

Hon DAVID CUNLIFFE: It is not rubbish; it is clearly substantiated by independent Treasury advice. A 2c cut in the corporate tax rate may, in other cases, be attractive. Why did we not do that? One reason is that a very significant proportion of corporate ownership is held internationally. Why would we give priority to a tax cut in favour of foreign owners, when we could target that tax cut to hard-working New Zealand small businesses? And that is exactly what we have done.

I should add that as part of the tax simplification process overseen by this vote the compliance costs of taxation for small businesses have fallen, according to independent advice, by 40 percent since that member’s party was in Government. For medium-sized businesses it has fallen by 50 percent. We are not taking a scalpel to red tape; we are taking a meat axe to red tape, and the independent advice proves it.

The fact that the worst that that member could do was to talk about consultants proves one thing: this Government has presided over one of the most substantial expansions of the New Zealand economy, if not the most substantial, in our history. Unemployment is at a 20-year low, average growth is at a 20-year high, and our average growth rate is a full 1 percent or more above that achieved by the National Party when last in Government.

New Zealanders know, as they consider the run-up to this year’s election, that a vote for that party is a vote for risk and uncertainty; and a vote for the Government is a vote for prudence, good fiscal management, good leadership, and stability. It is a pleasure and an honour to serve under Dr Cullen in this good and prudent Labour Government.

Dr the Hon LOCKWOOD SMITH (National—Rodney) : In examining Vote Finance I would like to focus on the fiscal policy advice that this Government has been receiving. We know that this Government sprays taxpayers’ money around as if there were no tomorrow. Government spending has risen—it was $34 billion in the last year—and if this Government were to get another term it would take that spending up to $60 billion. This Government would double its spending in 9 years, on things like tertiary singalong radio programmes, Cowboys and Indians parties for the Weathertight Homes Resolution Service, and that kind of wastage and nonsense.

But I want to focus on something more serious, because we all know of this Government’s wasteful spending. I have a Treasury document, called State Sector Wages. I want to know what this Minister plans to do about that advice. That document is dated 28 January 2005, and it tells us that over 5 years the core public service—and let us put teachers and health professionals aside—has increased by 25 percent under this Labour Government. The number of people involved has risen from 30,000 to 38,000. The document also tells us that the average rate of increase in the cost of that public service is 8 percent a year. In fact, in the year to June 2004—in 1 year—it scored a 12 percent increase in cost. That Treasury document tells us that what has been driving those cost increases, averaging 8 percent a year, in the public sector is the increased number of positions I have mentioned—a 25 percent increase in 5 years—and increased wage levels. But let us wait for this one. There are also increased costs associated with regulatory change, particularly the Holidays Act, equal employment policies, and those kinds of things.

The report goes on to tell us: “Commensurate increases in outputs do not appear to have been achieved as a result of this increase in costs.” That is Treasury stating that the taxpayer is spending a huge amount—8 percent a year more—on the core public service, and that we are getting nothing for it. I want to know what the Minister will do about that. I guess Labour will lose the election, and that will solve the problem. Treasury goes on to state that the cost of the public sector is expected to increase more rapidly than the rate of economic growth. Do members know what Treasury points out will be the consequence of that? The increase in cost of the public sector has the potential, to quote Treasury, to “choke off” economic growth. That is what the report from Treasury, which is under Vote Finance, states in the fiscal policy advice to this Minister. We want to know what the Minister will do about it. Treasury is telling him that if the rate of increase in the public sector continues, it has the potential to choke off economic growth. The report states that it will mean that the Minister will be unable to implement the policies he wants to implement.

One of the most recent policies of this Government that I have heard about is interest-free loans for students forever. Have members heard anything more irresponsible than that? That will mean that anyone with half a brain will enrol in something, so that he or she can borrow to the hilt on the student loan scheme and have free money forever. That has to be the dopiest policy—and the Government claims to be fiscally responsible! What advice has Treasury given the Minister on that? What advice has Treasury, under this vote, given the Minister on that policy? Interest-free student loans forever! I bet I know the advice Treasury has given him. It would be not to go down that route, because anyone with enough brains to get into a tertiary institution will have enough brains to know that he or she should borrow every cent possible under such a stupid policy, given that the money is free. All that he or she would have to do over the years would be, under a very gentle regime, to pay back the principal gradually. I do not know what advice Treasury has given the Minister on that policy.

Hon DAVID CUNLIFFE (Associate Minister of Finance) : It is not my intention to entertain all of that rather spurious contribution in detail, but I do want to mention several important indicators. Firstly, Government expenditure as a percentage of GDP has fallen during the life of this Government, from 35 percent to 31.7 percent, as outlined in the Budget documents themselves. What is more, tax as a share of GDP has remained stable, and will remain stable, at around 30 percent. More important still, our commitment to the fiscal anchor, that is debt reduction, has been honoured. Gross sovereign issue debt has fallen from 35 percent of GDP when we were elected in 1999 to—wait for it—23 percent in June 2005. It has fallen from 35 percent to 23 percent, and it is going down further to 20.2 percent by 2008.

If that is not good enough, net Crown debt has fallen to zero. By 2006-07 New Zealand, rather like Singapore, will be a creditor nation for the first time since Sir Julius Vogel borrowed to build the railways. If that is not good enough for the National Party, what is? It is not interested in the facts; it is interested in cheap scaremongering that it can put on a red-blue billboard—because it is the season! But I do not underestimate the New Zealand public like National members do. I think that members of the New Zealand public know we are in for the long haul. And, yes, they have a few issues, and not everything is perfect; and they are a bit grumpy about a few things, but the reality is that they know that when we have the kind of expansion we have had in the last 5 years, it ain’t good luck! If it were good luck, then by God we have been the luckiest Government in history, every year for the last 5 years! Luck just does not get as good as that. If Dr Cullen were as lucky as that, he should buy a lot of Lotto tickets and become a very, very wealthy man.

Again, this is a good, prudent Government. It is a Government that has restored a deficit in public service capability, quite proudly, since we were elected. That was the right thing to do. That crowd opposite ran it down. It left us with a public service that could not discharge its responsibilities to New Zealand families. We fixed it, and we make no apologies for doing that.

Occasionally, we get somebody who does something wrong, and when we find that, we nail it. We do not beat around the bush and pretend it did not happen. We nail it. Ministers take responsibility. We do our job. That is what the public expects, which is why we will be back here on the Treasury benches in 8 weeks’ time and why Mr Key’s political career will flatline, rather like net debt.

GORDON COPELAND (United Future) : Three great debates have been unleashed by the 2005 Budget. Firstly, is there room for tax cuts? It is interesting to get a perspective from someone who is independent of this debate. John Shewan, chairman of PricewaterhouseCoopers says: “Yes, at about the $2 billion level.” It makes United Future’s $2.5 billion package over 3 years look prudent and modest, does it not? The figures tell the story.

The Budget forecast an operating surplus over the 3-year period 2005-07 of $18 billion. Please note that this is after all the Government’s revenue expenditure, covering health, education, pensions, welfare, police, defence, etc. Of that $18 billion surplus, $7 billion will be contributed to the New Zealand Superannuation Fund—nicknamed the Cullen fund—to pre-fund the future greatly increased cost of New Zealand superannuation. United Future supports the New Zealand Superannuation Fund. That leaves $11 billion after New Zealand Superannuation Fund contributions. Our tax cuts, which, unlike other parties, we have announced to the public, will utilise $2.5 billion of that surplus over 3 years, which still leaves $8.5 billion for capital expenditure on items such as schools, hospitals, roads, defence equipment, etc.

Secondly, the big debate has been about whether tax cuts will be inflationary and raise interest rates. Labour says “Yes”, although whether Dr Cullen actually believes that may be another question. After all, because John Howard and Peter Costello used it against Labor in Australia and it worked for them, Dr Cullen reasons that maybe it will work for him as well. But, again, let us turn to someone who is somewhat independent in this matter. What does Dr Bollard, Governor of the Reserve Bank, say?

Several of us on the Finance and Expenditure Committee took the opportunity when we last saw Dr Bollard to ask him those very questions. His answer was, of course, that it depends on the net effects, and that is exactly right. Tax cuts used by highly indebted families to repay debt, for example, would not be inflationary. Tax cuts coupled with a reprioritisation of Government spending to increase productivity would not be inflationary and tax cuts invested by the private sector to improve productivity would not be inflationary. Borrowing to reduce the $1 billion costs of decongestion in Auckland would not be inflationary, because it would reduce the cost of trucking goods across the city or to the wharf. It would reduce taxi fares and fuel consumption, increase workforce productivity, etc. Therefore, logic would suggest that the funds should be borrowed to eliminate traffic congestion in Auckland, Wellington, and Tauranga.

The Government, with United Future’s support, has given itself the legislative authority to borrow for land transport but chooses not to do so, and I for one have to wonder why. What is the case for not doing that, when even Dr Bollard would say that it would be a good thing to do, it would increase productivity, and have a positive effect on inflation? But, no, the Government wants to go down a different line.

Thirdly, the other big question that has come out of the Budget is whether the Government is spending taxpayers’ funds wisely. Let us take a few examples. Health expenditure is budgeted to increase to $9.3 billion next year, but will that be spent effectively?

I shall give a couple of examples. I spoke to a surgeon recently who works at Starship children’s hospital. He said he could not tell me how frustrated he was and that he would like to do a lot more surgery there, but could not. I asked him why, and he replied that he did not have enough nursing support staff. I told him that good nurses were available from the Philippines and asked him why did he not bring in some of them to work at Starship, because that would solve the problem and enable him to get on and do more surgery. He said he could not do that because it was not under his authority and that others in the organisation made decisions about recruitment. He did not know whether they had thought of Filipino nurses. However, he did know that productivity in Starship children’s hospital could be vastly improved by having more nursing staff.

I told my colleague Paul Adams about this and he was interested because of the situation of a surgeon friend of his who did cataract operations.

DAVID PARKER (Labour—Otago) : I have two points to make before I start my intended speech. Firstly, when Dr Bollard was questioned by the Finance and Expenditure Committee he was absolutely clear that if tax cuts were funded in part by borrowing more money and increasing Government debt, then that would be absolutely inflationary. It is axiomatic that if borrowings are increased—

John Key: Are you the world’s expert?

DAVID PARKER: I was quoting Dr Bollard from a meeting that member was present at, where Dr Bollard made it absolutely clear that if tax cuts were funded through borrowing—which will have to be done if the promises of tax cuts and spending bribes that National has made for this coming election come to fruition—then there is only one way that that equation can be made to work, and that is through increasing Government debt. That is somewhere this Government will not go.

It is not so long ago that this country had spiralling Government debt and when Government debt equalled 70 percent of GDP.

Hon Dr Nick Smith: National fixed that.

DAVID PARKER: No, National actually caused that. That was Mr Muldoon. The member has a very short memory.

John Key: What was the absolute level of debt?

DAVID PARKER: The absolute level of debt is absolutely irrelevant. The relative level of debt was 70 percent of GDP. The importance of that is shown by the fact that $1 in $5 of tax that was collected by the then National Government was spent on interest. If the following Labour Government had not substantially restructured the economy that amount would have ballooned to $1 in $4 in 1-2 years. That is why it is important that debt goes down, not up. When this Government came to power—

Dail Jones: What was unemployment?

DAVID PARKER: Unemployment was quite low in 1984, but that was on an unsustainable basis. Huge subsidies were afforded only because the Government was increasing Government debt at such a huge rate.

In the meantime, when this Government came to power, Government debt had been reduced to 36 percent or 35 percent of GDP. It is now down to under 25 percent of GDP and we are determined to drive it slightly lower, down towards 20 percent of GDP, which we think is appropriate. Now $1 in $20 of tax is spent on interest, rather than $1 in $5, so the taxes people pay can go towards health, education, superannuation, law and order, and the things that people in this country expect the Government to provide.

During the period of this Government growth has also been impressive, averaging 4 percent over recent years. That is higher than the OECD average of 2.5 percent, higher than Australia’s rate, and indeed, the rate in the United States, which our critics often compare us with.

Earlier in this debate there was reference to a problem attracting nurses, or a problem with the number of nurses at Auckland Hospital. One has to ask oneself why that is—why did nurses desert New Zealand in the 1990s for Australia? The answer is that Australia had better wages and conditions. Why has health expenditure gone up? Part of the reason is we have had to pay our nurses and doctors more in order to keep them in New Zealand.

Our unemployment rate is 3.8 percent. That is not the tenth-lowest rate in the world—that would be pretty good. It is not the fifth-lowest or the fourth-lowest rate. It is the second-lowest rate in the developed world and that is something we should be proud of. The drop in Māori unemployment on a proportionate basis has been most impressive. In 1999, unemployment stood at 15 percent for Māori overall, and 32 percent for young Māori. Overall, that figure of 15 percent has dropped to 8.7 percent. It is close to half. That must bode well, not just for Māori but also for our future prosperity as a nation and for our future social cohesion.

There are 250,000 more people in jobs than when we took office. In fact, it is slightly more than that. One can say that pretty fast, but that is more people than the combined populations of Cromwell, Alexandra, Dunedin, Oamaru, Queenstown, Balclutha, Gore, and Invercargill—in fact, it is more people than there are south of the Waitaki River. That is all people, including retired people, children, and women looking after children who are not in the workforce. There are more people in extra new jobs in New Zealand in the last 6 years than there are people south of the Waitaki River. Let us look at the unemployment statistics for my own electorate.

JOHN KEY (National—Helensville) : I was going to take my call during Vote Revenue, but I just cannot help myself from replying to the Associate Minister of Finance, Mr Cunliffe, who is affectionately known as the “Minister of Homework”. He needs to do a bit more homework, because he spent quite a bit of time telling the country that gross debt to GDP had fallen from 35.1 percent to 22 percent, and what a wonderful thing that was for the country, because Labour had worked hard to repay debt. Sorry David, wrong on that one!

The CHAIRPERSON (H V Ross Robertson): The member will refer to other members by their full name or their portfolio title.

JOHN KEY: Sorry Mr Cunliffe, but Labour has repaid $1 billion of debt; and that is all. That is the lot. Nominal debt has gone from $36 billion to $35 billion. Debt to GDP has actually fallen, of course, but only because GDP has grown, and not at all because Labour has assiduously paid off debt. You have not paid any debt, so do not run around the country telling people that you have been so efficient paying off debt, because you have not paid off any debt at all.

The CHAIRPERSON (H V Ross Robertson): The member cannot bring the Chair into the debate.

JOHN KEY: Mr Cunliffe’s second claim was that the Government had been so great, because it had cut spending as a percentage of GDP in the 6 years it had been in power. Firstly, he claimed that the figure had gone from 35 percent to 30 percent. Unfortunately, the “Minister of Homework” needs to do a bit more homework. The number was actually 31.3 percent. Mr Cunliffe should look at the facts. It is not my fault that you want to claim that you came into office before a period of time you were actually here.

The CHAIRPERSON (H V Ross Robertson): The member cannot use the word “you”.

JOHN KEY: What is very interesting is that I asked the Minister of Finance about those numbers. I asked him what was the number, if one took into account the right years and the non-discretionary spending items, which was essentially a reduction in the unemployment benefit, and took financing costs out for a second, because there has been no change. In fact, the numbers would show that Government spending, as a percentage of GDP, had been rising. That is a shock. It has been rising, not falling.

And then of course, there are the plans Labour has for the next 3 years to take Government spending as a percentage of GDP from 29.6 to 32.6, roughly spending about $12 billion annually on the baseline. So, sorry, Mr Cunliffe is not right on any of those figures.

Then there was the last claim, of course, that the Government is fiscally prudent. “Yeah, right!”, I suppose they say—when one looks at a student loan scheme where the message is pretty simple, such as it announced today, which is to borrow as much money as one can and never voluntarily repay it, and never have a job to try to repay that through one’s student holidays or anything. One should just borrow to the hilt and then one will be absolutely fine, because one will never have to repay it to any great extent and there will be no incentive to do so.

I want to go back to the issue of policy advice, and ask what advice there was on tax. What advice did the Government and the Minister of Finance receive in relation to thresholds? In fact, the change in thresholds will take place in 2009. No consideration whatsoever has been given for the last 9 years, or it will be 6 years, and then 9 years prior to that—none at all. Those years have mysteriously been forgotten. That was about a 14 percent reduction, because of inflation in New Zealanders’ incomes, but there is no consideration there.

