Hon BILL ENGLISH (Minister for Infrastructure) : I move, That the Infrastructure Bill be now read a first time. It is my intention to move at the appropriate time that the Infrastructure Bill be referred to the Transport and Industrial Relations Committee for consideration, but note that the committee may wish to ask the Social Services Committee under Standing Order 283(1) for its opinion on Part 4, which includes amendments relating to affordable housing, and that the committee report finally to the House on or before 13 November 2009, and that the committee has authority to meet at any time while the House is sitting, except during oral questions, and during any evening on a day on which there has been a sitting of the House, and on a Friday in a week in which there has been a sitting of the House, and outside the Wellington region during a sitting of the House, despite Standing Orders 187, 189, and 190(1)(b) and (c).

The Infrastructure Bill progresses a suite of amendments across several Acts to facilitate infrastructure development by removing unnecessary barriers and improving the consistency of regulatory arrangements. The Infrastructure Bill is an omnibus bill of four parts covering three areas. Parts 1 and 2 improve the arrangements for managing access by utility operators, such as electricity, gas, telecommunications, and water operators, to road and rail corridors. Current arrangements are inconsistent across utilities, which creates inefficiencies, uncertainty, and disputes. This leads to delays and to higher costs for operators, for local authorities, and for the New Zealand Transport Agency. Part 3 amends the New Zealand Railways Corporation Act 1981 to remove some of the statutory restrictions that negatively affect the running of the Railways Corporation’s business, and to bring the entity’s governance arrangements more in line with equivalent provisions in the Crown Entities Act 2004. All of this is relevant to the operation of KiwiRail. Part 4 repeals the Affordable Housing: Enabling Territorial Authorities Act 2008 while retaining an amended prohibition on restrictive covenants affecting social housing.

In Part 1 the bill establishes a framework for a national code of practice that governs how utility operators and corridor managers coordinate their activities. To enable industry participants to develop and take ownership of the code, the bill allows anyone to prepare a code, but the code must meet certain requirements before it can be approved by the Minister of Transport. The code must have broad agreement between stakeholders, include the method by which any statutory criteria are to be applied, and must include operational and dispute resolution processes. A code approved by the Minister under this legislation will be deemed a regulation. It will impose an obligation to comply on all utility operators and corridor managers unless parties otherwise agree. This obligation is backed by the ability of the court to order compliance with the code, and to impose a fine if that court order is not complied with. There is no requirement to have a code in force. However, if there is no code suitable for approval and the Minister identifies a need for one, he or she may make regulations in place of a code.

Part 2 of the bill amends the Telecommunications Act 2001, the Electricity Act 1992, the Gas Act 1992, and the Local Government Act 1974. This is to provide for consistent provisions across the Acts around reasonable conditions of access to the corridors, allocation of costs when utility operators are required to move assets, and time periods for notification and response. The Crown has a particular interest in the passage of this bill as it contemplates the roll-out of broadband around the country. Amendments to the Railways Act 2005 and the Government Roading Powers Act 1989 provide time frames for responding to requests for access to rail corridors and motorways, and require corridor managers to publish the criteria on which they will base their decisions to grant access. This will, hopefully, overcome what one would describe as a patchy performance across the country by those who look after our rail and road corridors.

The Railways Corporation is a Government agency that manages New Zealand’s rail infrastructure and almost all rail services. Many of the provisions of the New Zealand Railways Corporation Act are outdated because it was written when the Railways Corporation was a Government department and the major reforms of the State Sector Act had yet to occur. This, of course, has become topical since the Crown purchased KiwiRail and fitted it back into the Railways Corporation structure. While KiwiRail was in private ownership, these provisions of the legislation, obviously, did not apply to its operation. But now many of the provisions of the New Zealand Railways Corporation Act are anomalous when compared with the equivalent arrangements in the State-Owned Enterprises Act and the Crown Entities Act. Part 3 of the bill amends the New Zealand Railways Corporation Act to bring those provisions in line with equivalent provisions in the Crown Entities Act. The changes proposed in the bill include normalising the appointment and dismissal of directors, changing to a simple majority the number of directors who can call a meeting, establishing the power to appoint a deputy chairperson, and streamlining arrangements for changes to the Railways Corporation’s capital—probably the most important of the changes suggested. The bill also removes a requirement to annually provide the Minister with a programme of capital works, removes the limit on how much the Railways Corporation can expend in 1 year, and permits the Railways Corporation to effect insurance cover for, or give an indemnity to, a director or employee.

Part 4 repeals the Affordable Housing: Enabling Territorial Authorities Act 2008 while retaining an amended prohibition on restrictive covenants affecting social housing. The Affordable Housing: Enabling Territorial Authorities Act was intended to provide local authorities with regulatory tools to address problems of housing affordability. However, the Act has been viewed as a potential impairment to increasing the housing supply. In fact, it was a very misguided regulation passed by the previous Government that was consistent with its usual interfering and nitpicking way of doing business.

For instance, local authorities are rightly concerned that the Act is complex, costly, and overly prescriptive. Developers have pointed out that the Act is probably counter-productive, and likely to reduce rather than increase the supply of affordable housing, whatever that is. I might say that it did not really define affordable housing. The associated processes create regulatory barriers that contradict the initiatives of this Government to reduce regulatory barriers and compliance costs. Recent evidence demonstrates that the regulatory powers are, in fact, inadequate in increasing the supply of affordable housing. Moves to encourage the building of new housing need to ensure that regulatory and other costs are contained, and that opportunities for development are enhanced. It seems pretty obvious: we should write some rules that make it easier to build housing, not harder. In addition, the supply of residential land, using existing planning systems, through rezoning could result in an increase in the housing supply, which would make housing more affordable.

Section 30 of the Act currently addresses growing concern at the use of covenants to exclude social housing. These covenants unfairly discriminate against some of our most vulnerable people: older people, children, and people who require assisted living. Restrictive covenants against social housing in one area lead to concentrations of social housing in another. To address the growing obstacle of restrictive covenants, a modified version of the prohibition relating to certain restrictive covenants will be included as an amendment to the Property Law Act 2007.

This legislation deals with a number of issues relating to enhancing infrastructure investment in our transport and rail corridors, enabling better operation of the rail infrastructure of this country, and taking a step in the direction of cleaning up the regulatory mess that is preventing the development of affordable housing. I commend the bill to the House.

Hon SHANE JONES (Labour) : Tēnā koe, Mr Deputy Speaker. It is a pleasure to follow the Minister for Infrastructure, Bill English, on an area in which both the main parties share similar concerns. Firstly, I say that Labour will be supporting this bill to go to select committee. It has reservations about Part 4, which have been unwisely exaggerated and distorted by the earlier speaker, but that comes with the territory of his type of politics. We hope that when the matter is referred to select committee at the end of the first reading debate some thought is given to the carve-out of Part 4. I will deal with that part first.

Part 4 reflected a policy initiative at a time when housing affordability captured a great deal of political attention, media words, and, quite frankly, societal anxiety. Indeed, Phil Heatley and a host of other National politicians who sat on the Commerce Committee, if I recall, were very enthusiastic about the affordability inquiry run by that committee into the housing prospects of everyday New Zealanders, and what a Government at a point in time could do.

That initiative—which, as I recall, my colleagues Mr Carter and Maryan Street were advancing—was an attempt to deal with the inexorable rise in the cost of providing infrastructure as developers sought to expand housing estates. At the end of the day, councils needed a clear way of ensuring that future ratepayers were not saddled with excessive bills in terms of maintaining infrastructure, and they had a way of ensuring that the developers contributed along with local government to make some of the housing affordable. My suggestion is that that part actually be taken out of this proposed legislation and dealt with separately, although it is highly likely that ongoing friction and movement in the market will address it in a way that none of us can fully comprehend.

Let us deal with the three areas that this bill touches on. It is beyond cavil that anyone who has a vision or aspirations for modernising our economy has to continue to invest in infrastructure, just as Labour in 2006 advanced with some studies of its own and dealt with the fact that there were far too many blockages in the system according to infrastructure developers. For those reasons this party has already reflected in the Local Government and Environment Committee that it will be taking a very progressive stance in relation to the amendments that are coming back to the House via Nick Smith and the Resource Management (Simplifying and Streamlining) Amendment Bill, which is a small part of what this bill tries to address.

