PHIL TWYFORD (Labour) : I say good morning to the Committee, and good morning to New Zealanders, who may be a little nonplussed that we are considering some fairly fundamental changes to our system of local government here at 9 o’clock on a Thursday morning, under urgency.

Hon Ruth Dyson: Again.

PHIL TWYFORD: Again, the Minister of Local Government has brought a bill to the House that takes away the democratic rights of New Zealanders in local government and, again, it is being pushed through the House under urgency.

There is plenty to talk about in this bill, and I am looking forward to some detailed debate at the Committee stage on the provisions of the bill. I will start by explaining one of the reasons why Labour is voting against this bill in its entirety. This bill, through a number of its provisions, seeks to open up local government services, assets, resources, and systems to the private sector, and it does that in a number of ways. Principally, it removes the democratic safeguards that exist in the law currently that give citizens and communities all over New Zealand the chance to be informed and notified of changes in the way that assets are owned or managed and in the way that services are delivered. Citizens have the opportunity to consider that and to give input—to be consulted as part of the democratic process. This bill takes away those rights.

I will go through some of the clauses in more detail. Clause 11 repeals section 88 of the Local Government Act 2002. The effect of that repeal is to take away the right that citizens in this country currently have to be consulted thoroughly when a public service currently delivered by the council is corporatised, transferred over to a council-owned company, or contracted out to the private sector. There is a reason why section 88 is currently there, which is that, whether a service is delivered by the private sector or whether it is delivered in an open, transparent way managed in the interests of the public good by our local authorities, it is a matter of legitimate public interest.

I would have thought that after the last year and a half in Auckland, the Hon Rodney Hide would discern that the public actually care about this stuff. The public backlash that he faced in Auckland because of his corporatisation agenda for the new Auckland Council, where he has essentially consigned three-quarters of local government services into council-controlled organisations, caused a storm of public concern from the New Zealand Herald and right across the city, including all the elected mayors. There was massive public opposition, and the corporatisation agenda that he rammed through in Auckland is one of the reasons why not only his own personal stakes but also the Government’s standing took a real hit in Auckland over the super-city.

Hon Member: And their mayoral candidate.

PHIL TWYFORD: That is right. Surely that is demonstration enough that people care about this issue. The reason people were concerned was that the council-controlled organisation model is deliberately designed to keep the business of local government away from the sunlight of transparency and democracy. It is designed to keep the public out.

The storm of public opposition to the Minister’s agenda in Auckland forced some real concessions that made the Auckland council-controlled organisations far more responsive and transparent than otherwise, but those concessions will not apply to the rest of the country. They do not. So under this bill, councils around the country can transfer services to a council-controlled organisation without consulting their ratepayers, without telling them what is going on. Once those services and assets are in council-controlled organisations, a whole lot of other democratic safeguards do not apply. They can dispose of assets more easily without having to consult the community, and their meetings are no longer open to the public. They do not have to publish agendas or minutes. All of the normal conventions of accountable government that we take for granted in local government do not apply under the council-controlled organisation model. That is why the current law says that communities should have the right to be consulted before the services, assets, and resources of local government are transferred across.

If we look at the transport council-controlled organisation in Auckland, we see that Mr Hide, against the advice of four Government departments, advised that the transport agency should be corporatised. Nowhere else in New Zealand is transport run as a council-controlled organisation—as a corporate entity. But there was a huge public outcry about that, because people do not necessarily want their local government services to be run by a corporate entity. People like to have access to the meetings and to hold their politicians to account.

This bill undermines those rights. Nothing in this bill would prevent a council from transferring its libraries to a council-controlled organisation, its parks to a council-controlled organisation, or its transport operation to a council-controlled organisation. A council could do those things—[Interruption] Members opposite ask why they would do that. Well, I ask them why the Minister in the chair, the Minister of Local Government, transferred three-quarters of Auckland local government services to a council-controlled organisation, against the wishes of Auckland—against the wishes of Auckland’s elected politicians and against the wishes of the public. That is a perfect example of a politician choosing to do that. He never gave the people of Auckland a say, and this bill reflects that exact same political style. The citizens of Auckland would not be given a say as to why their services would be corporatised. Why members opposite cannot get that into their heads, I just do not understand.

The Government claims that this bill will make local government more transparent and more accountable. Well, we will look at a whole series of examples as we go through the clauses of this bill, but clause 11, in particular, which repeals section 88 of the Local Government Act 2002, is a classic example of how this legislation will make local government less transparent, less responsive, and less accountable. It is all because of the ideological blinkers of this Government and this Minister of Local Government, who brazenly want to encourage the privatisation and corporatisation of our local government system. They are taking away the democratic safeguards that New Zealanders expect and rely on.

There is an important philosophical difference between National and ACT, on one hand, and Labour and the Greens, on the other. Members on this side of the Chamber believe in the importance of public ownership and public control as part of our democratic system of government. It is so that our communities, and their resources and assets, are managed for the public good, in the public interest, and in a transparent and accountable way. But what does this Minister of Local Government believe in? What do members opposite believe in? They are quite happy to shovel our resources and our assets, which generations of ratepayers have paid for through their rates, into corporate entities where business can be done behind closed doors, with no transparency and no accountability. Those members do not care, because they are totally happy for our cities and our communities to be run by an oligarchy of private interests. That is the system they are setting up. It is the system that Rodney Hide has been setting up in Auckland.

This bill severely undermines the democratic processes of local government. Labour does not believe in it, we will not stand for it, and we will denounce it and call it what it is. This Government, with the help of this Minister, who is currently polling at about 2 percent in the polls, is undermining our public institutions and our system of government by taking away the right of people to be informed about their resources.

I would have thought that with the experience of the last couple of years, this Government would realise that people actually notice and care about issues of public ownership and public control. The fiasco that this Minister presided over in Auckland is a classic example of that. We could look back to when the forces of the right tried to privatise the Ports of Auckland and provoked massive opposition.

Hon RODNEY HIDE (Minister of Local Government) : I thought I would do something novel and speak to Part 1 of the Local Government Act 2002 Amendment Bill. It is clear to me that Mr Phil Twyford is traumatised by the success of Auckland and cannot bring himself to talk on this bill.

Part 1 inserts several new provisions so that local authorities will be required, firstly, to have particular regard to the contribution made by particular core services; secondly, to assess the risks and returns of commercial investments, which I thought would be a good thing; thirdly, to develop a financial strategy and include this in the authority’s long-term plan—again, I would have thought that that was a good thing—and, in particular, fourthly, to publish a pre-election report. These provisions are under clause 16. The information that will be included in the pre-election report for members is set out in schedule 1.

By the way, I should say that Part 1 contains the bulk of the substance of this bill. Part 1 also provides for more consistent financial reporting and the disclosure of infrastructure service information. For example, it enables regulations to be made that prescribe that forms for funding impact statements are included in long-term plans, annual plans, and annual reports in schedule 1. It also enables a Secretary for Local Government to make rules specifying standard performance measures for five groups of activities, and sets out the purpose and criteria for doing so. These performance measures will be included in long-term plans and annual plans, which are intended to take effect from 2014. The part amends the definition of “community outcomes”, in clause 4, so that it is about the outcomes a local authority aims to achieve for its community.

Chris Auchinvole: Is this the hidden, evil bit?

Hon RODNEY HIDE: Maybe. The part also repeals requirements for local authorities to carry out separate processes for identifying, monitoring, and reporting on community outcomes, under clause 12.

Part 1 repeals requirements for local authorities, firstly, to consider the views of interested or affected persons at four specified stages in the decision-making process.

Dr Cam Calder: How many is that?

Hon RODNEY HIDE: Four. It will be up to the council to decide how many times it will consult. Secondly, the part repeals requirements for local authorities to consult on proposals to change the mode of the service delivery of a significant activity from a local authority to a council-controlled organisation or other body, under clause 11. The council can still decide to do it; it is not a legal requirement. Thirdly, the part includes certain proposals, decisions, and long-term plans. These include proposals to construct, replace, or abandon a strategic asset, in clause 14, and proposals for the sale or exchange of endowment land, in clause 33. I have to say that these provisions have been overwhelmingly received by the local government sector. Part 1 removes most funding and financial policies from long-term plans, while requiring separate consultation on some of those policies. That is set out in clauses 18 to 26.

Regarding the provision of water services, Part 1 gives local authorities and their communities more options for providing and financing their water services, so that they can decide for themselves what is in their best interests. That will help to facilitate private sector investment in water infrastructure. The provisions in clauses 31 and 32 extend permitted time limits on water service contracts and joint arrangements with the private sector from 15 to 35 years, which makes those arrangements more workable. I do not understand the position of Labour members. They were happy for the term to be 15 years, but somehow 35 years is suddenly the end of Western democracy as we know it.

Phil Twyford: It’s private ownership.

Hon RODNEY HIDE: Mr Twyford keeps yelling out. I think he should concentrate on finding somewhere in Auckland where the Labour Party would like him to stand; that would be a positive thing.

This part also enables councils to build, own, and operate transfer schemes, by allowing a private partner to open new infrastructure during the contract period. The public would have to be consulted on these proposals, and on any other kind of joint arrangement. The bill does not require any changes to be made, and does not privatise water services. For example, it does not enable permanent ownership by, or the transfer of council water services to, the private sector. Local government would remain legally responsible for providing water services, and for pricing and policy decisions. Customers would continue to have a direct relationship with the local government organisation, which would be accountable to those customers. The bill prohibits arrangements in which the private partner has the right to revenue from the water service, such as concessions or other franchise agreements. It also prohibits the sale or transfer of the ownership of existing infrastructure—

Chris Auchinvole: Could you say that again—inhibits the sale?

Hon RODNEY HIDE: I will say it again because I know Mr Auchinvole is interested.

Chris Auchinvole: Did you say it prohibits the sale?

Hon RODNEY HIDE: Yes, Part 1 prohibits the sale or transfer of ownership of existing infrastructure, unless that is incidental to, and desirable for, the success of the joint arrangement. Again, the public would be consulted.

Hon Darren Hughes: He was a celebrity once; now his fan base is Chris Auchinvole.

Hon RODNEY HIDE: It is so interesting, is it not? We have Mr Darren Hughes, who I think lost his seat at the last election. We have Mr Twyford, who cannot—

Phil Twyford: How’s your polling in Epsom, Rodney?

Hon RODNEY HIDE: Actually, it is very good. Mr Twyford cannot even convince his own Labour Party to let him have a crack at a seat.

We will also have a Supplementary Order Paper to make minor drafting amendments to Part 1 of the bill—

Hon Darren Hughes: Don’t show off about victories.

Hon RODNEY HIDE: —and I know that Mr Hughes will be interested in that Supplementary Order Paper. Clause 16 is amended to clarify that the provision will relate to a local authority “referred to in subsection 1A”. Clauses 25 and 26 are amended to fix cross-reference errors. Clause 32(4) is amended to fix the amending terminology used in the provision. I am looking forward to the Labour Party actually addressing Part 1.

BRENDON BURNS (Labour—Christchurch Central) : I am very please to speak in the Committee stage of the Local Government Act 2002 Amendment Bill. What is very clearly behind this bill is a very specific agenda—

Hon Members: Ah!

BRENDON BURNS: Yes, it is a very specific agenda for the privatisation of New Zealand’s water assets, and I will give the Committee two examples, one of which is relevant to those noisy members from Canterbury. I will quote from a Canterbury District Health Board document that warns about the consequences of this bill. I will also quote from another document that is not so public from the Minister of Health in respect of this privatisation agenda, because this bill raises very serious concerns about not only the loss of local New Zealand control of ownership of our water supplies but also very major risks to public health.

I specifically refer to clauses 28, 29, and 30, in Part 1. The Local Government and Environment Committee received commentary from the Canterbury District Health Board on those clauses. I have to say that in 25-plus years of being in and around public life I have never seen a submission so strongly made in such language explicit with warning to a Government as this submission, which was written by the Canterbury District Health Board’s manager of healthy physical environments. In it he warns that “Deletion of sections 125-129 of the LGA effectively removes the specific regulations pertaining to water and sanitary services overseen by an (independent) Medical Officer of Health.” The actions of the Government in taking away the Ministry of Health’s oversight of water schemes, as this bill does, are, as the Canterbury District Health Board states explicitly in its submission, precisely the type of action that played a significant part in the Walkerton tragedy.

Walkerton is a small dairy-farming area in the Ontario province of Canada. A new Government came in promising to sweep away the red tape and the horrendous regulations that were squeezing the lifeblood out of business. It did that. It took away the red tape. The consequence of its actions, which included the removal of health department oversight of water schemes, was a serious outbreak of E. coli in 2000, which saw seven people die and two and a half thousand people get sick, and which cost an estimated $200 million in direct and indirect costs to that province of Canada. Seven people died—

Hon Member: What?

BRENDON BURNS: Seven people died, and two and a half thousand people got sick because a Government came in and said it would sweep away the red tape, the regulatory restraint, which was strangling the lifeblood of business. The consequence of that was to take away health department oversight of the management of water supplies in that part of Canada. That is precisely what will happen here.

I invite the Canterbury member opposite Nicky Wagner to stand up, challenge her district health board—which she likes to snuggle up to sometimes—and tell it that it is wrong, and to put it on the record today, so that when this happens in Canterbury, under this bill, she can stand by her record and can tell the board that she was right. Here it is, in black and white: the Canterbury District Health Board is telling this Parliament and telling this Government that this bill, in removing Ministry of Health oversight of water schemes, in a blatant attempt to privatise our water supplies—to put in the profit motive—will lead to a tragedy. It is saying that taking away regulatory oversight of water schemes will put this nation at extraordinary risk. They are not my words; they are the words of the medical officer of health of the Canterbury District Health Board, and his team, who currently have a role in the oversight of drinking water. My goodness, that district health board already has a struggle going on in trying to make sure that our drinking water is safe. It has a Minister of Health—[Interruption] Mr Chair! Mr Chair! Mr Chair!

The CHAIRPERSON (Eric Roy): I will give you the call, but we are not going to have a barrage of calls. I am quite aware when people are seeking the call, and I am not going to have any member yelling at me. If someone continues to do that, that member is not likely to get a repeat call.

BRENDON BURNS: Thank you, Mr Chairperson; my apologies for the volume. This is an issue that deserves to excite the interests of members of the Committee, because there are very, very pronounced risks for New Zealanders under this bill in terms of the safety of their water. A submission from the Canterbury District Health Board to the committee explicitly states that there are very real risks in taking away the medical and health oversight of water schemes and handing it across, in 35-year terms, to the private sector. In doing so we will risk doing exactly what happened in Walkerton, Ontario. We are risking the lives of New Zealanders by taking away that health oversight.

Allied to that, just a few weeks ago I was able to discover that the Minister of Health has taken an action that I think is involved in, and linked to, this issue. Until very recently the Ministry of Health had a team that was responsible for oversight of our drinking-water schemes. That has now virtually ended. From a team of five 2 years ago, there is now one staffer left in the Ministry of Health providing oversight of drinking water. Instead, the Government has awarded a $2.25 million contract—$2.25 million of our taxpayers’ money—to a consortium led by a company called Allen and Clarke, which National members opposite were describing 5 years ago as cronies. They were saying that rampant cronyism was at work involving this company. But that has not stopped them from awarding a $2.25 million contract to a consortium led by Allen and Clarke to provide oversight of our core public health function, the safety of our water. I see a very strong linkage between that and what we have seen in this bill in respect of taking away, at a local level, Ministry of Health oversight of drinking water.

If we put those two things together, where are we going? We are going into a system where contracts will be handed over to the private sector for 35 years, without, at a local level, health input and oversight of drinking-water schemes. At a national level, as a result of the Minister of Health’s intervention and the awarding of a $2.25 million contract to a consortium led by Allen and Clarke, we now have a contracted-out responsibility for what is a very clear public health function. If there is one thing that we as a First World nation should be able to do, it is to have some belief that water is safe to drink, and currently fewer than one in five New Zealanders are able to be given that assurance. Fewer than one in five New Zealanders are able to be told explicitly that water is safe to drink. That is the statistic in the latest Ministry of Health report—

Nicky Wagner: That is not—

BRENDON BURNS: Yes, it is. The 2008-09 Ministry of Health annual survey shows that 80 percent of New Zealanders are drinking water that is assured to be safe—down from 83 percent in the previous year—but one in five, or 20 percent of New Zealanders, are not given that assurance and do not know that their water is safe, because their water either is not tested or, when it is tested, is found not to be safe. That is the result.

Nicky Wagner: That’s scaremongering.

BRENDON BURNS: No, it is not scaremongering. We saw what happened in Walkerton, Ontario under precisely the sort of regime that this bill is leading to—precisely. They are not my words. There is the member from Rangitata. You stand up and take a call—

The CHAIRPERSON (Eric Roy): Order!

BRENDON BURNS: —and deny what your local district health board is saying. It was an explicit warning. You go on the record and say this is a nonsense—

The CHAIRPERSON (Eric Roy): Order!

BRENDON BURNS: My apologies, Mr Chairperson. The member for Rangitata, not the Chairperson, should take a call to make sure that the constituents she is currently the member for—somebody else might be their member shortly—hear her put on the record that what the Canterbury District Health Board is saying is a nonsense. She should then put on the record—and I would like to hear the Minister of Health say this, as well—that it is her view that it is appropriate to take away the Ministry of Health’s role and hand it to a consortium, at a cost of $2.25 million of taxpayers’ funds.

This consortium includes an outfit called Parsons Brinckerhoff, which is an American engineering conglomerate. My supposition is that it is here not just to play a role in the oversight of water through that contract but to line itself up for some nice, juicy contracts that will emanate from this bill as we see the creation of 35-year contracts. A generation of ownership is provided for under this bill for our water schemes, for our basic right to enjoy safe drinking-water, which should be a core public health function.

LOUISE UPSTON (National—Taupō) : I will take us back to the focus and intent of the Local Government Act 2002 Amendment Bill, because we have not heard very much about that, unfortunately, in this debate so far. We have heard from the members opposite a lot of alarmist talk and scaremongering, and emotive extremism that has actually bordered on histrionics at times. But I want to talk about the bill, because that is what this debate is about. I say it is about the bill, in case some members have forgotten that. I actually do not think many members opposite know what the bill is all about, so I will take members through the background—

Jonathan Young: They weren’t on the committee, anyway.

LOUISE UPSTON: That is right, and those who were did not show up all the time.

This bill is actually about sharpening up the local government debate and making sure that we achieve in local government. It is very important to have effective local government, because we know that builds strong communities. Strong communities are empowered by local government, and they have influence, they have a say, and they have access to transparent information so that they are in a better position to influence the decisions of those who represent them. That is why I want to spend a bit of time talking about what the council is involved with, and the transparency around that, and about actually being able to provide good information back from a council on how it has been doing, with some consistent performance measures. Also, what most people would expect is a financial strategy as to how ratepayers’ money will be spent, and then a report back as to whether that was done.

One of the issues that came up from time to time in the submissions comes up a lot for me as an electorate MP. I am not sure how many members opposite are electorate MPs, but a lot of constituents who come through my door talk about the fact that their greatest concern is the ever-increasing burden of rates increases on their fixed income. Measures in this bill will provide those people with the ability to look at, and have a say on, what local government is doing.

Let us have a look at a couple of those measures—for example, core services. We have heard a diatribe from members opposite about core services, and I want to set the record straight on the intention behind the statement of core services. That statement actually enables councils to have a focus on core services, but nowhere is it stated—and it never has been stated—that a council is restricted to those core services. Instead, the statement is about creating a priority for those activities, and then allowing debate by the people who live within a council boundary to decide which other activities should occur.