What will happen to the $1.4 billion in additional taxes that New Zealanders will pay in the 3 years because of fiscal drag? No consideration has been given to that. Was that all part of the advice given on thresholds—advice that saw a Government deliver 67c a week to New Zealanders earning $38,000 a year, but it has enough money to fund singalong courses that are meant to be fiscally prudent? Today we found out that it has enough money to fund Little Hiawatha and sort of Cowboys and Indians parties and Sound of Music parties, but it does not have enough money for the poor old family that is out there working hard and doing an honest day’s work, because they will get 67c a week. All that largesse is paid for by taxpayers in New Zealand, whom that Government has absolutely no regard for. It is a disgrace. No wonder it is on its way out!

Hon DAVID CUNLIFFE (Associate Minister of Finance) : The desperation of the Opposition spokesman is simply proven by the technique he is using. He excludes numbers that are going down and includes numbers that are going up, and thus concludes that the average has gone “up”. Well, congratulations! But I have the privilege of sitting near the Secretary of the Treasury and he has just confirmed to me that the numbers I quoted last time—Government expenditure was 35 percent of GDP when Labour came in and is 33.7 percent now—are correct. If Mr Key does not believe those numbers, he should take them up with Treasury, because that is just what I have done.

Dr Smith and other members have referred to the tax cut debate. That is a very important debate. For the benefit of the public who are listening, I will say two very simple things. The public understands the difference between a surplus and a deficit: one gets paid, one gets wages, one gets money in the purse, one pays one’s rent or mortgage, one buys groceries, one pays a power bill. Whether one is in surplus or deficit at the end of the week comes down to one thing: is there any money left in the purse? The reality is that this year’s Budget forecasts that we will be in a cash deficit for 3 out of the next 4 years. That deficit will actually go down to about $3 billion negative in 2008. In other words, we will have to take on a small amount of debt in order to fund ongoing operations. If Mr Key—who is so banally hectoring—were running a business, he would hardly take on additional debt to fund current consumption and operations. That would not be prudent. Nor will we take on debt.

Dr Cullen has also used the analogy of a banquet. At the “Tax Cut Banquet” the top table goes first and they scoff themselves on the smorgasbord. They gorge themselves. The middle table gets a small helping, and the bottom table gets the crumbs. At the end of the meal, everybody gets the same bill. That bill has three components. It has the debt that those people want to load onto our children in the form of Government borrowing or flogging off what is left of the country’s assets. Those parties have tried it before, and we were sick of it and voted them out then. Why would we have them back now?

The second form of that bill is in the cuts to services like health, education, and other important things. Kiwi families know that what matters to them is not 10 bucks a week from John Key. They want to know that when their kids are sick they can go to a doctor, they want to know that they have a good school down their street, and they want to know that the cops are there to keep them safe. In short, they want good Government, not cheap Government. We have offered them good Government, and we know that the voters will ensure that we can continue to offer good Government.

But, of course, the crunch, the kicker, is the third part of the bill: higher interest rates. Let me give members the simple, back-of-the-envelope example of a family with three kids that earns $50,000 a year and lives in Auckland with a mortgage of $200,000. If I leave aside the $120 or so a week extra they will get from Working for Families—the family tax cut that Labour has already promised—and simply take the effect of a 3c cut across the board in tax rates, by my calculation that is around 28 bucks a week for a family with an income of $50,000, give or take. If National were to borrow the $7 billion it would need to fund the tax cuts plus its spending promises, I bet members opposite that the interest rate would go up at least 1 percent. If it did, that is 38 bucks a week on a $200,000 mortgage. That family would be 10 bucks worse off a week under National’s tax cut, thanks to their mortgage going up, leaving aside what they would not get from Working for Families. No sane family in New Zealand on $50,000 will vote for that lot and see their mortgages go through the roof, when they could stick with good fiscal prudence and a good Government.

Dr the Hon LOCKWOOD SMITH (National—Rodney) : I think the previous speaker, the Hon David Cunliffe, mentioned that people want to know what they will get when they ring the police. [Interruption] Under this Labour Government, though, dialling 111 has produced anything other than police.

Let me share with the House this little titbit that I found out the other day. Members will be aware that there is a motorway going through my electorate called ALPURT B2. It is the first tolled motorway, although it is not in a Labour-held seat but in a National-held seat. There are a couple of tunnels involved in this motorway construction, so everyone has been involved. The police came along because, of course, people thought the police would be interested in safety in those tunnels. But the only thing the police were interested in was a place in those tunnels for their speed cameras. That is the only thing they were interested in. They were not interested in issues of public safety in those tunnels; all the police were interested in was to make sure there was a place in those tunnels for their speed cameras.

That approach will change when the Government changes—the public is sick of that. [Interruption] The Labour members will get a chance to take their call. They should just settle down for a moment.

What the public finds so insulting about what the Associate Minister of Finance has just said is the notion that the Government knows better how to spend its money. When one goes around the country now, one of the things that has changed hugely in the mood of the public is that people are sick of the Government, and they are sick of Prime Minister Helen Clark telling them how they should run their lives and telling them where money should be spent. The people of this country are sick of that.

The public are sick of people like the Associate Minister of Finance David Cunliffe standing up and saying: “We know best how to spend your money.” We have heard today where this Government is spending money. For workers in New Zealand, it takes a lot of work to earn money and it is hard work earning money. When workers hear that this Labour Government’s priority for spending money in tertiary education is on singalong radio courses, and that the Weathertight Homes Resolution Service spends their hard-earned money on Sound of Music parties and on Cowboys and Indians parties, they find it kind of insulting when this Government says: “We will give you a tax cut—67c in 3 years’ time.” That is why the public is so angry about this Government. It is a bigger issue than just tax cuts.

The public are sick of people like David Cunliffe standing up and saying: “We know better than you do how to spend your money.” Members heard the Associate Minister trying to explain deficits and surpluses. The public know that! The public know that one cannot spend more than one earns. What the public object to, though, is being told endlessly by this Government that they are too stupid to know how to spend their money, that this Government knows better, that this Government will tax them more, and that this Government will spend their money on singalong radio courses in tertiary education and on Cowboys and Indians parties and Sound of Music parties. That is what makes the public so angry.

I asked the Minister of Finance some specific questions about what he is doing in response to Treasury advice. I specifically asked about the Treasury advice on the burgeoning public sector, where Treasury has told him that, in fact, core public sector expenditure risks growing faster than the rate of economic growth in this country, and it risks choking off economic growth. It is growing at an average of 8 percent a year, and Treasury is pointing out to the Minister that that is very serious. I want to hear from the Minister what the Government is doing in response to that.

We also asked the Minister another question, which he has ignored totally, about what the Treasury advice on interest-free loans to students was. I know from my time as an Associate Minister of Finance that Treasury will have given advice on that and advised that that policy will invite abuse of the student loan scheme. I think that the people of New Zealand deserve to know the full advice the Government received on this—what would one call it?—bribe.

John Key: Desperation.

Dr the Hon LOCKWOOD SMITH: It is an election bribe from a desperate Government.

METIRIA TUREI (Green) : Crown Minerals Group sits within the Ministry of Economic Development, which we are discussing at this moment. The Crown Minerals Group is responsible for administering the Crown Minerals Act, under which a number of mining companies have made seabed prospecting applications this year. There has been a notable growth in seabed prospecting applications this year, because the Government has made seabed mining a more lucrative activity. Changes in the tax regime and the Overseas Investment Commission legislation, and, of course, the Resource Management Act amendments currently before the House, make prospecting more attractive, because the financial gains are greater and the involvement of the community in the decision-making process will be radically reduced.

Of course, the Foreshore and Seabed Act, which gives the Government full legal and beneficial ownership of the seabed and foreshore, has opened the doors for mining companies by removing any opportunity for Māori to utilise the protections of Te Tiriti o Waitangi arguments to protect the foreshore and seabed from that activity, just as te tiriti arguments protected State forests from sale in the 1980s.

It was only a couple of months after the foreshore legislation was passed that Black Sand Exploration Ltd made an application to search for ironsand along 3,000 square kilometres of coast from the Kaipara Harbour to Taranaki. Ironsand is in very high demand at the moment, and New Zealand’s marine area is a potential source of that mineral. The Government has acknowledged that not enough is known about our marine environment to make rational decisions about its use and management, yet prospecting for minerals in the seabed is being approved, despite that confession. Without quality information and clear, long-term planning for the sustainability of the marine environment and its species, the environmental costs of allowing such mining will far exceed any fiscal gain that might be made from the selling off of our marine resources.

The Green Party is opposed to any seabed or foreshore mining in any significant marine habitat, and it is clear that most of the seabed prospecting applications now approved are right in the middle of a number of significant habitats, most notably, those of endangered Hector’s and Māui’s dolphins. There are currently three approved prospecting permits that I am aware of—one from Iron Ore New Zealand Ltd regarding an area off the coast of Taranaki, and two from Seafield Resources, which is looking for gold off the West Coast of the South Island.

Black Sand Exploration Ltd—whose application spurred the development of community organisations like Kiwis Against Seabed Mining—has had its application put on hold, but that application could be resubmitted at any time. Black Sand Exploration’s original application covered the exact same area as the gill-net ban that is in place along the North Island’s west coast to protect the Māui’s dolphin from further endangerment. There are only about 111 individual Māui’s dolphins left. They are critically endangered and remain at serious risk from human activities. There are endangered Hector’s dolphins along the West Coast of the South Island, where the Crown Minerals Group has recently approved gold prospecting permits for the seabed. Prospecting is the very beginning process for mining, and in and of itself it is not necessarily a threat to those species. But mining certainly is, and we simply cannot afford to add any further damaging human activities in those areas.

Gill-netting causes the most problems for dolphins, but there are other threats. Trawling kills Māui’s dolphins, and lost nets can cause havoc. Pollution threatens dolphins—and not only pollution from the sea itself. As dolphins can feed quite close to shore, nutrient-rich freshwater that discharges into coastal waters can cause algal blooms and other damage, and thereby threaten the habitat of those dolphins. Tourism has damaging impacts, as does invasive research. Now we have the added threat of seabed mining, which damages dolphin habitats and could lead to increasing rates of dolphin deaths.

We must have stronger protection measures in place that will restrict or prohibit human activities that threaten those endangered species. Fishing technologies must be subject to a sustainability test, and those that fail those tests must be severely restricted in their use. Zero by-catch limits should be set for endangered species like the Māui’s and Hector’s dolphins, and near-zero by-catch limits set for other species. Added threats like seabed mining must not be allowed to take place within those fragile habitats.

Hon JIM ANDERTON (Minister for Economic Development) : Firstly, I think it has to be recognised that Crown Minerals has been funded through the Ministry of Economic Development output agreement for many years—that is not something new. Crown Minerals administers the permitting regime, gives policy advice to the Government on the Crown Mineral Estate, and promotes investment in the mineral estate. The key point to note is that there is nothing new in promoting responsible investment in exploration and development.

The mineral estate has a multibillion dollar value, and the growth and innovation framework, which this Government follows, explicitly recognises the need to manage our natural resources responsibly. I point out to our Green Party colleague that Dr David Bellamy—someone whom I think the Green Party would recognise as a reasonable authority—has stated: “New Zealand has the most environmentally responsible mining industry in the world.” I think any Government would take some comfort from that, and I suggest that the Greens could take some comfort from it as well, if they were reasonably objective.

In terms of Black Sand Exploration’s so-called mining proposal, let me quickly state a few facts. Firstly, there are no proposals currently before the Crown to mine offshore ironsands or mineral sands, which would include gold. There is a lot of heat around this issue, but there are simply no grounds for it. It is too early to speculate, firstly, whether a mineable deposit exists, and, secondly, if a resource exists, what the scale of it might be, and, therefore, what economic benefits might flow from it. Responsible exploration and mineral production has the potential, of course, to have a range of economic benefits, both regionally and nationally, but there is considerable exploration and appraisal work to be done before any meaningful assessment can be made.

It must be understood that mining permits under the Crown Minerals Act regulate only who is allocated Crown-owned minerals and the royalty returned to the Government from the mining of those minerals. The Crown has treaty partnership obligations under the statute, by which iwi and hapū are consulted, and areas that are of particular importance to the mana of an iwi can be excluded from any mining permit.

Secondly, public concerns about mining are about whether mining is compatible with communities where people live, and also about any possible adverse impacts of mining on the natural and physical resources of communities and their environment. Those concerns are addressed through the resource consent process of the Resource Management Act 1991, just as the environmental impacts of all industries in New Zealand are so managed. If the member has not picked up that there is some discussion around the way in which the Resource Management Act works in terms of development, then she must be living on a different island or planet than I live on. There are plenty of people who would say that the Resource Management Act gives sufficient protection—some would even say too much—in terms of development.

Although the Crown Minerals Act gives jurisdiction for prospecting and/or exploration, it does not give automatic permission for extraction and mining. Those applications have to go through the required processes for resource consents, which are made to the district and regional councils with responsibility for the geographic area concerned. I think we should have a little more light and somewhat less heat in these issues, because, as I have stated, the reality is that there are no proposals currently before the Crown. The application that the member has mentioned, from Black Sand Exploration Ltd, for example, has been declined because the applicant failed to provide sufficient information to enable a full and proper assessment to be undertaken, despite repeated requests from officials. If there is anything about the application being declined that the member does not understand, then maybe she could give me a note on it and I will explain it to her.

Hon MARK GOSCHE (Labour—Maungakiekie) : I look forward to the debate on Vote Economic, Industry and Regional Development, and I congratulate the Hon Jim Anderton on the good work he is doing in economic development. Up and down this country we have regions going ahead like they have not gone ahead for a very long time. That is why we have the lowest unemployment rate this country has seen for so long. This is not a “sit on your hands”, do-nothing Government, like that lot on the other side of the Chamber would be. I ask members to watch: when we get to the vote they will vote against this. They will say to business that they are against nearly $250 million going into economic development, that they are against helping business build capacity, and that they are against the Government being involved in helping regions with their planning.

On this side we applaud the Minister for the money he has in this vote that will help the Food and Beverage Sector Taskforce support business clusters and incubators, because that creates economic wealth and jobs, and it allows regions that have suffered under National Governments in the past to move ahead as they have never done before. We are for this Government being involved alongside business in training, advice, and grants for budding entrepreneurs, for people who want to start up businesses, for small businesses, and for people looking to initiate exports, in terms of helping this country to develop and create employment opportunities.

I want to know why members of that party on the other side are saying they are against those initiatives. They are saying: “No, we will not support those. We’ll cut tax some time in the future. We’ll tell you what it will be in maybe 4 weeks, so that you get as little time as possible to read the fine print.” It is these initiatives that go out the window if they cut taxes. Opposition members will rubbish them at the same time as saying that they support economic development in the regions. Well, it just cannot be so. One cannot cut taxes and also go out and do the sorts of things that Jim Anderton has been doing—marching up and down the country, visiting region after region, and listening to what people have to say in terms of what they need.

We would not have a film industry that is going ahead in leaps and bounds in this country if we did not have such things as the Screen Innovation Production Fund, which receives $35 million extra in this Budget. Those things are creating skills, jobs, and overseas earnings for this country. It does not happen by sitting on one’s hands like the National Government did for so long. We saw regions going backwards at a rapid rate. What we have with this sort of policy and with this Minister is a proactive Government; not one that says it will give some sort of tax cut, maybe, but will not tell people about it for 4 weeks, in case they read the fine print and find out that it is a con. We actually have a Budget that says what we are going to do as a Government. We are using taxpayer funds cleverly, smartly, and we are seeing the results.

We are seeing regions like Northland, which used to have record levels of unemployment and very little hope, going ahead like no one would believe. We are seeing the East Coast of New Zealand going ahead like no one would believe, because we have a Minister who went there and asked: “What do you need to improve this region of yours that suffered high unemployment and stagnation for too long under National?”. So we developed a strategy, we have transport infrastructure going in, we have capacity being built, and we have people working alongside Government.

I want to hear members of the business community say that they do not want this $250 million, and that they want some miserable tax cut instead. There is an expectation that one can have this and a tax cut. Well, it does not work that way; it has never worked that way. National Governments, have a record of sitting on their hands, doing nothing, and leaving it to the market. National cannot say it will give some sort of tax cut, as well. This is evidence of the enormous difference between National, and the Labour and Progressive Government.