Access to roads, motorways, and rail corridors is an essential part of ensuring that we do not slip off the radar and end up in an economic international category that is not a part of the OECD, or that does not suit our aspirations and dreams of ensuring that our children have a modern economy, and that communications, transport, and a whole host of other goods and services we take for granted can continue to be delivered in a very efficient way. That is why we are very keen for this bill to go to a select committee and hear as many submissions as possible.

The bill proposes changes to the New Zealand Railways Corporation Act. This area will always be a source of some debate between the two main parties, as will another area of infrastructure, which unfortunately has been completely overlooked in any meaningful way in this bill: the role of coastal transportation in terms of our broader transportation infrastructure. We will no doubt hear more about that area in the future, but we may need to wait for a change of Government to hear anything lucid on such matters.

I direct members’ attention to a key portion of this bill: the code of practice. This code proposal has been kicking around for quite some time. It has had some vigorous proponents, who brought it to the attention of those of us sitting on the Local Government and Environment Committee during consideration of the Resource Management (Simplifying and Streamlining) Amendment Bill. It provides infrastructure developers and infrastructure corporate leaders with a chance to put their rhetoric into practice. There will be the ability for regulations to be passed, and punitive remedies will be available for people who do not abide by this code. But, in fairness to the architects, there is some innovation associated with the notion that the code should be posited in this kind of legislation, and it will actually help coordination between the infrastructure developers. The problem does not lie just with local government, but also with the way in which they work with each other.

A key area where I believe we will encounter more submissions has to do with what kinds of organisations in 2009, 2010, and 2011 in New Zealand ought to enjoy privileged status in terms of the designation procedures and requiring authority status. I say this because it is an area that has been held over to the second part of the Resource Management Act reforms, but it is vitally important, and it must be debated in relation to infrastructure. I have no doubt that these submissions will come to the select committee. On one side of the debate are those who are guided by anxieties about social democracy, who believe that foreign-owned bodies should not enjoy this privileged status. Others—and I must confess that I myself have been quite persuaded by the arguments of a number of our big utility developers, etc.—believe that because of the essential importance that their services represent to modernising the economy and ensuring that the lifeblood of the economy continues to flow, there has been historically a case for them to enjoy that status.

I hope the committee remains alert to those submissions, because anything that simplifies the process in terms of ensnarlment in the bureaucracy needs to be both studied and, hopefully, agreed to. But, of course, that cannot take place if the thresholds to do with good environmental management are punctured.

Those of us who have been hanging around the Auckland governance debate have been told of some gross and egregious mix-ups in simple things such as laying pipes. It beggars belief that between the different Auckland local government authorities it has not been possible to have a uniform measurement type of pipe. The continuance of that situation is actually a big source of cost, etc., and presumably one of the good things flowing from the consolidation of all the local bodies into the Auckland super-city is that we will see an end to that.

The other thing we need to bear in mind is that it is wrong for this House to be told continually that only over the last 9 months has there been a positive fillip in relation to investment. We know that that is rubbish. The new Minister has come in, and in many respects I am quite impressed by the progress he is making, but to really improve it he has to change a number of key personnel in his own party.

The key point that both parties need to bear in mind, though, is that this is not just a National or a Labour issue. This is an issue of central government constantly looking for ways to improve the manner in which we invest in infrastructure, we consent to infrastructure, and we upgrade infrastructure. I will just recite that over the last nine Budgets, for example, annual funding for roading more than doubled—from $850 million in 1999, through to $1.9 billion in 2007—and whether or not members on the other side of the House want to admit it, it has led to an improvement in highways, motorway extensions, etc. No doubt we will remain disappointed that those members do not have the same level of either commitment or confidence in public transport, and they certainly have no interest whatsoever in coastal transport, but that is possibly because constituencies that have propelled those members into power need to be rewarded.

The implications in this bill in relation to KiwiRail and the various telecommunications companies need close attention. One area that I think will enjoy close attention is the spectacular failure of Mr Joyce’s proposal to set up a public-private partnership in relation to growing the size of the pipe moving electronic data around the country. It reflected heroic assumptions but political naivety. Most of the people who might have access to capital do not like the terms of the proposal that are currently on the table. These sorts of things will, I think, be the subject of submissions to this Infrastructure Bill, which we want to see go to a select committee, but Ministers on the other side of the House—in particular, Mr Joyce and Mr English—need to not show us but to do it. Kia ora tātou.

Hon STEVEN JOYCE (Associate Minister for Infrastructure) : It is an absolute pleasure to rise in support of the Infrastructure Bill and to have the opportunity to talk in the House about infrastructure, because I think that infrastructure is such an important underpinner and enabler of economic growth and productivity. I do not suppose that there will be much disagreement in the House about that fact, although there may be some. The evidence is all around us, in the development of this country, of the great ability of the right infrastructure at the right time to assist and encourage economic growth that otherwise, perhaps, would not have occurred.

I think of an example like a certain bridge in Auckland, the Auckland Harbour Bridge, which is probably the most dramatic example in New Zealand’s history. The development that has occurred north of that bridge over the last 50-odd years is absolute evidence of the enabling ability of great infrastructure. Another example that comes to mind is a little place called the Coromandel, which is not far from Auckland, and a bridge that crosses the estuary there, Kōpū Bridge. The current piece of infrastructure has had a restricting effect on the development of the Coromandel for so many years. We approved that $40 million project a short time ago. The Prime Minister and I did some sod-turning: he was the turner of the sod; I was the sod. It was such a powerful day to be there—

Hon Members: 9 whole months.

Hon STEVEN JOYCE: —because we did it a heck of a lot earlier than Labour members were going to. That $48 million bridge should have been done years ago. For $48 million it should have been done years ago, but it is now under way and will be completed in a couple of years.

The Victoria Park bottleneck, which is the most notorious outstanding bottleneck in Auckland, causes the congestion problems on the Auckland Harbour Bridge. It is not the bridge that is the problem; it is the Victoria Park bottleneck just south of it. The previous Labour Government had not advanced that project. Each day 165,000 vehicles go through that bottleneck. In the New Zealand context, that is a massive number. Most of those vehicles go through it at 20 to 30 kilometres an hour, if that. This Government not only has proudly stepped up and provided the funding to enable that project to start ahead of time by a year or two, but also has done that in the face of a planned postponement and the possibility that the project would be put off because of what the previous Government was proposing to do with State highway investment over the next 3 years.

Hon David Cunliffe: Was this the Government that was spending more on roads than the current one?

Hon STEVEN JOYCE: No, actually: the member opposite is wrong. I always worry about the counting ability of the spokesperson on finance for the Labour Party. In the last year around $800 million was spent on State highway infrastructure construction, which is, to his credit, the largest amount to date, but it was due to a decline under the Government policy statement of the previous Labour Government to around $650 million a year for State highway infrastructure for each of the next 3 years. If Mr Cunliffe needs me to give him the information, I am happy to do so. This Government has increased that amount to $1 billion a year, or an additional $1 billion over the next 3 years. Those are the facts. That is the commitment that this Government is placing behind transport infrastructure.

It is not just roading infrastructure, either; it is also public transport infrastructure. Despite the best efforts of the Opposition, the public of Auckland know that the Government has followed through on the investment in public transport infrastructure without whacking on an additional 14c a litre—or possibly more, given the way that some of the numbers are turning out at the moment—of petrol taxes for the people of Auckland. That increase would have been a direct drain on productivity and economic growth.

On top of that this Government is prepared to look closely at the cost of infrastructure projects. It is prepared to look at a project like the Waterview Connection, which is a crucial project for New Zealand, and say that $2.8 billion, including the finance costs during construction, is too much, and that we need to look again and find a better answer. I am pleased to say that the Transport Agency is in the process of finding a better answer. I note that the Labour Opposition has gone very quiet on its commitment to the deep-bore tunnels at Waterview. I invite Mr Cunliffe, if he is planning to speak on this bill at some stage, to share with us what those members’ current position is on that project. This Government has made the call that the project will come out of the National Land Transport Fund, so it will, in effect, save the Government debt position by the full cost of the project. That is the sort of sensible infrastructural investment that this Government is undertaking.