For example, economic development was mentioned several times, and that is an important activity to touch on. If I look at the Taupō electorate, I see that economic development occurs quite differently in Waipā from south Waikato and from Taupō. Not one of those councils is stopped from doing economic development, but the priority is different, based on the needs of those communities. This bill provides the flexibility for each council to work towards meeting the needs and demands of its communities. If a particular community wants to invest significantly in economic development, then local ratepayers get to make that call, which is exactly how it should be.

In terms of core services though, we would not want to have a situation where some non-core activities took priority over the building of roads, for example. Every ratepayer has a certain expectation about roads to drive on and water to drink. That is exactly what we have in terms of core services.

Despite some random comments from members opposite, this bill is about communities making decisions around the activities in their communities. More important, in activities like the pre-election report the community gets to see how the council has been going with regard to the decisions that the community has had input into. At local body elections—and we have just had one—voters will be able to rely on solid information rather than just electioneering material. The previous speaker talked about democracy. I am not sure why members opposite cannot understand that pre-election reports allow for more information to be provided, to enable voters to make informed decisions about whom they will vote for. Yet, members opposite say this bill takes away democracy.

CHRIS HIPKINS (Labour—Rimutaka) : One has to hand it to the National Party and the ACT Party. At the last election they promised New Zealanders that they would not privatise any public services in their first term, and of course they did not mention anything about local government services. Local government services are what this bill is all about. It is about privatising local government services and, contrary to the previous speaker’s comments, the bill is all about removing the ability of local communities to determine what shape of local government they want. Under current law it is up to local communities to decide what type of local government they want and what sorts of services they want their local councils to provide. Communities have the ultimate say, but this bill is all about watering down their ability to determine what they want their local councils to provide.

I particularly want to talk about core services, and that is what the previous speaker Louise Upston—a single-term MP for Taupō—was talking about. I will talk about how councils will define a core activity, because a core activity in one area will not necessarily be a core activity in another area. A core activity now might not be a core activity in the future. If I had been writing the Canterbury council’s list of core activities 6 months ago I am not sure that I would have put “earthquake recovery” on that list of core activities, though I imagine that Canterbury local authorities are quite actively involved in that at the moment. These things change. The needs of communities change, and councils need to be able to respond. Not a single submitter to the Local Government and Environment Committee thought that defining core services was a good idea. Can any members opposite name a single local authority that said that was a good idea?

Dr Cam Calder: Yes, I can and I have the piece of paper. Would you like me to table it, Mr Chair?

The CHAIRPERSON (Eric Roy): Order!

CHRIS HIPKINS: Give me the name.

Dr Cam Calder: Wellington City Council; I have the document in front of me.

CHRIS HIPKINS: Rubbish! The Wellington City Council did not argue that way. I sat through that council’s submission, and it opposed the definition of core services. Not a single local authority thought that defining core services was a good idea. I sat through the hearings, and none of the councils argued that it was a good idea to define core services. In fact, the Government’s vision of what core services should be and Rodney Hide’s definition of what core services should be cut out a whole lot of stuff that local authorities currently work on. For example, employment creation, job creation, and economic development are not part of this Government’s vision for the role of local government. I think that local government could play a larger role in these types of activities. The Mayors Task Force for Jobs, for example, was very successful but there is no accommodation for something like that within the definition of established core services.

One of the reasons they say we have to shrink the size of local government is rates increases, yet the Department of Internal Affairs advice to the select committee was that 97 percent of council expenditure was on the things that they list as being core services for local authorities. There is absolutely no need to define core services in legislation. All that will do is unnecessarily tie the hands of local authorities and make them less responsive to their local communities. They want to take the “local” out of local government. Local government should be about local communities saying that “These are the services that we want you to provide.” They need to be able to change. They need to be able to adapt to different situations. I am very concerned about this idea of local authorities having their hands tied.

I want to talk also about the financial strategy that councils will need to put in place, because potentially that will also constrain councils’ abilities to respond to local community needs. I support having a financial strategy, but I am concerned that it will require councils effectively to cap the level of rates they will be able to charge. It is very popular to promise lower rate increases and therefore defer to future generations the costs of very necessary infrastructure upgrades and very necessary expenditure. In 10 years’ time, or 20 years’ time, when the plumbing stops working, the water stops coming out of the taps, and the roads are full of potholes, the councils of 10 or 20 years ago will not be the ones that have to deal with the problems. Those problems will be faced by councils in the future. So 20 years ago those councils may have kept their rates low, but future generations are the ones who will end up having to deal with the legacy that that will create; they will have to worry about that legacy.

Overall, the idea of a financial strategy for local authorities is a good one. We have a financial strategy for central government finances, so having a similar mechanism for local government is perfectly acceptable. But I am concerned about putting an arbitrary cap on the level of rates. We do not do that for central government taxation. We do not say we will cap at a certain rate the amount of revenue that central government can earn, and thereby everything else has to fall within that cap. Central government has the ability to raise taxes as it requires, in order to fund the activities that it deems necessary and on which it goes out and campaigns for a mandate. Why should local authorities be subject to a different standard? Why should they be prevented from delivering the things they promised to their local communities in an election, because there is an arbitrary cap on the amount of revenue they can create?

If local communities want local authorities to provide certain services and they vote for local authorities to provide certain services, then the local authorities need to be able to raise the revenue in order to deliver them. If the local people do not like it and are unhappy with the level of rates being charged, then there is a mechanism they can adopt in order to deal with that—they can elect a different council. It is the same with central government. If people are not happy about the level of tax they pay, they can elect a different Government. If they are not happy with the services provided by central government, they can elect a different Government. Why should local authorities be any different? Why should central government be tying the hands of local authorities and preventing them from delivering on the services that local communities are demanding of them? They are effectively short-circuiting the local democratic process by saying that the local communities might say that that is what they want, but that we in this Parliament know better. Actually, we do not; the local communities should be able to determine what they want to have delivered.

As I mentioned before, putting an arbitrary cap on the revenue that local authorities can raise also constrains a council’s ability to deal with unforeseen issues that may arise from time to time, and again I come back to natural disasters, for example, Canterbury’s earthquake. Why would we want to constrain the ability of local authorities to adapt to things that are unforeseen? The Canterbury earthquake is at the extreme end of the scale; I am talking about smaller-scale natural disasters. The Hutt Valley, where I come from, is prone to regular flooding. In the last 10 years or so there have been three or four reasonably significant floods. They are not the types of floods where every home in the Hutt Valley is flooded, but ones where significant numbers of homes and businesses end up being flooded. Local authorities need to have the flexibility to respond to those disasters and to raise the revenue that they need in order to respond to those disasters, without this idea of an arbitrary cap on them. If we put an arbitrary cap on the level of rates that councils can charge, again what we are doing is encouraging local authorities to defer the burden of providing adequate infrastructure on to future generations. I think some of our local authorities already have an infrastructure deficit, whereby the replacement of core pipelines and so on has not taken place because those local authorities have been striving to keep their rates down. As a result, at some point a future generation will end up having to front up and pay an awful lot more in order just to keep the basics operating.

Why should we place this constraint on councils? Why should we place this overriding objective on councils that keeping rates low is the ultimate objective, no matter what the consequences? Ultimately we will get what we pay for. If we pay for a cheap, shoddy water system and a cheap, shoddy sewerage system, that is what we will get. But if we are willing to invest in it now, then we will be catering properly for future generations. I am concerned about that desire to cut down the role of councils by restricting them to what Rodney Hide thinks local authorities should be providing, rather than what the local communities think they should be providing and, by putting this arbitrary cap on the level of rates, thereby restricting the ability of local authorities to raise the revenue for the services that local people want their local authorities to provide.

Those are two things that I am particularly concerned about in this legislation. I know that the Minister has indicated that he will take the next call, so I am quite looking forward to hearing his response to those two particular issues.

Hon RODNEY HIDE (Minister of Local Government) : I want to correct some of the statements that have been made by Labour members.

Chris Hipkins: They’re factual.

Hon RODNEY HIDE: No, I am sorry, they are false. First of all, Mr Twyford said that no council supported the clause on core services. This is simply untrue. For example, Rangitīkei District Council officials advised me that the council thinks it is helpful to highlight in legislation those core services that councils must have particular regard for. I am sorry, but the Labour members must have been asleep during discussion on that one. Indeed, Wellington—

Phil Twyford: How many supported it?

Hon RODNEY HIDE: Mr Twyford now changes the debate. He said none earlier, and he misled Parliament. When we come to Wellington City Council I am advised that the council supported the clause in its current form. I think it would be helpful for this debate on the important area of local government if Labour actually concentrated on some accuracy.

Dr CAM CALDER (National) : I thank the Minister in the chair, Rodney Hide, for what he pointed out, because I think the previous Opposition contribution showcased the problem we face in this debate: there is a lot of extremism, there is a lot of alarmism, there is scaremongering, and a lot of it boils down to the presentation of positions on behalf of other bodies, which are fundamentally wrong. As another example, which I think the Minister briefly touched on, may I please read what the Wellington City Council said? One of the pleasures of being on the Local Government and Environment Committee was receiving the high quality of feedback from local government and from members of the public on this bill.

Chris Auchinvole: What did they say?

Dr CAM CALDER: They said a number of things, and we listened very closely. I have to acknowledge at this stage the inclusive chairmanship of chairman Auchinvole and the contribution of people from all sides of the House—all sides of the House—which may not be apparent in this debate when we hear some of the comments being made.

As well as being on the select committee I had the pleasure of visiting a number of local and regional councils in the south in the last couple of weeks. It has to be said that there were few, if any, concerns about this legislation—few, if any, concerns. Let me address the previous query as to whether we could possibly mention any councils that support the core services provision. Yes, we can.

Chris Auchinvole: Can we do that?

Dr CAM CALDER: Yes, we can. New section 11A, inserted by clause 5, introduces a list of core services and the requirement that local authorities have particular regard to the contribution of those services to communities.

It has to be said that many communities expressed some concerns about this. They said they were small rural communities and they would obviously have things that they wanted to do that were different from large urban communities. We understand that. The select committee took that on board, and the Minister has alluded to the fact that we understand that. The list of core services does not prevent a local authority from carrying out anything that it sees necessary in its community. As we know, there are numerous clauses in this bill that require consultation with the community by the council and for the community to be able to make its views heard, despite what we have heard from Opposition members. I will very briefly speak further to this, and answer the member Chris Hipkins’ earlier interjection to name a council. I would like to name Wellington City Council, in addition to Rangitīkei District Council, which I believe the Minister mentioned. The council wrote: “In our view the clause is intended to ensure that councils have duly considered how the listed services contribute to the well-being of their communities. Wellington City Council considers it will be able to demonstrate that the council has had particular regard to the contribution that specified core services have made to our community. Wellington City Council supports this clause in its current form.” Thank you.

SUE KEDGLEY (Green) : George Orwell coined a language that he called doublespeak. It is a language that makes the bad seem good and the inappropriate seem appropriate. But I have never—or seldom—heard so much doublespeak coming from Government and ACT members as in this Local Government Act 2002 Amendment Bill. We have a bill that they say is all about increasing openness and transparency. Then we read the fine print and we discover that the bill is about gutting the consultation procedures in the local government legislation so that openness and transparency will be reduced or taken away. The bill will remove the requirement that councils have to make the decisions that will significantly affect the capacity of local government. It will remove the requirement to consult the public if councils want to contract out their water or other services. It will remove the requirement to consult the community when councils construct, abandon, or replace strategic assets. Can members believe it? Government members are saying that this will increase the openness and transparency of local government; the only word to describe it is Orwellian.

The other thing is that Government members are trying to pretend that allowing a private water company to own water infrastructure, and to manage it for 35 years, is not water privatisation. What a joke! That is using all the best Orwellian language in the world, because the truth is that this bill is all about allowing private water companies to come in and take over our water supplies for 35 years: to own them, to manage them, and to control them. Water privatisation, as I was saying yesterday, has a terrible record right around the world. The reason for that is that once private water companies take over a local water supply, the whole goal is to maximise profits for the water companies, not to protect the public interest.

How do such companies maximise their profits? They do three things. Immediately they shed the workforce—about 25 percent to 50 percent of the workforce in most cases is immediately shed—and they reduce working conditions. The second thing companies do to increase their profits is increase the price of water, and I will refer to what they did in the United Kingdom. The third thing they do is under-invest in the asset; they do not bother to fix the leaks. They do what Fay and Richwhite did to our railway network: they just run it down. Instead of investing in upgrading water infrastructure, they siphon off all of that money into the profits of the shareholders. That is what has happened all around the world, wherever Governments have allowed the privatisation of water. When the United Kingdom fired 25 percent of staff, the price of water increased by 50 percent in the first 4 years, and the number of people having their water supply cut off tripled, because those people could not afford the price of water. In the meantime, the huge bonuses and salaries paid to the management and directors of the water companies, and the profits of the water companies, soared by 142 percent in the first 8 years.

Let us be under no illusions: that is what this bill is about. I think the private water corporations must be popping champagne as this bill goes through the House. They must be rubbing their hands together with excitement. They are being booted out of countries all around the world because of water privatisation’s terrible track record. Forty cities and towns in France are booting out private water companies. Paris has just booted out a private water company and put back the city’s water supply into public ownership. In Uruguay in Latin America, and all around the world, people are so outraged at what has happened to their water supplies under privatisation that they are booting out the water companies. Just across the Tasman in Adelaide, the biggest water company in the world, Veolia Water—which, by the way, owns the Wellington and Papakura water supplies—has not had its 15-year contract to run the city’s water supply extended. The water supply is going back into public ownership.

All around the world the opportunities to take over water supplies are being reduced; private water companies are being booted out of countries around the world because people have seen what has happened under water privatisation. Yet water companies must be rubbing their hands together with glee: just as they are being booted out from everywhere else, we are passing legislation, yet again under urgency, to tell them to come to New Zealand as we are now open for water privatisation. Here we are!

I just wonder what water companies have had to do to get this water legislation through. Their wildest dreams are being fulfilled by this legislation. I know that when we were discussing alcohol legislation, Mr Anderton asked whether liquor companies contributed money to the National Party. It would be interesting to know, for the public record—and eventually we will find out—whether water companies have contributed any money to the National Party. The beauty for the water companies is not only that they can get 35-year contracts to own our water supplies but that they will no longer have to consult the public. That will all be able to be sneaked through from now on. Councils will be able to contract out their water supplies for 35 years, or give their water infrastructure to a private corporation to own for 35 years, and they will not have to bother to tell the public. They will be able to sneak provisions through in the dark of night, just as we are doing under urgency here today, because with this bill we have removed all of the consultation requirements.

The ACT Party will also be popping champagne after this bill goes through, because today we are seeing the implementation of what I call Rogernomics part 2: the corporatisation and the privatisation of as much of local government as possible. It is all set out in the ACT Party’s local government policy, which I have here. The whole idea is that local government will shed its ownership of commercial activities; it will be confined to core activities. Piped water will be supplied on a fully commercial basis, and the contracting out of services will be encouraged. That is ACT’s local government policy, and it is being implemented today in this bill. The ACT Party, as well as all the private water companies around the world, will be popping champagne; they will be rubbing their hands together will glee. They will be asking how they could have pulled off this one. Not only will they now be able to take ownership of all the water supplies in New Zealand but they will be able to do it secretly in the dead of night. They will not have to go through messy consultation. They know how New Zealanders feel about water privatisation, and they know there might be a lot of opposition, so they have managed to do it without allowing for public consultation.

The Business Roundtable has been lobbying for just that for years. I have all of the papers here by Roger Kerr, going back over many years, about privatising water supplies. In one he says: “Private companies that build, own and operate water systems around the world now have annual revenues of around US$300 billion, excluding revenues for the sale of bottled water.” He goes on and talks about how the World Bank is pushing privatisation initiatives. He has been lobbying for 20 years to have happen what is happening today—to allow water privatisation to take place in New Zealand. That is what the Government is doing. It is implementing the objectives of the Business Roundtable, of ACT, and of the Rogernomics part 2 agenda—and Roger is sitting there. That is what he came back to Parliament to do—to oversee Rogernomics part 2, the gutting and the commercialisation of local government.

Chris Auchinvole: Gutting?

SUE KEDGLEY: Someone mentioned the word “gutting”; it is a gutting of the consultation requirements.

Hon JOHN CARTER (Associate Minister of Local Government) : Let us get one thing very, very clear: this Government is not privatising water. Let us get that really clear on the floor of the House. This Government is not privatising water. What we are allowing is what has been happening for many years.

Dr Rajen Prasad: It’s a monopoly. Why do it?

Hon JOHN CARTER: I will just explain to the member, if the member will listen. I will put a very cogent argument and point of view as to what is happening.

The fact is that for many, many years local government has had the opportunity, if they wish, to have their water supplies managed by the private sector for 15 years. They have come to us and said that they think there is a very good reason why it may be prudent to extend that beyond 15 years. So in this legislation we have said OK. The system has worked well for many, many years, and we have allowed the management—not the ownership and not the privatisation, but the management—of water by the private sector for 15 years. Local government is saying to us that it would not mind if it was extended a bit more, so we will allow them—the local authorities, which are democratically elected by their community to represent their community—to decide whether they might want to have their water supplies managed by the private sector for up to 35 years, if they decide that is prudent. It is up to local government to make that decision.

I just say to the Committee that I am not certain of the number, but I suspect that 30, 40, or even more private water supplies managed by the private sector already exist in this country. I dare the Opposition and Sue Kedgley to go to one of those people who are the recipients of water supplied by the private sector and ask why they do not stop doing that, and hand the supplying of water back to the local authority. I can tell members what the answer would be, and there would be a quick march out the door. I have asked many of those water suppliers. The member Kelvin Davis knows of one just up in Taipā, for example, up on the East Coast. There is a privately managed water supply there. I ask that member to ask those people whether they think it would be a good idea if Wayne Brown and the Far North District Council took over the supply of water. I know what the member’s response would be if he asked that question. I have asked that question, and I have to tell him—

Dr Cam Calder: What was it?

Hon JOHN CARTER: Well, it was not a very good response, I have to say. It was commented that if I even suggested that happen, that I might lose some local support. So I did not even make that comment. The point is that those people are very happy with the way their water is supplied. They can turn on their taps, they get the water, they pay the bill, there are no extra huge charges, they are very happy with the rate at which water is charged, so it works. The point is that it has been working for years and years, and it will continue to work, because that is what that community wants.

The other thing that might be useful is for the member George Hawkins to take a call to tell us what happened when he was Mayor of Papakura. I tell members that this might come as a surprise to the left, but one of their members, who was a former mayor, instigated allowing the private sector to run the Papakura water supply. What happened? Well, the local people kept turning on the taps and getting water out of the taps—it did not stop—and it ended up that they had the cheapest water supply in the Auckland area. Goodness, we should not let that happen, should we? No, maybe we should change this bill and not allow that to happen! But I dare anyone to ask the people of Papakura whether they think this Government should stop allowing that to happen.

All we are doing is applying what one might call a modicum of common sense to a practice that has been happening in New Zealand for a long time. It allows locally elected, democratically elected councils to make a decision as to whether they think it is in the best interests of their community.

Phil Twyford: But they don’t have to consult the community.

Hon JOHN CARTER: Yes, they have to consult the community—that is a lot of hogwash. Councils have to put it in their long-term council community plan. Councils have to tell the people that they think it is not a bad idea to extend the provision out, and give them the reasons why. Councils will get feedback from their people. What will happen is that in 3 years’ time, if the public do not like it—because it is going through the long-term council community plan and all the consultation procedures—they will not vote for the council, will they? Is it not that simple? I cannot understand this objection to our extending something that is already working so well in New Zealand. We have plenty of examples where the supply of water is cheaper. I know that is a dreadful thing that the Opposition might not like to think about.