We say we are here to help, and we are here to listen. We do not just march in and say: “This is what you have to have.” We ask what taxpayers’ money needs to be spent on, and that is exactly what this Budget gives: $30 million for promoting New Zealand businesses and their products and services within New Zealand and internationally, so that we support the development of international trade and attract new, high-quality investment. That is what the Minister has talked about, and that is what this vote is about. National will not have a word to say on this, because it is embarrassed. It is embarrassed by the fact that this Government is actually making a difference out there in the economy, and that this Budget makes a difference.

Judith Collins: Ha, ha!

Hon MARK GOSCHE: We get the little giggles from Judith Collins, who has been sent in to prop up the National Party ranks, which are very depleted at the moment. We notice that its economic spokesperson is not leaping to his feet to talk about this, because he knows, and Dr Brash knows—wherever he may be—that one cannot have economic development and have a tax cut. One cannot have this portfolio producing what it is producing and have a tax cut. But National members do not want to talk about that.

JILL PETTIS (Labour—Whanganui) : There is huge competition on this side of the House to speak on this particular vote this afternoon, because Labour MPs represent the key provincial areas in New Zealand, and we know that so much has happened in our areas that we are excited and delighted at the growth we have seen in our patch. We know what it was like in provincial New Zealand under those Tories in the 1990s. It was grim. It was terrible. I am very proud to represent the seat of Whanganui, and I remember what it was like in my patch in the 1990s. It was awful. Everything closed. It was shocking, and there was a shocking waste of our most valuable resource in this country: our people. But this Government was elected in 1999, and we reinvested in our most valuable resource—that is, our people.

Sadly, I have only 5 minutes, but I know my colleague Mr Duynhoven is busting to speak.

One of the very tangible ways that this Labour-Progressive Government—this progressive Government in every sense of the word—has poured money into provincial New Zealand, and where my area in particular has benefited, is through major regional initiatives. There will be a formal announcement, and the Hon Jim Anderton is coming to our region next week as part of that announcement. Ruapehu, Rangitīkei, and Wanganui all worked together to get $2 million worth of funding to help further regional and economic development, and tourism development in particular. We have some wonderful tourism sites and potential areas for the sympathetic and wise development of our tourism sector.

That initiative has worked because this Government has also worked with the tourism sector, instead of alienating it like those Tories opposite did when Murray McCully was the Minister of Tourism—the years of the golden handshakes. But, no, under this Labour-led Government, this Labour-Progressive—in every sense of the word—Government, money is being put into the provinces. We are benefiting.

We have some of the highest rates of employment we have seen since most of us were kids, and all that money in those wages and salaries is being reinvested in the community. We have houses going up, businesses expanding, and new businesses being established. I have to say that it is wonderful when one is moving around one’s electorate now, compared with what it was like not too many years ago. Some of us remember but, sadly, some people have forgotten.

I have to say that anybody who thinks they can work out their economics to continue to spend money and invest at the rate this Government has invested in New Zealand, yet still have tax cuts, is just talking voodoo economics. It is just like being at home. We cannot buy a new house, a new car, and new carpet, and have the landscaping done, all in one year. It is just not possible. When we run our own budgets, we all have to live within our means. Why is it that some people out there in society believe that they can throw money around like a man with no arms and there will be no consequences? Of course, there would be consequences.

One of the most serious consequences of tax cuts that will impact on people in my electorate in particular is what will happen with mortgage interest rates. A large number of people in our Labour-held electorates have significant mortgages. The first thing they will feel the pinch about will be the increase in their mortgage interest rates. They might get 7 bucks a week extra in a tax cut from those Tories over there—and it is pushing the boat out a bit to say $7 a week—but I will probably get $70. I do not need $70 extra a week, but some of the people in my electorate who are on low to middle incomes most certainly do. But under the Tories’ plan, it will not work out like that. They work on the principle of “To those who have, more shall be given”.

We on this side of the Chamber believe that we should give people a hand up, and one of the ways we can do that is by investing in the whole community, by investing in health by lowering the price of going to a doctor and of picking up prescriptions, and by introducing income-related rents. People in my electorate are now hundreds of dollars—and I do not throw that figure around lightly—better off a year since income-related rents were introduced. Families in my electorate are hundreds of dollars better off because of the Working for Families package.

DAIL JONES (NZ First) : That was a very interesting speech from the Labour member for Whanganui. Of course, she covered things like housing, health, trade, and suchlike. I remind Labour members of what has happened to the cost of housing during the term of this Labour Government for people in Wanganui, Gisborne, Timaru, or Auckland. Housing prices have now gone beyond the ability of young New Zealanders to buy a house. Young people are totally unable to buy a house now, and that is why they are going to Australia. What has happened to interest rates for young people who are trying to buy houses? Interest rates have gone up and, of course, the amount one pays has gone up. Whereas in 1998 people could borrow $100,000 or $150,000 to buy a house, now they have to borrow $300,000 to $350,000, and the amount paid on interest is doubled. It has gone up by 100 percent compared with what it was in 1999. The utter failure of this Labour Government is no better exemplified than in so far as housing is concerned.

The member from Whanganui spoke about going to the doctor. Well, what has happened about going to the doctor these days? When New Zealand First was in Government, we introduced a scheme whereby young children up to the age of 6 got free health care. Is that still the case today under a Labour Government? No, they are paying through the nose. The cost of health care has gone up for the young family in Wanganui, Timaru, Gisborne, or Auckland. It has soared as a result of the failed policies of this Labour Government.

New Zealand First policy is very clear: we will restore the situation for people with young families and with children under 6. In fact, we will take it further. It is one of the New Zealand First planks of this election that that primary health care goal should be extended to young children at primary school, as well. [Interruption] That will be the best investment to be made for anybody—

The CHAIRPERSON (H V Ross Robertson): Can the member please keep to the topic of economic development.

DAIL JONES: I am responding, Mr Chairperson. You had no complaints about the member who spoke before me, so you should have no complaints about me. She raised the question of primary health care, and I am prepared to continue with it.

The CHAIRPERSON (H V Ross Robertson): Order!

DAIL JONES: I raise a point of order, Mr Chairperson. That issue was raised by Jill Pettis. I ask you to have one law for both sides of this Committee. She raised the question of primary health care; I am taking it up. Now, if you do not like it, and if Labour does not like it, I am not surprised—

The CHAIRPERSON (H V Ross Robertson): The member will see that I am on my feet. Every member has the right to counter any debate, but not for the length of time the member was doing. I gave him good, ample time. I accept what he says, and I understand his frustration.

DAIL JONES: So I have made my point that New Zealand First will introduce a policy that is far better than Labour’s current failed policy, which is not even carrying out the policy it inherited from a New Zealand First Government way back in 1998. We care about young children; Labour does not. It is as simple as that.

As far as the way in which money is being spent in the regions, what about spending a bit more money in Auckland? After all, Auckland’s population has increased by 50 percent in the last 18 years. Its population has increased by 50 percent, but have we had a 50 percent increase in the Auckland region in hospitals? Have we had a 50 percent increase in schools? Have we had a 50 percent increase in roads—in anything? No!

Hon Harry Duynhoven: Yes, more than.

DAIL JONES: No, there has not been a 50 percent increase in roads in Auckland. For example, Auckland’s population in the last 18 years has increased by the size of Wellington’s whole population from year one. Have we had the same number of schools or the same number of hospitals in Auckland that exist in Wellington?

Hon Members: No.

DAIL JONES: That is the arithmetic. Auckland’s population in the last 18 years has increased by Wellington’s total population on a region by region basis, and it is well behind in terms of funding.

Now, that member has explained that all the money is going into the provinces. I say good on the provinces for getting something and for getting growth. But I also remind that member, and I remind the Minister for Industry and Regional Development, that we are now facing a $10 billion deficit in trade, and it is not surprising we are facing that deficit if this Labour Government is spending money, and allowing Auckland and the regions to borrow money on credit, as if it were going out of fashion.

About 3 to 4 weeks ago I asked the Labour Government when it was going to put some controls on our balance of trade. It was a $6 billion deficit in trade then, it went up to $8 billion, and it is now $10 billion. Clearly, all the Government wants to do is to see New Zealand get into debt and more debt, so long as it can try to win the election on the basis of things being good. But there will be a time of paying the piper very shortly after the election, and New Zealand First looks forward to working with any other party to make sure we act responsibly in the best interests of New Zealand. As we have done in this debate, we have abstained from voting. As a responsible, non-aligned party, we are prepared to work with any party and, if necessary, to take the third option of sitting in the middle and approving votes as they come, one by one, as we have shown today.

Darren Hughes: Who’s your favourite?

DAIL JONES: Our favourite is the New Zealand public. Our favourites are New Zealanders, I tell Mr Hughes. That will come as news to that member for Otaki. But we favour New Zealand—first. That is who we favour. [Interruption] That is also something new for Mr Cunliffe, one of the spending Ministers.

Hon HARRY DUYNHOVEN (Minister for Transport Safety) : It is always a pleasure to follow my New Zealand First colleague. The junior Government whip made a very interesting interjection when he asked the New Zealand First member who his favourite was—who New Zealand First would go with. I think that is a really important question for the New Zealand public, because the New Zealand public very clearly heard New Zealand First the last time that party thought it was in that position saying to them: “Vote for us, and we will put National out.” But what did New Zealand First do? It went back with National.

However, I want to talk about regional development issues, because I think that they are really important issues. I am delighted to have been part of a Government that for more than 5 years straight has seen, in every quarter, the regions in this country prospering in positive growth. Nowhere is that more exemplified than in Taranaki.

• Sitting suspended from 6 p.m. to 7.30 p.m.

The CHAIRPERSON (H V Ross Robertson): The Hon Harry Duynhoven has just over 4 minutes remaining.

Dail Jones: If he wishes.

Hon HARRY DUYNHOVEN: In answer to Mr Jones, I do wish to continue my speech. It is always a pleasure to follow someone from New Zealand First, because it gives one quite a lot of debate material. The New Zealand First member had just been gleefully telling the Committee how New Zealand First was determining who would be in Government, perhaps, after the election. I want to remind the public of New Zealand that the last time New Zealand First members thought they were in that position they told the public to vote for New Zealand First to get rid of a National Government. And what did they do? They put a National Government back in.

I return to the topic of this debate, which is industry and regional development. I am absolutely delighted with the tremendous progress that has been made not only in my own region of Taranaki but also throughout the country and the regions, where we have seen economic growth second to none. We have seen huge development. Regions like the Waikato, Taranaki, and Whanganui—all sorts of regions in the country—have done extremely well under this Government. I can tell the Committee that in my own region—and in every one of our regions, actually, not just my own region of Taranaki—under this Government we have had a total, complete period of economic growth. We have seen quarter after quarter of continuing economic growth right throughout the country and the regions. This has meant that for the last 5-and-a-bit years in Taranaki we have seen continuing growth in all sorts of areas—engineering, film, and all sorts. We have seen continuing growth and, therefore, continuing employment. We have not only seen employment; for the first time in my political career, which now spans 15 years in total—with, regrettably, a 3-year break, which you might remember, Mr Chairman—we have the problem of attracting people to the region to fill jobs. The problem used to be finding enough work to attract people and getting them to stay. Now it is finding enough people to fill the jobs we have. In all skilled areas we simply have shortages. We will take any fitter-welders, engineers, electricians, and plumbers—skilled people who add value to the economy. We will take tradespeople any time in any place in this country.

This Government has been a partner with private industry. Our regional development policies have added a huge amount to that growth. The total investment in Vote Economic, Industry and Regional Development is now close to a quarter of a billion dollars. Contrary to what the National Party keeps telling us, 94 percent of that $250 million actually goes to delivery. Only 6 percent—a small percentage—goes into the bureaucracy making it happen. I tell the National Party that it can promise all the tax cuts it likes, and promise them on the base of no borrowing, etc.—it is not saying that, but it is leaving that impression by saying that tax cuts will come out of cuts to the bureaucracy—but such a small percentage of the New Zealand economy is spent on those involved in the bureaucracy that National is simply misleading the public if it is saying that savings will come out of the bureaucracy. It will either borrow and leave debt for our kids, or it will cut services. That is all that can happen. One cannot simply invent cuts. Mr Ardern can leap up and down all he likes, but he knows that what I am saying is the truth, just as his Taranaki predecessor did some years ago on the same sorts of issues. I am very proud to be the member for New Plymouth in this case.

• Vote agreed to.

Hon MARK GOSCHE (Labour—Maungakiekie) : It is wonderful to stand up in this debate and talk about housing. It is something we on this side of the Chamber are proud to speak about. It is an area where this Budget builds on previous Budgets in determining the difference between a Labour-led Government and the rest. What did those members on the other side of the Chamber do in the 1990s to fund their tax cuts for the wealthy? They sold 13,000 houses.

Hon Steve Maharey: How many?

Hon MARK GOSCHE: They sold 13,000 houses, which can no longer be lived in by the poorest families in this country. That is how members on that side of the Chamber fund tax cuts. Let us make no mistake about it—they would do so again. The National Party spokesperson—and apparently there is one; I think it is David Carter—

Hon Steve Maharey: No.

Hon MARK GOSCHE: Is it somebody else now? National has had about 15 in the last year. [Interruption] Is it Shane Ardern? [] Surely not!

The spokesperson went to Auckland and said that National would sell State houses again. That is what he told the property investors. They would have lapped it up, because they would have been buying the houses, rather than the low to medium income families this Government helps into housing through things like KiwiSaver. We will not sell State houses; this Budget actually talks about more State houses. There is more money in this Budget for houses to be built, which will provide employment, skill development, and housing for the low-income families of this country who need it.

Over the next 4 years, $134 million will be spent to provide 1,300 new homes for those in need. I congratulate the Minister in the chair, the Hon Steve Maharey. He is doing a wonderful job for the families out there who look to Labour for traditional things such as a roof over their heads that they can afford, not more of the market rents of the 1990s. When this Government came to power we got rid of those. We brought back income-related rents, and families in our communities benefited.

Judith Collins smiles. She pretends she represents the people of Papakura. She could not care less about the poor families of Papakura who paid market rents under the previous National Government. She was on the Housing Corporation. She implemented the policy. She was proud of the market rents and the sell-off of houses, and she would do it again if she were given the chance. But nobody is stupid enough to give her that chance—not in this country. [Interruption] She thinks screeching like that makes some sort of difference. She cannot hide from the fact that this Budget provides 1,300 new homes for low-income families, many of them—whom she ignores—in her electorate. The previous National Government sold 13,000 houses to fund the tax cuts of the 1990s. When we took over, hundreds of millions of dollars were built into the Budget from the sale of houses. Our biggest spend in our first year in Government, back in 2000, was not selling those houses. That is what cost our Government the most in the first year—we had to forgo all that revenue.

That is how National funds tax cuts. It attacks the lowest paid, the weakest, and the most vulnerable, and it sells their houses. Its mates on the Auckland City Council thought that that was a good lark, and they sold the pensioners’ houses as well. That forced this Government to come up with $80 million to buy those houses so that the elderly were not tipped out on the street by those Tories. Thankfully the people of Auckland decided that that was no good and they tipped those Tories out of the council, just as they will reject that horrible lot over there who say: “We’ll give you $13 a week, or $6 if you’re low paid, but, by the way, we’ll sell your State houses to do it.”—just as they did in the 1990s.

What does the National Party care about people in rural areas who have been living in sub-standard housing for far too long? This Budget puts an extra $22.6 million into that area over the next 3 years. We have State housing areas that have been run down and are not up to the standards of modern living, and we have allocated another $7.4 million for community renewal programmes in about five or six areas of New Zealand.

Healthy Housing is a wonderful project that deals with overcrowding. I heard the Māori Party slagging that and saying that we should be doing more of it. Well, I do not know where the Māori Party has been, but we started the Healthy Housing programme 5 years ago in my electorate, which has had the worst rate of meningococcal disease in the country, and we are making those houses better and healthier for Māori and Pacific Island families in particular. I expect the Māori Party to support that, not to slag it and vote against it. I expect National Party members to applaud it, but no, we will not hear that from them.

BRENT CATCHPOLE (NZ First) : I would like to pick up on a subject that is dear to my heart, and I must note that the previous speaker failed to mention it. In 5 minutes, he failed to mention anything about leaky homes. That just shows that this Government does not care about them. The member does not give a damn about it.

Hon Mark Gosche: It’s the wrong programme.