Hon David Cunliffe: When’s the start date?

Hon STEVEN JOYCE: Well, I say to David Cunliffe that we do not know when the start date is yet, but I can tell the member that I would even be prepared to put it off for 6 months if it would save me $1.4 billion. I do not know about him, but I certainly would be prepared to do that.

This Government has made big investments in infrastructure. It has made commitments in areas such as the ultra-fast broadband initiative, which has been very enthusiastically received—[Interruption]—and much to the Opposition’s disappointment and anguish, the Government will soon confirm how it will proceed. Although those members are getting a couple of weeks to have a bit of a crack, once that is done they will be rather disappointed as the Government proceeds successfully not only on urban broadband but also on rural broadband. Members should not forget that although the previous Government had a few successes late in its reign—

Hon Member: Name one.

Hon STEVEN JOYCE: Well, it made a bit of a contribution in terms of the ADSL roll-out with Telecom, but that did not happen until about 2 years ago. The first 7 years were very, very quiet on the telecommunications front. The previous Government was very, very quiet on the roading front. But in a late sprint, as it was heading to the finish line, just before the voters turfed it out, it started to do a few things.

Hon Phil Heatley: Were they funded?

Hon STEVEN JOYCE: Actually, a few of them were funded. A lot of them were unfunded, but a few of them were funded. The members of the previous Government did a few of these things. Now they have the temerity to suggest that they are as interested in infrastructure as we are, and that they understand it. Nothing could be further from the truth.

This Infrastructure Bill is one of the many things that this Government is doing to support investment in infrastructure. It is not just about the Crown making a contribution, although there are some areas, obviously, where the Crown is well suited to making a capital contribution. It is also about facilitating the development of infrastructure by other people. A lot of what is in this bill is about that.

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

Hon DAVID CUNLIFFE (Labour—New Lynn) : I am slightly relieved not to be the previous speaker—the Associate Minister for Infrastructure, Steven Joyce—but I will pay him a compliment. The Minister walked into a bit of an infrastructure buzz saw early in his tenure when he cancelled the regional fuel tax in Auckland and then woke up the next morning and realised that he had thereby cancelled $137 million worth of railway stations. The locals were none too happy about that. However, unlike Minister Joyce’s colleague Anne Tolley—who has also made a rather unfortunate cut, in the area of adult and community education—he had the foresight and listening ability to realise that he was faced with an unintended consequence, and he took steps to reverse it. The solution he came to was a 60:40 split between the New Zealand Transport Agency and the Auckland Regional Council. The bottom line is that those stations are now being built. Good on him. I hope his colleague Anne Tolley will take a leaf out of his book.

Labour supports the Infrastructure Bill with enthusiasm in respect of Parts 1 to 3, but does not currently support Part 4, which we believe needs to be carved off and given careful separate analysis, for reasons I will go into. In my remarks tonight I will say three things. Firstly, Labour is an enthusiastic supporter of infrastructure development, and our record proves it. Secondly, the key provisions of the bill, in Parts 1 to 3, are necessary, and with due select committee consideration should be worthwhile and deserve support. Thirdly, Part 4 is complex and does not belong with the rest of the bill. Indeed, we suspect that it has been placed with the rest of the bill to confuse two things in the minds of the public: first, the accepted need to smooth the way for needed infrastructure; and, second, what appears to be a push-back from some in the real estate community against the necessary provisions to require affordable housing in certain economic circumstances. That is why we think Part 4 needs separate consideration.

I will begin by discussing the first of those three major points. Labour is incredibly enthusiastic about infrastructure. We want to see New Zealand moving. We, like the Government, accept that infrastructure barriers can be a significant block to investment. How would investors feel about new industries if they could not be assured of an adequate energy supply, of the ability to transport goods to market, or, in the case of intellectual property, of the ability to transport ideas to market around the world using good old fat broadband pipes?

Labour’s record on infrastructure proves we have much to be proud of in that area. Post-election I do not normally in the Chamber hark back to the good old days of being in Government. This speech is not an exercise in enthusiasm of that kind, but it is relevant to recognise where the country has come from in the last decade. When the Labour-led Government was elected in late 1999, New Zealand’s infrastructure was in need of serious investment. Many new major roading projects under construction were virtually non-existent, investment was barely adequate to cover road maintenance, and Auckland was in danger of becoming permanently gridlocked. The railway system had been sold and was then asset-stripped. Investment in energy generation and transmission languished.

Labour was elected to Government on an agenda for change, with an investment in infrastructure signalled as a high priority. Over the Labour-led Government’s nine Budgets, annual funding for roading, for example, more than doubled from $850 million in 1999-2000 to over $1.9 billion in 2008. Let us put that $1.9 billion into perspective. The National Government in its latest Budget has heralded the fact that over 5 years it might spend around $7 billion on roading infrastructure. On a per annum basis that is less than was spent in the last year of the previous Labour administration. Although we are very pleased to see the Government making that investment, and we support it, let the country not be under any illusions: that spending is no great increase. Indeed, on a pro rata basis it is a slight decrease from what was spent in the last year of the Labour Government.

Investment in public transport in 2008 was over 15 times greater that in 1999-2000. Major public transport projects, such as the building of the Northern Busway in Auckland, have been completed. A $600 million project to improve train services in Auckland is under way. Of that $600 million, some $300 million has gone, end to end, for the New Lynn underground rail trench, a project that will transform that community, get new businesses into the area, and un-gum a huge bottleneck of transport services to the city. For transport investment as a percentage of GDP we cannot really go past that example as an indicator of commitment. Transport investment was at 1 percent in 1999, at the start of the previous Labour Government, and nearly doubled by the end of our term. There was the buy-back of the railway sector, and in the energy sector there were major investments in generation capacity, with over 1,600 megawatts added to capacity since 2000, equating to $3.5 billion to $4 billion of investment. Nobody armed with those facts could possibly argue otherwise than that the outgoing Labour Government had a solid and proud record that was well based on developing New Zealand’s infrastructure needs.

Sandra Goudie: Ha, ha! Oh, dearie me!

Hon DAVID CUNLIFFE: Some members opposite may laugh, through pure ignorance, but they have inherited a party that traditionally has not represented an activist view of the State. Going back to 1935, Labour has been the Government and the party of change, activism, and getting New Zealand moving, especially in recessions.

I will give another example: broadband. The issue was controversial in the election campaign. Labour had committed an initial $500 million of grant money, with a further $500 million to follow. That is $1 billion all up. Because it was regional, because the projects were shovel ready—or, I should say, fibre ready—and because no return to the Crown was expected from that investment, we were able to guarantee leverage of greater than one for one: closer to two for one. The projects were ready to go; the project plans had been approved and banked. The new Government came in on a promise of a $1.5 billion package, which sounded good. It seduced some people, but there were three problems with that package, as we have now found out. First, fibre to the home was never going to actually be to the home. It would have been to the kerb, at best, leaving the householder with $1,500 to $3,000 of connection cost. Second, our package was ready to go, whereas National has been waiting for a year, thinking about its package. Third, and most important, our package was regional and competitive, whereas, unless National has a road to Damascus experience, all the signs are that it may fall back on the old Telecom monopoly and put the grant money into the hands of the incumbent. Let us hope it does not do that. That is one reason why we believe that the part of the bill that guarantees reasonable and consistent access to utility corridors is absolutely essential; it was on our work programme.

Network infrastructure providers have to make the best use of assets that are already there. For example, it is well known that KiwiRail has massive amounts of optic fibre running the length of the main trunk railway line. The trouble has been that others could hardly use it. Another example that everybody knows is that because we could not get councils and infrastructure companies to work together as productively as they could have done, a street was dug up to lay pipes, resealed, and then dug up again to lay fibre or wires. Why not get councils and infrastructure companies to work together, do it once, and do it right? That is why Labour introduced provisions like developer contributions and upfront consultation. We think this bill will assist that situation, and we think it is a good step forward.

Let me come to something the Government probably will not want to hear: an OECD report, which Treasury officials submitted to the Finance and Expenditure Committee, that revised downward the OECD’s estimate of the fiscal stimulus from this Government from the 5 percent of GDP we left it at to only 3.5 percent. Part of the reason for that is the OECD has found some double-counts, like Kōpū Bridge. It was brought forward 9 months as it was a good project. National members said: “Let us do it!”.