Dr Cam Calder: They do not think about money.

Hon JOHN CARTER: That is true. It is unfortunately sad. But in this case there is a very good reason why this should happen. There is a very good reason why we want to give local communities the opportunity to make the decision. Parliament is not making the decision; all we are doing is providing the opportunity. It is up to each community to make the decision. To suggest that this Government is privatising the supply of water is silly. What we are doing is allowing for prudent management, if that is what the community decides. There are many good examples across—

Phil Twyford: Ownership of assets.

Hon JOHN CARTER: I say to Mr Twyford that there are many good examples across New Zealand where it happens well. As I said, if that member suggested to those communities that it should not do this, I tell him that we might go out and say that Labour is suggesting to the private sector suppliers that it wants them to come back into local government control. That might not be a bad policy, actually.

Phil Twyford: But you wouldn’t be telling the truth, would you?

Hon JOHN CARTER: Well, that is true. I say to Mr Twyford that if he thinks it is so bad, why are the Labour Opposition and the Greens not going around saying that it should be taken back into local government control? I will tell him why. It is because he knows that they would not get support for that policy. If they tried to unstitch what is happening now, they would get a negative view, and it would not help them in their endeavours to become the next Government, which of course will fail.

The fact is that this system works; it works well across the community. We are putting the responsibility and the opportunity back to local communities to make decisions about their own destiny, and why would we not do that? We should allow local communities to have that opportunity. Thank you.

KELVIN DAVIS (Labour) : He tīmatanga kōrero māku, Mr Chair, ka mihi atu ahau ki tērā kura kātahi anō ka tau mai ki raro o te tuanui o tēnei Whare i te rā nei, Te Kura Kaupapa Māori o Taumārere. Kua puta kē rātou i te Whare nei engari, e mihi kau ana ki a rātou. Kātahi rātou ka tau ki Te Whanga-nui-a-Tara. Nā reira, mihi kau ana ki a rātou.

[Mr Chair, I would like to begin by welcoming that Māori medium school of Taumārere today. It is their first time under the roof of this House. They have left this House now, but I really acknowledge their presence. The visit to Wellington is a first for them, as well. To them, I say well done.]

Firstly, I acknowledge the school that was up in the gallery a few minutes ago, Te Kura Kaupapa Māori o Taumārere. They have come down from the very far north; some of those kids have flown in an aeroplane for the first time. They are here to see democracy in action. Unfortunately for them, they saw democracy being bulldozed through, under the cloak of urgency. I acknowledge them. The mother of one of the children up there in the gallery was a pupil in a class I taught back in the early 1990s.

I return to the bill. I will talk about new section 11A, in clause 5, which describes the core services that local authorities will perform. The list consists of “(a) network infrastructure: (b) public transport services: (c) solid waste collection and disposal: (d) the avoidance or mitigation of natural hazards: (e) libraries, museums, reserves, recreational facilities, and other community infrastructure.” My concern, speaking as Labour’s tourism spokesperson, is that tourism is not considered to be a core activity. I want to know where the Prime Minister—who is also the Minister of Tourism—is right now and why he allowed this bill to go through with his blessing even though tourism has been omitted as a core service.

Many people will say that it is more important to build roads and to build pipes to take drinking water here, there, and everywhere, but let me read to the Chamber what the Tourism Industry Association thinks about this bill. The Tourism Industry Association is the collective that is basically the go-to group for the Prime Minister. Its news release states: “Local authorities play a critical role in the tourism industry, through their investment in public amenities used by both residents and visitors, like water, sewerage, toilets and roads. … Tourism is a core activity for most communities around the country and councils can help provide the best possible experiences to visitors. By helping attract visitors to the region and encouraging them to stay for longer, councils are boosting the economic contribution from the tourism sector.”

This bill reinforces what the tourism sector believes of local government, and that is that local government just does not get tourism—it just does not understand the economic contribution that tourism makes to local communities. The association went on to state: “most tourism businesses are small and operate on low margins,”. This Government says it is there for businesses, but it is neglecting small to medium sized enterprises by not investing in them or making sure that tourism is one of the core services in this bill.

Councils earn a good return on their investment in tourism as visitors spend millions of dollars in the regions. Let me give members an idea of the sort of return we get when we invest in tourism. If we invest just a single dollar in the United Kingdom, marketing New Zealand to the United Kingdom, we get an $11 return. From investing $1 in the United States we get a $16 return. If we invest $1 in Australia we get $26 back. Why would local government not want to invest in tourism and get that sort of return?

The benefits of tourism go beyond the accommodation, hospitality, and attraction sectors. The benefits of tourism provide employment and business activity indirectly to many sectors of the community, including shops, supermarkets, cafes, taxis, and food producers. What is it that this Government does not get about the contribution tourism makes to local economies? Why would local government not want to invest in it?

Nicky Wagner: There’s nothing stopping them.

KELVIN DAVIS: As the member correctly says, there is nothing in the bill to stop local government from investing in tourism. But because tourism is not mentioned as a core service, there is a legal basis, or a legal foundation, that tells local bodies that they do not have to invest in tourism—they do not have to. The bill concentrates the core services in an arbitrary list designed by the Government. If Government members could look just a bit wider than the shoebox they reside in, they would see that there are massive benefits to be made by local government investing in tourism.

KEVIN HAGUE (Green) : I take a call to talk about some other aspects of Part 1 of the Local Government Act 2002 Amendment Bill that have not received much discussion so far. I draw on the Canterbury District Health Board’s submission on the bill, in which it talked about some of the inadvertent consequences of exactly this type of approach to water in the town of Walkerton in Ontario, Canada.

In the town of Walkerton in 2000 an outbreak of gastrointestinal disease occurred through contamination of the water supply. In that outbreak, seven people died and half the town of 5,000 people became ill. The committee of inquiry into the Walkerton outbreak of disease found that “the Government of Ontario had made commitments to cut Government barriers to job creation, investment, and economic growth.”—it sounds familiar, does it not? The committee’s report went on to state: “It had also made a commitment to reduce the size of Government, and to provide the people of Ontario with better for less. In carrying out these commitments, the new Government elected in 1985 promised to eliminate red tape, and to reduce the regulatory burden for businesses and institutions.”

The Canterbury District Health Board has made the point that that is precisely the justification that this Government has given for this bill, in which the objectives are to remove unnecessary barriers to water infrastructure development, and to provide councils with an increased range of options for the provision and management of water services. The district health board has pointed out that under new section 136 of the principal Act, which is inserted by clause 31, the bill will remove some of the important safeguards in relation to water contracts from the existing legislation, in terms of the requirements that currently pertain to local bodies, and will introduce some unnecessary lack of clarity. The district health board has said we need to ensure that elements such as public consultation, quality control, reporting, auditing, performance review, and evaluation are included. It has made the point that the bill is unclear about who will have the legal responsibility for that, because the term “water supplier” that is used is unclear.

The district health board has also drawn attention to the amendment to section 125 in clause 28 of the bill and the repeal of sections 126 to 129 in clause 29. It has made the point that those sections repeal the prescribed process for undertaking assessments of water and sanitary services. That provision removes the requirement to consult, and consider the comments of, the medical officer of health. That will compromise the ability of the medical officer of health, an independent statutory officer, to effectively assess and review local authority activities in regard to water and sanitary services. The district health board has said that is precisely what occurred in Walkerton. In Walkerton, the Government of Ontario set out to create a looser regulatory regime, to ease the costs of business, to cut out red tape, and to do all of the things that National and ACT, in this debate over this bill, have been saying are precisely the kinds of things that local government requires. But the district health board has made the point that some of this red tape is in place exactly to ensure public safety, and to ensure that when we consume drinking water we are consuming a product that we know to be of high quality and to be safe.

The role of the medical officer of health is crucial in that area. The district health board has said that role is particularly important for protecting public health when a local authority may be driven solely or in part by fiscal or political concerns, which is precisely the case that we believe will be in place if this bill goes ahead unamended. The district health board has made the point that the medical officer of health can be utilised as an independent expert and trusted source of information, with proven value in communicating issues associated with public health risks to communities. But that requirement is being removed by this bill, by the repeal of those sections. In the Government’s headlong rush to free up the regulations that apply to local government in relation to water, to facilitate this process—

NICKY WAGNER (National) : I move, That the question be now put.

MOANA MACKEY (Labour) : I cannot believe that National is trying to move a closure motion already. I wish to speak to four clauses, three of which have not really been discussed at all so far, and one of which is—

Jo Goodhew: That’s because a whole lot on your side haven’t talked about the bill.

MOANA MACKEY: Well, I am talking about the bill now, I tell Miss Goodhew; I thank her very much.

The first clause I will talk about is clause 24, “Policy on remission and postponement of rates on Māori freehold land”. I was flicking through the bill and this caught my eye, because I remember the debate on the Local Government Act in 2002. I alert the Minister in the chair, the Associate Minister of Local Government, to comments made by his colleague the Hon Dr Nick Smith, who is a Cabinet Minister in the current National Government and was a Cabinet Minister in the previous National Government. He said about this policy—and I would like to know whether this is still National’s position—“Then we come to [this clause]. This is nothing less than apartheid.” That clause has been carried over into the current bill with some minor changes.

Section 102(4) of the Local Government Act 2002 states: “A local authority must adopt— … (f) a policy on the remission and postponement of rates on Māori freehold land.” Nick Smith stated: “I ask the Minister to tell me why councils must have a policy on remitting rates on Māori land, but may remit rates on other land. I want some member in this Chamber—maybe Parekura Horomia—to provide me with an explanation. Why must a council develop rates remission policies for your cuzzy bros and not for mine? It is a fair and reasonable question.” He then went on to state: “This damn law that we are being required to pass is nothing less than apartheid, and I cannot believe that members opposite want to impose this sort of obscene provision. It offends against National’s principle of one standard of citizenship.”

I would genuinely like to hear from the Minister in the chair about whether the Hon Dr Nick Smith’s stated position on the provision put by Labour in the Local Government Act 2002 that local authorities have a policy on the remission and postponement of rates on Māori freehold land—a provision that has been carried over into this legislation—still stands. I would very much like to hear from the Minister in the chair on that.

The second clause I will address is clause 22, regarding the policy on development contributions. As Labour’s spokesperson on housing, obviously I have a great deal of interest in this issue. I note that under clause 8 of this legislation, the community is losing the right to consultation. The community that elects the council is having consultation processes stripped from it. But I ask why developers are suddenly having extra consultation procedures put in for them so that they can continue to oppose and challenge councils that have applied development contributions to ensure that there is some public and community benefit from those developments.

We have a housing crisis in New Zealand. It would be useful if new developments could contain, for example, a proportion of affordable or social housing, given the length that councils often have to go to in order to provide amenities to those communities. Why not say that something should come back in return? That is what happens everywhere else in the world. This Government repealed Labour’s legislation that made it legally clear that councils were entitled to do that, given the legal problems that councils like Queenstown Lakes District Council have had in putting a policy in place for the inclusion of social and affordable housing in private developments and then being dragged through the courts by developers who say they do not have the right to do that. Labour put that into law; National repealed it.

But here we are again, and I ask the Minister again why communities are having consultation procedures taken away from them under this law but developers are getting extra ones. I ask how that is fair to those ratepayers and councils.

When I look at clause 8 on community consultation, I think of Environment Bay of Plenty, which is also known as the Bay of Plenty Regional Council, and of how a number of years ago, in 2004, it resolved that it would shift its headquarters from Whakatāne to Tauranga. That came completely out of the blue for the Eastern Bay of Plenty. Consultation procedures were not followed. I tell members that a community that has gone through an experience like that one understands the importance of having strict community consultation procedures—robust and genuine community consultation procedures. That decision was devastating for the Eastern Bay of Plenty. It was completely ridiculous, and it made no sense. Whakatāne is in the centre of the Bay of Plenty.

CLARE CURRAN (Labour—Dunedin South) : My colleague Moana Mackey has got right to the nub of one of the most important things I see in the Local Government Act 2002 Amendment Bill, and that is the issue of community consultation, which I want to talk about today. The bill is truly sorry and scary legislation.

Hon Members: Oh!

CLARE CURRAN: It is, I say to members opposite. Last night I said that the Government was screwing our workforce by trading away a precious week’s holiday. I said it was like being in a horror film, and today the horror continues.

Dr Cam Calder: Ha, ha!

CLARE CURRAN: Members opposite might laugh and think it is funny, but the horror is really for the people of New Zealand in the watering down of their ability to have a say in how their ratepayers’ money is spent, and that gets to the heart of what our democracy is all about.

Today the horror is continuing under urgency and we are rushing through the final stages of this bill. At least the public did get to have a say on this bill, even though the Government is taking no notice of the vast majority of the submissions. Instead we are seeing further attacks on our democracy through this bill, under the guise of more code words used by this Government to mask its real intentions, such as “transparency” and “accountability”. Sue Kedgley from the Greens got it completely right when she talked about Orwellian language, and I will talk about that, too. The use of the words “transparency” and “accountability” is rubbish. The Hon John Carter said that this bill is not about privatisation of water, when it clearly is. It is about the privatisation of local government services, allowing them to be run on a commercial basis, and removing—and this is what I want to talk about—the requirement for local authorities to consult with the community if it wishes to contract out services to the private sector, or corporatise them by transferring them to a council-controlled organisation. All those things run counter to transparency and accountability.

This Government is all about saying one thing and doing another. As Sue Kedgley pointed out, that describes Orwellian language, and she gave a definition, but I want to give the definition from Wikipedia, which describes it as “an attitude and a policy of control by propaganda … misinformation, denial of truth, and manipulation of the past,”. Orwellian language can also be defined as saying one thing and doing the opposite, or rhetoric versus reality.

There were 414 submissions on this bill: 360 were expressly against water privatisation, 17 were in favour, 36 submissions were made by councils against the bill, and countless submissions were made by community boards and other organisations. The Government is essentially ignoring the mood of the people, which has been shown recently across this country in the local government elections, particularly with the election of Len Brown in Auckland—an outcome that was not in the plan of Rodney Hide or John Key—and the outcomes of the elections in Wellington and Dunedin.

I will talk about clauses 11 and 8. Currently, under section 88 of the Local Government Act, any proposal to contract out or corporatise council activities requires consultation. Clause 11 repeals that section so that local authorities can transfer core activities to council-controlled organisations or the private sector, as I have said, without having to consult the community. I tell members that this Government will rue the day it introduces that clause. Right across New Zealand, except perhaps in Christchurch, people voted in local government elections with an express desire to have more consultation and to be more of a part of the process. In Dunedin we have a new mayor, Dave Cull, who is a very good bloke, and I am really looking forward to working with him. The last mayor, Peter Chin, was also a good bloke.

CHRIS AUCHINVOLE (National—West Coast - Tasman) : I move, That the question be now put.

The CHAIRPERSON (Hon Rick Barker): I will just say that most members have been focused on the bill, and this is the most substantial part of it. I am prepared to let this debate go on a little longer, but Part 2, which follows, is much more narrow, and there will be a narrower debate.

SU’A WILLIAM SIO (Labour—Māngere) : You are absolutely right, Mr Chairperson: Part 1 is the most substantial part, and I want to focus my remarks on clauses 4, 5, and 8. Just before getting into those clauses I reflect to the Minister in the chair, the Associate Minister of Local Government, some thoughts about his comments earlier. He was absolutely correct in what he said about George Hawkins when he was Mayor of Papakura, but if the Minister were to talk to the Hon George Hawkins today, George might well say that he has had second thoughts and that he has learnt from his bad mistakes. I tell the Minister that, because George would also say that his actions were based on community consultation. There was a protest in Papakura early this morning by the community, which has itself changed its mind. People of that community now realise the truth; they realise that they have been fooled all these years by this right-wing ideology, and they now recognise that they should have never sold their water asset.

I also say to the Minister that I totally disagree with him when he says that things are getting cheaper. Things are not getting cheaper. If he were to spend time talking to a mother or a father who is on the minimum wage, earning about $400 or $500 a week, and spending $300 on rent, he would find that those people are saying that things are not getting cheaper but are getting more and more expensive under this Government.

I turn to clause 4, which, unfortunately, changes the whole community perception in terms of how communities use their local governments to achieve outcomes. That clause changes the definition of community outcomes. I would say that the public will not be happy about that particular clause. Today the public are able to define for themselves, by engaging with their local councils, what community outcomes they seek. Those outcomes can differ from community to community. This clause proposes that local governments dictate to the community what outcomes the community should receive. In many ways it is as though this Government is saying: “We know better, and we will tell the people what they need and deserve.” That is such arrogance. [Interruption] I agree with my friend here, Dr Ashraf Choudhary, that “arrogant Tory” is probably the catchcry that will go from north to south when this Government forces this bill through, despite the protest happening in Papakura at this very moment.

I turn to clause 5, which covers core services. The Government is saying in this particular clause that there are only certain activities that local governments should focus on. Again, this is the old catchcry that local government should focus only on roads, rats, rates, and rubbish. That is the ideology of old local governments. But that is no longer the case. It has not been the case since 2000, and it is now 2010. In that period, communities themselves have determined what core services are. I say to members that one core service that is prevalent in many of our communities in Manukau is events. Events bring communities together. Events help to liven up a place. They help to bring vibrancy to communities. Events rely on local government for support—not only financial support but also manpower and a range of other things required to make those events happen. This Government now says that clause 5 will define for the community what core services are, and it gives a list of those things. Again, that emphasises the arrogance of this particular Government.

Dr RAJEN PRASAD (Labour) : It is very clear that the views on this side of the Chamber and those on that side are quite different.

Chris Auchinvole: We’ve read the bill.

Dr RAJEN PRASAD: I want to address clauses 8, 9, and 10 of the Local Government Act 2002 Amendment Bill. If the member Mr Auchinvole would like to listen, I shall address those clauses, and I hope the member will keep on listening.

Essentially, the way in which the Government has constructed clauses 8, 9, and 10 shows that it thinks that councils know best, and that the community does not need to be involved. Actually, that attitude is endemic through all of the local government legislation that the ACT-National Government has imposed on New Zealand since it came into power. It has used the particular style of the Hon John Carter. The Hon John Carter has become the salesperson for this way of thinking throughout the local government reform legislation. He is the placater, and he does that with some style, I will give him that. But he couches the Government’s ideology, which is privatisation and no community involvement, in a particular form. The particular phrase John Carter used today was “What’s the harm in that?”. Well, I can apply that phrase to a whole series of changes in the social area over the last 25 years that went past that particular Minister.

Community consultation is the hallmark of best practice in the 21st century. Many, many methods are being designed internationally now to make it possible for communities to participate in the systems that organise their own lives. That is the hallmark of best practice. International models have been developed. Let us look at the Canadian example. They are world-beaters when it comes to community engagement and community consultation. Australia is a country that this Government wants to catch up to. Well, we will be far behind when it comes to community consultation and community engagement, to involving people in those things that matter. Somehow, this Government thinks business can do it better, can do everything better, and that is it. In this particular bill, the community is taken out of far too many things.

Chris Auchinvole: Here we go again! He was all right until he went off sideways.

Dr RAJEN PRASAD: There is growing demand, I say to Mr Auchinvole, from our communities to be involved, but Mr Auchinvole and his Government turn a deaf ear to that. They are not interested, yet many jurisdictions are addressing it in very, very powerful ways.