BRENT CATCHPOLE: Mr Gosche says that it is the wrong part of the estimates. Well, I would remind the member that it is definitely part of the Department of Building and Housing, and that very little money is being put aside to compensate people who own leaky homes for the problem. During question time I listened to the Minister for Building Issues, Mr Carter, talking about weathertight homes, and he made a joke of it. Once again, this Government made a joke of the leaky homes debacle. The Minister made a complete joke of the whole situation. He does not have the ability to really comprehend what a travesty this problem is for those people who have it. They face a serious crisis. Their homes are rotting and falling down around them. The value of their houses has gone through the floor, along with some of their furniture. It has reached the point where those people are devastated, because all their life savings were tied up in their properties.

Dail Jones: And what’s New Zealand First going to do?

BRENT CATCHPOLE: What are we going to do about it? New Zealand First wants to make sure that those people have an opportunity to have their properties repaired quickly. Then we will worry about going through the long, slow Weathertight Homes Resolution Service process, because the longer people leave it, the worse the problem becomes in the home. People’s homes rot around them while they are waiting. Those people have seen some of the $18 million appropriated in this particular vote for the 2005-06 year being spent on—wait for it—Sound of Music and Cowboys and Indians ventures around the country. That is not solving the problem; the Government is just sitting there, thumbing its nose at those people, and saying: “We are having a good time. We hope you get off the planet and do not worry about it.”

Over 3 years the Government has allocated $53 million for the Weathertight Homes Resolution Service. There are 3,500 claims before the service, of which only 10 percent have been resolved. That is about 120 claims being resolved per year, and that is not good enough. Today the Minister stated clearly that the average settlement is $46,000. That is absolutely ridiculous! For most of those property owners, most of the money they have received has gone into the cost of removing the cladding and of inspections, and into having lawyers—and they do need lawyers—and experts front up to the Weathertight Homes Resolution Service to make sure that they get a fair deal. Most of the money they have received has gone in costs. It is an absolute disgrace, and this Government is sitting there, thumbing its nose at those people.

Let us look at one of the things that has been blamed for this situation. Everybody has been blaming everybody else. They are pointing their fingers and saying: “It’s not me. It’s others who are at fault.” The Building Industry Authority was one of the parties to this situation. The Department of Building and Housing, which absorbed the Building Industry Authority, is being protected in every possible way from any legal proceedings. It is blaming untreated timber for the problem. If we think about what timber is, we know that it rots. It is a natural product and it rots naturally. So if we expose it to the natural elements, it will rot. Clearly, by putting it into a house after treating it with untested systems, it will rot. During 1995-98 the Building Industry Authority actually approved kiln-dried, untreated timber for housing.

DIANNE YATES (Labour—Hamilton East) : I am pleased to respond to the previous speaker, who was involved with the building inquiry and the Building Act, and who knows very well that this Government has done a great deal about the weathertightness of homes. We have had an inquiry and we have had a bill, and I thank him for the work that he did on the bill. He knows very well who was the chair of the Building Industry Authority when the complaints first came forward and who ignored them. It was George Chapman, a former National Party chairperson. The member also knows that the causes of leaky buildings are multiple and are part of building development. He knows that the problem is one of timber and design. He knows that it is a problem with regard to certification, and he knows that it is also caused by not having qualified, certified builders to do the work. He knows all that, and that we have just passed a huge Building Act, which he helped us to work on. It was 2 inches thick, and it has revised our building law. So the member should give us credit, and he should give himself credit for the work that he did on that bill with us, because—as he very well knows—the causes of leaky buildings are multiple and they are being addressed. I thank the Labour Government for actually doing something about that problem, and I say more shame on people like George Chapman, who just ignored the advice he was given and was going ahead with deregulation. Deregulation was one of the major causes right throughout the time of that building industry problem. We have turned the situation around, we have a new Building Act, and we have got things back on track. So let us put the record straight in this Chamber.

Let us also talk about housing. I thank the Minister of Housing for the wonderful job that is being done. As Mark Gosche has said, 13,000 State houses were sold off, which was a crying shame for working people in New Zealand. Many people in New Zealand had their start in life because their family got a State house. I thank Michael Joseph Savage and all the good Labour people who ensured the provision of that basis of life—a decent home to live in; a home in which to bring up our kids and give them a good start in life. That is vitally important, so I say thank you to Labour. In my electorate we are acquiring 90 houses a year, and many of them, thankfully, are lovely little two-bedroom units for older people. Older people are moving out of the big State houses and into new, smaller State houses. They are brick State houses, and have garaging with internal access, doors wide enough to get a wheelchair through, and walk-in showers. I thank Labour for having the insight not only to build new State houses but also to build ones that care for the needs of people in our electorates, and for caring for the people who need them. So a good deal has been done.

What is the result of State housing? It is, as our local schools will tell us, more stability in people’s housing. What is the result of that? It is that children stay at the same school, succeed, and pass their maths and English tests because they have decent houses to live in. They are living in the same area and going to the same school. Let us not forget income-related rents. People forget the good things that are done in good times, but they are things that make life better for Kiwis in this country. Another result in my electorate is that people are saying that the demand on food banks is down to a minimum. What did we have under Jenny Shipley? I would just remind the Opposition members that with Jenny Shipley we had tax cuts, superannuation cuts, benefit cuts, and job cuts. That is what we had under a National Government—and we will get it again, and people in New Zealand know that. People who care—the superannuitants, the grannies that I speak to every day, and the older people who can remember poverty and depression—will vote for a Labour Government, to make sure that we have not only economic growth but also stability for our people and decent social services. Jim Bolger used to talk about that—we should bring back Jim Bolger, if anybody from National. He used to know about having a decent standard of living for decent Kiwis, who will live in this society and not be sold down the drain by some bribe made at election time by Don Brash, who knows only about money, in his 1953 style. He is a 1950s man, and that is all he knows about. Let us have people in Government who know about real Kiwis who are living real lives in this country.

PAUL ADAMS (United Future) : I rise on behalf of United Future and I want to pick up on what I believe is a natural disaster in this country with the leaking homes situation. The Hon Mark Gosche, who is a man I personally respect, has really laid out a policy that New Zealanders had heard about. He talked about housing. He said that he was proud to stand up on the housing issue, but he was talking about houses that the Government owns. He was not talking about houses that hard-working New Zealanders own. He was not talking about the houses of young people who had saved up for a deposit and had put all their life savings into a home that they wanted to be safe and secure in and had expected to be watertight. They did not expect to have mould growing on the walls. They did not expect their home to be a safety hazard or a health hazard.

What did we hear from this Labour Government? We heard that nanny State knows best. The Government said: “We will look after what we provide for you. As for what you provide for yourself—tough luck.” Well, I say that the people of New Zealand are absolutely sick and tired of that type of mentality. There has to come a point in time when we will again support people who are prepared to work for themselves, and who are prepared to put their money where their mouth is, yet we have this natural disaster in housing in New Zealand—a ticking time bomb—that absolutely nothing has been done about.

If people want to pick up on an important election issue, I would suggest it is that thousands of New Zealanders are living in such bad housing conditions. If it were a workplace situation, there would be inspectors coming in to say it was a health hazard or a safety hazard. Why do we have concerns about the workplace? Because somebody else pays to fix workplace problems up. But with this issue, the Government really has to pick up the responsibility. We cannot let houses deteriorate as they are without taking some form of responsibility.

I have a set of papers here that were taken, I admit, off the website. There are 42 pages on how one deals with the problems in one’s house—but the house continues to leak and the damage continues to get worse. People have to go to the Weathertight Homes Resolution Service, and there are many technicalities involved in doing that, yet they cannot get legal advice and they miss out on opportunities.

I believe, and United Future believes, that this is a very serious issue facing New Zealanders at the present time. It is not only to do with safety; it is to do with long-term effects on the health of families. From my research, I find it is not just mono-clad homes that are affected but also brick homes and precast concrete homes, because if water gets in and cannot get out, we have major problems. I believe that we need to take responsibility. We need to put a plan into place so that repairs can begin on those homes.

There is only a 10-year limitation period on claims relating to building work. I can tell people, as one who has been in the car industry, that if we bring a 7-year-old car into this country we have to give it a warranty as if it is a brand new car, yet for a claim on a person’s home—his or her lifetime home—we say “10 years and you are out”. We in United Future say that the clock has been ticking for far too long and that we cannot continue to bury this issue. I believe the public of New Zealand is demanding some action from the Government and, as politicians, we need to get together and put a plan into place so that people can begin to get their homes fixed.

What happens if a State house begins to deteriorate? The Government will move in and begin to fix it and put it right. But anybody who owns his or her own house gets no help, and we believe that that is totally unacceptable.

Hon STEVE MAHAREY (Minister of Housing) : I shall begin my comments this evening by saying something about the previous Minister of Housing, Mr Mark Gosche, who spoke earlier in the debate and pointed out how important it was to have introduced a measure such as income-related rents. One of the priorities when we came back into power in 1999-2000 was to introduce that policy, and I want to pay Mr Gosche the compliment of saying that he drove that policy through rapidly. Although some of us do not have, I imagine, a great deal to do with the State-housing parts of our electorates, those of us who have would have seen an immediate difference. Even Mr Maurice Williamson, who is smiling over there, is happy and knows that even though he is a man who believes that the market should deliver everything, absolutely everything, he understood that there were certain things that the market was not doing well. This is called what he would recognise as market failure. Housing was not being delivered. So in his electorate, income-related rents had the immediate impact of people suddenly having money in their pockets.

Hon Maurice Williamson: I don’t have State houses.

Hon STEVE MAHAREY: Actually I do understand that Mr Williamson is as out of touch as he appears. He does not have any State housing in his electorate. But for those who do, we understand what happened, for example, with our local schools—the population stabilised. People stayed in their houses. Kids were able to go home and not have to be in an overcrowded setting. Their parents had some money in their pockets. They thought about people such as Maurice Williamson who, as part of the National Party, never knew anything about those who were poor, never did anything about people in those circumstances, and never thought about the circumstances that were caused by not having income-related rents. And in 6 short years later of a Labour Government, he still has no contact with people who actually have to make a bob each day.

He himself, of course, if I remember rightly, said he was coming into Parliament for only 9 years, and then over his dead body would he stay in Parliament. He must be up to about 18 years by now, and we will be pleased to see Maurice Williamson go. I think it is time to release him back into the market, any time he wants to return. I think that would be a very good thing to do.

But I come back to the point of Mr Gosche’s time as the Minister of Housing: that was an amazing step forward, for people who were on low incomes to have a house, money in their pockets, able to be stable in their house, and stable in their community. This has had an enormously positive impact on New Zealanders.

We have just released a book on 100 years of State housing. It is 100 years since we had the first State house in this country. It is interesting to read that book, because it shows that time and time again, people such as Maurice Williamson have come into power in New Zealand, begun to believe that the State did not have to provide State housing—[Interruption] I tell Maurice Williamson that it is a symbol of the market—and once again ruined the investment in State housing, and it has to be rebuilt by people who understand that the market simply does not always provide for people who cannot afford to buy their own house or afford a market rent.

That is exactly what we learnt in the 1990s. That is exactly what we are doing at this time—rebuilding the State housing sector, because without it we see poverty grow. We see all sorts of problems that grow from poor housing. We see all of the issues that were there when we came back in 1999.

Let me just say what we have done. First of all we have begun to provide houses again. Thirteen thousand houses were sold. The rest of the stock was on the block to be sold if the National Party had returned. They were sold not to the tenants—not to the people who lived in them—they were sold to anybody else. In many cases, that meant that speculators were buying those houses, taking them out of the hands of people who were poor, and making sure they never returned to those kinds of people. We are rebuilding that stock once again, and we will not sell that stock. We have to put ourselves in a situation where people who are in poor circumstances can get hold of a good-quality house.

Can I also say what the National Party did. It not only sold houses to people who actually did not need them, it sold the better stock. So if people go to Auckland, for example—and Maurice Williamson would not know this, because he does not go near people who are poor—and look at State houses, they will find that the houses that were sold were in places that were sunny, for example. Houses that were not sold were in places that were not sunny. They are cold. They are damp. They are places that are hard to insulate. That is the kind of stock we have been left with. We are now making sure that not only are we getting stock again, but we are building well-designed insulated houses that people can raise families in and feel proud of.

I have to say that time and time again I have been to fantastic new State houses that I would be proud to see any New Zealander in. We on this side of the Chamber, and I include my colleagues in United Future, want to see New Zealanders in houses that we as people who represent government in this country can be proud of. We want to know that those houses will be there to last, they are good quality, and they are good places to raise children.

We are also modernising houses all over the country. We are building houses in rural areas. Do people remember that when Labour came into power we were confronted by the fact that people had moved back to places like Northland, and their houses were literally burning down? We had the tragedy of children dying in houses in that area. The National Government had done nothing about that. It probably would have sold the candles that people used to light those houses, if it could have. We went back into those areas and we have begun to build houses, to move houses into those areas, and to pay for modernisation, pay for basic services like sewerage and water, so that people can live again in those kinds of areas.

One of the most important things, too, that we have set up is the innovation fund. In my area, for example, it means Lutheran churches can partner up with Housing New Zealand to get housing together for older New Zealanders and get them housed in decent communities. All over the country now, iwi, churches, and city councils are approaching us and saying that they have land, or money, or something they can put into a partnership, and we can then build more houses to enable New Zealanders to live in decent conditions.

We have also got back into home ownership. Don Brash says that New Zealanders should not be worried about owning houses. Unfortunately for Don Brash, they do. They regard owning a home as an asset, they regard it as part of being a Kiwi, so we introduced the Mortgage Insurance Scheme to ensure that people who are on lower incomes can buy their houses. Five thousand Kiwis will own their house in any one year, from that scheme alone. On top of that we have now introduced the KiwiSaver programme, which means that Kiwis will be encouraged to save their money so that they can buy a house and be independent.

I say to Don Brash that owning a house is the Kiwi dream. That is what New Zealanders believe should be their right, and they want the opportunity to do it. I know that Dr Brash, on a salary of $500,000 a year, working for the Reserve Bank was probably able to buy his own house. But other Kiwis who work hard in factories, for example, and who are on low incomes, need to get that step up into independence so they can buy their own houses. The Mortgage Insurance Scheme and KiwiSaver are two practical ways that Kiwis will be able to do exactly that.

I say to New Zealanders that there will be a very, very clear choice at this election. They can have a few dollars of tax cuts in their pockets, they can have the Government borrowing again, so that interest rates rise, or they can continue to invest in good-quality State housing, into an innovations programme that builds houses, and into programmes that allow New Zealanders to buy their own homes, raise their kids in their own homes, and have an asset to build up during their life. That is the trade-off. Either we have tax cuts of a few dollars, or a continued investment that is transforming the lives of tens of thousands of New Zealanders. I know, Mr Chairman, that you have to be impartial but I bet even you, sitting there, would be saying: “I know what I would vote for.”

STEVE CHADWICK (Labour—Rotorua) : Housing is one of the iconic brands of the Labour Government, and I am really proud of the initiatives we have undertaken since Labour has been in Government. I came in in 1999. We were selling our Housing New Zealand stock in Rotorua. It was disappearing underneath our very eyes to private landlords who were then, in turn, charging exorbitant rentals to poor families.

However, only last Friday I went to look at our urban renewal project in Rotorua, run by Housing New Zealand in Fordlands, which is a very deprived area in Rotorua. It is incredibly exciting. The whole community has come alive. What are they doing? They are doing up their houses, retrofitting their houses, and 36 houses have been retrofitted by Housing New Zealand. The children living in those houses, which were once overcrowded, have not been admitted to hospital this winter with bronchiolitis, pneumonia, and asthma. Parents have said that this is simply the most profound thing this Labour Government has done for their families and their children. This is not only about the houses that they live in. It is about putting the heart back into the homes of families, and poor families, around New Zealand.

I also saw urban renewal in Te Whaiti, a rural aspect in my community—a very remote village. All the houses there are being renewed by Housing New Zealand, with “sweat equity” going into the retrofitting of the houses. Those people, unbelievably, are also losing weight. One might ask what on earth that has to do with urban renewal, but they are coming alive. They have a reason to live. They have pride restored and self-esteem, in terms of doing up their homes. They are all going off to the primary health organisation for cheap doctors’ visits and have decided they will lose weight. Twenty-three of the families in Te Whaiti are now doing adult education—they are going to better themselves. This all came about because of this Government’s housing policy, and I am so proud of it.