JEANETTE FITZSIMONS (Green) : There is a lot of obvious good sense in providing a code of practice for infrastructure providers. There is a huge amount of waste when there is no coordination and no planning in terms of combining the wires, pipes, and fibres in the same corridor. It is high time to attempt to bring about that kind of rationalisation. I understand the work on that began under the previous Government, and it is good to see it being brought to completion. The Green Party certainly supports that.

We do think there is quite a mystery as to how we can combine in one bill, this Infrastructure Bill, such a load of disparate amendments to nine different Acts. We could make a case for Parts 1 to 3 hanging together and being something to do with infrastructure, but how Part 4 on housing has anything to do with wires, pipes, trenches, railway lines, or any other kind of infrastructure totally beats me. However, we will come to Part 4 in time.

The provision in Part 2 that gives us some concern relates to the old tension between territorial local authorities saying to someone who is going to dig up a street that it would be very sensible to do some amenity improvements at the same time, and infrastructure companies saying that is nothing to do with them, and they do not feel like cooperating. This bill resolves that conflict totally in favour of the infrastructure companies, and totally at the expense of territorial local authorities. The status quo is that infrastructure companies and territorial local authorities tend to share those costs unless other arrangements are made, and we are concerned that this bill errs too far on the side of making things difficult for councils. We want to look at that matter in the select committee in order to see whether the right balance has been struck, because we suspect that it has not.

Likewise, we have no objection to cleaning up the New Zealand Railways Corporation Act and, effectively, bringing the corporation under the same rules that apply to other State-owned enterprises. It is time that was done, too. The corporation is a Crown entity, and there is no particular reason why it should have its own set of provisions that are different from those of all the other kinds of State-owned enterprises.

Part 4 repeals the Affordable Housing: Enabling Territorial Authorities Act, and initially that concerned us considerably. But we believe that the most important part of that Act is being saved by keeping the provision that kills exclusionary covenants. Those covenants insist that development has to be consistent with somebody’s idea of a good standard, which can be very discriminatory to anybody else who wants to build in the same area. We very strongly supported that provision in the Act and we note that it is protected in this bill, but we wonder whether there was a drafting mistake that means that the replacement clause is not retrospective in terms of all of the exclusionary covenants already entered into. The Act is repealed, but the replacement clause applies only to covenants entered into on or after the date that this Infrastructure Bill comes into force. So there will be a gap period. We wonder why, if Government members believe that exclusionary covenants are a bad idea and should not be allowed—and they believe that sufficiently to have rescued that provision from the legislation that they are repealing and put it back into law—they think that it should not apply to the ones entered into up until the date that this bill is enacted. I very much hope that this is some kind of drafting oversight or mistake. If it is, then we can rectify it at the select committee, and the Green Party will certainly be arguing to do that.

We will support the referral of this bill to the select committee, and we will see what happens to it there.

TE URUROA FLAVELL (Māori Party—Waiariki) : Kia ora, Mr Deputy Speaker. Kia ora tātou katoa, i tēnei pō. The priority accorded arrangements to facilitate infrastructure development has been welcomed by iwi, certainly from the feedback that the Māori Party has received. I would not go so far as to say that iwi would be flooding our offices with requests for changes to the umpteen range of Acts that are amended by the Infrastructure Bill. The bill amends the Telecommunications Act 2001, the Electricity Act 1992, the Gas Act 1992, the Government Roading Powers Act 1999, and so on. That detail is properly reserved for the members in the House who are fascinated by the fine print. The people out there are excited by the bricks and mortar of infrastructure development and the dollars and cents.

Iwi are embracing the investment opportunity for ownership of infrastructure projects as part of public-private partnerships. At the start of this year a tribal assets workshop, chaired by Ngāti Tūwharetoa paramount chief, Sir Tumu te Heuheu, was a forum for iwi leaders from around the country, the motu, to discuss their enthusiasm for engaging in infrastructure projects. From Ngāpuhi, Ērima Henare spoke passionately about the desire of Māori to have a viable partnership with the Crown and with private enterprise. In his words: “They don’t want to be bit players and bulldozer drivers.” Tainui chairman, Tukoroirangi Morgan, also spoke very positively of iwi being poised and ready to go, just waiting for the opportunity to be opened up by the Crown.

The last 24 hours have given us a very sobering context in which to consider both the capacity of iwi to take on the challenge of infrastructure development and the readiness of the Government to respond. As I indicated at question time today, Tukoroirangi Morgan was not impressed after the shock announcement of the decisions made in advance of the select committee report into the governance arrangements for Auckland. Yesterday Mr Morgan said, and I repeated his words at question time today: “Giving Māori people the crumbs at the second level is a nonsense and we’ve made it quite clear we are not interested in being a tekoteko … or tonotono …—people who are subservient to the top table.” Perhaps the bill provides an opportunity for the Government to again reflect on its recent actions and consider whether it intends to restrict Māori to positions as bit players or bulldozer drivers—tekoteko or tonotono—or whether it can reconsider ways and means to honour the Treaty relationship with mana whenua.

The bill will improve the arrangements for managing access by utility operators—gas, power, phone, water, electricity, and the like—to transport corridors, roads, railways, and motorways. The Māori Party stands today, as it did yesterday and will do tomorrow, to remind the Government that infrastructure development is as appropriate an avenue for iwi investment as any. If that was not obvious from the outrage that has been expressed across the land at yesterday’s announcement, it should be obvious that iwi are, as Tuku Morgan described so well, the sleeping economic giant in this country. The Māori Party will encourage iwi to engage with the nation’s essential hardware, just as we encourage iwi to engage in every sphere of activity across the Government sector.

The co-leader of our party Dr Pita Sharples told the House this afternoon that Māori people will be here forever; they are not going to go away. The Māori Party will continue to advocate for Māori representation to be fully engaged in every aspect of a fair and meaningful democracy. Investment in infrastructure is a way of providing for employment, enterprise, and economic development. Iwi see participation in infrastructure development as a way of advancing economic interest beyond the more traditional tribal pathways of primary industry, fishing, forestry, tourism, and property. We support every opportunity that we can to enhance economic growth for iwi, and, in doing so, to improve the nation’s productivity.

The Māori Party seeks to bring other considerations to the debate. As a party we have placed great priority on any commitment to further invest in public transport by strategies such as developing Greater Wellington’s public transport network of buses and trains, and network of walking and cycling tracks. We need services that are frequent, reliable, and inexpensive for users. We note a press release today by the Sustainable Energy Forum that calls for a rethink of the Government’s transport policy. It directly challenges the Government to take a precautionary approach to the construction of State highways, in the context of the dual challenge of peak oil and climate change. The forum’s concern was generated by a report of the OECD’s International Energy Agency that oil production is declining at almost twice the rate that had previously been predicted. The other issue is around the capacity of the Government to meet the 2020 greenhouse gas reduction target—a challenge that will require significant cuts in transport greenhouse gas emissions.

Those are the issues that we take very seriously as a party. There is an urgent need to prepare for ongoing oil price increases and a future downturn in availability, by providing people with affordable alternatives. We will be looking to the select committee process to see exactly how the legislation will take into account the imperatives for sustainable development. We all appreciate that there is an urgent need to reduce dependency on oil by using strategies, and to that end we will be interested to see a wider-ranging debate around the consequences of the bill for those wider energy and environmental issues.

We reiterate the genuine readiness and enthusiasm of iwi and Māori to be actively involved in any future discussions surrounding the issue of infrastructure development. Just 1 month ago my colleague Dr Pita Sharples announced the signing of an agreement with InfraTrain, the industry training organisation for the civil infrastructure industry. The Māori trade training initiative will allow an additional 1,820 Māori to receive training in industries that have strong employment prospects. How can we not be enthusiastic about that sort of initiative? Māori make up more than one-third of the current civil infrastructure workforce in the North Island, so there is plenty of interest. Māori are a strong and reliable component of the human resources that will be required to make this bill work. We are proud of the Minister’s initiative to provide 250 training places in the civil infrastructure industry—50 places in Waikato, 100 in the Northland and Auckland area, and another 100 in the East Coast and Hawke’s Bay area. Of course, the great Waiariki region for which I am the MP, will be first in line for the next stage of the development, I hope, such is the level of our people’s enthusiasm for industry training opportunities, the prospect of job creation, and a focus on high-level training.