In this bill there really is a general desire to limit community participation and consultation. Clause 8 repeals section 78(2) of the principal Act. Section 78(2) is a very powerful section. This amendment makes it possible for local authorities to undertake perfunctory community consultation. It enables a tick-the-box approach. Councils can virtually do what they like, call it community consultation, and that is what it will be. Labour members agree that section 78(2) could be streamlined, and an amendment on Supplementary Order Paper 180, which we have put forward, does just that. But repealing section 78(2) enables local authorities to engage in perfunctory community consultation. Maybe that is what the ACT Party wants and maybe that is what National wants, but it certainly is not what this side of the Chamber wants. It brands us quite differently. Those who have been listening to this debate over the last 2 days ought to know very clearly that there is a fundamental difference between what this side of the Chamber does, which is take the community seriously and consult it, and what that side of the Chamber is doing. Members opposite cannot deny that repealing section 78(2) is a major change.

Nicky Wagner: No, it’s not major.

Dr RAJEN PRASAD: Yes, it is. The member does not realise what it means. There is far too much perfunctory community consultation, and that is what this change will do. And it runs contrary to public expectation. The expectation is for meaningful consultation. The member has not read the original provision. I invite the member to read the original provision. That is precisely what it does, and repealing it runs contrary to the expectations of the community. Members on this side of the Chamber take the community very, very seriously. That side of the House is used to doing the opposite and no doubt will continue to do so.

PHIL TWYFORD (Labour) : I thank my colleagues Su’a William Sio and others, who have raised the issue of community outcomes. I will make some comments about clauses 4 and 12 of the Local Government Act 2002 Amendment Bill.

Clause 4 restricts the definition of “community outcomes”, the high-level goals that are set in the long-term plans of local authorities. It restricts them to things that only the council itself can deliver. The Government justifies this move by saying it is part of its streamlining efforts. The problem is that it is important to many of our communities to be able to call on their councils and their local authorities to take leadership in tackling some of the most important issues in their communities, even if the council itself cannot deliver the whole solution. In many cases—and I will give a few examples—councils can through leadership, advocacy, and coordination help the community respond to community demand to tackle some of these big problems.

One example I can think of is the failure of infrastructure. In Auckland we have had an ongoing series of problems with infrastructure failure in the electricity network. Most recently, in the summer of 2008, we had a problem with the Ōtāhuhu substation. The cable went down and the city was without electricity for some time. This is a major issue that affects the economic viability of our city. The people of Auckland expect their local authorities to help to sort that problem out. It is not a problem just for central government; people expect councils to take a leadership role on questions of infrastructure, which is so important to the success of the city and those communities. People expect councils to ensure there is a timely and adequate response to that problem.

One of the other issues that many councils take up is the issue of community safety. I think there is a real mood of concern at the moment about things like binge drinking, crime on our streets, and the social impacts of gambling and boy racers. These are all matters of concern to our communities. Councils do not necessarily have the ability to solve the problem and deliver the solutions, but people expect their elected representatives to provide leadership, respond to their concerns, and take up those matters.

There is no reason that the community cannot require that those pressing problems be identified as the high-level goals or community outcomes in the long-term plan. That is an entirely reasonable part of our democratic process, but, unfortunately, this bill will take that part away and apply an unduly narrow approach by saying that community outcomes must be things that only the council itself can deliver. That is a real shame and a real problem with this bill. Labour has tabled a Supplementary Order Paper in my name to omit that provision and continue to allow communities to identify their high-level goals and not be restricted in this way.

The other thing that I want to say about the community outcomes relates to clause 12. We acknowledge that the current process in the legislation is a little too prescriptive in setting out the process by which councils identify their community outcomes. We agree that the process is too heavy, and it could be lightened up. But the effect of clause 12 is to completely remove any principle-based approach to saying how councils should identify their community outcomes.

Under this bill a council could just sit down around a table themselves and pull community outcomes out of the air, and say that the high-level goals for the long-term plan will be whatever pops into their head on the day. There is no requirement in here that councils have a consultation process with their community or that they give their citizens the right to be part of a transparent and open discussion in identifying community outcomes. Although we acknowledge that the current law is too prescriptive, we believe that there should be some principle-based requirement that citizens be involved in the development of the process of community outcomes. Otherwise there are plenty of councils who could just say what they think, or what someone said to a member in the supermarket the other day or in a dairy—

Moana Mackey: Or one of their funders.

PHIL TWYFORD: Yes—or what one of their funders, donors, mates, fellow board directors, or whoever said to them. Councils could basically make it up and set the community outcomes in a way that would be undemocratic and would shut people out of the democratic process.

Dr CAM CALDER (National) : I move, That the question be now put.

PHIL TWYFORD (Labour) : Much of what is contained in schedule 1 pertains to what goes into the long-term plan, and I think that that is something worth discussing. It brings us back to the question of community outcomes, which we can see in Part 1 of new schedule 10, substituted in schedule 1. Community outcomes are the key thing that should be contained in a long-term plan, and, in fact, are the high-level goals. I just reiterate the concern that we have already expressed this morning about what this bill does to the whole process around community outcomes. The bill takes away the requirement that councils must consult citizens in the development of those high-level goals, and it undermines the very democratic basis of the whole structure of having long-term plans. I think that that is a real shame.

As well as taking away the requirement for councils to consult their citizens, this legislation also restricts the definition of community outcomes far too narrowly, I think. It says that the community outcomes, as the high-level goals of the long-term plan, can be the things that only the council itself can deliver. Setting aside any number of important issues that communities feel strongly about—they could be boy racers, alcohol, or the effect of gambling in the community—none of those things will be completely controlled by local councils themselves; it requires leadership, advocacy, and coordination. It is perfectly legitimate for communities to ask their councils, and their elected representatives in local government, to take up these matters, and it is perfectly reasonable that these issues could be identified as community outcomes.

The other thing I wanted to say about the long-term plan in relation to schedule 1 is that the kinds of things that go into the long-term plan are any substantial changes in the level of service that is being provided, or the sale, construction, or replacement of an asset. Those things are typically the kinds of things that go into a long-term plan. Yet this bill removes the obligation of councils to consult the people in their communities on these kinds of issues.

I will give one example that happened recently in Auckland. The council, well-meaning and wanting to promote public transport and bus patronage, proposed a four-lane highway to run down Dominion Road, which is one of the main arterial routes on the Auckland isthmus. Basically, it was to provide faster bus passage through, and in and out of, the central city. The impact of that proposal, when the council started to consult the community, was that the local community was horrified. Dominion Road is home to a couple of wonderful urban villages with really vibrant shopping communities, a lot of pedestrian traffic, and fantastic local restaurants. A lot of new migrant communities, particularly Chinese communities, have made Dominion Road their home. It is a really great part of Auckland. The effect of the council’s proposal to put a four-lane highway in, and no parking down either side of, Dominion Road for several kilometres would have been a disaster for these vibrant urban villages, but only the requirement on the council to consult on this matter would have gone into the long-term plan. Only the requirement to consult the community thoroughly allowed what was a well-meaning but misconceived transport plan to be debated and discussed; ultimately, it was thrown out. That is a vindication of the kind of community consultation processes that this bill is weakening and undermining. As a result of the long-term plan set out in schedule 1, those processes will be greatly weakened.

SUE KEDGLEY (Green) : First, I would like to record my disappointment that the debate on a bill as significant as the Local Government Act 2002 Amendment Bill has been so truncated that I did not have time to put forward any of my amendments to the last part we debated, Part 1. This bill is about a major change in New Zealand. It allows the privatisation of our water supplies. It allows ownership of our water supplies by private multinational corporations for 35 years, yet we are having a very truncated debate. This bill is being rammed through under urgency. The public has a right to expect that members of Parliament will at least have a say about this far-reaching bill and be able to introduce amendments. So I would like to record my disappointment at the truncated nature of the debate on this hugely significant bill before us.

I am quite certain that Roger Kerr from the Business Roundtable is listening with mounting satisfaction as we debate all the parts of this bill. Roger Kerr, the Business Roundtable, and the New Zealand Council for Infrastructure Development have been lobbying since the 1990s for the Government to allow the privatisation of our water supplies. I have here a number of policy statements and articles that Roger Kerr has written. They point out that private water companies have annual revenue of $300 billion, and they beg us to allow private corporations to take over our water supplies. Roger Kerr has achieved his wildest dreams. For 30 years he has been lobbying for this day, and he and others will be listening to this debate with huge satisfaction. Finally, their lobbying efforts have paid off, and from now on multinational corporations will be able to take over our water supplies for 35 years. They will be able to own them, control them, and manage them for 35 years. What a coup! I know Roger will be listening, and he must be enormously satisfied.

The provisions we are dealing with now are about long-term plans and financial strategy. The key thing is that the consultation requirements in the long-term plans and in other parts of local government have been absolutely gutted by this legislation. Now when councils consult on the long-term plan, they will not even have to mention that they have an intention to privatise their water supplies for 35 years or that they have an intention to hand those supplies over to a private corporation to own for 35 years. They will not have to mention this.

There will be no need any longer to bother to consult communities about such a significant thing. That is the real coup of this bill, and that is why Roger Kerr, the Business Roundtable, and the water infrastructure companies will be rubbing their hands with glee. I predict that there will be parties all weekend for the water companies that have been booted out of communities and countries all round the world, because, now, when they close down their operations in Latin America and even in Adelaide in Australia—they have just been kicked out of Adelaide—they can pick up the pieces, come across to New Zealand, and seek to privatise our water supply. There will be parties all weekend. One of the main things the private water companies will be celebrating is the fact that they will be able to sneak privatisation in. Councils will not have to consult citizens, because there is no longer a requirement to mention in a long-term plan that the water supply is about to be privatised.

This bill also deals with the financial strategy. One of the many clever little things Rodney Hide has managed to get into this bill is an innocuous-sounding clause that basically requires a cap on rates. It is based on finance and expenditure limits we have seen in America, in places like Colorado, where they set a cap on spending. In Colorado, under legislation similar to this, they are not allowed to increase their budget. The aim, of course, is to reduce spending, make us all resent paying our rates, and drive down the resources of local government to the point where it becomes bankrupt.

What happened in Colorado when they implemented the sorts of rate-capping provisions that are in this bill? Well, as a result of the grand experiment, which this bill is trying to implement, the Colorado budget will have a shortfall of $28 million this year, which is 10 percent of its budget. It has been brought about by the strangulating effects of this sort of cap. One-third of Colorado Springs’ 24,000 streetlights were turned off earlier this year to save about $1 million in expenditure. Residents can adopt a streetlight—they are encouraged to pay $100 a year if they want a light in their street. In the meantime, taxi drivers are trying to do the work of police because the police are so overstretched by cuts. Park budgets have been slashed by 25 percent. Grass is now mown monthly, not weekly. Buses have been sold and bus services no longer operate in the evenings and weekends. The fire and police budgets lost $5.5 million.

Is that what we want here in New Zealand? I am sure the people of New Zealand do not want that, but that is what is being sneaked through under urgency, along with all the other sinister provisions in this bill, which is, of course, all about seeking to implement Rogernomics Part 2. The battleground for the agenda of the Government and Rodney Hide to corporatise and privatise as many assets as possible has shifted to local government in this term of office, because the Government has had to rule out national privatisations. This bill is a triumph for them. It is the culmination of years of lobbying, and it allows local government to corporatise most of its assets, to contract out, and to privatise water supplies.

The Government is hoping that by sneaking this bill in under urgency the people of New Zealand will not notice. It is also hoping we will think that allowing a private multinational corporation to own water supplies for 35 years does not amount to water privatisation—that is what the National Government, in its Orwellian double-speak, is claiming. Members should not believe that New Zealanders will be fooled. New Zealanders need to be aware of what the rate-capping provision in the financial strategy section is intended to do. It is intended to reduce spending in local government to the point where local government is more and more short of money, it eventually goes bankrupt, and then—as has happened in Colorado and other places—it is required to contract out and to privatise not just the water supplies for 35 years but all of the other services.

This is the agenda of this part of the bill and other parts, and that is why private water companies will be rubbing their hands with glee. Twenty years of lobbying by Roger Kerr has finally paid off. He and the water companies finally have their goal—allowing them to get their hands on our water supplies, and deregulation of the whole water supply industry in New Zealand. It is way beyond their wildest dreams. Already two of the major global water companies, Veolia Water and Suez Environment, have 39 contracts between them in Australia and New Zealand, including ownership of United Water in Auckland and the privatisation of the water programme here in New Zealand. Its name has changed about three times because the ownership of that company has changed over three times in the last decade or so. But Veolia Water, this private water corporation, owns the water in Wellington and in Auckland already, and now, under this bill, it will be able to get its hands on the rest of the water supplies in New Zealand, and it will not even have to consult people in its long-term community plans. That is the beauty of this bill for the private water companies.

CARMEL SEPULONI (Labour) : Looking at schedule 2 of the Local Government Act 2002 Amendment Bill, the thing that stands out to me that I am concerned about—I know members on this side of the Chamber are concerned about it, and I know the Greens are concerned about it—is the way in which the term “council community” is omitted the whole way through schedule 2. That highlights the point of difference between this side of the Committee and that side of the Committee. To us, community should be the focus—a sense of community and ensuring that the community has a say in what happens in any council—whereas on that side of the Committee it is all about ensuring that the democratic ability to have a voice is shut out.

A good example of this difference is the recent local body election that we had in Auckland. There were two very different main mayoral candidates: one was all about the corporates—and he was supported by the Government side of the Committee—and one was all about the community. That was Len Brown, who went on to win, and he was supported by this side of the Committee. I can imagine that a mayor who is all about community will struggle with legislation like this, which excludes the community and undermines its ability to have a say in what is happening.

Every community has the right to hold its council to account and expect transparency in decision making, so any ratepayer and any person who is part of the city should be up in arms about this bill, because it will undermine their ability to hold their council to account and expect that transparency. I know that the Minister of Local Government, Mr Hide, is one of those people who do not think communities should have a voice, which is why we see this legislation coming through this Parliament. That is unfortunate, given that most Aucklanders recently voted for a mayor who promised them an inclusive city—a mayor who promised them that community would be at the centre of everything for that city, the biggest city in New Zealand, Auckland City. Yet here a National Government is voting for a bill that undermines communities’ ability in that respect.

I say it again: Auckland City voted for a mayor who was all about community, not for the mayor who was all about the corporate. Yet the Government does not listen to that, the National Party does not listen to that, and the ACT Party does not listen to that, because they think they know better, even though the overwhelming majority of people who voted about a month back decided that the most important thing for them was community.

I point out again that the Government is attempting through schedule 2 to omit the requirement that the council consult its community—the requirement that the community have a voice in council decision-making. We are very concerned about what that will mean. When we look at the aspects of the bill in relation to that provision, we can see very clearly, with regard to the corporate agenda versus the community agenda, what the Government is trying to do. This bill puts into place the ability for the private sector to own water infrastructure for up to 35 years, which is effectively privatisation. Again, that fits into that corporate model that the Government side of the Committee is ideologically in support of. It goes against everything that we believe to be right with regard to the community having a say in what is happening.

Although we support the move of this bill to increase financial accountability and transparency, we oppose the imposition of arbitrary core services and cuts to the requirements for councils to consult their communities. At the end of the day, how can we guarantee accountability and transparency when we are legislating so that the council no longer has to consult the community about its views?

With regard to community, I just point out that we have seen the merger of a number of cities in Auckland, some of which were very community-focused.

Hon CLAYTON COSGROVE (Labour—Waimakariri) : I will carry on from my colleague Carmel Sepuloni on the theme of this legislation, especially in respect of schedule 1, “Long-term plans, annual plans, and annual reports”, of reducing the requirement on a local authority to consult its community. I raise a couple of practical examples from down my way in Christchurch. I note in passing that the author of this bill, the Hon Rodney Hide—the man who preaches openness, transparency, and accountability, except when it comes to his own wallet, his own air tickets, and a few other things that he has been less than open and transparent about—brings a bill in here that is couched as though it will make councils more accountable and more transparent to their communities. Buried in this, of course, is a reduced requirement on those local authorities to consult on things like goals and community outcomes.

Well, if we are to give councils the ability to arbitrarily set goals for community outcomes and basically make it up as they go along, the question I have asks how a council can be in touch with its community and know what it wants, what the goals and the outcomes are, if it is not prepared—and it should be compelled by this House and this legislation—to consult those communities. I will give the Committee a “for instance’; a real one. In the Christchurch City Council there was a move—before the election—to put market rents on early childhood education centres. I say this for the benefit of Kate Wilkinson who says that in my electorate the Government’s cuts to early childhood education funding will be only—

The CHAIRPERSON (Lindsay Tisch): Order!

Hon CLAYTON COSGROVE: I come back to the bill, Mr Chair, but I am sure you are interested in that. If it were the case, as it was with the local authority in Christchurch that did not impose cuts on an early childhood education centre of $29,500 but put forward a measure for those centres that were on council-owned land to require them—after 20, 30, or 40 years—to pay market rents, it would have put those early childhood education centres out of business. I know that Ms Wilkinson is quite supportive of change, even though Swannanoa Preschool, an early childhood education centre in Waimakariri District, has said publicly that it will have a $100,000 cut this year. I tell colleagues that the centre happens to be a few hundred metres down the road from where Ms Wilkinson lives. She would have known that, if she had knocked on its door. The Minister asks where I get my facts from. I tell her to try visiting an early childhood education centre a couple of hundred metres down the road from where she lives.

If it were the case, as it was at the Christchurch City Council, that a local authority wanted to put early childhood education centres that were on council land on to market rents, as it proposed, then under this legislation there would be very limited, if any, opportunity formally to consult that community. What happened in the Christchurch case was that the community was up in arms and said: “No way.” There were meetings, there were protests, and the council backed down.

That is called democracy. That is called listening. This bill should be about transparency and accountability. There should be a requirement in this legislation that councils are compelled—I repeat, compelled—to consult their community. There should be no option; they should consult. We know, of course, that this Government is not in favour of consultation, because the community might say that it does not like it. The community, hey presto, may say: “We’re not going to allow the local authority to steamroll over our public opinion and do whatever the hell it likes.” There is no reference to Mr Finlayson in that quote.

I say that this bill is a sham and these schedules are a sham. The bill purports to be holding councils to account, bringing councils closer to their community, and aiding democracy. What it really does, in these schedules and in other parts of the legislation, is reduce the absolute requirement on councils to consult their community. Some members of Parliament in this Chamber are so out of touch with their community. One sits on the opposite side of the Chamber—Ms Wilkinson. She cannot even understand how an early childhood education centre is funded, either by local government in terms of its property management or the fact that 34 out of 54 of them will be subject to a cut of $700,000 to $800,000 a year, thanks to her Government.

The early childhood centre down the road from where that member resides has a cut this year of $100,000, but she goes to the media and says: “I’ve been told that 22 of them will have $29,500 total in cuts.” That shows how out of touch that member is, and she has been caned in the media today. That is quite good, because it shows how out of touch she is. I tell the Minister to walk a hundred metres down Tram Road, although it might be too far for her, knock on the door of the Swannanoa early childhood education centre and ask them about it. She should have done that before she wandered into print, told mistruths, and was very slack with the facts.

MOANA MACKEY (Labour) : I will talk about the definition of “development contribution policy” as laid out in Part 2 of schedule 2 of the Local Government Act 2002 Amendment Bill. The schedule amends that definition and is an interesting move away, given the context of the bill that we are debating. This legislation now says a review period can be requested for development contribution policy decisions. That means that developers can put a lot of pressure on councils where they are paying a development contribution levy—where a council has decided, for example, that if a development is going ahead in their area, if land is going to be put aside for it, if the council is going to chip in for amenities, then the developer can provide something back to that community in the way of a contribution. For example, it could go towards the provision of affordable housing or social housing in that district—

Chris Hipkins: Or early childhood centres.

MOANA MACKEY: —or early childhood centres, as my colleague Clayton Cosgrove has pointed out.