Hon Maurice Williamson: Who wrote this?

STEVE CHADWICK: The other thing we are seeing happening at home is that groups like Women’s Refuge—and Maurice Williamson might know something about Women’s Refuge—are now getting help from the innovation fund to find accommodation to help women, to restore them back to their families, and to give them decent housing for the first time.

The other innovation fund project that is being led jointly with our district council is to find homes for the homeless. Housing New Zealand is working with the innovation fund to find a suitable house, in order to flush out those poor, desperate people who are living on the streets in poverty, and to get them decently housed in a house for the homeless to be run by the trust.

That is innovation. That is this Government going out on a limb for people in our communities, and people do not forget that. They have not forgotten about the ability to have pride in the home in which they bring up their children and their families. So this is not just about income-related State housing; it is about putting the hearts back into communities. That is what this Government cares about.

It cares about student debt, too, with the announcement made today, which is huge. Children are now saying: “I’m not going to be indebted forever. I can afford to start to save for my own home.”, and that is another KiwiSaver scheme. Today I phoned three of my children who have student debt. They said: “Mum, we can now look forward to saving for our own home, through KiwiSaver.” I say: “Well done, this Government.”

• Vote agreed to.

Hon STEVE MAHAREY (Minister of Research, Science and Technology) : I want to make just a brief comment about research, science, and technology and Crown research institutes, which will be dear to the heart of Mr Williamson, who does know something about this area as opposed to not knowing anything about housing. As National’s housing spokesperson, though, it would be useful if Mr Williamson did get to know his portfolio a little more than he does at present.

Hon Maurice Williamson: I’m not the housing spokesperson.

Hon STEVE MAHAREY: Well, who is the National Party spokesperson on housing? I say to Mr Williamson that I am afraid I do not think anybody in the country knows.

But let me return briefly to the issues of research, science, and technology and Crown research institutes. One of the interesting parts of this estimates debate is the fact that research, science, and technology and Crown research institutes have attracted no attention at all from Opposition parties. I think that is a real shame.

If we look at the formula for what we believe will be the future of this country, we see that it is clearly growth through innovation. How is that innovation driven? Obviously, it is driven through science, technology, research, education—those kinds of issues. Yet, time and time again, this Parliament does not see the kind of debate on research, science, and technology that it should.

I am sure that in this case Mr Williamson would join me in arguing that we do need to ensure that New Zealanders understand that their taxpayers’ dollars going into research, science, and technology will be the best investment they can make with those dollars, as long as we ensure that we are putting them into the right place. Since Labour has been in Government we have increased that investment by 56 percent, but one of the things I find as I travel around the country is that far too—[Interruption] No, not in the social sciences, as Mr Williamson is suggesting—too little. I am arguing that it would be very useful if the whole House were to begin to debate more about the research, science, and technology area.

The enthusiasm shown by Mr Williamson for the topic we are raising this evening is what should lead him and his party to start showing a lot more interest in this particular topic. I say to members of parties elsewhere around the House—New Zealand First, the ACT party, and United Future—parties that have raised issues on almost every other estimate, that I want them to begin to think about this particular vote. We have to convince New Zealanders that this is the investment we need to make. [Interruption]

Mr Shane Ardern says there is nothing there. I remind him that this vote, for example, had the single biggest increase for health research in the history of the health research vote. Overall, it was the single biggest change in—

Hon Ken Shirley: I raise a point of order, Mr Chairperson. The purpose of the estimates debate is for members to grill Ministers on the various votes. No member chose to take a call, yet we are all being subjected to this tirade from the Minister in the chair. It is actually against the purposes of the estimates debate.

The CHAIRPERSON (H V Ross Robertson): The Minister is perfectly entitled to take a call in the debate, as the member himself well knows. That is not a point of order.

Hon STEVE MAHAREY: I understand Mr Shirley’s frustration. He will not have many opportunities to express it again. But I tell him that I do have the right to rise in a debate like this and simply make the point that all parties are invited to start debating the issue of science, research, and technology, because if we as parliamentarians do not raise the profile of this particular debate, then the people out there in New Zealand cannot be blamed for thinking that it is not one of the more important parts of the Budget we spend each year.

Research, science and technology is a vital part of our Budget. We do not debate it enough. We as a Parliament ought to be pushing up its profile, and I would like to think that the next time we have a debate around research, science, and technology and the Crown research institutes, we will have a much healthier and wide-ranging debate on the estimates.

• Vote agreed to.

JUDITH COLLINS (National—Clevedon) : I rise to speak against the estimates in relation to the Ministry of Social Development and Vote Social Development. In relation to that, I would like to make a couple of points. I thought today that I might need to come along tonight and apologise to the Minister, because, as most people in this House know, I have been a stern critic of the wastage that has occurred in social development spending. I have also been a stern critic of the Families Commission and of the $9 million every year it gets from this Government as a pay-off.

Today, in the House, when I heard about the $9 million that is still going to be spent on singalong courses in the tertiary education sector, I decided that maybe I should apologise, because at least there is a Families Commission for $9 million, and we know that for that $9 million the commission has employed and sacked one chief executive in 3 months and given a secret payout to that chief executive, which apparently the Minister cannot tell us until, gosh, after September. It has also had a survey done, and about 2,500 people, probably all of them related to people who work for the Families Commission, have written in and said what they want for families and what makes families tick. That is $9 million, which is peanuts for this Government.

I will not apologise to the Minister, though, because I have also reminded myself that he has spent $127.8 million to fund a new service to help sickness beneficiaries and invalids beneficiaries in some way. We have a situation where the number of sickness and invalids beneficiaries seems to be continuously growing, and the best he could say to us today in the House was that those numbers are not growing quite as much as they were last year. Frankly, that is not good enough. There are 120,000 working-age New Zealanders on the sickness and invalids benefits, and we in the National Party do not for a moment believe that there are 120,000 working-age New Zealanders who need to be on the sickness and invalids benefits. What is most infuriating is the fact that that money—which should be going to help the people who really are sick, who are dying of cancer, and who have terminal illnesses and have to travel overseas to get treatment—is being wasted. That is what is so infuriating.

Governments do not have money; Governments simply use and borrow taxpayers’ money. There is no such thing as Government money; there is, in fact, only New Zealand taxpayers’ money. Taxpayers’ money should be spent on what New Zealand taxpayers need—that is, on dealing with the sick, on really looking after the elderly, and on really making sure that hip, knee, and cataract operations are done. Those are things that this Government has failed to do anything about, despite the massive increases in health funding. Tonight I have been sitting here listening to the debate, and I have thought about how time is valuable and about the amount of nonsense I have heard from the Labour Government. Certainly, I presumed, having heard the very good speech from the member from United Future who spoke previously, that United Future members would not be voting for this nonsense, but I have been told by one of my colleagues that unfortunately they will. I have to wonder why the people of New Zealand have to continue to wait to do something about this Government. Fortunately, we now have an election date, so something can happen.

Just the other day we saw one of the examples of bureaucracy and nonsense coming out of the Government in this area. It is something called Social Report 2005.

Steve Chadwick: It’s fantastic!

JUDITH COLLINS: I hear from the member for Rotorua that it is fantastic. Unfortunately, not everyone agrees with her. This document, which I calculate is at least 1½ centimetres thick, was described yesterday by the New Zealand Herald as “Scorecard a waste of money”. The goes on to suggest in its editorial that one of the first things the National Party should do in Government is to get rid of this PC nonsense—and when the says that in its editorial, then, by goodness, things are about to change. One of the things it says about the report is that it is full of Government propaganda—gosh, fancy that—and is uninformative. But Steve Chadwick says it is fantastic. The report suggests that everything is happy and lovely here in the land of Nod, but it does not explain why 30,000 New Zealanders are voting with their feet every year and going to live in Australia. It does not deal with that, unfortunately, and the reason it does not is that so many thinking young New Zealanders who can work have already gone. That is what is happening.

Lesley Soper: And why?

JUDITH COLLINS: They have gone because they know they are much better off in Australia. They are 25 percent better off in terms of money in the pocket. The reason why is that they get paid more and are in an economy that can do that. We in this country have to try so much harder. I tell Mrs Soper that one of the reasons those young people are going is that they are sick of being told what to do by a nanny State—a pack of parenting experts who would not know one end of a child from the other; a pack of people who are always poking their sticky little beaks into everyone else’s business and telling people what they can and cannot do. And, by goodness, they had better think nice thoughts! They are sick and tired of social engineering. They are sick and tired of being told in this sort of document from this sort of Minister that they are happy, and they are certainly not particularly happy with billboards that tell them that they are better off with Labour. They are certainly not happy about being told, yet again, how well off they are. This particular social report is just one of those superb indications of the wastage that happens with this Government.

What did this Government have to do to get Television New Zealand’s profits up? Fifteen million dollars was spent on advertising the Working for Families package. That is what it spent its money on. That was down from the $20-something million it was about to spend until one of my colleagues pointed it out. This Government is so busy waving everyone bye-bye at the airport that it is not prepared to take the tough decisions. One thing I find so interesting with this Labour-led Government—and I should acknowledge Jim Anderton’s Progressive Party, although I notice today that he did not use the correct name; that is the new name he has for it—is that it is so good at spin. We have heard that from John Tamihere. This social report, which is supposed to tell us all how happy everything is in the land of Nod, is one of the things—

Steve Chadwick: Read it.

JUDITH COLLINS: Strangely enough, I actually did read it. Clearly, that member did not. Obviously Mrs Chadwick either did not read it or is terribly impressed with glossy pictures and different coloured ink. They are some of the things that fascinate people in the Labour Party. They are very, very fascinated by glossy pictures, different coloured ink, and strange little fonts that most people cannot read without their glasses on. This document is not meant for reading; it is meant for looking at the pictures. That is what this is all about. That is one of the reasons why people are leaving this country. They are sick of being told all about how happy we are in the land of Nod. When I listen to the “women’s brigade” of the Labour Party, also known as “Labour’s Ladies’ Party”, I understand why so many people are on the sickness benefits and the invalids benefit. People like that have no understanding of the real world. They have no understanding of what it is like to get a real job and get real pay because this is the best money they have ever seen in their lives.

LYNNE PILLAY (Labour—Waitakere) : What a lot of drivel! I feel incredibly sad when I hear the bitterness and aggro that comes from the opposite side, from a woman member who kind of gives the word “woman” a bad name in this Parliament. And why?

Judith Collins: I raise a point of order, Mr Chairperson. I take exception to that.

The CHAIRPERSON (H V Ross Robertson): That is not a point of order. The member will be seated.

LYNNE PILLAY: It makes one feel one should be ashamed to appear to advocate for women’s issues, for things that this Government has been proud to introduce—things like paid parental leave, which has given the mums of this country so many opportunities to care for their newborn babies in their first 13 weeks of life. We think that is a good thing. Clearly, the Opposition does not think it is a good thing. It thinks it is a dreadful waste of money.

Opposition members bang on and on about Labour’s policies and how ineffective they are, despite the fact that this country’s level of unemployment has been turned round under this Government to become the second lowest in the OECD, with over 260,000 more Kiwis in work than in 1999. People are not standing outside the post office looking for work. Neither are they working for the dole. They are undertaking industry training and getting apprenticeships, which is something that was lobbied for by the union movement. The “union movement” is another dirty term, a dreadful term, for people on the other side of the Chamber. They do not believe in anyone advocating for working people. But, yes, the union movement advocated to this Government, and it listened. We are a Government that listens. We understood that investment in skills and training would be a great thing for our country, so that is what we did. Now there are 9,000 apprenticeships, and in the near future we will probably see more increases. We are a Government that is committed to skills and training.

The first thing the National Government did when it came into power was to scrap pay equity for women, which the National Party is totally opposed to. The second thing it did was to scrap the Apprenticeship Act. Overnight the National Government stopped training and skills in this country. We saw that devastation through the 1990s. When Labour got in, we fixed it. We gave hope to young people and created jobs by supporting business and creating skills, and we are seeing the rewards in our unemployment statistics now. We are seeing job growth, and that is a really good thing.

Again, we are seeing the Working for Families package bad-mouthed. Why would one bad-mouth that? Why is it bad to support working families in this country? Why is it bad for hard-working families in this country who have more than one child, who have two or three children, to get targeted tax relief so that they can provide the best opportunities possible for their children? Why is that a bad thing? I would ask Judith Collins that question, but I know she does not know the answer. All National wants is to return to the failed policies of the 1990s, when there was no training and no support for industry and families, when State houses were being flogged off as quickly as one could look at them, and when there was no support for education in this country. We know—we saw what happened through the 1990s.

Judith Collins was working really hard at doing I do not know what. She seems to think that people on this side of the Chamber do not know what hard work is. I look along at my colleagues and I know that they all know what hard work is. We are at the grass roots. We are talking to people all the time, just like our leader is. We know what is important to people in this country. It is training, education, and opportunity for people, for their children, and for their children’s children to enable them to sustain a good lifestyle and to have a future in this country. We see it with superannuation. What was another thing the Nats did when they came in? They said: “We aren’t going to touch your super.”, then they cut superannuation and tried to fool the people, telling our superannuitants that they had not cut superannuation. But they knew—and they were told very clearly—that they had reneged on their word.

We are a Government that is very proud of our policies. We are proud to support our families, we are proud to support skills and training, and we are proud to support education.

GEORGINA BEYER (Labour—Wairarapa) : Thank you for allowing me a call in the debate on Vote Social Development. I would watch out for that cold ill wind of change that came across the floor before. Where have we heard it before? Mrs Collins was so Shipley-esque in her delivery. What happened in that era? It was a grave ill wind. It was nipping—it was more than nipping, it was savaging. Tatters is what was left of social development in this country under that National-led Government. One cannot trust a National-led Government to support and invest in New Zealanders who need most help. It has proved that in the past.

This Government has delivered. We have the lowest unemployment rate in decades—not just in terms of the general statistics of unemployment, but also in terms of the Māori statistics. It is all about social cohesion—about getting all the bits of the puzzle coming together, and forming and working well in various areas. This debate might be about social development, but our investment as a Labour-led Government has been in New Zealanders.

What I heard before from the member Judith Collins was not about us investing in all New Zealanders as fairly and inclusively as possible. The figures in this Budget that we are talking about tell us that benefit numbers are declining. People are finding jobs through the initiatives that this Government has employed over the last 6 years, and has given strong and positive indication that it will employ in the coming 3 years. That is most definitely a defining issue in terms of the difference between us and the cruel, cool wind that could blow in from that icy blue National Party over there.

I advise New Zealanders to be wary, and to think very, very carefully before they make that vital decision on September 17 about who delivers and who they can trust to deliver. So far, the Rt Hon Helen Clark, the Prime Minister of this country, who has led us well; Minister Maharey, in reference to the debate on social development that we are addressing at this point; and the inclusive policies of the Government in general have added to the social cohesion and the nature of a far more happy nation. We are happy to be proud of who we are—we are not talking ourselves down at every opportunity, which does not add value to New Zealand. We on this side of the House actually think of the future, as evidenced by the announcement today by our Prime Minister and Mr Mallard. What a wonderful announcement it was for the grandparents and parents of this country to contemplate, and, most certainly, for the greatest beneficiaries of it at the moment, the students of this country. They have some hope—

Hon Member: Graduates.

GEORGINA BEYER: Indeed, graduates. There are many more reasons to stay in New Zealand or return to New Zealand apart from those announced today. That is already obvious to the country, if one cares to look. Indeed, I really do believe that the Opposition should take great note of what has been achieved.

I heard Judith Collins slag off the work that, I have to say, the Ministry of Social Development—its chief executive and all its staff—has had to do to restore the tattered infrastructure of human resource that was eaten away in the 1990s. When I heard that ill wind coming from Judith Collins, I thought it was so Shipley-esque. It was under Mrs Shipley’s leadership that so much of the vital infrastructure that helped all New Zealanders and those most in need anywhere and everywhere—in the provinces and in cities—was lost. I can tell members that what this Government has been able to deliver in the last 6 years has been nothing short of a miracle. It has come back and recovered from the tatters left by the National-led Government of the 1990s.

I am very, very wary of the decisions that will be made in the future. So I ask New Zealanders, as they listen to this debate tonight, to analyse for themselves what is of greatest benefit. We in the Labour Party invest in New Zealanders. We in the Labour Party are proud of what New Zealand has to offer and of what it exports internationally, and we show it by our positive policies.