The Minister of Māori Affairs called for a Māori economic summit conference and that was held earlier this year. There was a focus on Māori party policy and the flourishing of economic enterprise and skills development. Members should make no mistake; that issue is very clearly on the agenda for iwi.

We support the first reading of the bill and look forward to the doors being flung wide open to ensure Māori participation and representation in this process, which hopefully will be encouraged. Kia ora tātou.

MOANA MACKEY (Labour) : I am happy to stand and take a call in the debate on the first reading of the Infrastructure Bill. I was not expecting to take a call, because I do not think anyone was expecting that a bill on infrastructure would repeal affordable housing legislation. But, indeed, here we are, and I am happy to put my comments on the record.

First of all, I endorse the comments made by the previous Labour speakers on this debate: we support any investment in infrastructure. When we look around the globe currently at what various Governments are doing to put stimulus packages in place to lift their countries out of recession earlier, we see that they are, in fact, doing far, far more than this country.

Hon David Parker: South of Christchurch.

MOANA MACKEY: My colleague David Parker raises the very real concern that there is nothing in this legislation for any community south of Christchurch. That is a real concern because those communities are also suffering from the impacts of this recession, and deserve to have the same kind of treatment as every other community in this country. But in saying that, I also say that Labour supports any investment in infrastructure.

My colleague Clare Curran will comment more on the broadband issue. That issue is a real concern, particularly for provincial communities. When Labour was in Government we had a clear strategy for rural broadband. I sincerely hope that the New Zealand Regional Fibre Group is able to get this contract. I believe that they are best placed to use existing infrastructure far more efficiently and far more cheaply to deliver a service that will better benefit people in provincial regions. I certainly hope that is the path that the Minister for Infrastructure will take if we ever see an announcement from him on this issue.

I want to talk particularly about Part 4. It repeals the Affordable Housing: Enabling Territorial Authorities Act, which was put in place by the previous Government. I was the chair of the Local Government and Environment Committee that considered this legislation. I want to say that I am pleased that the clauses on the restrictive covenants are being carried through. I think that is extremely important. At the select committee many cases were raised with us where such covenants were being used to exclude certain groups of people in society from housing areas. That is unacceptable to this Parliament and I am pleased that part will remain.

I want to know why the Government feels it is so necessary to repeal this Act. I have had contact with a number of groups who have sent me emails asking whether it is true that this has happened and that they were not told about this issue, which affects them. They never would have thought to look in the Infrastructure Bill for that issue if they had not been tipped off that it was there. I think that is an important point to raise; hopefully, these people will have some input at select committee. I note that this bill will go to the Transport and Industrial Relations Committee, which is appropriate. The problem is that the issues around housing are normally dealt with by the Social Services Committee. It is a shame that that committee is not able to fully consider these issues, and also that the Local Government and Environment Committee cannot, given that this bill also affects territorial authorities.

When the last Government passed the Affordable Housing: Enabling Territorial Authorities Act, National members said that it was just another layer of bureaucracy and something else that territorial authorities had to do. The fact is that territorial authorities did not have to do it. This was just one tool in a tool box that we put forward containing a number of affordable housing initiatives. There was significant legal uncertainty around whether territorial authorities could require developers to include affordable housing or social housing as part of the development mix, or to put money and land aside so that the affordable housing could be built elsewhere. This Act provided that certainty. It said that, yes, people were able to do it, and if they were going to do it then this was the process to take.

This is not an unusual kind of arrangement. North America uses this arrangement extensively. Where a large development takes place territorial authorities will require a number of different things; it will vary across the states. They might require that the infrastructure—such as the roads, the lighting, the sewerage, the fibre for the broadband, and all that kind of thing—be provided by the developer. If the developer is doing a commercial development, such as a large shopping mall, the territorial authorities might require the developer to build housing close by for the people who are going to work in the mall, or to provide transport for them. Labour did not think up this arrangement out of thin air; it works very, very well overseas.

My disappointment with this part of the bill is that if the Government had taken the time to seriously look at the Act and think about whether it could make some changes, we would have been absolutely open to that—to looking at whether we could make it work better or be more accessible. A lot of the Act was taken from the Queenstown experience, of course. It is not right to simply repeal it, as the local authorities were not required to use it at all; it was there to use at their discretion.

I think it is important to mention that one cannot address the issue of affordable housing in isolation from the territorial authorities. Anyone who thinks that affordable housing can be done just by the Government, and that if we just keep the territorial authorities out of everything it will work, is dreaming. Territorial authorities are a really important part of the solution. This Act, which is to be repealed, simply provided them with the legal certainties to carry that arrangement out, if they wanted to, now or in the future. When a big developer comes in and decides to do a big development, they could have said to them that they want 5 percent of it to be affordable housing, or if they did not want it in that area they could say that they want land put aside somewhere else. Why should they not be able to do that? Why should other ratepayers always have to pay for the cost of all this infrastructure? They are not able to get access to affordable housing—they are locked out of the housing market—so they are renting. They are paying higher and higher rents—the rates are going up for their landlord and some of that is being passed on to them—or they are in a house and they would like to move to another house but they cannot afford it. They are ratepayers. Why should they have to foot the bill for absolutely everything for a developer who comes along and makes an awful lot of money from a new development? Why is it not OK to say that in some situations we may want to get 5 percent affordable housing, or we may want the bulk of the infrastructure paid for by the developer? I think it is the right of the territorial authority to make that decision, based on what is best for their ratepayers and what is best for their district. That is what this Act does.

It is interesting that there has been so little movement on affordable housing from this Government. The fact is I think it was relying on the recession to see housing prices drop so significantly that the issue of affordable housing would go off the boil. The fact is that housing prices have not dropped. Working families are still locked out of the housing market. The Minister of Housing, Phil Heatley, stood up and took credit for every single Labour policy that was introduced under the last Government. He has not come up with any new ideas, and he is repealing one now.

Hon Chris Carter: Like former housing Ministers.

MOANA MACKEY: That is right. Excellent former housing Ministers attacked head-on the issue of affordable housing. They said that we would never have only one solution; we would have to have a mix of solutions, which is what we had. We had the Welcome Home Loan scheme, we had shared equity, and we had this legislation enabling territorial authorities. We had a number of initiatives. We were putting affordable housing into the mix at Hobsonville, and we were looking at it in Tāmaki as well. We were attacking this issue head-on. The fact is that the recession has not made housing more affordable for most New Zealanders. In fact, they are losing their jobs, their salaries have stalled, and housing prices have not dropped so they can offset that.

The Minister of Housing’s No. 1 promise for affordable housing was tax cuts. Well, they are out the window, and he still will not answer the question: how do significant tax cuts for the wealthiest people in New Zealand help low and middle income New Zealanders get into housing? The answer is that they do not. He then said in the House last week that he was responsible for the lowering of interest rates. I wish he would tell us how he did it, and then maybe we could put that in legislation. The fact is that this Government has not tackled the issue of affordable housing. I think the Government is just hoping that if it does not talk about it, it might go away. We welcome increases to Labour’s very good Welcome Home Loan policy. We think that is really good.

The other issue is that the Housing Innovation Fund, which received an increase in this year’s Budget—we acknowledge that—is no longer available to territorial authorities for upgrades on their social housing. That means that some territorial authorities might get to a point where they have to consider whether they can even keep that housing, and whether they might sell it, given that the choice is to either upgrade it or sell it off, like they have in Whakatāne. What did the Whakatāne District Council say in when it gave a reason? The council’s reason for selling off the housing was that the Government told them it was no longer a core activity and it not something that it should be focusing on.

I come back to my point that we cannot address affordable housing without bringing territorial authorities into the mix. I would welcome the next speaker answering that question. Thank you.

DAVID BENNETT (National—Hamilton East) : It is with great pleasure that the National Government puts forward the Infrastructure Bill of 2009. This bill reflects the National Government’s commitment to building a stronger economy that will provide growth for all New Zealanders, and to providing the social infrastructure that New Zealanders desire and that has been sorely lacking under previous Labour Governments. This legislation contains a number of components, all of which relate to each other and relate to economic growth. They are related to building a stronger economy for our country going forward.