This legislation says that the review needs to take place. It goes through this special consultative procedure, which is a very in-depth procedure in the Local Government Act. I recently sat through this procedure, both the judicial review and the Court of Appeal case that the Whakatāne District Council took to clarify what is required under the special consultative procedure. I am very pleased to say that the Whakatāne District Council ended up being successful in the Court of Appeal.

A very in-depth procedure is required for the review of these development levies. It has a number of steps along the way and is intended to be robust. It is intended to be genuine, and that is a good thing. It is a shame, though, that the community is losing that right themselves, through various other portions of this bill—in particular, clause 8 in Part 1.

Under Part 2 of schedule 2 we have discussion of a process for the review of development levies where a developer could put pressure on a council, because the developer does not want to keep having to pay it, to go back and review it. Yet the community has lost all these provisions for consultation. So the community loses consultation and the developer gets more consultation. That to me does not seem to be a particularly fair or just move under schedule 2 of this bill.

These contributions are particularly important. It is commonplace everywhere in the world. It is not unusual to require developers to provide a contribution. I refer in particular to where a council may require a portion of a development to be set aside for affordable or social housing. In lieu of a developer being prepared to do that, a financial contribution may be offered, which could then go towards the provision of affordable or social housing.

As we know, we have a housing crisis in this country. It seems an incredible shame that where these brand new developments are going up, there is no leadership from this Government to make sure that part of that development ensures that young families are able to get into their first home. We know the benefits of homeownership; we know them very, very well. We know how difficult it is for young people to get into homeownership. So here is an opportunity when we have a new development for a council to put in place a policy or a levy that goes towards assisting people into homes, and goes towards housing people who find it very difficult to house themselves. They may be on a very low income because the cost of living has risen so highly under this Government. Here is an opportunity to address that crisis.

The Labour Government put in place legislation to specifically allow for that contribution, and to make it clear that councils are legally able to require it of developers. We did that off the back of a council in New Zealand that was being dragged through the courts by developers who challenged the council’s right to do that. The National Government repealed that legislation, and I would have hoped that in both Part 2 and the schedules of this bill we would see something to replace it, or more of an effort to say that the council is there for the community, nor just for developers. There is nothing wrong with the council saying that all the community should benefit from a development, not just the private companies that are involved in it. Of course, the Government does not like that, but it needs to look at the local body vote in Auckland to see what the community was saying. They do not want corporatisation of these services. They believe they should be for community benefit.

LOUISE UPSTON (National—Taupō) : I move, That the question be now put.

SU’A WILLIAM SIO (Labour—Māngere) : I totally agree with Moana Mackey about what should be important in the bill. Unfortunately, those things are not in the bill. I also agree with Sue Kedgley when she says that this bill is designed to gut local government, to gut local democracy, and to make it easier for this Government to sell off our water assets. The Hon Clayton Cosgrove gave a wonderful speech that described the way this Government is going about couching this under “transparency” and “accountability”, when in reality the bill removes transparency and accountability.

I ask members to look at clause 47, “Other amendments to principal Act”. This clause should be of concern to the public, and I have no doubt that it will be of concern, once they get wind of what this Government is attempting to do.

Hon Member: They submitted on it for months.

SU’A WILLIAM SIO: Some of them submitted; not all submitted. Members of the community of Papakura are protesting right at this very moment because they are outraged by what this Government is attempting to do. Clause 47 refers us to schedule 2, which principally changes the way that we now have to look at how councils conduct their business when it comes to community council planning. Schedule 2 changes the definition of “long-term council community plan”, and removes from the Act two critical words: “council community”. It removes the participation of community in consulting with councils to identify outcomes.

Let me give members some examples why a lot of people, including supporters of this Government, and, no doubt, members of the National Party, will be outraged by this measure. Currently, ordinary ratepayers are able to be involved in the entire long-term council community plan from genesis right until the fruition of a particular outcome. One example is housing for the elderly, which resonates very strongly with elderly people in Manukau, in various parts of Auckland City, and, no doubt, throughout the country. Whenever a council is determined to remove housing for the elderly, many National Party members and supporters will turn up. It does not matter how old they are, or whether they are using a walking stick or a wheelchair; they turn up from the beginning of the consultative process right until the very end. But this schedule removes their ability to participate. This legislation gives the power to the local council to determine whether consultation should take place, and whether people are involved only at the beginning or not involved at all.

This bill also gives the right to the local authority to determine outcomes for ratepayers. In other words, what Sue Kedgley said about gutting local government is precisely outlined in this very schedule. Every section outlined in schedule 2 removes community participation. It removes the ability of ordinary people—ratepayers and senior citizens—to front up to their local government and to say that they are not happy with a particular course of action that that local authority may want to take place.

Hon SHANE JONES (Labour) : Tēnā koe, Mr Chairperson. Kia ora anō tātou. I would like to direct our attention to Part 2, because, unfortunately, after I left the Local Government and Administration Committee the quality of input from Government members, in terms of vigilance and adherence to principles, diminished greatly. But that reflects the electoral fortunes that lie in their very near future.

I want to direct our attention to clause 46, “New Schedule 10 substituted”. New schedule 10 is set out in schedule 1. I have a great deal of sympathy for what proved to be a well-written minority report put forward by the Māori Party members. Naturally we support the attack that they are delivering. We are only sorry that they did not think they could join us and collaboratively oppose—

The CHAIRPERSON (Lindsay Tisch): Schedule 1 has already been debated.

Hon SHANE JONES: I said schedule 10.

The CHAIRPERSON (Lindsay Tisch): Schedules 2 and 3 are the schedules, not schedule 1.

Hon SHANE JONES: I am directing my attention to the provisions that relate to the Māori parts of this bill, which, unfortunately for our people, as reflective of the broader local government reforms of the last 18 months, are very slender. But there is an important part in Part 2 that relates to dealing with rates, and in particular Māori rates, and this was picked up by the Māori Party, that reflects a complete absence in terms of what might be the Māori expectations of this bill. I direct our attention, along with that of our colleagues here, to the issue that once we define the community that local government would serve in a narrow monetary sense, one is writing out their interests and stakes in local government. Why should people in local government communities be reduced to elements to be defined only by money or wealth? Unless one has money or wealth one will not be able to influence local government decision-making, in the absence of broad community consultation provisions.

That in actual fact is what has happened in this bill. We accept that red tape ought to be rooted out where it is found. But it was Local Government New Zealand, not the Local Government Forum, that told every member on the Local Government and Administration Committee that this bill will have the effect of worsening the level of red tape. I do not understand why Government members have backed so enthusiastically Nick Smith’s attempt to improve resource management. Unfortunately that small glimmer of hope has long been wiped out by more recent attempts that he has made to improve resource management through local government, but that is another matter.

The tragedy of the situation is that although this part was designed to improve the prospects of simplifying local government and reducing costs, it has had the opposite impact.

Hon John Carter: I raise a point of order, Mr Chairperson. I raise the point of relevance. We are actually debating Part 2, which refers to schedules 2 and 3. The part that the member is talking about is contained in Part 1 and we have already dealt with that.

Hon Clayton Cosgrove: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Lindsay Tisch): I do not need any help here. This is very clear, because I brought the member’s attention to this earlier on. We are on Part 2, and that includes schedules 2 and 3. I ask the member to come back to those points. This is a very narrow debate. [Interruption] No, this is a very narrow debate, and that is what we are on at the moment.

Hon Clayton Cosgrove: I raise a point of order, Mr Chairperson. The theme that has come out of the speeches in the last hour has been around consultation, or lack of it. I accept your ruling absolutely, but I put to you that 90 percent of the member’s speech has been around that theme. If that theme was relevant and valid for other members, then I would argue—

The CHAIRPERSON (Lindsay Tisch): I have been presiding on Part 2 since the start and the debate has been within the realms of Part 2 and schedules 2 and 3. I ask the member to come back to that part of the debate.

Hon SHANE JONES: I raise a point of order, Mr Chairperson. I was, unfortunately, interrupted earlier in that speech. I direct your attention to clause 24, which clearly talks about a local authority’s policy on the remission of rates on Māori freehold land. The key point is that if we disenfranchise that segment of the community through participation and consultation, we make it very difficult for local government to make informed decisions. I would gladly accept a direction, either from parliamentary staff or from you, if I have misconstrued the clause.

The CHAIRPERSON (Lindsay Tisch): Yes, the member is correct. Please continue.

Hon SHANE JONES: How much longer do I have, given that we have wasted enough time—

The CHAIRPERSON (Lindsay Tisch): No. When there are points of order, the clock stops, so no time has been deducted. You have 1 minute and 13 seconds remaining.

Hon SHANE JONES: I am possibly doing the job that my relation from the far north Hone Harawira should be doing. Having said that, I actually want to enjoy a small measure of celebration on his behalf that I have enabled the Committee to exhaust a little of its attention on the postponement of rates on Māori freehold land. Although it might be said that it is a small and potentially irrelevant segment of this bill, it reflects the Government’s approach to these seemingly insignificant things. Small, seemingly modest Māori issues can loom large, and they can even cause Ministers of the Government to invoke the spectre of hell, and start to recite Dante’s version of politics. The underlying problem is that where one is to have a transitional provision for review, one cannot engage in the exercise of review unless one has access to information. That is not unreasonable.

Dr CAM CALDER (National) : I move, That the question be now put.

SUE KEDGLEY (Green) : In schedule 10 there is a whole section on long-term plans and what sorts of things long-term plans must clearly identify. It talks about all the assumptions of a local authority concerning the useful life of significant assets, the replacement of significant assets, etc. But the extraordinary thing is that although the long-term plan will have to do the sorts of things that are spelled out in clause 18, it will no longer have to spell out to the community whether a council intends to divest itself of strategic assets, including divesting itself—

Hon John Carter: I raise a point of order, Mr Chairperson. I listened to the member, and I assumed she was going to bring clause 18 into the relevance of the part we are debating, which is Part 2 and schedules 2 and 3. Actually, the clause 18 that she keeps referring to is in Part 1 of new schedule 10, substituted in schedule 1, so it is not part of the debate. We are talking about transitional issues relating to our long-term plans, so I think that clause is outside the scope of the debate.

The CHAIRPERSON (Lindsay Tisch): I thank the member. I say to the member that we are debating, as I indicated earlier, Part 2, and schedules 2 and 3.

SUE KEDGLEY: In this section we are talking about long-term plans, and we are talking about transitional provisions for long-term plans. I was making the point that long-term plans will be required to do all sorts of things, but they will not, any more, be required to inform a community about when a council intends to divest itself of key strategic assets. Until now there has been a requirement for councils to alert people in their long-term plans that they intend to divest themselves of key strategic assets, such as the ownership of water. But now, under this section, they will not have to inform New Zealanders, in those plans.

Most New Zealanders will not believe that as a result of this part of the bill, there is no longer a requirement for councils to inform or consult communities about when they intend to do something as fundamental as getting rid of the ownership of water supplies, which have been built up by generations of New Zealanders, and which will now be able to be handed over to—in fact, owned by—multinational corporations for a period of 35 years. That will not have to be mentioned in a long-term community plan. I honestly do not believe that New Zealanders will believe that the Government could do that—could think it was acceptable to sell off water assets, or any other assets—to a private corporation, without requiring that to be mentioned in a long-term community plan or any other plan. The real thing this bill does is that it guts the consultation requirements of local government agencies, so that they will not now have all the nuisance and irritation of having to consult communities when they intend to divest themselves of key infrastructures such as water.

I notice a bit more squawking from the Government members; they say that the Government is not selling water. But I am afraid to say that allowing a private corporation to own a water supply for 35 years is water privatisation by any other name. I do not know why National members keep on trying to object—

The CHAIRPERSON (Lindsay Tisch): Order!

SUE KEDGLEY: But I am only responding to the interruptions that I am receiving from National members, Mr Chair.

The CHAIRPERSON (Lindsay Tisch): I bring the member back. The long-term plans are in Part 1. We are on Part 2 and schedules 2 and 3. Please confine your comments to that.

SUE KEDGLEY: The consequential amendments and transitional provisions outlined in Part 2 also refer to transitional provisions for the long-term plan, and that is what I am addressing. It is there in clause 49. As I was responding to my colleagues in National, I tell them that they have some idea that the public is going to be deluded into thinking that handing over the control and the ownership of a water supply for 35 years is not water privatisation. But New Zealanders will not be fooled. They know that handing over for 35 long years—11½ electoral cycles—the ownership of a water supply that has been built up over generations amounts to privatisation. Those members are wringing their hands and shaking their heads, but that is the truth.

CHRIS AUCHINVOLE (National—West Coast - Tasman) : I move, That the question be now put.

The CHAIRPERSON (Lindsay Tisch): The question is that the question be now put.

Hon CLAYTON COSGROVE (Labour—Waimakariri) : I raise a point of order, Mr Chairperson. With respect, I want to raise two matters with you. There has been a lot of to-ing and fro-ing over the schedules, and you have made a number of rulings. You ruled against Mr Jones in his first call, only to reverse that. Mr Jones sought a second call. He has had only one call in—

The CHAIRPERSON (Lindsay Tisch): No. I thank the member for his comments. I am the sole judge of the relevance of the debate. On many occasions, as is well known, I have asked members to come back to Part 2 and schedules 2 and 3. This debate has been going for nearly 50 minutes. It is a very narrow debate on a very small number of provisions. Determining the relevance of the debate is at my sole discretion, and I have accepted the closure motion.

Hon Clayton Cosgrove: Mr Chairperson—

The CHAIRPERSON (Lindsay Tisch): I do not intend to debate this matter further. I have accepted the closure motion and I will put it to the vote. That is where it stands.

Hon CLAYTON COSGROVE (Labour—Waimakariri) : I raise a point of order, Mr Chairperson. I wish to raise a matter with you. You are right that you have ruled in respect of relevancy. I point out that in doing that in respect of Mr Jones, you reversed your ruling. He was dealing with a very narrow point, as I understand it, in respect of the rating of Māori land. You called him out for that. You subsequently reversed that, and the words you used were: “You are correct.” It is a very narrow point, which has not been examined by other speakers, but you denied him a second call.

The CHAIRPERSON (Lindsay Tisch): I did not deduct any time from the member. He carried on and was actually talking about the provision of race—

Hon Clayton Cosgrove: Rates.

The CHAIRPERSON (Lindsay Tisch): —rates in terms of Māori land. I said he had 1 minute and 13 seconds remaining, and in that 1 minute and 13 seconds he did not actually mention anything that he had said he intended to mention. I have judged that the scope of this debate is a very narrow one. Under Speakers’ ruling 65/3 I am the sole judge of relevance. I have ruled that I will accept the closure motion, and that is where it stands.

PHIL TWYFORD (Labour) : We were discussing just a few weeks ago what came to be known as the “Warner Bros Bill”. I propose that we rename this bill the “United Water Bill” in honour of the economic interests that stand to benefit very significantly. We could call it the “Veolia Bill”, because under this bill the public of New Zealand should be very clear that councils will be able to enter into contracts for period of up to 35 years for the private management and control of our water assets, including ownership—including ownership.

The Associate Minister of Local Government, who is currently the Minister in the chair, was candid enough, finally, in question time a few months ago to acknowledge that the bill allows private ownership of water assets. I think the Government has been a little bit unclear in its own mind about whether it would allow the private ownership of pre-existing water assets. We are talking about pipelines, dams, and wastewater treatment plants. Let us be clear: this bill makes explicit provision that it will allow the private ownership of pre-existing water assets if that is deemed to be incidental to the project and important to the success of the contract.

Nicky Wagner: That’s prohibited, unless.

PHIL TWYFORD: Well, one could drive a bus through that. Not only does this bill allow private ownership of new water infrastructure that is constructed in the course of a build-own-operate-transfer scheme—also known as a BOOT scheme, or a public-private partnership—but also, if it is deemed to be important to the success of a contract, existing—existing—water infrastructure can be sold to the private sector. We have had the bizarre spectacle over the last few months where members on the Government benches have repeatedly denied that that is privatisation. I do not know how they can deny that when it allows 35-year contracts for private control, including the private ownership of our water assets. On any common-sense reading of that, it is privatisation. The member opposite Nicky Wagner is parroting the line that it has to be sold back to the council at the end of the 35 years. Well, you know, it could be sold back, but equally that contract could be rolled over to create a 70-year period of private ownership of our water infrastructure.

I think the public of New Zealand see through the fiction that the National Government is pedalling in this case. There is no way around it; this bill amounts to opening the door to the effective privatisation of water infrastructure. The member opposite may not like it, but it explicitly allows the sale to private interests of our existing municipal water infrastructure, if that is deemed to be incidental to the contract and important to the success of it. It is there in black and white. How members opposite can continue to deny that that amounts to privatisation, I simply do not understand.

This bill could be renamed the “United Water Bill” in honour of United Water’s role in this bill. The Associate Minister made a great play of saying that a few local rural councils would like the ability and flexibility to work with the private sector. But this bill allows Auckland’s new billion-dollar water monopoly to have the whole kit and caboodle contracted out to United Water overnight, without consulting the public.

We are not talking about a little wastewater treatment plan in the back of beyond, I say to Mr John Carter; this bill applies just as much to Auckland’s billion-dollar water monopoly, which has been paid for by generations of ratepayers. That can be handed over to United Water, and, under the cuts to the consultation requirements in this bill, which are in clause 11, ratepayers would not know a damn thing about it. It could be done without any sort of consultation or advanced notification to the community. I believe New Zealanders do not want that.

CARMEL SEPULONI (Labour) : Mr Chair, you always get a very good equity balance in the calls that you give out, and I think that is admirable.

I have a number of ideas with regard to the title. To start with, rather than the Local Government Act 2002 Amendment Bill, I think it is appropriate that we call it the “Local Government (We Couldn’t Win Auckland in the Local Body Election So We’ll Privatise Auckland’s Assets in This Way) Bill”. That name comes from something that has been discussed quite widely in this debate. It has been about the Government’s agenda with regard to privatising assets, and privatising Auckland’s assets in particular. It has been about the ideological views of members on the other side of the Chamber, who want our local government bodies to act in a corporate way rather than in a community-focused way. That title really is appropriate, given that this bill allows the private sector to own water infrastructure for up to 35 years, which effectively is privatisation, as my Labour colleagues and Sue Kedgley have pointed out. So that title is appropriate.

Although, as we have said before, we support what the bill states it intends to do, which is to increase financial accountability and transparency, we know that in all actuality that is not the case, because the bill is about privatisation and it is about removing the rights of the community to have a say in what is happening, so that corporates can move in and the communities cannot object to what is going on around them. So that is one idea with regard to what the title of this bill could be, and I will repeat it: the “Local Government (We Couldn’t Win Auckland in the Local Body Election So We’ll Privatise Auckland’s Assets in This Way) Bill”. It is a long title, and the one thing I am concerned about is that it is a little bit long. Other than that, it captures the agenda of the National Government and what it intends to do with this legislation.

Another idea I have with regard to an appropriate title for this bill is along the same lines but a little bit shorter. Rather than call it the Local Government Act 2002 Amendment Bill 2010, we could call it the “Government Wants to Sell Off Your Water and Now We Can Bill”. That would also be appropriate. I will not go into too much detail about why, because I think it was covered in the explanation of my previous recommendation of a good title for this bill.