MOANA MACKEY (Labour) : I am very pleased to stand up to support the estimates for Vote Social Development. I am a member of the Social Services Committee, and I can say categorically that this area has been one of the true success stories of the Labour-led Government over the past 6 years. It just kills the National members. It absolutely kills them that no matter how hard they try to spin the numbers, and no matter how hard they try to re-jig and re-evaluate everything, they cannot get away from the fact that under this Labour-led Government there are almost 100,000 fewer working-age people on benefits than there were when we took over from the previous National-led Government in 1999.

One of the things that has been raised with me at home by local Work and Income workers is that they are sick of the Opposition parties standing up and saying that somehow they are fiddling the numbers. Somehow those parties do not believe that all the people concerned have come off benefits. They believe that somewhere in the system the Work and Income front-line people must be shoving people off an unemployment benefit and on to a sickness benefit, and that somehow their dishonesty somewhere along the way is causing the numbers to change.

Dr Wayne Mapp: It’s the Government.

MOANA MACKEY: Mr Mapp agrees. Mr Mapp is calling out, and he agrees. Well, I say to Mr Mapp that there are 100,000 fewer working-age people on benefits now than there were in 1999, including sickness beneficiaries. I ask Mr Mapp to try to spin that one—he cannot. I feel for those front-line workers, because they do an amazing job. They are doing active individual case management, which is working, because people are moving from the unemployment benefit into work. Since 1999 I believe only 7 percent of people have moved off the unemployment benefit and on to the sickness benefit. The rest have gone into work, and that figure speaks for itself.

What does the National Party have to offer? Its members sit over there bleating, but what do they have to offer? I was looking on the Internet the other day, and I thought that I must have hit an archived file. What I saw was Work for the Dole. Work for the Dole is the National Party’s answer to unemployment in New Zealand. National did that in the 1990s, and the scheme was an abject failure. Earlier today we had Dr the Hon Lockwood Smith stand up in the House, seething and spitting over the announcement today of Labour’s tertiary education policy for graduates who have student loans. He claimed that we must have ignored Treasury reports and the reports from officials, because why else would we have done that? He said the officials could not have said that policy was an OK thing to do. Of course, in the 1990s, when the previous National Government reviewed the Work for the Dole scheme—or Work and Income reviewed that scheme—Work and Income said it did not work. It said that people who were on the Work for the Dole scheme were less likely to move into real jobs than people who were not on the scheme. Did National listen to the officials? Obviously not. Treasury said that for every four Work for the Dole jobs created, one genuine private sector job was lost. That is what Treasury said. Has National listened to that? Obviously not.

The reality is that it is all very well to say we will make people who are on the dole go out there and do jobs in the community, but there are people in our communities now who do those jobs for a living. That is what they do. They are the small business contractors and the small business owners, who cannot compete with the State-sanctioned Work for the Dole scheme. They cannot do that, and I think that is an important point. The people who provide those very important services in our communities should be very worried that business could be taken off them and given to people on the dole. That is the reality if National implements the Work for the Dole scheme—and the experience in Australia has been exactly the same. I hear the National Party members talk about how in Australia a similar scheme has been a great success, but it has not. The evaluation in Australia also stated that participants in the work for the dole scheme were less likely to move into real jobs. In fact, it stated that they were markedly disadvantaged, and could not get real jobs.

What kind of employment scheme is Work for the Dole, when it actually disadvantages people? It would be bad enough if the Work for the Dole scheme, with all the money and the investment that goes into it, produced no measurable outcome. But to make things worse—I have to wonder why National has resurrected that policy. To do it once might have been OK. National did it once and people said they thought that when people did not have time to look for jobs they would not get jobs, and said they also thought the scheme would take work away from many of the small contractors in their communities. It might have been fine that National did try Work for the Dole because it thought it sounded good. Admittedly, it is a good sound bite—it sounds good to be tough on beneficiaries, in order to get them out there. But to have the scheme reviewed and shown to be a failure, and to bring it up again, is pure foolishness.

Dr MURIEL NEWMAN (Deputy Leader—ACT) : I am rising on behalf of the ACT party to take a call in this estimates debate. I would like to start off by saying it really is a tragic fact that Labour has failed to take advantage of the unique opportunity provided by the great economic conditions it inherited to address the very serious problems we have in welfare and with families.

The reality is that the economy has done well, not because of Labour, but in spite of Labour. This Government has failed to set New Zealand on a path to prosperity. That opportunity was within its grasp and it has failed dismally. Instead, because of ideological reasons, Labour has introduced some 30 new taxes, charges, and levies, which means that wages that had risen in households around New Zealand have, in fact, been wiped out, and working families are no further ahead now than they were before.

It is a shame that the Labour Government has not taken the opportunity to address the problem in welfare, because welfare is the biggest cost to New Zealand. That cost would not have to be made if the Government worked with the welfare system properly. I am pleased that tax cuts are now a major election issue, because ACT members have campaigned on that area since we came to Parliament.

ACT members have also campaigned for welfare reform. It is a great tragedy that Labour has abused the goodwill of New Zealand taxpayers by failing to require able-bodied New Zealanders who are being paid benefits—being paid to waste their lives in a dead-end way, I might add—to go out to work. The interesting thing is that Labour has also sat on its hands with regard to evidence that shows children raised in families on welfare fail to do as well in almost all areas of life. The Labour Government should have reformed welfare, not just to get parents back into the workforce, but to also give a better go for children.

It is a scandal, at a time when the country has a shortage of workers that is crippling our economy, that 74,000 adults are still reliant on the dole. They are being paid to do nothing. The Minister shakes his head. I am talking about people receiving the dole and their spouses or partners. The Minister’s figures show that there are 74,000 such people. There are some 50,000 sole parents on the domestic purposes benefit whose children are at school and who could be working, as well. It is a disgrace that when we add up all the people of working age who are on welfare, the total comes to almost 320,000 New Zealanders. Half of them could be working.

This Minister and his Government have failed to make the provisions to ensure that those people go and get jobs. There are jobs for Africa in our economy at the moment. The Minister and Government members can shake their heads, but their failure to make the welfare system work is an abuse of the taxpayers of New Zealand, and it is keeping our taxes so high. By the way, if we brought in proper welfare reform, lower taxes would be affordable in the long term.

What is worse is that Labour, with its soft-on-welfare policies, has made benefits easier to get on to and harder to get off. It has increased the welfare net through the Working for Families package and has turned working families into beneficiaries. It has gone soft on benefit fraud. It is allowing beneficiaries to rip off the system and is doing very little about it.

And, of course, it is fiddling the figures. We all know that the number of people who have moved from the dole to the sickness benefit or the invalids benefit has escalated. We know that a lot of people now call themselves students and do dodgy courses. We also know that the public service has expanded dramatically, and I suggest that there are a lot of make-work jobs there.

Having said that, it is better for people to be in any job than to be on a benefit, but the point is that Labour is so desperate to make the figures look good, it has failed to get people who could work off a benefit in order to fill the jobs out there that need filling.

Hon STEVE MAHAREY (Minister for Social Development and Employment) : I, like many people in the Chamber, will miss Dr Muriel Newman when she goes, because, unlike the National Party members, at least she consistently raises criticisms about the issues that matter most to ACT. I think the problem—as has occurred all the way through this debate—is that although Dr Newman has raised a lot of criticisms, we have yet to hear a programme that New Zealanders really believe would be practical and useful in relation to the area of social welfare. That, I guess, is why ACT is polling at 1 percent—the criticisms may be there, but the answers, unfortunately, are not.

I want to go back to Moana Mackey’s comments before, and to say that I am looking forward to the election campaign. I do not think that any of the candidates who are either in the Labour Party or in the parties that have supported the Government over the last 3 to 6 years will have any difficulty at all, in any debate anywhere in the country, when talking about the issue of welfare. Let me say why that is the case. If we look back to the 1990s, we see that unemployment peaked at 11.9 percent across the whole of the population—11.9 percent. That was in 1992. The official Māori rate of unemployment was in the mid-20s under that Government. The Pacific Island rate was around 20 percent under that Government. Whole towns of people simply could not find a job. Whole towns of people lived in overcrowded conditions—people were unable to find a decent house. The list of things that were wrong went on and on. In 1995 one in three children in New Zealand lived in a household whose income was below the poverty line. That is the picture in a nutshell, just using the headlines that the 1990s took us into.

The 1990s were a time when the Government decided it should not invest in social issues, should cut benefits, and should demonise people who were on a benefit. If a person was on a benefit, he or she was a bludger, according to the previous National Government. It claimed beneficiaries were the problem, not the fact that there were no jobs out there, no decent housing, and so on—it was the individual who was the problem. By the end of the 1990s, not only was it possible to reel off figure after figure of what was essentially a social deficit but most people in the country who had any conscience at all had come to the belief that the Government’s policy was just unfair, mean-spirited, and bad, and had decided that they would not tolerate having a Government that turned on the most vulnerable people in the country in that way. One of the major reasons National lost the election so comprehensively in 1999 was that it followed policies that made people feel that the Government was unfair when it came to the vulnerable people of this country. [Interruption]

Since then, Mr Ardern may like to know, the whole picture has changed. The experts at the New Zealand Herald who write its editorials—and I do not know where they received their qualifications in social policy from—have told us that they do not want to hear measures of progress around social policy. Well, I am really sorry to say that Labour does. We regard it as being essential to know that there is less poverty in the country. We regard it as being very important to be able to tell New Zealanders how well we are doing socially. In the 1990s the previous National Government could not, and did not want to, do that, and the result was that those issues were ignored until they became hugely costly problems that had to be repaired, over the last 6 years, by this Government. We will have a social report. That report will tell us that New Zealand has improved on 16 of 22 measures, which has made sure that we are now in the top half of the OECD and are improving on social well-being in this country. The OECD calls New Zealand a “jobs miracle”.

If we take the benefit area, having got that general picture of the hustings going, we can say that 164,000 New Zealanders were on the unemployment benefit when Labour came into power, and that 50,000 New Zealanders are on an unemployment benefit now. For the first time there has been a sustained drop in the number of people who receive the domestic purposes benefit. I want people on the domestic purposes benefit to go back to work, and I say to members of the Committee that we have to do things that are practical if that is to happen. We have to provide childcare, for example; otherwise people cannot go back to work. The Government has been putting childcare in place. For the first time we are seeing the number of people on the sickness benefit level off. We are now looking at the possibility of the number of people on the sickness benefit going down—but not by talking about it, and not by saying that we should get tough on people who have serious illnesses and somehow make life hell for them. We can say that we now have good, practical policies. In fact, every single developed country in the world is looking at those policies, because they can see that we, unlike them, are seeing a real difference in the number of people on the sickness benefit. We are also seeing, for the first time ever, a decline in the number of people who are coming on to the invalid’s benefit. We have policies that work in a humane and just way to get people off the benefit and into the mainstream of society again, and earning a living, which is where the Labour-Progressive Government wants them to be. That is what we want.

When anybody in this House comes to a forum in his or her area, that member will find candidates will stand up and say that the area was going backwards before this Government came into office. They will say it had a regional economy that was failing, people were coming on to the benefit, and people and businesses were leaving the area. The situation is exactly the opposite of that now. If anybody in the House wants to invite me, I will welcome the opportunity to come and do an election forum in his or her electorate, and I will talk about welfare with the people in that area. The National Party can put up its genius ideas about what it wants to do. We will talk about 6 years of practical, humane, just gains for the most vulnerable people in the communities of the MPs in this House. I look forward to that. Barbara Stewart can invite me to come to her area. I will be right there. Mr Craig McNair can ask me. I will be right there. I will come to Shane Ardern’s region in the King Country, and we will have a good debate with the farmers there. We will talk about how everything is getting better.

The last thing I want to say is that the ideas we have had from the National Party so far are things like the compulsory immunisation of children. I listened to Mrs Judith Collins the other day at a forum. Someone said that he or she understood National wanted to compulsorily immunise children, and asked how it would do that. Mrs Collins said that National would just do it. The person asked how National would do that, and what would happen if the parents said that they were not going to have their children immunised. Mrs Collins’ response was that compulsory immunisation had happened in America. The questioner asked what had been done in America, so as to know how National would force parents to immunise their children. Mrs Collins’ response summarises the entire National Party campaign. She told the people at the forum not to worry, that National would not do compulsory immunisation now, and that it would figure that out when it got into power. I say to Mr Ardern that that is one of the other reasons why I am really looking forward to being in his electorate and debating his policies, because the National Party cannot actually tell us how a single one of its policies will be implemented. The National Party is like Mrs Muriel Newman: it is full of complaints, full of gripes, and full of attacks on people who are vulnerable, but it does not have a single workable idea to put before the people of this country.

These estimates deserve the support of this Committee. In the social development area we have made a huge difference. I am enormously proud of the people in Work and Income and the Ministry of Social Development. I look forward to working with them again after the election.

CRAIG McNAIR (NZ First) : In speaking to Vote Youth Development, I want to talk about a positive experience I had the other day. I visited a gentleman who runs a youth conservation corps project in Omaha—an outdoor education trust. It was great to see some of the projects they had been doing in the few months that the programme has been running. It was encouraging to see the kinds of things they had been doing. They had not been doing things just for themselves, or things that were fun. They had been doing things like painting people’s houses—things for the community—and I could see that it was a positive programme.

So often we talk negatively in the House, and so often that is the right thing to do because we need to focus on the problems that are facing our country. There are a lot of things that are not right that we need to get right. It was very encouraging to see this project, and to see that young people in our communities—in the Rodney area where I come from—are able to foster a bit of community pride, and a sense of discipline and self-esteem in their lives.

In focusing on Vote Youth Development, New Zealand First would like to expand programmes such as this in order to foster that sense of pride, purpose, and direction in our young people. We know that many young people are struggling with issues such as youth suicide, and all the other problems that are caused by a whole lot of issues in our communities such as unemployment, family problems, family breakdown—and the list goes on.

There are some other programmes that New Zealand First would like to implement, such as targeting youth recidivist offenders and entry-level crime, and helping those offenders to get into industry or military-type training. New Zealand First believes there is a real need for that, and that it would go a long way towards fostering that pride and sense of purpose I was just talking about that I saw a lot of people developing in the Conservation Corps. But the young people I am talking about, as far as military-style training and so on is concerned, are at another level. They have been struggling for quite a while, and are at the notice of police and other authorities within the community.

There is also another point, which was mentioned earlier. We could tell that members opposite were very opposed to the community wage, which was New Zealand First’s idea. New Zealand First implemented it in 1996. It was not surprising to see the National Party copy another one of our policies the other day. The community wage rose again, and all of a sudden the National Party was in favour of it. New Zealand First implemented that in the 1996 coalition Government.

Lindsay Tisch: I raise a point of order, Mr Chairperson. I note that this is a debate on the Appropriation (2005/06 Estimates) Bill, and so far the member speaking is propounding a view of his party’s policy. It is interesting that his party abstained on the last vote. When I look at youth development in the Estimates, on page 1450, and that is what the debate is about, I do not see anything there to do with New Zealand First’s policies. I think it would be appropriate to stick to what the debate is about, and that the member confine his efforts to what is actually in the Budget.

The CHAIRPERSON (Hon Clem Simich): Thank you for raising the issue. It is not a point of order.

CRAIG McNAIR: I will continue with my speech, then. I was specifically talking to Vote Youth Development, because when we talk about appropriations we are also talking about what we want to achieve.The truth might hurt that member—that he copies just about every policy that New Zealand First puts out. Everybody else in this Chamber knows that that is the fact, that that is the case. It might hurt him, but facts are facts.

I was specifically talking about the estimates of appropriations, and about the Conservation Corps—how we would like to expand that programme. I was totally within the parameters of the debate. But before I was so rudely interrupted by that member, I was going to say that one of the Labour members was talking about how Work and Income New Zealand said that the community wage did not work. Well, I do not believe that Work and Income New Zealand is the most impartial source of information as far as the community wage is concerned. I know somebody who went through one of those programmes, and now he is a qualified nurse. He is married, he has a little family, and he is doing really well and contributing to society. He is actually fulfilling a need there, because we need more males in the nursing profession. He is doing great, he is a very good worker, and he has been nursing for a few years now.

So I think it is a case of who one talks to. A lot of people have said positive things about those programmes, and I believe there are positive things to come if one votes for New Zealand First.