I turn to the four areas that have been noted in the legislation. The last area that the previous speaker, Moana Mackey, mentioned in respect of affordable housing is quite interesting. She summed up Labour’s approach to economics and to the management of resources: it feels that the Government of the day, in setting the rules and regulations, would determine the best approach. Labour believes that the Government, in determining the nature of how and when land can be used and under what process, will be the determining factor in whether it is successful. I have news for the Labour Party: it is not that way. The last Labour Government tried that approach. Did that Government help people who wanted affordable housing? It did not.

This Government’s approach will deliver some serious results for people who want affordable housing, who want to achieve the Kiwi dream of having their own home. We will not stagnate the process through the Government and say that the Government knows best. We will have a much better system—one that takes into account the market, the purchasers, local government, and the economic realities of buying one’s first home. This legislation incorporates that and leads to that outcome, and that is the advantage of this legislation when we look at affordable housing.

When most people look at an Infrastructure Bill, the first things they think about are the traditional forms of infrastructure, such as roading, rail, and power. That is the nature of the heart of this bill—the first part of the bill—which deals with access by utility operators to transport corridors. Before we talk about infrastructure I want to first of all set the scene and look at the future of New Zealand. If we look at what areas the predominant economic growth that New Zealand will experience will encompass, we see that it will be predominantly in the Hamilton, Tauranga, and Auckland regions. That area is commonly called the “golden triangle”, and it represents what will be three of the biggest cities in our country in a short period of time. Auckland will be the most dominant city by a long way, but Tauranga and Hamilton will be a considerable size. They will challenge the Wellingtons and Christchurches of this world within a generation. Those cities will represent a new breed of New Zealanders: the ones who want to see an economy that is successful, that is based on strong education, that is based on a strong work ethic, and that is based on having a future that is progressive and successful on the world stage. Those cities represent the New Zealand of the future.

The Infrastructure Bill is giving the New Zealand of the future the opportunity to achieve its real mandate. Without this legislation those cities would continue to be hamstrung, as they were under the previous Government. We are not in the mood to let that continue, nor do we intend to let it continue, because we have better dreams for New Zealand. We see a country where we can grow; we need the infrastructure to achieve ambitious targets.

This bill talks about having a code of practice on how utility operators and corridor managers coordinate their activities. Codes of practice are probably unique to New Zealand legislation. It is not something that we do every day. We tend to have an approach that is based not so much on a code, but rather on legislation amending and building on itself. Having a code probably represents more of a European approach to legislation, and also to management and structuring of Government involvement in infrastructure. That code will be an important instrument, and it will be part of creating an environment whereby companies that are investing—Government companies as well as private sector companies—will have the ability to invest with confidence. They will see that they have a process that will enable them to build the strong infrastructure that we need in this country.

It is not about just that part of New Zealand that will be the growth engine we can perceive in the future; the rest of New Zealand also has an important role, in managing and taking advantage of that growing area. Also important are the parts of the South Island that provide a lot of the power for the North Island; the likes of Wellington, which has a central role in providing governance; and the rest of the North Island and the South Island, which provide a lot of the agricultural and primary production infrastructure that provides the exports for our country. Those areas will need these codes and will take advantage of them because rail-tracks and roads go through their territory, and so do power lines. We need to consider those instrumental parts of the debate on infrastructure, and we need to develop a strong process for them. This code does that going forward.

Part 2 talks about the standard process in regard to the Telecommunications Act, the Electricity Act, the Gas Act, the Local Government Act, and other Acts. It provides consistent provisions for access to transport corridors, allocation of costs, and time periods for notifications and responses to requests. It essentially provides standardisation so that business has some certainty. That certainty was lacking under the previous Labour Government: business had no certainty. Long-term investment is a key part of infrastructure. If we are to build a long series of roads, then investors want to know they can invest in the equipment and the people so that they can continue to build over a certain period of time, get a return on that investment, and get paid for what they have put in. The previous Government did not do that; it did one-off projects on the whim of the day. It did what it thought was in its political interest. This Government will not take that approach. We will give some certainty to the community that we will provide this infrastructure. That is why we have those kinds of provisions in the bill: they give some long-term direction so that people know the rules they will be playing under. That certainty is vital in business because the last thing investors will do is invest in technology or people if investors do not have certainty in being able to get those things in order to take advantage of that investment.

Part 3 of this bill amends the New Zealand Railways Corporation Act. Rail was one of those things that the previous Labour Government bought on a political whim. It wanted to own the trainset. It did not do due diligence on its purchase of rail. It missed out on a great opportunity to take advantage of Toll’s management capabilities and it ended up paying far too much for an asset that needs a lot of investment. This Government has been left with the baby and we have had to deal with this issue. The Minister of Transport has done a great job, so far, in restructuring the nature of rail’s involvement in the transport sector. Some more changes need to be made to the corporation, and they are included in Part 3. They deal predominantly with directorships, and the requirements and roles of directors and chairpersons.

All in all, the bill has four main parts, but the heart of it provides opportunity, certainty, and direction for New Zealand investors, New Zealand infrastructural companies, and the New Zealand Government—which is a big player—so that they know what the rules are. They will have a long-term capability and a long-term vision, which are needed in the provision of infrastructural services. We also have rules that will enable people to take advantage of opportunities such as affordable housing and rail transport to make sure the Government gets the results in those industries that it intends. All in all, this is very important legislation because it sets a platform for growing the New Zealand economy.

CLARE CURRAN (Labour—Dunedin South) : I shall take a call on the first reading of the Infrastructure Bill. The bill is the Government’s attempt to lift New Zealand’s national productivity and improve New Zealand’s future economic growth.

I shall put the bill in context. I am the Opposition spokesperson on communications and information technology. It is incumbent on Labour and on me to be across all forms of social media and new technological advances in this important industry, so I want to read a posting on Facebook that I came across tonight while preparing this speech. It seems particularly relevant: “Unemployment doubles, workers get zero percent wage increases, food and electricity prices continue rising, Bill English has a $900 a week housing allowance, Sir Roger Douglas gets free trips to visit his family in the UK, and while Telecom engineers have their jobs contracted out their CEO is handed a cool five big ones. That’s about $13,698 every single day of the year. Our society continues to get sicker.” That just about sums things up.

I shall talk a bit about the bill, then I will talk more broadly about some infrastructure challenges for our nation. Labour supports the bill, although we reserve the right to question or oppose individual clauses. The bill appears sensible in its intent and was the result of a review process, which the previous Labour Government had started. Labour has some reservations about some provisions in the bill, particularly Part 4, which repeals the Affordability Housing: Enabling Territorial Authorities Act 2008. Broadly, the bill deals with three areas. The first is utility access to roads, motorways, and rail corridors, which, among other things, involves amendments to the Telecommunications Act 2001. It also includes changes to the New Zealand Railways Corporation, and repeals, as I said, the affordable housing legislation enacted in 2008.

The previous Labour Government always recognised the importance of good infrastructure for economic development. Infrastructure is hugely important, and getting it right is especially important. Infrastructure can be defined as the basic physical and organisational structures needed for the operation of a society or an enterprise, or the services and facilities necessary for an economy to function. As the global recession has bitten, many Governments around the world have poured funds into infrastructure spending in an effort to stimulate the economy and save jobs. Many sources quote that total infrastructure spending around the world will reach $35 trillion over the next 20 years. Saving jobs and stimulating the economy are important roles for any Government, and in times of recession they are an absolute. This Government has waited for too long to introduce legislation to stimulate the economy, and the Job Summit that was so talked about failed to act as fast as was imagined. My electorate of Dunedin South has seen the effects of the recession. In the last 12 to 18 months there have been multiple closures of plants. There has been no Government-led initiative since this Government was elected to provide jobs for any of those people. So far it has all been tinkering around the edges.

Today I want to talk about an important piece of infrastructure that is in limbo, but before I do that I will put a few facts out there. National will spend $7.5 billion on infrastructure over the next 5 years, $3 billion of which will be spent on roading in the next 3 years. That is nearly half, although it does include the $1.5 billion to be spent on broadband. Over the Labour Government’s nine Budgets, which we have heard about already tonight, annual funding for roading more than doubled from $850 million in 1999 to over $1.9 billion in 2008, but annual investment in public transport in 2008 was over 15 times greater than that of 1999—15 times! This Government will not be going down that route. There are some commitments to public transport, but mainly in Auckland; around the rest of the country it will not be a top priority. That is a tragedy and a missed opportunity for our nation.