On a different note, going back to the concerns that have been raised about the Government’s desire to erase the community’s ability to have a say in what is going on in local government and to hold their representatives to account, I think another appropriate title would be the “Local Government Doesn’t Have to Ask You What You Want or Think Bill”. That would be appropriate, given that this bill removes the need for local government to actually consult with communities on long-term strategic goals, on the long-term outcomes that are strategically put into place for the particular cities that will be covered. That is of concern, because one would think that with local government, and with central government as well, actually, constituents, ratepayers, and taxpayers should be able to have a voice in decision making. They should be able to go to their elected representatives and say that they believe that their representatives should be focusing on this, this, and this outcome, and then they should be able to push for their representatives to do that. Unfortunately, this bill removes the right for that to occur. Again, that recommendation for an appropriate title for this bill is “Local Government Doesn’t Have to Ask You What You Want or Think Bill”. I am pretty sure that that would give New Zealanders a good indication of what the National Government is trying to do, if they do not already know what it has been trying to do for the past 2 years it has been in Government, or for the entire history of National’s existence.

SU’A WILLIAM SIO (Labour—Māngere) : I said earlier that the Minister driving the Local Government Act 2002 Amendment Bill is a Minister who has lost a lot of credibility in the eyes of the community, particularly in the eyes of the Grey Power community. It is the people in the Grey Power community who spend considerable time being part of their communities, and considerable time participating and engaging with their local government. Many of the Grey Power community members who are supporters of the National Government will now be saying that this bill should be called the “It is Time to Change the Candidate in Epsom Bill”; that is the name the bill should be given.

I also say that this bill—and many of my colleagues have said so—is really designed to enable the privatisation of water assets. If the Minister is so keen to promote transparency and accountability, why can this Government not be transparent and just name the bill the “It is Time to Sell Our Water Assets Bill”. Heck, it is time to sell all of our assets and, while we are at it, why do we not just sell New Zealand, as well? We have done that recently with the Hobbit film, so why do we not go all the way? Those are the names that come to mind because of the way this bill has been rushed through in this Parliament, and because of the way the clauses of this bill are designed to gut local government.

While I am at it, I tell members that we should also give this bill a name such as the “Removing Community Outcomes From Our Communities Bill”. Let us be open and transparent: that is what this bill is designed to do. It removes the right of ratepayers to identify and determine their own outcomes, and the bill will give the power to the local authority to decide those outcomes for the community. That is not right—that is not right, but that is what this bill will do. I have a suspicion that ratepayers, and Grey Power members in particular, up and down this country, will be listening with interest to hear whether the Government takes a step back, and takes their word seriously about transparency and accountability. This bill does nothing for transparency and accountability. It closes shop for the few who are now being given power to make decisions on behalf of the community.

Another thing is that the bill also removes the right of ratepayers to be engaged in the consultation process from the beginning to the end. Let us be open and transparent for all New Zealanders and name this bill the “Removal of Community Participation in the Consultative Process Bill”. Let us just be open about that, and declare that once and for all.

Phil Twyford: It’s a bit long.

SU’A WILLIAM SIO: Well, it is a bit long. Nevertheless, it is being open and transparent; is that not what this Minister has been talking about? The bill is removing the right of ratepayers to participate in the consultative process.

Another thing is that simply handing over to local authorities the right to determine outcomes and to determine when ratepayers can participate in the consultative process does not make that right, and it does not make a local authority the community. The community are the ratepayers. Councils are elected representatives and can be part of the community, but they are not solely the community. The community are Grey Power; the community are ratepayer associations; and the community are Manukau, Auckland region, Waitakere, and Porirua where my friend Kris Fa’afoi is fighting tooth and nail to keep this Government out there, come this Saturday. I would say they are the real communities. They are the real communities, but this bill, this Minister, and this Government have no desire to allow the participation of the wider community. That is why Kris Fa’afoi would not agree with this bill. Kris Fa’afoi would say that we should be open and transparent, and simply call this bill what it is; it is the “For Sale of Assets Bill”; it is the “For Sale of New Zealand Bill”.

TIM MACINDOE (National—Hamilton West) : I move, That the question be now put.

SUE KEDGLEY (Green) : I have two particular names I would like to suggest for this bill. The first one is the “Rogernomics Part 2 Bill”, and the second one is the “Business Roundtable Implementation Bill” or the “Roger Kerr Implementation Bill”.

It is the “Rogernomics Part 2 Bill” because it implements the agenda of ACT and the Business Roundtable of corporatising as much of local government as possible, and allowing the councils to sell off their strategic assets without having to go through the inconvenience of informing their residents or even bothering to consult them. That is what this bill does. Mr Hide and the Business Roundtable are having to sit on their hands for 3 frustrating years because the privatisation of State-owned assets has been ruled out by this Government this term. That is for what it hopes will be its next term of Government. While they have to sit on their hands in frustration, unable to sell off State-owned assets, they have bided their time by focusing on local government. Nobody is surprised that Mr Hide got his prize of being the Minister of Local Government and immediately set about making radical, far-reaching changes to local government. He has not just got rid of Environment Canterbury and obliterated eight democratically elected councils in Auckland; he has worked on the prize of this bill, which, through a series of provisions, will encourage the councils to corporatise as many of their assets as possible. It will allow them to sell off their assets without having to consult—even their water assets.

The second possible title for this bill is the “Business Roundtable Implementation Bill” or the “Roger Kerr Implementation Bill”, because Roger Kerr has been lobbying for the provisions of this bill for two decades. I have here a series of his papers, and I will read from them. This bill is what he has been lobbying for through two decades. It is the prize of opening up local government to the multinational corporations that he represents. He will be listening with mounting satisfaction to this debate.

Hon Dr Nick Smith: That’s just awful—just outrageous.

SUE KEDGLEY: I say to Dr Smith that this is exactly what is happening. He may pretend otherwise, but this bill will allow Veolia Water, the largest multinational water corporation in the world, to own our water assets for up to 35 years, and if Dr Smith thinks that is not water privatisation, I say dream on.

Roger Kerr has been lobbying for this outcome and one can only imagine the amount of behind-the-scenes lobbying by Veolia Water, the Business Roundtable, Roger Kerr, and Suez to get this bill. Vested interests have been lobbying in secret to get this prize, which is what this bill is for them. Mr Kerr has been pointing out since the 1990s that owning water is a $300 billion business, and he asks why we cannot open up our water supplies in New Zealand to water privatisation and water companies. He acknowledges in this series of papers that it is controversial, but he says water is not a human right, not a precious resource, not one of the life-support systems of our planet; he says it is an economic commodity, it should be treated as an economic commodity, and it should be run by the market, run by multinational corporations. Then he talks about the opposition to water privatisation, which he is increasingly frustrated by. His strategy is to say we should go for partial water privatisation, not complete, outright privatisation. We should pretend that the councils will still retain ownership of water supplies. We should come up with what he calls partial privatisation, which is allow the councils to hand over the water supplies for 35 years to private corporations.

Dr CAM CALDER (National) : I move, That the question be now put.

Hon CLAYTON COSGROVE (Labour—Waimakariri) : In addressing clause 1 on the title of the Local Government Act 2002 Amendment Bill, I say that one could call it the “ Rodney Hide Special Bill”. I for one am not at all surprised that Mr Hide has brought in this bill. He has talked about transparency. What is his tag line when he is in the political mire, as he has been, day after day? It is to say he has to go out and do the best job that he can for the people of Epsom. I say to Mr Hide that this bill reeks of hypocrisy. Mr Hide has a long, long track record of talking about transparency and accountability. He talked about it when the issue was about perks, and we all know he came a gutser on that. He talked about transparency and accountability in respect of law and order, and we know he came a gutser on that too, when he covered up for David Garrett.

Now Mr Hide has brought into Parliament this bill, which could be titled the “Biggest Act of Hypocrisy That We Have Seen Come in Here Bill”.

Hon Dr Nick Smith: Calm down.

Hon CLAYTON COSGROVE: At least I have not had a couple of crates of V this morning, as that member has. If any member in this Chamber should calm down, it is “Old Psycho” over there. He should not tell me or any other member to calm down, because Nick Smith does not want councils to be accountable, not even his own council in his own patch. The old windbag over there, the old hayseed, does not want his council to be accountable to the community or to consult it. Oh, the pills must have kicked in! He is a bit silent now.

I say to Mr Hide—

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. I take offence at the coarse allegations that are being made by Clayton Cosgrove. They are both untrue and unparliamentary. I ask him to withdraw and apologise.

Hon CLAYTON COSGROVE: I withdraw and apologise.

The CHAIRPERSON (Eric Roy): I am on my feet. The debate has been quite passionate, but on a reasonably respectful plane. We are nearing the end of it, and I would not like us to lose that.

Hon CLAYTON COSGROVE: I come back to the point that Rodney Hide and other members of the Government have gone around the country, saying this bill is about transparency and accountability. Mr Hide has made great play of the fact that the people should have their say. He has said the people should be involved in local government, and the politicians in local government should be accountable to them. It is a pity he does not apply that to his own personal affairs, but putting that aside, he states that politicians should be accountable to the community.

Hon Dr Nick Smith: Always in the gutter.

Hon CLAYTON COSGROVE: You are no example, I say to Dr Smith. Then we come to this bill, which reduces the requirement on local authorities to consult and be accountable to their communities. I come back to the suggestion that a good title for this bill would be the “Yet Again, a Rodney Hide Special Bill”. It is a case of Mr Hide talking about transparency, accountability, the good people of Epsom, and how every day he has to try to be the best MP that he can be, regardless of his track record in this place, then pushing through a bill under urgency. Every bill on local authority matters that the Minister has introduced has been handled under urgency—

Phil Twyford: Bar one.

Hon CLAYTON COSGROVE: —bar one—because he does not want his legislation to be scrutinised and does not want the people to hold him to account.

I challenge the Minister to get up and explain how reducing the requirement on a local authority to actively consult with its community on community goals and outcomes in any way engenders and enhances political accountability to those people. I ask the Minister that question. That is what he said he founded ACT on. It is what he says he lives by, apart from in his own personal and political affairs in Parliament, yet although he preaches that, he does not walk the talk. How will a local authority know which goals and outcomes a community wants to have, if it is not required to consult that community? Even Nick Smith’s council will not be required to consult on those community goals and outcomes. Yet again, Mr Hide preaches accountability and transparency for everybody else. He takes the moral high ground, desperately trying to rekindle a political future that is in tatters.

I will give Mr Hide this: he has guts. Even though he is trying to rekindle his political future and reinvent himself yet again, with or without the spray-on tan, he still has the fortitude to bring into Parliament a bill that does exactly the opposite of what he preaches that everybody else should do. Everybody else should be accountable; everybody else should consult their electorates. He says he consults the people in Epsom, but he brings a bill into the Chamber that reduces the requirement of a local authority to consult its community, its constituency. I ask my colleagues how that shows accountability and how that will hold local politicians’ feet to the fire when they propose to do bad things—and we have seen that occur.

When it comes to water, I challenge Nikki Wagner. We have a major water issue in Canterbury—a major water issue. This bill, of course, allows the privatisation of water assets in the future. So I look forward to future debates with that member over there, Nick Smith, and with Nikki Wagner, as well.

CHRIS TREMAIN (Senior Whip—National) : I move, That the question be now put.

MOANA MACKEY (Labour) : I have been present for the entire Committee stage of this debate, and have participated in it. In reflecting on the Committee stage, I believe that the current title, the Local Government Act 2002 Amendment Bill, is not appropriate, and needs to be amended to better reflect the debate in the Committee stage and the amendments made to the bill.

The first change that I would suggest—

Hon Dr Nick Smith: I raise a point of order, Mr Chairperson. Mr Cosgrove, whose call has ended, is continuing to shout abuse across the Chamber when I am trying to listen to the contribution from his colleague. He has finished his time and he should be asked to desist.

The CHAIRPERSON (Eric Roy): I did not hear the member but a member has taken offence. As I said, we are nearing the end of this debate, so let us just conclude it in the best spirit that we possibly can.

Hon Clayton Cosgrove: I raise a point of order, Mr Chairperson. I think it is a tradition in this Chamber that one responds when provoked.

The CHAIRPERSON (Eric Roy): Look, I have just said that we are getting near the end of the debate—very near the end of it, I think.

MOANA MACKEY: Thank you, Mr Chair; I say that members on this side of the Chamber have a lot more to contribute in this very important part of the debate. I am very pleased that the Hon Dr Nick Smith is listening to my contribution.

I think a better name for this piece of legislation, perhaps, would be the “Local Government (That was Then; This is Now) Amendment Bill”, because when I look at the issue of remitting rates on Māori land, I am reminded of the comments made by the Hon Dr Nick Smith on this very issue, when he was in Opposition, and when Labour passed the Local Government Act in 2002. The clause is being carried over into this bill—a review period is being put into it. I think the bill should be called the “Local Government (That was Then; This is Now) Amendment Bill” because of the comments made by the Hon Nick Smith, when he was in Opposition, on this very issue of remittance of rates on Māori land. He said: “This is nothing less than apartheid.” The clause states “that a local authority must adopt ‘a policy on the remission and postponement of rates on Māori freehold land.’ It must do that.” He then went on to say: “I ask the Minister to tell me why councils must have a policy on remitting rates on Māori land, … I want some member in this Chamber—maybe Parekura Horomia—to provide me with an explanation. Why must a council develop rates remission policies for your cuzzie-bros and not for mine?”. The Hon Dr Nick Smith then went on to say: “This damn law that we are being required to pass is nothing less than apartheid, and I cannot believe that members opposite want to impose this sort of obscene provision. It offends against National’s principle of one standard of citizenship.”

Well, that is quite a departure from the bill we have in front of us now. I ask the Hon Dr Nick Smith—who said he was listening to my contribution, and I thank him for that—to take a call and tell us whether that is still his position and, if it is, whether he will be voting against this part of the bill. Indeed, maybe he will vote for my suggestion of a new title, which is the “Local Government (That Was Then; This Is Now) Amendment Bill”, because that is quite a U-turn, even for the Hon Dr Nick Smith.

The other title that I think would suit this bill is the “Local Government (Sale of Council Housing) Amendment Bill”, because housing does not appear in the list of core functions in this legislation. Councils around the country have already said quite openly that they are looking at selling off their pensioner housing, because, clearly, central government does not think that it is an area councils should be involved in. That was backed up by the fact that the Minister of Housing has stopped local government from having access to the Housing Innovation Fund to maintain those properties. That is sometimes the sticking point; properties get to a point where they have to be maintained, and the council wonders whether it should sell them or keep them.

If central government is prepared to take the issue of housing seriously, in partnership with local government, and to respect the role that local government plays in housing, then local government should be allowed to have access to the Housing Innovation Fund, as Labour allowed. I was in Kaipara earlier this year, and I was told that the Housing Innovation Fund allowed the council to maintain its properties, and that was part of the reason the council kept them and reversed its policy to sell them. Yet the National Government has said to local government that it does not have a role in housing, and that housing is not a core function, which has already seen the sale of some pensioner housing in districts like Whakatāne. The Whakatāne District Council has said that the Government did not want it to be involved in housing anymore. So we could call this bill the “Local Government (Sale of Council Housing) Amendment Bill.

It could also be called the “Local Government (Consultation is Important for Corporates but Not for the Community) Amendment Bill. Under this legislation—and we heard this earlier in debate on the Committee stage—communities’ consultation rights are being slashed back to the bone. But new procedures for corporates are being introduced—for example, developers can put pressure on a council to review its developer levy and development policies. Corporates will get the right to the special consultative procedure while communities are having the right taken away from them.

CHRIS AUCHINVOLE (National—West Coast - Tasman) I move, That the question be now put.

The CHAIRPERSON (Eric Roy): I move, That the report be adopted.

CHRIS AUCHINVOLE (National—West Coast - Tasman) : Some concluding remarks were made when we started on the third reading, and I mentioned the contributions made by various members of the Opposition. I said that Shane Jones had given a good speech, but perhaps I should say that his speech was quite good, or, perhaps, goodish. When I listened to speakers on the other side of the House, I wondered whether we were talking about the same bill. Goodness me! It was as if we were introducing apocalypse three—it is not as bad as that.

I stand to speak in the third reading of the Local Government Act 2002 Amendment Bill. It is all good, and I am excited that this bill is about to become law. I have not heard very many problems associated with it coming from councils or councillors. I must say that I wonder what sort of council and councillors the members on the Opposition side of the House have in their territories. I revere the good citizens of Tasman-Buller, the great district in Westland, who stand for their councils and do a thoroughly good job representing their people. They are quite capable of making choices; they are quite capable of making good decisions. Again, I say this is a good bill.

We heard a lot about the dangers of giving councils the option of having water services conducted by private partners—there is no compulsion for any council to do that. It is not a compulsory thing. If councils choose to, they can. That is why the bill has been put forward as it is. It ain’t compulsory; it ain’t complicated.

I am a bit surprised, again, that there has been scant reference from members opposite to smaller communities. Those members seem to have a huge preoccupation with Auckland, but there are other places in the country. I live in the small community of Moana, down in the West Coast, and residents each have their own private water supply. There is no centrally reticulated water system, so we have our own private water supplies. But after thinking about that further, and having been in conversation with some members of the Local Government and Environment Committee, it is astonishing that many small communities—and I am sure Mr Jones is aware of this in his part of the country—are dependent on privately provided infrastructure to keep themselves going. Those who visit our locality are amazed at the many local facilities that have been put in place by members of the community or working groups.

I want to turn to how the bill achieves what it sets out to do. It makes councils more accountable to their ratepayers by providing ratepayers with better information through a provision of a financial strategy, the pre-election report, plain English financial reporting, and the disclosure of infrastructure service information and performance measures. Standard performance measures will be in place for five key infrastructure activities: water supply, sewage treatment and the disposal of sewage, stormwater drainage, flood protection and control works, and the provision of roads and footpaths. This is a great package that will enable ratepayers to make comparisons of costs, funding arrangements, and service performance standards. Plain English financial reporting will mean that ratepayers can clearly understand the financial situation and dealings of councils, without it in any way being obscured.

The bill requires that councils have particular regard to the contribution that specified core services make to their communities. In the debate this morning and late last night, some members could not come to a conclusion as to what those core services might be. Well, members of the public do not seem to have any trouble determining what the core services for a council should be. The bill requires that the council has particular regard—it is a careful phrase: “particular regard”—to the contribution that specified core services make to their communities. Those who suggest that the list of core services is rigid and restrictive must bear in mind that just because a council is required to have particular regard to each of the core services, it is not obliged to deliver those services and it is not obliged to do anything else. Again, there is no great deal of compulsion. Local authorities will be able to decide that certain services are not a priority in their community, or that those services are adequately provided for by other organisations. There is nothing preventing a local authority from deciding to provide a service that is not listed as a priority.

The most contentious measure in this whole bill is probably the extended length of contracts for the operation and joint arrangements for the provision of water services, from 15 to 35 years. Private partners will be allowed to provide, and then own, new infrastructure for a period of up to 35 years, after which it will be transferred to the council. Opposition members have called this measure “privatisation by stealth”, but nothing could be further from the truth, because local government organisations will continue to be responsible for water quality and the provision and pricing of water services. Opposition members do themselves no credit by creating an alarming situation and scenario to describe their fears. Local government organisations will regain ownership of all infrastructure associated with water services on the expiry of the contract.

In summary, this Government has listened to the concerns of the local government sector, has been well advised by it—

Phil Twyford: Rubbish.

CHRIS AUCHINVOLE: —oh yes, it has—and has acted accordingly. We have increased flexibility. We have increased transparency and accountability, which in turn improve engagement and consultation with communities. I feel sorry for those members on the other side of the House who wish this legislation did even more, but I am delighted to be part of a Government that is making such huge improvements to local government in New Zealand. Thank you.