Hon STEVE MAHAREY (Minister of Youth Affairs) : I thank Mr McNair for his contribution to the debate. One of the good things about MMP, obviously, is that we have younger people coming into Parliament, and that means we have a spread of interests around the kinds of portfolios we have to debate. The fact that we have a lot more younger people here in Parliament means that we have an interest in youth policy. So I thank the member for his interest.

I am delighted that he went to see the Conservation Corps. I visited a branch myself just recently in Christchurch. They were a group of young people, all of whom said they had no idea what they were going to do with their lives. They came from churches and groups around the city, and they had all somehow become connected with the idea of the Conservation Corps. They had just come back from a programme of looking after kiwi around the Canterbury area. They had gone off into the hills and camped. They had not actually seen kiwi but they had heard them. The young people were out there basically to try to trap stoats and all the predators that get into kiwi in their particular area. I spent about an hour chatting with that group, just as, no doubt, the member did. I came away totally impressed with a group of young people who clearly had a whole lot of issues going on in their lives, but right then they were focused, they were doing something practical, and they were all beginning to get a sense that when they came out of that course they would go on to something else, because they wanted to do that.

One of the interesting things, though, that I want to suggest to the Committee in terms of these estimates, is that members will notice some changes to Vote Youth Development. It has come across to what is called the Ministry of Social Development platform. That means that the nine people who do policy and the 14 people who are involved in administration are now part of a much bigger organisation. That has given them reach right across the country, so in each of our areas around the country youth development will now have a presence in a policy sense. Our aim is to get out and talk particularly to young people, so that they can be heard in terms of the issues that they feel impact on them.

It is interesting talking to young people, I find. The issues that interest them are often not those necessarily that I think they should be interested in, but that is what we should be doing—finding out what is on their agenda and what they are talking about. The Ministry of Youth Development is doing that, and on top of that it is looking at what it might do with its programmes.

One of the things we have found with areas like the Conservation Corps is that the number of young people who are available to come along to those kinds of courses has shrunk, because the rate of youth employment now is higher and people are often in tertiary institutions. There is not that same big pool of young people who are available to come into those programmes. So members will also notice in the estimates that there is money available for youth development, to respond to what members hear around their regions in terms of new and interesting styles of programmes that young people might be able to identify, which might make a difference.

One of the things we do find as we sit down with different groups of people is that some will say: “Yes, the Conservation Corps is exactly what I want to do; I would love to get out there and do something out in the hills and so on for my community.” But others say that they would not mind doing a leadership programme or learning how to run something. So one of the things we will look at is how we can use that money within the Ministry of Youth Development to respond to what we hear from young people in terms of programmes. So I am impressed with what we have, and I am grateful to hear that Mr McNair and, I guess, other people around Parliament are also hearing good things about what the Ministry of Youth Development is doing.

But I say to people in the Committee that there are opportunities to have a look at new things that might be done. That will be one of the things that MPs like Mr McNair, who are connected to younger people around their communities, might like to make a feature of in the next year. They can feed back through the Ministry of Youth Development, and hopefully we will end up with some more programmes that are very interesting.

Shane Ardern: I would be very worried now if I was in the Green Party.

Hon STEVE MAHAREY: Mr Ardern, who has long parted company with young people, intervenes there, but Mr McNair is somebody who is connected, and I was interested to hear him say how he enjoyed being in contact with that programme. The invitation is there to look at how money might be spent on new programmes that respond to young people.

• Vote agreed to.

METIRIA TUREI (Green) : I rise to speak on behalf of the Green Party, and particularly of our human rights and foreign affairs spokesperson, Keith Locke. The Greens want the Minister of Foreign Affairs and Trade, and of course the ministry, to be focused on promoting human rights around the world in a more systematic and bold way than they are now. Labour has gone considerably further than the preceding National Government on human rights issues, but sometimes it baulks at the final hurdle.

We have seen that over the last month on Zimbabwe. The Government has taken a strong stand against the Zimbabwean cricket team coming here in December this year, because of the inhumane, repressive actions of the Mugabe regime, and the Government will not be giving visas to a visiting Zimbabwean cricket team. The Prime Minister also moved a strong motion today condemning the Black Caps’ cricket tour of Zimbabwe. However, if that does not shift New Zealand Cricket and get it to go to the International Cricket Council to get out of its Zimbabwe contract, then stronger action is needed.

Only the Green Party is pushing for that stronger action in the form of a draft bill that would make the Zimbabwe tour technically illegal, and provide a token fine on New Zealand Cricket of up to $50,000. That would definitely get New Zealand Cricket out of its International Cricket Council contract. Our bill would not infringe on any person’s right to travel, but would just put a token sanction on New Zealand Cricket for going ahead with an official tour in the same way that economic sanctions, which New Zealand has enforced in the past on several countries, put some legal restraints on businesses trading overseas.

On China, the Government has spoken out against some of the actions of the one-party Chinese regime more than the previous National Government did. However Labour has been fairly timid about pushing for the right of the Tibetan people to self-determination, and it does not acknowledge Taiwan’s right to self-determination. In both cases, the Green Party is not advocating independence but is just promoting the right of the people themselves to determine their own constitutional structures. Our co-leader, Rod Donald, sparked a wave of support across New Zealand when he held up a Tibetan flag outside Parliament Buildings during the visit by the head of the National People’s Congress of the People’s Republic of China. The Green Party strongly upholds the rights of all Chinese people who stand up for their rights of free speech and organisation, and the right to religious freedom. The Falun Gong meditation group, for example, is severely put down in China today. Many thousands of their group have been arrested and even killed. One of the reasons our Government’s human rights promotion is a bit weak is that trade interests are often seen as pre-eminent. The Labour Government is very keen on getting a free-trade agreement signed up with China, and although that does not mean it goes completely quiet on human rights, it does mean that it is treading too softly.

In Burma, MPs representing the democratic party were forced into exile when the military junta cancelled the result of the 1990 election, won overwhelmingly by Aung San Suu Kyi’s National League for Democracy. The visiting MPs were pushed for an economic boycott of Burma. I recognise that this Government has sanctions on visits here by members of that regime, but the Government should go further. This is one of those areas where the Greens think that the Bush administration is actually doing better than New Zealand—wash my mouth out! It bans imports from Burma, and it bans investment in Burma. Standing up for democracy in our region is particularly important, and is perhaps the real test. It is relatively easy to speak out against the repression in Darfur, which is so far away, and when we do not have much in the way of political or economic relations with the Sudan.

The test in our region and in the Pacific today is how strongly we speak out for democracy in Tonga. There is a big divide in Tonga between the monarchy, which runs the show, and the people who vote in each election mainly for candidates of the human rights and democracy movement. Over the last couple of months we have seen big protests in Tonga over corruption and for higher wages for civil servants. The Green Party backs the people of Tonga in their struggle to achieve democratic government, economic justice, and an end to corruption. It will require a strong Green presence in the next Parliament, and perhaps in the Government, to get Labour to speak out much more strongly for human rights in Tonga and elsewhere.

Hon MARIAN HOBBS (Associate Minister of Foreign Affairs and Trade (Official Development Assistance)) : I am very happy to speak to Vote Foreign Affairs and Trade, as it includes NZAID. But before I do, I want to make reference to the capability review carried out by the State Services Commission working with the Ministry of Foreign Affairs and Trade, because I am really concerned. Over the last few weeks and months we have heard this whole story about tax cuts, and we have been told that the simple way to fund tax cuts is to cut the bureaucracy. Those who tell us this refer to the bureaucracy as “pen-pushers”. They totally forget the bureaucracy that represents us overseas—our diplomats, whom we call on absolutely in times of urgency. I will refer to that in a minute.

The capability review was done. As a result of the capability review, which is referred to in the Foreign Affairs, Defence and Trade Committee’s report on the estimates, a 5-year funding package was designed to enhance the ministry’s capability in areas crucial to Government security and prosperity priorities. I would like to know whether, if any party but Labour forms a Government, it will honour such funding that has gone into protecting New Zealand’s interests.

There were five main areas of increased funding. One was simply remuneration. If we are asking people to do trading deals, we need them to be good lawyers. If we are asking people to define the marine areas between Australia and New Zealand, we need them to be good international lawyers. They do not come cheaply, and the Ministry of Foreign Affairs and Trade has to compete out there with private enterprise and overseas organisations. Remuneration meant that we were losing a number of really highly qualified people into areas of private enterprise.

We also need good infrastructure. By that I mean that it is too easy to bomb undefended buildings owned by embassies in some of the more exciting places around the world. Therefore, we have to protect the people who work for us overseas. Some of them had not been well protected. Their infrastructure had been left to run down. It was very important that we dealt with that.

This includes information technology. I could take members into some of our overseas embassies and find the room that contains the machine that sends messages overseas, and the axe that is on the wall in case this room is invaded—I saw it in Vienna—in which case one takes the axe to the machine and breaks it down so that the information cannot be coded and sent back to New Zealand. Information technology inside the Ministry of Foreign Affairs—

Darren Hughes: I bet the National Party caucus wishes it had that system.

Hon MARIAN HOBBS: It may well do. This information technology really needed to be updated. Quite seriously, we had people unable to communicate with each other easily inside our foreign embassies.

Then, of course, we have training, particularly training in languages. The world is increasingly getting smaller, but the languages are still different. Under a previous Government, language training was savagely cut. We have replaced that training. We have restored the capability of the Ministry of Foreign Affairs and Trade. This is called public service. This restoration of ability is in danger from parties that say they will cut the public service. They have talked only about not cutting some things in health and education, but this is a public service that is in danger of being cut in return for $30, $13, or $6 a week for some people—maybe.

Then we come to the question of understanding how crucial it is to have a solid public service in, for instance, our response to the tsunami. The phones went bananas when that tsunami happened. Thank goodness we used the Red Cross out there this time. But I came into the department 2 or 3 days later and found 30 or 40 people working on the books, taking down details from the Red Cross to check where New Zealanders were in Thailand, Indonesia, Malaysia, etc. They were doing that as overtime work, I suppose one would say, but they surely were not getting overtime. That sort of consular work needs to be supported and upheld by a ministry—that is, public service.

Another area in this vote is disarmament. It is mentioned again in the estimates, because we have put in funding of $1.2 million sought for contributions to the G8 global partnership. Some of that money is there to make sure we do not have people out there selling nuclear weapons or weapons of mass destruction such as chemical weapons, taking them from places like Russia and redistributing them around the world.

That is why New Zealand has contributed money for the destruction, with the support of the Russian Government, of chemical weapons inside the former Soviet Union. That is valid work. It is work about peace. It is work about building and holding a nuclear-free world. That is something we hold to very, very strongly—not just in the Labour-Progressive Government but in New Zealand.

There is no way our nuclear-free status will be gone by lunchtime. That would absolutely fly in the face of a commitment we have made and stood for on the international stage for so long, and on which we have been honoured for the work we have done.

Then I think about multilateralism. One of the reasons why we did not go into Iraq and join the coalition of the willing is that that was the antithesis of multilateralism. That was countries deciding to go in on their own, with a few friends. They were a strange variety of friends. They were countries that really wanted to be friends because it would probably be to their financial advantage to be friends. New Zealand did not do that. We have been challenging—and New Zealand citizens have been challenging—Dr Brash to say whether he would now go, or whether he would have then have gone, the unilateral way rather than the multilateral way of working within the United Nations systems. That is what we are on about, and that is what we support and work with.

The multilateral system, though, requires an extraordinary amount of hard work, and it requires support. As the Minister with responsibility for working with the disability sector will know, one of our ambassadors in New York chaired the committee on the disabilities treaty—I cannot think of its exact name—that is being worked on, and won us enormous kudos around the world for his ability to listen to and work with disabled members of the international community in looking for a system of human rights. That same ambassador also won us enormous kudos for his work with the small Island States, particularly at the conference in Mauritius following straight on from the tsunami. Then, of course, we have the kudos we get from the work of other ambassadors such as our disarmament ambassador in Geneva, who has recently coordinated the New Agenda Coalition and chaired the conference on disarmament. Such people know and believe in multilateralism, and New Zealand flags have flown high because of their work.

Finally I come to NZAID. NZAID, a new baby on the block, is a semi-autonomous agency. It sits on its own and has worked out where it goes. Right now we have a report out there internationally saying how good it is, but asking us to please give them some more money. Well, in the estimates we have. We have made an increase of 23.5 percent—an extra $60 million.

There are numerous examples of the achievements we will be making and working on as we focus on negating poverty in the Pacific. All New Zealanders should be proud of these ministries and the work they do. They should be funded seriously, as we have demonstrated we will do, and as we as a Government have done.

JILL PETTIS (Labour—Whanganui) : I want to take a brief call because this is an important debate and it is not one that always attracts a great deal of attention—not that I hold myself up as an authority on foreign affairs issues, but it is something I have a particular interest in.

Shane Ardern: Thank God for that!

JILL PETTIS: Unlike Mr Ardern, who has never been much further than the farm gate, nine members of my family have given service to this country, and they have contributed in many ways. So, because of that connection, I do maintain an interest in foreign affairs issues.

This issue has been very prominent in the media recently, and more so because of the huge uncertainty coming from the Leader of the Opposition, Don Brash, about the position the National Party would have taken in regard to Iraq. This is not a light issue. This is about sending combat troops overseas. This is about sending our sons and our brothers. I am a parent. I have a 33-year-old son who would be old enough to be conscripted or required to go if the situation were exacerbated, so we have a personal interest in these types of matters.

What was glaringly obvious to this country was that Don Brash clearly cannot be relied upon in a time of crisis. Did anybody feel like saying: “Gosh, this man makes me feel safe.”? Did anybody feel like we felt when Tony Blair came on the BBC after the first tragic bombings in London, where he made us feel safe? Did we feel like that when Don Brash was on TV being interviewed and he was equivocating, vacillating, and could not give a straight answer if he tried? No, we did not feel safe. We saw him on television and we thought: “God help us!”, because he did not make us feel confident.

It got worse, because Mr Brash then went on television the next night and tried to clear the situation up, but he did not make the position very clear at all. In fact, it got worse. People became more embarrassed. It was one of those situations where one says: “Oh please, God, let him shut up—this is so embarrassing!”. It was like that.

That man is not good in a crisis. In a time of international and national crisis, we need to know that the person who is in charge gives us confidence and that that person knows what he or she is talking about and what he or she is doing. That person needs the ability to lead. That man could not lead a shadow, and he made us feel very much afraid that there are some people who will be misguided—innocently, in many instances—into thinking that that man could lead. That man could not lead a shadow.

One of the other issues that is of huge concern to us is his vacillation in regard to our position in Iraq, because it is not Mr Brash and the chaps over there who are going. They are not capable. But many young people in New Zealand would be capable of going. They are the young people who would be going. They are the young people, I have to say—and I am not saying this too emotively—who would have been home in body bags by now because, as sure as night follows day, we would have suffered casualties.

That was the man who would have sent people away without any certainty or confidence about why he was doing it. They are huge decisions to make; they are not decisions that one seeks information from one’s advisers on. They are issues where one builds up a lot of personal experience and knowledge before one sends mothers’ sons away to be shot. I do not have any confidence in Mr Brash’s position on Iraq, at all.

The National Party is making a big mistake about its position on New Zealand’s nuclear-free policy. It is very worrying and very dangerous.

• Vote agreed to.

MURRAY SMITH (United Future) : Our justice sector is in crisis. When the Justice and Electoral Committee found that out during our review of the estimates, a number of the members were, like me, shocked to find that this crisis had been hidden by both the National and the Labour Governments over a period of some 15 years.

When we did the financial review, which we commenced at the end of last year, we interviewed the Ministry of Justice. Its officials advised us that they had a plan for a baseline review of the justice sector, and that they had established a team to undertake a comprehensive review of the ministry’s capability, and to examine whether baseline funding was adequate for the delivery of services. As we reported in our published report, at that time they told us that the main reasons for that review were the need to meet new expectations following the merger of the Department for Courts with the Ministry of Justice, and the fact that the baseline funding of the Department for Courts had not been reviewed since its inception in 1995.

We bought that line because we were aware that the merger had occurred recently, and we felt it was reasonable to give the Ministry of Justice a bit of time for this situation to settle down. It now transpires that there were, in fact, a lot of more serious issues going on, and it was not until that review was published and we looked into the estimates that we discovered just how serious the situation was.