Instead, roading is the main priority of the Minister of Transport—that is, roading for the North Island. In the Budget earlier this year the Minister announced an extra billion dollars for the seven roads of national significance. Of those seven roads, the only South Island project is the Christchurch motorway. There is nothing at all from further south. As the representative for one of two Dunedin electorates with a highway heading south out of town in need of urgent attention, I have to say that our part of New Zealand does not seem to be a priority. In fact, there is no infrastructure spending at all of any note anywhere south of Christchurch. So it is all about roads.

At some point the Minister will get round to that other important piece of infrastructure that is currently languishing while he is making up his mind what to do about it, and that is ultra-fast broadband, which is an important utility and is fast becoming an essential service for all New Zealanders in their homes, their schools, and their workplaces. The National Government was elected more than 9 months ago. A central component of National’s campaign strategy was its $1.5 billion commitment to roll out ultra-fast broadband to 75 percent of New Zealand homes within 10 years. It was its big-ticket campaign pledge. The first thing the new Government did was axe the existing broadband programme introduced by the Labour Government, the Broadband Investment Fund, which had dozens of regional broadband projects poised to roll out and had widespread support in the industry. Members heard my colleague David Cunliffe talk about that earlier. The new Government axed that programme and there is now a vacuum in the industry. It took this Government until the end of March to release its investment proposal for consultation. Since then, there has been nothing. We are now approaching the end of August and there is no indication of how and when this Government will start rolling out broadband.

This Government has a dilemma—several dilemmas. The first is whether to choose between a Telecom-led roll-out or a growing coalition of electricity lines companies and independent fibre operators called the Regional Fibre Group. Choosing the Telecom-led roll-out would be somewhat controversial given what is happening right now with the country’s biggest telecommunications company. Telecom is embroiled in an escalating drama with its own workforce of 900 service technicians and engineers in Northland and Auckland—unionised and un-unionised—who are fighting attempts to turn them into dependent contractors of Visionstream, the new contractor awarded the contract. Essentially, these employees will lose the protection provided to them as employees, and will be forced to buy their own equipment and vehicles, to pay for their own holiday and sick leave entitlements, and to accept all the other financial obligations and risks associated with their own employment, costing them 50 to 66 percent of their income. They will be at the mercy of the parent contractor, with their remuneration based on how many jobs they can get through rather than the quality of their work. There are real and genuine concerns that that will have a devastating effect on Telecom’s skilled workforce at a time when it is needed most, and on the services that Telecom delivers.

Last week myself and Trevor Mallard, our spokesperson on labour, sent an open letter to Wayne Boyd, the Telecom chair, asking him not to put Telecom at risk, to intervene in the dispute between Visionstream and the service technicians, and to re-examine the terms of the contract. New Zealanders expect that Telecom will act as an efficient, customer-focused communications provider and a responsible corporate citizen. We also expect the Government to take a close interest, given that it needs a skilled workforce to roll out its ultra-fast broadband. We know that there are industry players who have grave concerns about these issues. Momentum is growing. There is growing alarm within the industry about the risk to the skilled workforce, Telecom’s ability to deliver on its regulatory undertakings, and its ability to deliver a quality service to its customers. Surely that is a matter for the Government. MPs across the country, including National MPs, are raising concerns about the contracts that these workers are being force to sign. One of them—Northland MP John Carter—personally acknowledged to me today that he is advising technicians in his electorate not to sign, that the Visionstream contract is a crock.

The second dilemma that this Government has is that it cannot deliver on its election pledge. It left out the entire rural sector. It knows now that that was a huge mistake. So what does it do? It looks likely that it will come up with a new proposal that is about equitable distribution of broadband across the country, investing in the rural sector, where our primary production exports are dependent on—[Interruption]; and that is good—our having a technological competitive edge, and where the social benefits of broadband access will make such a difference to rural communities. But if the Government does that, what will happen to the campaign pledge? Seventy-five percent of New Zealanders certainly will not have broadband in their homes within 10 years, so that pledge is out the window, I say to Mr Joyce and Mr English. If broadband is going to be rolled out in the rural sector as well, that is a reason to put Telecom firmly in the frame for that roll-out.

ALLAN PEACHEY (National—Tāmaki) : It is indeed a privilege to speak in favour of the Infrastructure Bill and to commend it to the House. The National Government’s infrastructure policy will be admired and imitated for generations to come. Historians will be breathless at the scope of the development that took place under the Key National Government. They will be breathless at the impact that the infrastructure policy had on the prosperity, growth, and standard of living of New Zealanders. But above all else, historians will comment upon the contrast between a National Government that developed New Zealand’s potential and gave its people the opportunity to enjoy success and prosperity, and the 9 years of adhockery, hit-and-miss, and wasted money of a failed socialist Government. The contrast will be commented upon by historians for generations to come.

The development of infrastructure is essential if New Zealand is to lift its national productivity and improve and expand its future economic growth and prosperity. For this to happen it is necessary, firstly, to improve the consistency of regulatory arrangements for infrastructure development; secondly, to streamline governance arrangements; and, thirdly, to remove regulatory barriers. That is what this bill does. Each of these actions, to be achieved by this bill, will contribute to improving the timeliness of infrastructure provision and reducing the cost of infrastructure development. The purpose of the Infrastructure Bill is threefold: firstly, to facilitate infrastructure development by removing unnecessary barriers; secondly, to improve the consistency of regulatory arrangements; and, thirdly, to review regulation and remove red tape. That is what this Government is all about: getting rid of the red tape that gets in the way of development of New Zealand and in way of New Zealanders’ opportunity to enjoy prosperity.

The Infrastructure Bill repeals the Affordable Housing: Enabling Territorial Authorities Act 2008. The purpose of this Act was to provide councils with regulatory tools to address problems of housing affordability in their districts, but it did not work. It has been interesting to listen to Labour speakers try to defend that legislation—their legislation—which did not work. Many developers and many territorial authorities have raised concern that the Act is counter-productive and likely to reduce rather than increase the supply of affordable housing. It is one more example of how the socialist Government got it so badly wrong. So the Affordable Housing: Enabling Territorial Authorities Act 2008 is to be repealed.

The Infrastructure Bill proposes substantive amendment to a number of pieces of legislation, six of which are dealt with in Part 2: the Telecommunications Act 2001, the Electricity Act 1992, the Gas Act 1992, the Local Government Act 1974, the Railways Act 2005, and the Government Roading Powers Act 1989. The purpose of the amendments to these Acts is to provide for consistent provision across the Acts being amended. One of the things the Government is looking for is reasonable conditions of access to road and rail corridors. Controlling authorities will have to have publicised criteria, on which they will base their decisions for granting access. Part 3 amends the New Zealand Railways Corporation Act 1981 to remove statutory restrictions that negatively affect the running of the Railways Corporation’s business.

The Infrastructure Bill is a major step towards cleaning up a regulatory mess that is getting in the way of New Zealand’s economic development. I am pleased to note that the Labour Party has at least been gracious enough to indicate its support for this bill’s going to a select committee.

Hon David Parker: We started the work.

ALLAN PEACHEY: There goes Mr Parker, who says they started the work. It seems to me that all they ever did was start work but never finish it. I suggest that members opposite, who keep interjecting about starting things, start to talk to us a little bit about why they never finished anything. Have members noticed that in 9 years they never finished anything? As the historians will say, it was 9 years of adhockery—9 years of socialist adhockery.

Let us take a moment to consider the scope of the infrastructure development that this Government is talking about. Budget 2009 increased the capital spending allowance from $900 million to $1.45 billion—$1.45 billion. This is just the first part of a planned $7.5 billion boost for infrastructure over the next 5 years. Under the planned spending, capital spending allowances will remain at $1.45 billion for the next 4 years, then rise to $1.65 billion in 2013-14. The historians will be breathless at the scope and scale of the infrastructure development in this country that has resulted from the work of the Key National Government.