BRENDON BURNS (Labour—Christchurch Central) : The Local Government Act 2002 Amendment Bill represents blind ideology, and outdated ideology at that, which the rest of the world has in large part abandoned. It is based on an absolute belief that the market can, and will, get it right in privatising water supplies, and with sinister intent this bill also removes public health oversight of the management of public water supplies. It is not the first such move. It has been accompanied by several other similar efforts by this Government, and I note most particularly the Environment Canterbury bill that was passed under urgency, in 30 hours, in March of this year. It took away the role of councillors in the public oversight of the management of Canterbury’s water. There has been overwhelming public submission on this bill, saying that New Zealanders do not want to see their councils putting water into private ownership by providing for a 35-year tenure, effectively a generation. If it looks like privatisation, if it smells like privatisation, then indeed it is privatisation.

New Zealanders know the risks of that. This morning I received an email from a woman known to me who 20 years ago was working in the United Kingdom. One of her tasks involved the clean-up, in a metaphorical sense, of the aftermath of the biggest water-poisoning incident ever seen in the UK, at a place called Camelford, under an organisation called South West Water, which was one of the first water boards privatised by the Thatcher Government. A contractor to that company accidentally dumped 20 tonnes of aluminium sulphate into the wrong tank. It led into the water supply of communities that fed off the supply from South West Water, and hundreds of people were made sick. But the interesting thing about this case was the cover-up. It took more than 20 years and a coronial inquiry before people were told the facts of what had happened. The reason for that was the Thatcher Government did not want to have this made public. It did not want any taint attached to the privatisation project it had under way for the water boards and schemes of Britain. The eventual result was simply that South West Water was prosecuted for the total sum of £10,000. It was fined £10,000 for an incident that caused hundreds of people to become sick. Some people suffered permanent injuries, due to aluminium poisoning. Although 148 people were able to bring a case and get some very modest compensation, they had to fight through the courts to get compensation for their ongoing health problems.

As the email this morning said: “Having seen that and remembering what a terrible mistake it was,” that woman hopes “it never happens in New Zealand.” She said “I see that the Government is saying it is not about privatisation, but about management.” Yes, believe it, if you will. This is about the privatisation of our water supply, and it is part of a concerted effort by this Government, not involving just this particular bill. It extends, I believe, for instance, to a contract awarded 3 or 4 months ago by Tony Ryall as the Minister of Health. The contract for the oversight of our nation’s drinking water is worth $2.25 million, and is a job that used to be one of the core functions of the Ministry of Health. It had a team of five or six water engineers, and other such experts, who were there as part of the core public function of ensuring our water was safe to drink. But they have gone; there is only one staff member. Instead we are paying $2.25 million worth of public money to a consortium that includes American engineering consortium Parsons Brinckerhoff, who are involved in water privatisation schemes all over the world.

This is all very much part of the same approach—that the market will deliver—although the experience around the world has been that when it goes wrong, it goes absolutely, horribly wrong. It is rampant ideology at work. It is contracting out to the private sector what should be a core function of government. We can argue across this Parliament about what the core functions of government should be, and I would be happy to take part in that debate, but if members opposite want to argue that oversight of our drinking water is not a core function of the State, then I would like to know what the heck is a core function of the State. I believe that drinking water is a basic human right and it is essential infrastructure. It deserves to be in public ownership, overseen by officials who do not have any concerns other than making sure that water is safe to drink, that the supplies are up to scratch, and that targets do not have to be met in respect of providing returns to a private consortium. Yet here we have a bill paving the way for our water supplies to be put into 35-year ownership contracts. Those contracts will be put into private hands for a generation, a lifetime of private ownership.

An example comes from Britain in respect of what happened under one of the first privatised contracts. Hundreds of people were poisoned by the misapplication of chemicals. It took people 20 years to get justice. I argue very strongly that if that incident had involved a publicly owned entity, there would have been answerability on that issue, one would hope, in a parliamentary democracy. Hundreds of people were made sick very, very quickly, and I hope that answerability have would have come, irrespective of which party was in power.

But there are other examples outside of that example in Britain. The Local Government and Environment Committee, which considered this bill, heard a submission from the Canterbury District Health Board. It was the most explicit submission I think I have ever heard from public officials. They said to the Government that removing sections 125 to 129 from the Local Government Act 2002 effectively removes the regulations about water and sanitary services, and the oversight provided independently by the medical officer of health. So we have it happening on two levels. In the Canterbury District Health Board, the medical officer of health’s role in terms of the oversight of the water schemes is obliterated by this bill. The private sector will be running and will be responsible for the monitoring and testing of the quality of the water that they are making their living from.

So at the local level the oversight is gone. Meanwhile, at the head office of the Ministry of Health, the team that oversaw that has been decimated and replaced by a private consortium with the profit motive at the heart of it. Our chances of having anybody in public office being able to stand up and blow the whistle on schemes that are not working are gone, are obliterated by those double acts of the Government, both by this bill and by the non-announced move by the Minister of Health. The Press newspaper and I publicised recently that the contract had gone to Allen and Clarke in concert with eight other parties, including the American conglomerate Parsons Brinckerhoff. Here we have at two levels, nationally and locally, the oversight of the safety of our water going into private hands for 35 years. There will be no oversight.

I commend the Canterbury District Health Board officials for their bravery in putting forward their submission, on which we have not had a response from the Minister. I wonder why that is. I still invite members opposite in the time remaining—Canterbury members in particular, or those like the chair of the Local Government and Environment Committee, whose electorate might be going into a district health board with Canterbury—to stand up and take a call to defend the Government’s overriding of the concerns of people with no agenda, with no axe to grind. Public health officials said in their submission to the committee that the role they have played in providing an oversight of drinking-water schemes will go with the passage of this bill, and that we are putting the oversight of water standards into private ownership.

The officials are extraordinarily explicit in saying that what this is doing is parallel to what happened in the community of Walkerton, Ontario in 2000 after a Government came in with a big agenda to sweep away the red tape and regulations that were strangling the Ontario economy. And what happened? Walkerton went into a scheme without any oversight from public health officials, and seven people died and about 100 people were made seriously sick. The cost to that community and to Ontario was estimated at $200 million. In fact, in total, 2,500 people got sick from the outbreak of E. coli that happened in that community. That is a forerunner of the risks this Government is taking not only with putting our water supply into private ownership for 35 years, with the potential for councils to pick that up, which they will, but also with the fact that we are taking away health oversight. I say that this Government is taking an extraordinary risk with public health for reasons of blind ideology. It does not make sense. New Zealand will end up paying a very high price for the pernicious legislation that this Government has put in front of us today.

SUE KEDGLEY (Green) : Roger Kerr of the Business Roundtable will be listening with enormous satisfaction to this debate today. For 20 years he and the Business Roundtable have been lobbying to privatise our water supplies, and the Local Government Act 2002 Amendment Bill is the prize, the culmination, of 20 years of intensive lobbying. In fact, with this bill Mr Kerr and the Business Roundtable have achieved their wildest dreams. This bill, once it is passed, will allow foreign-owned multinational corporations to own our water assets for 35 years. The bill also lets them get their hands on any other strategic assets without having to consult local people, because the bill takes away the requirement for councils to consult before they sell strategic assets.

Best of all for the bill’s supporters is a little clause that was sneaked in after Local Government New Zealand and others had made their submissions. I am referring to a provision whereby councils can sell any water infrastructure if they believe that the sale is desirable for the success of the joint arrangement. Members of National and ACT have been trying desperately to deny that this bill will allow water privatisation, but that clause, which was sneaked in at the last minute, says unequivocally that any council will be able to sell any water service if it believes that the sale is desirable for the success of the joint arrangement. That is water privatisation by any other name.

One can only speculate on the intense lobbying that must have gone on in secret by the powerful vested interests—the major water companies, Roger Kerr, and the Business Roundtable—to get this bill passed. I think it would be very much in the public interest if the public were to have an answer to the question of whether the Business Roundtable and global water corporations made large financial contributions to the ACT Party and the National Party. Perhaps one of the next speakers from National could answer that question.

There has been a big debate recently in New Zealand about our opposition to foreign ownership of land, but what will New Zealanders think when they realise that once this bill is passed, in an hour or so, our water supplies, which have been built up over generations by ratepayers, can now be sold to any of the huge, private, multinational corporations, which, I might add, are literally scouring the world, looking for water supplies to take over? They have worked out that as water is becoming increasingly scarce, they want to take advantage of water shortages—it is, of course, a natural monopoly—by buying up water supplies around the planet.

Once a water corporation takes over a water supply, as corporations will now be able to do in New Zealand, its goal will not be to protect the public interest or to ensure that everyone has access to safe and clean water. Its goal will be very explicit—to maximise the profits for its shareholders. It does this in three ways. It is almost a formula; these corporations do it all around the world. The first thing they do is sack most of the staff that run the water services. Secondly, they charge more for water so the price of water soars and becomes unaffordable for many people, who then have their water cut off because they cannot pay their water bill. The third thing they do is run the water infrastructure down. They do not bother to fix the leaks or to invest in the infrastructure. Instead, they siphon off the profits to shareholders.

I will use England as a bit of a case study, although I could give examples from all around the world. When the water industry there was privatised, the corporations immediately fired 25 percent of the workforce, increased the price of water by 50 percent in the first 4 years, and slashed their investment programmes. They used the savings to increase the dividend and pay huge salaries to the management and directors of the water companies. While customers faced continual price hikes and the number of people having their water supply cut off tripled, company profits soared by 142 percent in the first 8 years. That is what will happen in New Zealand if any local community has its local water supply taken over by a private water company. I was about to say “if the local community allows it to happen”, but, of course, it will not be up to the local community any more, because under this legislation the local council will be able to flog off a water supply without having to consult the locals. The locals need not even know about it.

One of the problems is that once these corporations own or manage a water supply for 35 years, or if they sell it under the provisions I was just reading out, locals and their representatives will have virtually no say over water supplies for the next generation. The contracts that the local council will enter into will be secret. They will be commercial-in-confidence, so ratepayers will be completely in the dark about what the provisions are and about any deal that has been struck between the council and the water company. Many contracts have guaranteed rates of return for the water company regardless of its performance. Chile, for example, had to guarantee a profit margin of 33 percent to Suez as a condition.

Another thing is that once these contracts have been signed, one is locked into them. It is very difficult to get out of them, even if over 35 years circumstances change radically, or if a company happens to go bankrupt. What happens then? It is hardly surprising to learn that water privatisation has a terrible track record around the world. There is a huge and growing backlash against water privatisation. Literally all around the world, communities are fighting back against the water privatisation of the 1990s. It happened in many parts of the world, particularly in Latin America, aided and abetted by the World Bank.

More and more councils and Governments are trying to get out of contracts they entered into with private corporations. France used to be known as the home of water privatisation, but more than 40 towns and cities have taken their water services back into public hands. Paris took back its water service amidst huge controversy earlier this year, and other countries in Latin America are doing the same. It will be ironic if it happens here, just as around the world water companies are being thrown out by grassroots opposition because communities have woken up and understood what happens when they allow water, a precious resource, one of the life support systems of the planet, to be handed over to private corporations who will decide whether to turn off the tap if someone cannot afford it. And, of course, it is not in the companies’ interests to worry about water quality and so forth.

Around the world, even across the Tasman, private water companies are being booted out. Adelaide has decided not to renew the 15-year contract that Veolia Water had to run their water services. Now Veolia Water and all the other private multinational corporations can pack up their bags and come to New Zealand, because they have achieved their wildest objectives with the Local Government Act 2002 Amendment Bill. Councils can now not only contract out water for 35 years but they do not need to alert or consult the public, and the sinister little clause that National members have failed to mention enables any council to sell its local water supplies to any private water company if the council considers that to be desirable for the success of a joint arrangement.

We have opened our doors to water privatisation. We have gutted consultation not just for the sale of water but for the sale of any strategic asset. This bill is the implementation of Rogernomics part 2, which is the corporatisation and privatisation of local government in New Zealand.

Dr CAM CALDER (National) : I am amazed at the alarmism, extremism, and scaremongering that we have heard in the House today. The Local Government Act 2002 Amendment Bill is a simple bill to improve transparency, accountability, and financial management. It is a bill on behalf of ratepayers the length and breadth of this country.

Its provisions are intended to operate on two levels. First, at a strategic level, the bill aims to change the way that local authorities set their direction and the way this direction can be influenced and assessed by the community. It is directed at communities having more knowledge of what is going on. How does the bill aim to achieve this? It reinforces the need for local authorities to focus on core services. We have already heard that the Wellington City Council approves of this. It is a guideline; it is not didactic. Effectively, local councils can focus on core services, and they will learn what those core services are from their communities.

The bill talks about introducing a pre-election report. Why does it do this? It is to encourage an informed election debate. People can elect the officials who will represent them on the basis of being informed and knowing well what each person stands for, how they perform, and how the council has performed in the preceding 3 years.

The bill introduces a financial strategy to the long-term plan in order to help local authorities and their communities debate and resolve the key financial and service delivery trade-offs that local authorities must make. It integrates community outcomes and long-term planning processes to encourage better prioritisation of community aspirations. Once again, it is all to do with what the community wants.

The legislation focuses community outcomes on the role that a local authority intends to play in its district or region. Of course, it improves the financial and non-financial information in long-term plans by making it more accessible, more useful, and more comprehensible to most of us. Most of us do not have an accounting degree; we want to make this information easy to understand.

At an operational level, the bill aims to simplify decision-making processes. We want to do this because we heard from many councils that they were required to consult at so many steps that they were getting consultation fatigue. The bill removes unnecessary auditing by taking a number of operational policies out of the long-term plan. It removes unnecessary consultation, as we have said, and levels the playing field to better enable the private sector to deliver local authority services where that is required by the local authority.

People have had a few concerns about consultation. I will address some of these concerns. The Local Government Act 2002 contains many provisions to ensure and enable community engagement and consultation in local authority decision-making. This bill proposes amendments to remove some of the more prescriptive ones, and we have heard from the other side of the House that that proposal has had a certain amount of acceptance from the Opposition. I am pleased to hear that.

The bill proposes to remove some of the more prescriptive consultation requirements, but we acknowledge and underline the fact that consultation is still required. Where is this consultation required? Section 78 of the Local Government Act 2002 requires a local authority to give consideration to the views of interested or affected parties when making a decision. Section 97 requires that any decision that would significantly alter the level of service provided for a significant activity, or that would transfer ownership or control of a strategic asset, be included in the long-term council community plan, which itself requires an involved community consultation. So we can put that concern to one side.

Core services are another area that we have had a lot of debate about. Clause 5 of the bill introduces a list of core services. It says that local authorities must have a particular regard to the contribution of these services to their communities. Many submitters noted that the list is unduly rigid or restrictive, and pointed out that what is considered a core service in one area is not considered a core service in another. We understand that. Clause 5 does not prevent a local authority from providing services not listed if it deems them a priority for its local community. The ability of the local authority to decide which services to provide for the community is preserved. The clause may be seen as providing a reference point and focus for community debate. I commend this bill to the House. Thank you very much.

DAVID SHEARER (Labour—Mt Albert) : The Local Government Act 2002 Amendment Bill is really a piece of ACT ideology that the National Government has decided to go along with. I do not even know whether the National Government really understands, or has contemplated, what is in this bill and how it will play out in the years to come. We have known that for many, many years Rodney Hide has talked about the need to reform local government so that corporate and private interests have a much bigger say. That is what this legislation does, and the National Government is going along with it, probably because of some agreement for supply whereby the National Government needs the ACT Party’s support in order to progress its other agendas.

This bill has gone through under urgency. Almost every piece of legislation that Rodney Hide has brought to the House has gone through under urgency. Members sat in the House until midnight last night for the second reading of this bill, and we have been debating it all day today. Two of the three bills amending Auckland’s local government structure also went through urgency. The first famously had Opposition members sitting almost right through the weekend in order to oppose it.

Many of my colleagues on the other side of the House have said that this is really about listening to the people out there and giving ratepayers a better say, and that in fact that is one of the intentions of the bill. But when one looks at the public response, one finds that there were 414 submissions to the Local Government and Environment Committee. In Auckland, on one occasion that I attended, many of the Auckland councils came and presented their evidence to the select committee. There 360 submissions against the legislation, and of those 36 were from councils. This is not simply a case of mums and dads sitting down and talking to the select committee—although those people are also welcome—it was councils that have been elected by ratepayers, saying that this legislation is a backward step. On the water privatisation part of this legislation, we had 414 submissions. There were 360 submissions against it—360 submissions—and 17 submissions in favour. Members can do the maths. About 5 percent spoke in favour, and an overwhelming number spoke out against it.

This measure is not wanted by New Zealand. It is not wanted by the councils that represent the local people around New Zealand. In the local body elections, people spoke out and said that they do not want this. In Auckland people voted overwhelmingly for a mayor and councillors who would be in opposition to this sort of legislation. We are lucky that we have them. We are lucky that those people are there to stand up to what amounts to ideological claptrap that this Government is bringing into the House. Not only is this legislation ideological but also a lot of it is actually unnecessary.

Cam Calder talked about the pre-election report that this legislation wants to have. We had varying degrees of submissions on this, but overwhelmingly submitters were against it. Some of them said that they could go along with it. But what do they really say? Well, most of the big councils said that they could do this, as they are already reporting back in a number of other ways to people. They make themselves accountable in a number of other ways, but they say they can also do this. The smaller councils said that they can do this pre-election report, but it will cost them, because they will have to employ more people to write it. In fact, this requirement will increase the administrative burden on many of the small councils. A number of the larger councils came along and showed us the reports that they already give. The local authority in the Waikato area puts out a report that is very easy to read. It is already doing what this legislation is asking for.

This legislation is unnecessary. It is taking the “local” out of local government and it is making sure that the Government is standardising, pushing from the top down, and making local government authorities, which are already representative of their local populations, more subject to central control. That goes for core services. This bill stipulates the core services. In fact, many of the local bodies that came before us said that this is not appropriate for them, because they do a lot of other different things. They want to be a lot more flexible towards their ratepayers. This bill makes them more straitjacketed than they will have been before. This bill also says that it wants to increase transparency. It says that it wants to simplify many of the consultative procedures. That is code for removing some of the safeguards that are already in place in the Local Government Act 2002 as it stands at the moment. There is a need to do some streamlining, and a number of the people who came to us said that. This bill removes the obligation to consult on key projects. These include the possible privatisation of water. Some of the core services—for example, transport—could be moved into an agency, which would change their whole accountability back to the council. That can happen.

The part that I think is most odious in this legislation is the privatisation of water—or the “privatisation” of water, because the bill basically pushes out the contracts from 15 years to 35 years, which could be half the lifetime of anybody in New Zealand—on the basis of no evidence that it will make water quality better, increase water availability, or make water pricing any cheaper. There is no evidence for that, at all. We have heard copious amounts of evidence today in this House from my colleague Brendon Burns and from Sue Kedgley to show that water privatisation, which is in this part of the legislation, has been shambolic around the world—shambolic. It has cost more, the water is of poorer quality, it has led to disease and public health risks, and water is less available for the people who need it.

What does that add up to? If we take away the requirement for consultation on key projects such as water and water quality, and if we up the ability for the contracts to be put in place from 15 years to 35 years, then we have a recipe for the non-transparent, non-consultative, non-accountable privatisation of the core assets that the people out there demand and need.

One of the key aspects of this legislation as reported by the Government—or certainly by the ACT Party; it is by Rodney Hide, the Minister of Local Government—is that somehow this measure will save on costs. But the really interesting thing about costs is that if we look at the costs and at the way that rates have, in theory, been going up over time, we see that rates have actually been staying pretty much level with the level of GDP. As GDP has gone up, the expenditure in local government has kept track, at about 3 percent of GDP. It is not actually true that these prices have been going up. But the Minister is making the case, wrongly, that somehow these cost rises are a function of all the non-core services—as he calls them—in this bill. Well, the fact is that the biggest amount of money spent by any council or local body is spent on the core services. Of all the money spent by local government, 97 percent of it is spent on the core services that are in this bill, yet this legislation aims to remove cost increases on non-core services.