Although we interviewed Ministry of Justice officials on 10 November 2004 and the baseline review was completed on 17 December 2004—a mere 1 month later—it is interesting that a copy was not provided to the Justice and Electoral Committee until we undertook this review, and little was said publicly. It was something that the Government kept very much under wraps because of its contents. The Audit Office was quick in its report to us on the estimates to point out the serious nature of some of the comments made in the baseline review that revealed the crisis situation we are in.

Ministry officials then told us that, effectively, the reasons for the baseline review were growing delays in case disposal, increased concerns from the judiciary about the level of judicial support, concerns about the information technology infrastructure of Vote Courts, visible deterioration in many court buildings, and broader problems in providing certainty to Ministers about workloads and associated costs. It was a very different story from the one we had been given when we looked at the financial review.

These are some of the comments that came out of the financial review. “Workload demand is unrealistically high for the current level of resourcing in the policy areas of the Ministry.” We were told that the policy area was under a lot of stress. The review continued: “All work remains at a reactive level and medium-term thinking and policy development has been sacrificed to the time pressures of immediate requirements.” I would point out the language that is used. Normally, in a review, we see fairly read-between-the-lines types of statements that are more passive; the use of terms like “sacrifice” shows just how serious the situation is. The review stated: “The quality of policy work is reflected in the increasing nature of demand, but has suffered in some areas from the ongoing time pressures and the need to constantly juggle resources. The functions of the policy group are broad, and encompass some operational functions as well as policy work. This means essentially that a low resource base is spread across a wide front, creating a thinness in almost all areas.” It stated: “There are unmet requirements for work in two areas—to complete the general policy work programme, and medium term strategic policy development.” It also stated: “Currently, the Ministry does not have the capability or capacity to enable it to lead sector strategy, planning, monitoring and reporting. Current resourcing is one FTE, which has resulted in progress being intermittent, based on scant analysis, and very limited in terms of sector collaboration.”

We on the Justice and Electoral Committee had been told that the Ministry of Justice had accepted a leadership role in terms of the sector, and that it would lead sector strategy planning, monitoring, and reporting. We then found that there was one full-time equivalent doing it, and that its ability to do it was severely compromised.

I conclude by saying that these issues are particularly serious, and it is time we looked seriously at this whole area of the justice ministry.

TIM BARNETT (Labour—Christchurch Central) : I have to say that I think that that was an unnecessarily gloomy presentation by Murray Smith of the situation of the Ministry of Justice. It did occur to me as I was listening to him that he represents a party that I understand is supporting tax cuts, yet it seemed from what he was saying that he was very clearly supporting further spending on what some people would quite unfairly label “pen-pushers”.

It seems to me that there is a very successful story to tell both in terms of law and order and in terms of justice. In the last 6 years we have seen New Zealand’s crime rate go to the lowest level for 23 years. Labour in Government has responded to the outcome of the referendum in 1999 by implementing a series of tougher laws. That means that the more serious offenders spend longer in prison, having been sentenced for longer periods; also, there is a higher barrier prior to their getting released. The Parole Board is looking at issues of community safety rather than at previous criteria. Four new prisons have been opened in that period, and New Zealand now has, internationally, a very high imprisonment rate. At the same time we have invested in more police staff and in more resources, so for the first time this year the police budget went over $1 billion. Many of us will see the challenges now as being in improving rehabilitation. Therefore, the new investment in the Budget this year was also looking at how to turn round the lives of people who end up in prison.

Side by side with that law and order policy we have a number of notable successes in justice, and Murray Smith spoke a bit about the situation in justice. I think the ministry has been very successful in what it has done to improve the human rights and civil liberties of New Zealanders. I shall give just a few examples. We expanded the human rights legislation so that individual New Zealanders can challenge Government for breaches by Government and in law about human rights principles. We passed the care of children legislation that came in just 3 weeks ago—a major rewrite of our guardianship and parenting law. We removed New Zealand’s link with the Privy Council and established our own domestic Supreme Court—a highly significant decision. We passed legislation to give rights to people in same-sex relationships and civil union. We have passed legislation to improve the ability of individual New Zealanders to complain about judges. We now have a proper judicial complaints system. We have built up powerful victims’ rights legislation, and the Justice and Electoral Committee that Murray Smith and I are on now wants to embark on a further stage of strengthening victims’ rights. We passed clean-slate legislation, which affects about one-third of a million New Zealanders. It enables them to hide minor past convictions to get on with their lives.

I think that represents a very powerful story in law and order and in justice, and I am very proud to present that record to the Committee.

• Vote agreed to.

BARBARA STEWART (NZ First) : On behalf of New Zealand First I rise to speak to the Appropriation (2005/06 Estimates) Bill. There is still a lot of work to be done in the health area, and that was emphasised some time ago in the New Zealand Herald polls. We all know that health spending has increased, but the outcomes in some areas have not increased proportionately. We are referring particularly here to children’s oral health and the adolescent oral health service. There is no money set aside in the Budget specifically for that service. On the Health Committee we were told that it would come from the health capital budget. We must hope that that money has actually been ring-fenced in the estimates for that particular area. The chronic shortage of resources for that service is a real concern, and it should be of concern to the Minister and the Government, because the bottom line is that children and teenagers need oral health-care. We do not want to see a return to the 1930s, when those who could afford to have oral health care had it, while those who could not had no teeth. It is interesting that there has been no announcement or any action taken on this issue. We want to know what has happened to the action that we were told was under way. We know that two reviews have been undertaken, but we need to see action, and we need to see some money being allocated to that particular area.

It was very disturbing to see last month that there was a mass resignation of Southland dentists from a scheme providing free care for children referred from school dental clinics. That should send a message to the Government that action is urgently required in order to prevent the complete collapse of the scheme. We know that the subsidy for dentists to carry out work on children’s teeth has been inadequate for many years—we all know that in this Committee. The accident compensation fees of $67 per visit are about 75 percent of the average private fee charged in Southland, but the Government has set the dentists’ fee for schoolchildren at around $33 for a basic treatment. That is obviously way below a level that is acceptable for dentists, who are not charities. They require reasonable fees for the services that are carried out. We know in this Committee that school dental therapists do a great job, but there is a time when they do need to refer children to dentists in order to have far more complicated work carried out.

The parents of the Southland children who need dental care will now have to pay for it. If they cannot do so, then their children will be added to the waiting list at Southland Hospital for that treatment, and we all know what the waiting lists are like. They are often quite lengthy. It is difficult to tell a child who has toothache to wait for actual treatment. We know that the situation in Southland is not unique, and that the dental care system for children and teenagers throughout the whole country is at risk of collapsing under the weight of inadequate funding. The Minister has done lots of talking about the system that she would like to see established, and it is time that we saw some action before it is too late. We urgently need some action there.

We were pleased to see that honouring the nurses pay settlement will be carried out in these estimates. That is essential, because that will bring nurses’ pay up to a reasonable standard. But, of course, it does absolutely nothing to address the issue of staff retention and other areas where workforce planning is actually required for the future. Here we are talking about our medical workforce: our nurses, our doctors, our cancer therapists, our dental therapists, of course, and many others. We need to retain their services, because after all is said and done they provide the health services for our people.

We note too that the funds allocated to rest homes are only enough to maintain the status quo. It is very unlikely that any money will filter down to the caregivers for the elderly, who we all agree in this Committee are chronically underpaid. Another area that requires immediate action is the mental health services. The Ministry of Health has estimated that 3 percent of the population has a serious mental health problem, and we know that there has been some increase in funding there.

HEATHER ROY (ACT) : The previous speaker was quite right when she said there is much work yet to be done in health. There is indeed a lot to be done. This year, $3.5 billion more was poured into health than went in when Labour came to power in 1999—a 57 percent increase. That is a huge amount, and the Government constantly boasts about it. The problem is that it is always easy to spend somebody else’s money. This is not the Government’s money. It is the money of the people of New Zealand, the money they have given to the Government—some of which is spent on their behalf on health services. I would like to say here in this Chamber, and to New Zealanders, that this money is not being wisely spent.

Figures collated shortly before Labour came to power in September 1999 showed that 180,401 people were waiting on surgical waiting lists and waiting to see a specialist for the first time. With an extra $3.5 billion a year, and 6 years down the track, the number on those lists, as at the end of April this year, was 180,672—an extra 271 patients are waiting on the waiting lists. This is 6 years down the track, after Labour claimed that it would slash waiting lists when it came to power.

Another way of looking at how well the money is being spent on health is to look at the number of operations being performed. I asked the Minister of Health earlier this year how many operations were carried out in the 2000-01 financial year, compared with the 2003-04 financial year, because those figures were easy to retrieve. She said that the number of case-weighted discharges in 2000-01 was around 270,000. Three years later, with a population increase of 4.3 percent, that figure had reached 273,000, and I am rounding up the number slightly.

So with a population increase and from the numbers she had given me, I worked out that per head of population the number of discharges had decreased in that time, despite huge injections of cash into health. So fewer operations per head of population are being carried out, but basically the same number of people are on waiting lists, so what value is the taxpayer getting from the tax dollar? I would contend that it is very bad value.

When I presented the Minister of Health with these figures—and remember that these are her own figures; they are figures I have been given by the Ministry of Health and by the Minister of Health—she said: “But I’m very proud of the 40,000 more discharges that we now have.”, the 40,000 more operations that she says are being done.

On 9 June I put down a question for written answer, asking the Minister to give some more information on that. When she said: “I will take more responsibility for the 40,000 a year more medical and surgical discharges.”, I asked: “What is the full yearly breakdown of medical and surgical discharges upon which this is based, broken down by financial year, and what is the source of this information?”. She made that statement in answer to an oral question I asked, but the answer I received to my later question, and this is the same answer by and large that I have had to all the questions I have asked in the last 7 weeks, was: “It has not been possible to obtain the information required to enable me to respond to this question by the due date.”

Is that not staggering? She has 4 hours to get an answer to an oral question, and she was able to give us a figure in reply to that question, but 7 weeks after I asked a question for written answer, she still has not been able to get the information. Despite my phoning her office frequently she still seems unable to get this information. So she goes around the country, saying we have 40,000 more operations, but where is the proof? It is not there.

Unfortunately New Zealanders are being tricked into thinking that this Government is doing a good job in health—that it is doing more operations. Well, it is not. These figures are unsubstantiated, and they are already included in the figures the Minister has given me.

This is a disgrace. The Minister of Health keeps saying she has provided New Zealanders with transparency and that figures are readily available to the public. This is not true. The website tells only part of the story, and the figures she gives to newspapers around this country and gives to us in this Chamber deal with only part of the problem.

One of the real difficulties with waiting lists is the category of “active review”. Active review is the waiting list to get on to the waiting list, and this continues to grow, too.

JUDY TURNER (Deputy Leader—United Future) : I want to refer to the Health Committee’s response to the estimates and I am interested in focusing my 5 minutes on primary health organisations. Certainly, funding for the 2005-06 year included $24.9 million for increased primary health organisation enrolments. This was all about extending the subsidies to people in the 18 to 24 age group from 1 July 2005, and then funding in the out-years. In the middle of all this we also come up with the fact that Treasury has said that it is concerned about the sustainability of the current rate of growth in Vote Health. The Minister explained to us that in her view there was a need to rebuild the health system, and she included in this issues of staffing, infrastructure, and facilities. She also made us aware of the fact that a working-group made up of Ministers and officials from Treasury and the ministry has been established to look at the long-term sustainability of health funding.

In the context of where we are now, heading into the election, certainly there is evidence to say—and this is mainly anecdotal—that there is a small reduction across the board in hospital admissions. No extensive research has been done to get a clear picture of this, but when questions are asked across different district health boards and different projects, like KidzFirst Children’s Hospital in Counties Manukau, some encouraging outcomes are starting to show themselves. This seems to be linked to the primary health organisations.

That is the first thing. However, when we look at the fact that there are nearly 1.2 million adult New Zealanders across two age categories—spanning 25 to 64-year-olds—we see that both categories are encompassed. Nearly 1.2 million people are actually enrolled in interim primary health organisations. I got that information from an answer to a written question I put to the Minister. So we still have quite large numbers of people who are associated with primary health organisations but who are not yet experiencing the roll-out of the full subsidy.

National seems to be a bit unclear about what it plans to do about primary health organisations, and I have concerns. United Future members are clear. We would like to see this endeavour rolled out. We think it is heading in the right direction, and we want some questions asked. We think that the Treasury report, when it comes out, will be very interesting on whether the funding formula for primary health organisations is exactly right. We have some question marks on that. Certainly, reports in the New Zealand Herald seem to indicate that National has been giving signals that it wants to reverse plans to provide cheaper doctor visits for all New Zealanders and appears to have, despite contrary claims by Dr Brash, some interest in cuts to health spending. Whether Dr Paul Hutchison is responding to a concern about the sustainability of Vote Health or whether those cuts will be reflected in the tax cuts National is yet to announce is all very unclear. However, I do think that voters going into the next 6-week period need to look very, very closely at what the parties’ policies are in regard to reducing hospital visits.

United Future believes very strongly that the real key to a robust health system begins with the ability to access one’s local general practitioner and the ability to afford, without hesitation, a visit to one’s doctor. It certainly concerns me. I have lived through times of having sick children and having to check my bank balance to see whether I could afford to take them to the doctor, and of making judgment calls around the health of my children based on whether I could afford to go. I know the appalling feeling that can create in a family. Therefore, I think it is really important that the Government also look very closely at whether doctors and primary health organisations are delivering on these cheaper subsidised cares. Certainly, where there is no cap to their co-payment, there are some real worries there.

TARIANA TURIA (Leader—Maori Party) : I shall focus my kōrero on diabetes. New Zealand has made some incredible achievements on the international stage, including, of course our Ngā Rauru and Ngāti Ruanui golf champion winning the United States Open. We will all welcome him home later this week, and that is Michael Campbell. But there is another world record that nobody is talking about. An epidemic of type 2 diabetes is occurring in New Zealand, driven mainly by demographic trends and the increasing prevalence of obesity. The epidemic most severely affects Māori and Pacific peoples. Mortality rates for Māori are six times higher than those for non-Māori, and the situation is just as bad for Pacific peoples.

Just 3 weeks ago public health experts gathered in Wellington to discuss the fact that health inequalities are still evident. The conference concluded that it was ironic that while some politicians are making political mileage out of claiming targeted interventions as race based, those same politicians are not standing up to draw attention to the race-based inequalities that created the need for the interventions in the first place. Looking particularly at race-based privilege in relation to Māori, I point out that Māori develop diabetes 10 years earlier than non-Māori do, Māori are four times more likely to develop type 2 diabetes than non-Māori are, and we are overrepresented in cases of diabetic renal failure, with rates up to 10 times that of non-Māori. What is of even more concern is that a study undertaken by Dr David Tīpene-Leach and his colleagues revealed the very high prevalence of insulin resistance among Māori from the East Coast north of Gisborne, particularly young adults below 40 years of age. Such a finding indicates that type 2 diabetes is already well established in our midst.

So what do the 2005 Estimates of Appropriations say about such a vital health issue for this nation? In the 50 pages allocated to Vote Health, the word “diabetes” was mentioned once, on page 727. This is a life-and-death issue. Diabetes causes approximately 1,200 deaths per year, and, in fact, at least 1,000 people lose their limbs. There was one mention of diabetes in 50 pages, and no specific Budget investment. We cannot afford to wait any longer. These are issues of great significance to Vote Health. Diabetes presents a significant health challenge for Aotearoa and should be a major priority for health investment. We should be seeing a comprehensive, multifaceted strategy to address this disease on all fronts. Prevention and better-quality care could reduce costly hospitalisation. Indeed, half the cases of kidney failure and dialysis, blindness, and amputation could be prevented if more money was invested. We need gold-star treatment and we need it now.

One of the most bizarre statements in this year’s estimates is the following: “The Ministry of Health is the Government’s primary advisor on health policy and issues and its contribution to improving health and independence is largely indirect.” One would have thought a policy agency would take direct responsibility for analysing the demographic trends, assessing the population demand, and forecasting appropriate interventions. The recent economic study commissioned from PricewaterhouseCoopers estimates that current services for diabetes costs the taxpayer about $247 million. If current services are kept at similar levels, the estimated cost of diabetes will be over a billion dollars each year by the year 2021, in current dollar terms. That is because of the projected increase in the numbers of people developing complications such as blindness, limb amputation, and dialysis requiring hospitalisation.

• Progress reported.
• Report adopted.