Let us have a look at the spending in some detail. In health, $245 million of capital spending will address demographic pressures, particularly in Auckland, and will enable consideration of hospital upgrades and dedicated elective surgery theatres. That is $245 million of capital spending for health. For broadband—and I noted one of the Labour speakers talking about broadband before—$250 million in capital funding and $56 million in operational funding will be given for telecommunications infrastructure. This includes $200 million as the Government’s first contribution towards its $1.5 billion ultra-fast broadband plan, $34 million of which will support schools.

Hon David Parker: When? When?

ALLAN PEACHEY: We listen to the Opposition members asking when and why. They had the opportunity. They had 9 years of adhockery, and now all they can do in this debate is ask why and when. It is little wonder that the people threw them out of Government.

In education there is $325.6 million, and so it goes on. In housing there is $124.5 million, in transport there is $142.4 million, in rail there is $90 million, and it goes on and on.

I conclude by commending the Infrastructure Bill to the House. I note that historians will be speechless when they write the history of the development of New Zealand under the Key Government, and then compare that to the adhockery of 9 years of socialist rule.

MICHAEL WOODHOUSE (National) : I rise beside my esteemed colleague Allan Peachey in support of the Infrastructure Bill. Although the bill itself is a pretty technical one, I think its overall purpose to facilitate infrastructure development is a very, very important one. I will take a slightly broader view in relation to this issue than some other members have. As we have heard from the Minister and other members, the sector is a really broad and complex one. We do not actually have a Vote Infrastructure as such, but the bill broadly covers a number of areas.

Moana Mackey: What is Dunedin getting?

MICHAEL WOODHOUSE: Well, I will come to that. I will illustrate, with one example at this stage, how important the Government’s focus on this is. I will focus on electricity in particular. In the adjournment weeks of July and August I was guest of New Zealand Aluminium Smelters at Tiwai Point near Bluff, as part of the New Zealand Business and Parliament Trust. As members know, the trust enables MPs to go out and visit businesses to find out what the issues are that face them, and for senior managers to come to Wellington and understand how the lawmaking process works. I spent 5 days down there. The focus of my interest was on quality and process improvement programmes, and how they might be applied to the public sector and the health sector, in particular. But as one does with those sorts of visits, one cannot help but get drawn into some of the other issues that face businesses, particularly from a public policy perspective, and that was certainly the case in my visit to Tiwai.

One of the significant issues that face organisations like the smelter is the reliability and cost of electricity supply, which, as some members know, is a huge component in the costs of producing aluminium. The smelter, when it is at optimum operation, I think, consumes about 85 percent of all the power that comes out of the Manapōuri power station. Members will recall that last year was a dry year. I know that one particular member will recall that very well, because there was quite a big demand on the Government of the day to introduce demand-reduction measures and conservation measures. The then Minister of Energy, the Hon David Parker, pretended for quite a long time that it was not occurring, but eventually the clamour from the organisations for a conservation strategy became so great that the Government put in place a campaign. But what was going on in the background—

Hon David Parker: That’s because the commercial users didn’t want to pay—

MICHAEL WOODHOUSE: Well, that is what I am coming on to. In the background, Crown companies were going to very large consumers of electricity, like the smelter at Tiwai Point, and saying “Please shut down.” In the case of the smelter, a whole potline was closed down, which made a significant positive impact on the demand at that time, which was when the price of the very high-purity aluminium the smelter was producing was very good. Notwithstanding that the electricity price was by world standards high, things were looking pretty good for the smelter. So in return for that magnanimity in reducing output and saving energy for the country, the company was rewarded with an increase of about 15 percent in its contracted price for electricity, at the same time as the world price for aluminium plummeted. That is a really clear illustration that an organisation—one of our largest exporters, one of the largest employers in the deep south, and one of the companies that makes a huge contribution to our economy—is extremely vulnerable because of the lack of a reliable electricity infrastructure.

I am aware that the Minister of Energy and Resources is doing some really good work on highlighting those issues with the electricity market performance review, and also with planning for the increased capacity that needs to be brought online straightaway, much less saved for the increased demand we are predicting for the future. But I think we have got into a situation where there is a really quite woeful lack of infrastructure planning, not just around electricity but around roading, broadband, hospitals, prisons, ships, ports, and everything else. So it is very necessary that the 20-year plan the Government has will spell out what those investment objectives are.

As we know, it is not just central government that invests in that sort of infrastructure; I have seen some figures that indicate there will probably be a fifty-fifty split between central government and local government investment needs over the next 10 years—needs that could cost as much as $60 billion. Given some of the demographic changes, and I am quite sure that members have mentioned Auckland City in that context, it is really appropriate that a national plan that looks forward into our infrastructure needs for the next 20 or 30 years is developed; I congratulate the Government and the Minister on doing that.

One of the sorts of things that this coordination will do is give organisations like the smelter a much greater level of confidence to be able to invest in itself. So it is not just the direct infrastructure investment that we will get; we will get the industry investment as well. I did not talk about this when I was at Tiwai, but I have no doubt that the owners of the smelter will not be putting any further substantial investment into the smelter unless they can be certain—or at least more confident than they are now—that they can get security of supply, and get it at a reasonable price. If members think that that is tripe, I can tell them that while I was there the news came through that one of the sister smelters in the group, in North Wales, will close next month and it will close simply because it cannot get reliable electricity at a competitive price. Without sounding like Chicken Licken, I have no doubt that if the same conditions were imposed on the smelter at Tiwai Point, that risk would be very real.

Hon David Parker: But they’ve got a contract with Meridian for years out.

MICHAEL WOODHOUSE: Yes, but contracts do not deliver supplies; sources of electricity do. We can talk contracts and price all we like, but if every time we have a dry year Ministers go running to large industry groups, like that at Tiwai Point, and ask them to switch off, we will not have an environment and an economy where people want to invest with confidence—it is as simple as that. It is not rocket science. Jobs get lost, overseas investment is lost, and capital for investment is lost. Those are the sorts of things on which taxes are paid and health and social services are built. I want to move on to the issue of—

Stuart Nash: So you say we fix the electricity problem by building roads.

MICHAEL WOODHOUSE: Yes, there are connections with all of those things and that is why the national infrastructure plan is so important. Now we have talked about central government and we have talked about local government, but of course the private sector has a part to play in this as well and I think the broadband investment plan is a very good example of where the Government and the private sector can collaborate. It will probably be a slow journey into those types of arrangements by the admission of the Government organisations that briefed the Minister for Infrastructure—the likes of Treasury, the Ministry of Economic Development, the Electricity Commission, and so on—whose officials admitted that “there was currently no practical experience and relatively little knowledge of public-private partnerships.”

We have talked a lot about it, have we not, for the last 9 or 10 years? I heard a lot about it in health, in energy, and in other industries. But very little was done to invest in that knowledge and expertise. One of those areas where we do not get a lot of private sector investment at the moment is in the health care sector. It is what I know well and Mr Peachey mentioned—

Stuart Nash: You want to privatise the hospitals!

MICHAEL WOODHOUSE: Not at all, and I think the member is disingenuous by saying that. I say now that the future of this country’s health sector has to be built on a strong and sustainable public sector, but the private sector has been there for a long time. But even with public sector investment—Mr Peachey talked about $250 million of planned investment—there is another nearly $700 million of capital that is backing up in the Minister’s office looking for approval. That is the sort of thing that the national infrastructure plan is designed to address, because if we do not we are going to get a bow wave of these things and at current growth rates it is simply not affordable. So I congratulate the Minister. I think this legislation is very important, it is part of stepping up that infrastructure planning, and I look forward to seeing it when it is rolled out. I commend the bill to the House.

• Bill read a first time.

Hon GEORGINA TE HEUHEU (Minister for Courts) on behalf of the Minister for Infrastructure: I move, That the Transport and Industrial Relations Committee consider the bill, and that the committee report finally to the House on or before 13 November 2009, and that the committee has authority to meet at any time while the House is sitting (except during oral questions), and during any evening on a day on which there has been a sitting of the House, and on a Friday in a week in which there has been a sitting of the House, and to meet outside the Wellington region during a sitting of the House, despite Standing Orders 187, 189, and 190(1)(b) and (c).

• Motion agreed to.