There is a lack of analysis and a lack of a plan. It is unnecessary legislation. It is ideological legislation, which has been brought into this House to further the ideological pathway of the ACT Party inside the National Government. It is a complete travesty of a bill.

Hon Sir ROGER DOUGLAS (ACT) : I will be relatively brief. The Local Government Act 2002 Amendment Bill is, in essence, a relatively simple bill. If one reads the bill, one finds it is clear that the Opposition—particularly the Greens, but also the Labour Party—is making a mountain out of a molehill.

The attitude of the Labour Party and the Greens to water is simply crazy, or mad, if you like. They have no interest in the question of the quality of water. Water quality is not at the heart of their opposition; at the heart of their opposition is the question of ownership. They say that it must be owned by the public. Public ownership is of the essence, irrespective of water quality. The goal for the Greens and the Labour Party is for water to be provided only by public institutions, when the goal should be to provide quality water at a reasonable price. Frankly, provided that the goal is reached of having high-quality water at a reasonable price, then we should not be too concerned about whether the water is provided under public ownership, community ownership, or private ownership.

I end by saying that over the last weekend I spent some time reading Tony Blair’s book. I recommend it to the Labour members. In the first 100 pages he raises the trials and tribulations he had in bringing a lot of his party members into the 20th century. Some of the things he describes remind me of the New Zealand Labour Party today.

RAHUI KATENE (Māori Party—Te Tai Tonga) : It gives me no pleasure at all to rise to speak on the Local Government Act 2002 Amendment Bill today. In fact, it literally gives me a pain. This bill, if it is simple, as the previous speaker, the Hon Sir Roger Douglas, described it, must have been conceived by a very simple person. The Minister who brought it to the House has a simple philosophy, and it is one of no representation, no consultation, and no tangata whenua involvement.

The Māori Party put our minority view into the report of the Local Government and Environment Committee on the bill, and when my colleague Te Ururoa Flavell spoke in the previous reading last night he talked about my report. It points out that some key areas in regard to the Act that this bill amends must be addressed, but none more so than that of tangata whenua participation at the local government level. It is well established that at the local government level tangata whenua have been unfairly, inequitably, and disproportionately under-represented across elected councils and boards, and this bill makes that worse.

In fact, when I stood to speak on another bill earlier this week—the Aquaculture Legislation Amendment Bill (No 3)—I alluded to the fact that the provisions in the aquaculture settlement were unable to be carried out because of under-resourcing and other things that local authorities could not do. As a result of that speech I received an email from a local councillor in the Bay of Plenty who said the work had already been done on the aquaculture settlement in terms of the allocations there, and who pointed out that this may have been because there are so many Māori on the local council. We can see from this that when Māori are on the local council, things actually work. Things happen; things move along. If we do not have tangata whenua there, and if we do not consult tangata whenua, then things will slow down very much. This is a very bad bill in that it takes away even more from the need to consult tangata whenua. In fact, this Government does not want tangata whenua to be dealt with at all. As I say, this is a simple philosophy from a very simple Minister.

It is of real note that in the annual review of race relations issued by the Human Rights Commission in March 2010, the need for Māori representation in local government and an effective voice for Māori in the decisions of the new Auckland Council are identified as one of the top 10 race relations priorities. I think this is something that is not given enough air time. By taking away representation and consultation with tangata whenua, we are actually creating a rod for our own backs in the area of race relations. This House needs to take the lead in creating good race relations here in this country, and this bill does not go in the right way. It definitely goes in the wrong way. It is something that everybody is concerned about except, unfortunately, for the National Government, which is led by the ACT Party and this simple Minister.

Hon Trevor Mallard: Led by the nose by the ACT Party.

RAHUI KATENE: The member has got that right.

We have real concerns about the provisions for water. It is really a problem that things are sneaked in by stealth, as they were. Throughout our select committee deliberations the National and ACT members tried to make it clear that things would not change and that this legislation was not about water privatisation, but then, suddenly, here it is. The evidence is right there in front of us that this legislation is about privatisation.

Chris Auchinvole: Oh, Rahui, I’m shocked. This is so unlike you.

RAHUI KATENE: I am sorry that the chair of the select committee is not able to see that that is what this legislation is about, but that is the fact of the matter. It is about privatisation. Given the fact that the privatisation of water has not worked anywhere else in the world, why on earth are we taking that route? Why is New Zealand not taking the route of seeing what is going on and picking up the best of what is happening in the world, instead of picking up the worst of what is happening in the rest of the world? We do not want to be a leader in the water privatisation area, so let us hold back and learn the lessons that have been learnt elsewhere.

We have real problems with this bill. We will be voting against it, and I really hope that this simple Minister will stop now with his simple philosophy of trying to get rid of tangata whenua.

LOUISE UPSTON (National—Taupō) : It is a delight to be able to speak in the final reading of the Local Government Act 2002 Amendment Bill. Despite the discussions that have taken place in the House today, our Local Government and Environment Committee has worked together very well on this bill. Obviously we do not agree on everything, but I do want to correct some of the misleading statements that have been made in the course of this debate. Chris Auchinvole always chairs this select committee in a fine, sound way, and this is yet another example of a Government bill that we are pleased and proud to bring to a conclusion.

I want to come back to a couple of points and remind the House that this bill is about increasing transparency and allowing local government to be more accountable. However, I stress that this is about keeping local decisions in local government because that is what builds strong communities. I wanted to touch on a couple of key areas as a way of summarising. The first is around core services. I was fairly staggered to hear a previous Labour speaker talk about the fact that 97 percent of council spending is on core services. That is not the message I have had from the three district councils in the Taupō electorate at all. Local councils like the ability that they will have to respond to their constituents, to the people who live in their communities, and to make decisions based on priorities that suit them. That is obviously once they have taken into account core services—obviously, sewerage and roading, as a couple of examples. Councils are not restricted just to these core activities, but they will create a sense of priority in relation to the activities defined in the bill as core.

I will now move to financial management. There was general agreement from submitters in relation to the fact that it makes sense that a local council should be able to be more transparent in terms of how the council is funded, and to have some more consistency around financial management. We have heard about the defined fiscal envelope. That allows a council to make a decision about what its own constraints are. From some of the speeches we have heard, people listening might think that this is a central government imposition of constraint, but it is not at all. It is a set of boundaries that each council puts around its own spending. This is really important to the constituents of the Taupō electorate. I am sure there are councils up and down the country that are concerned about further increases in their rates when their incomes are not growing accordingly.

I think that the pre-election report is a really important and valuable addition to local government. We were fortunate to have some examples of some of the reporting that local government provides. One example was from the South Waikato District Council in the Taupō electorate. It presents plain English information about how the council is doing, and in a format that the majority of voters are able to understand. I think that is a really important part of it. Yes, there are annual plans; yes, there is the long-term council plan; yes, there is the annual report. Some of the information currently in those is pretty highbrow. I do not think one should have to have an accounting degree to understand the books of the community in which one lives and pays rates.

One of the important changes that we made in the select committee process recognised that councils come in different sizes and shapes, and therefore have different abilities. We removed some of the requirements for councils with populations of fewer than 20,000 people to do it. Performance measures are one area in particular that I am very proud of, having worked in a city council when performance measures were put in place. This basically allows for councils up and down the country to have the same measures, so that ratepayers can compare how their council is doing. There was a bit of a hue and cry, and one would have thought that the sky was falling in, based on the Opposition’s comments in terms of how hard this will be. But if we look at some of the Department of Internal Affairs existing reports, we see that some of this information is available and the focus really will be on indicators that are relevant to the public, and that they can see are of value in assessing how their own council is doing. They pay rates, so I think it is fair enough that they have the ability to see how their council is performing and how that money is being spent.

The final point that I bring to the House’s attention is the issue around water assets. This issue comes back to the point I made about the fact that we on this side of the House recognise that local authorities come in different shapes and sizes—so do their demographics, and so do their geographics. Therefore the decisions around infrastructure for things like water are very, very different from one district council to the next. We recognise that, and in this bill we have allowed the flexibility so that if a council chooses—and I say the word “chooses” again—to contract out water services, it now has the ability to do that for 35 years. The focus again is on a council managing its infrastructure planning, managing its asset plans, managing the debt that might go on to ratepayers, and having the flexibility to deal with its infrastructure commitments in a way that suits it.

This is not privatisation—it is not privatisation. On this side of the House we do not think that the private sector is a big, bad, ugly monster. We actually think it does some things well, and through this legislation we are allowing it to do a bit more if the council chooses—if the council chooses. Local government is a democracy; it is only if the council chooses. It is not privatisation. Contracting out provides better and more flexible ways for councils to manage assets, if they want to. Councils being able to choose 35 years will allow them to better plan over the longer term for capital projects, and is in line with the Land Transport Act. So there is some consistency in what we are doing with this bill.

I am very proud to support the final reading of this fantastic legislation by our very able Minister of Local Government, Rodney Hide. I am very excited about supporting this bill. Thank you.

SU’A WILLIAM SIO (Labour—Māngere) : As the last speaker for the Opposition on the Local Government Act 2002 Amendment Bill—

Hon Darren Hughes: But the best.

SU’A WILLIAM SIO: I thank the member. I will use up my full time, unlike the Government member Louise Upston, who did not use up her full time. I will tell members why. I acknowledge the members of the Opposition, both Labour and Green. They have fought tooth and nail to hold the line for democracy for New Zealand, right through to midnight last night and early this morning, including taking a bit of democracy out to the Mana electorate, where Kris Fa’afoi is campaigning on our behalf.

The Government has argued that this bill is about keeping local decisions local. That is what the Government has argued. It has also—

Mr DEPUTY SPEAKER: The member is in full flight here. I would like to hear what he has to say.

SU’A WILLIAM SIO: I was in full flight; my wings were about to expand. The Government has argued that this bill is about keeping local decisions local. That actually means keeping local government decisions away from the ratepayers. That is what it is about. The Government argues that it is about keeping local decisions local, but we are saying that, as we understand this bill, it is actually about keeping local government decision-making away from the ratepayers, who pay for local government.

The Government has also argued throughout this debate that the bill is about transparency and accountability. I will reflect to members and repeat, perhaps, what many other speakers have said in this House. In so far as the Opposition is concerned, this bill does not provide one iota of transparency or accountability. The bill ushers in a sad day for local democracy—a sad day for local democracy.

The public who have been observing these debates will no doubt be asking why such important legislation as this bill is being rammed through the House in urgency, as the Government is now doing. Organisations such as Grey Power, and the ratepayers and residents associations right throughout this country are asking that question. I suspect that many will come to the conclusion that it is by Government design. It is deliberate. It is intentional, to undermine not only the Opposition’s ability to respond, but also, more important, the ability of the wider New Zealand public to react and respond defiantly. That is why it is important that I acknowledge all my Opposition colleagues for holding the line of democracy throughout this debate, and for fighting tooth and nail to hold this lot here accountable.

I have a feeling that many who are listening to these debates will come to the same conclusion that my colleagues and Ihave reached: that despite the eloquent rhetoric of Government members, despite their use of certain key words such as “accountability” and “transparency”, this bill does exactly the opposite. The behaviour and language of this Government has been designed to lull the New Zealand public into accepting something they would normally not accept, in the same way that a snake uses hypnotism to lull its prey before making the final and fatal strike. That is what this Government has done.

I will point out why I believe this and why I think so. The first thing is the water assets. These are important assets right throughout this country. The reference to water assets was hidden in the bill. This Government did not want the public to see what was in its design. Rodney Hide is allowing private companies to own the water infrastructure of councils for up to 35 years. It is privatisation, in spite of Government denials—it is privatisation. By giving over a valuable asset that generates an income stream that the ratepayers pay for, we are giving this valuable source of income to the private sector, no doubt to a select few—perhaps friends of Tau Henare, the millionaire from Te Atatū, as some might say—simply so that they can have that ongoing source of income. Who pays for that? It will be the ratepayers. What happens to the asset at the end of 35 years? No one knows. It has been my experience that the private sector generally squeezes every profit out of an asset and leaves it to rot. There is no maintenance. Who will have to pick up the maintenance of that particular asset after 35 years, with no one looking after its ongoing welfare? It will be the ratepayers. It will be the ratepayers right through this country.

The Government denies that it is privatisation, but that is nonsense. How many years would a dam have to be in private ownership before the Government called it privatisation? Fifty years? One hundred years? This bill allows private business to own water infrastructure for 35 years. That is a step too far for an activity that is, by the Minister’s own admission, a core service of local government. Rodney Hide has already admitted to the New Zealand Herald that he favoured the privatisation of council services. Changes brought about in the bill clearly show that that is in fact the Government’s agenda.

ACT’s policy is clear: it wants to see local government services, including roads and pipe water, run on a fully commercial basis. But National does not have the courage to be up front with New Zealanders. National MPs have spent the last few months arguing at the Local Government and Environment Committee that the bill’s long-term contracts for water are not privatisation and that shifting services to a council-owned company is not corporatisation. When the public sees the goings-on by this Government, they view it as being deceptive politics to say one thing when doing something else, and to also believe in doing something, but handing it over to that “1 Percent Party” to conduct affairs on its behalf.

Community consultation is a significant part that now changes. Instead of the wider community, the ratepayers and citizens of this country, being able to participate in the ongoing discussion of issues from the beginning to the end outcome of whatever the issue maybe, this bill now says that the local authority has the right to determine whether a citizen can participate in that process. At one point in time, I used to be the chair of the council’s annual plan committee throughout Manukau City. As somebody who values community participation, I took that committee to every corner of that electorate. I witnessed with my own eyes many National Party members and supporters in Botany and Pakuranga who took the time and valued being able to participate in the consultative community process. I say to every ratepayer and resident who is a member of the National Party that they will no longer have the right to participate in that consultation process. That right has been taken away from them by this bill and given to a select few on the local authority—it could be the chief executive officer. That is significant in terms of the gutting of local democracy, and that is what this bill does.

Finally, community outcomes have now been removed from the residents, ratepayers, and citizens of this country. It has now been given to the local authority to determine what outcomes the community ought to receive. That is arrogance and it is extreme, and that has been displayed by this Government throughout this debate. I say again: this bill overwhelmingly is about keeping decision making away from ratepayers.

TODD McCLAY (National—Rotorua) : The previous speaker, Su’a William Sio, wasted his time towards the end of his speech by offering advice to members of the National Party who are residents or ratepayers about what is or is not happening to them. If he had suggested that advice to them at the beginning of his speech the four people listening may have been able to hear him, but I fear they were fast asleep when he got to the end of his 10 minutes.

It is a pleasure to rise and speak on the Local Government Act 2002 Amendment Bill. It is a pleasure because good local government is essential for our communities, our economy, and our environment. I say clearly that the National Government values having an honest and open working relationship with local government and the local government sector, and we on this side of the House recognise that a one-size-fits-all approach to local government does not work.

The previous speaker made mention of democracy. He linked democracy in local government and local communities to this bill. Indeed, he mentioned the electorate of Mana and said the people of Mana would feel that they did not have democracy when it came to this bill passing through the House. I say to members opposite that I have heard rumours that some of the members of this House who sit opposite have spent the last 5 weeks of the Mana campaign on the telephone, berating members of the Pacific Island community in Mana and telling them how to vote. Why is it that members opposite are saying that this bill will be bad for democracy, but when they get on the phone and call hard-working people from Pacific Island churches in Mana and tell them how to vote—I am not saying that they threatened them; I am sure members opposite would not stoop as low as that—it is good for democracy? I will not even say in this House what some members of the Labour campaign team have said about Pacific Islanders in Mana. I would not repeat that; I think it is wrong. It is a horrible thing for them to say.

When it comes to local government, this bill will encourage local authorities to operate within a defined fiscal envelope. The people of Mana want their local authority to work within that envelope. The people of Mana want this Government to work within the tight fiscal envelope that has been set for us because of the recession that we face. They are happy with what the Government is doing. That certainly will be helpful to them, come the election.

I say to Mr Hughes opposite that a year ago when Hekia Parata was working in Mana she had mana. Last week when she was in that electorate she had mana. Today in that electorate she has mana. It does not matter what happens on Saturday in that electorate, on Monday she will still have mana. That is more than I can say for most of the members on the other side of the House.

I think the people of New Zealand want this bill to move forward. I think the people of New Zealand and their local government are looking forward to transparency, looking forward to accountability, and looking forward to a level playing field to better enable the private sector to help deliver services. I will not take up any more time in this House. I will let members opposite get up and ring a few more of those Pacific Island ministers in Mana and tell them what they should do on Saturday. Thank you.

Hon JOHN CARTER (Minister of Civil Defence) on behalf of the Minister of Education: I move, That the Education Amendment Bill (No 2) be now read a second time.

Hon Member: Excellent.

Hon JOHN CARTER: It is an excellent speech; it will just get better and better. Of course, everything with the National Party gets better and better.

The bill introduces legislation that will enable the establishment of secondary-tertiary programmes for students enrolled in school. The bill will reduce the compliance burden on what are described as limited-attendance centres by exempting them from early childhood education licensing standards. The bill will protect the sustainability of New Zealand’s export education sector by changing the refund provisions for international students enrolled in private training establishments. Amendments in the bill will improve the law affecting private schools in response to the Law Commission’s 2009 report Private Schools and the Law. The bill will also make minor changes to school enrolment scheme priorities by offering places to out-of-zone students via a ballot process.

Since the bill’s first reading, the Education and Science Committee has recommended some amendments to strengthen the bill by clarifying some of the policy decisions. I thank members of the committee for their careful consideration of this bill. I also acknowledge the contribution of those who provided submissions. I am particularly pleased that the select committee adopted the changes proposed to the legislation affecting the New Zealand Teachers Council. I thank the committee for agreeing to consider those amendments at short notice, and for their sensible and diligent attention to those serious issues. I also appreciate the committee accepting the changes proposed to teacher information matching. Currently, the Education Act 1989 prevents the Ministry of Education and the Teacher Council from matching data on relieving teachers. This change will allow data matching on relieving teachers.

Hon Trevor Mallard: It doesn’t prevent it.

Hon JOHN CARTER: That may be true, but this bill will now permit it.

I will now go through the key elements of the changes to the bill recommended by the select committee. The bill has been amended to make it clear that industry training organisations cannot directly provide secondary or tertiary education, but may still be involved in the arrangement of tertiary courses and work experience as part of secondary-tertiary programmes. A change has been made to refund provisions for international students, to require a private training establishment to hold in trust any payments made by a foreign student enrolled in a course for under 3 months. The funds will be available for refund to the students according to the rules specified by the New Zealand Qualifications Authority.

Five changes have been made to the legislation affecting private schools, following the Law Commission’s review. The requirement for the Education Review Office to charge private schools with more than 29 foreign students for reviews has been removed from the Act. Charging the relevant private schools would be difficult to administer, and would generate very little, if any, revenue. The legislation has been redrafted to allow the Secretary for Education to request a further Education Review Office review of private schools during extensions to provisional registration. A change has been made to include the Insolvency Act 1967, as well as the Insolvency Act 2006, when assessing a potential private school manager against the fit and proper person requirement. The bill has been amended to ensure that if the Secretary for Education finds grounds to suspend a private school’s registration, the secretary must also impose conditions to allow the school the chance to lift the suspension before considering deregistration. Two other minor technical amendments have been made to this part of the bill, which clarify the role of the secretary when suspending a private school’s registration.

The bill brings creches at centres like gyms and shopping centres, which look after children on a very temporary basis, into line with provisions such as those that apply to Sunday schools, and exempts those centres from early childhood education regulations that require education plans, qualified teachers, and ratio and space rules. The select committee amended the bill to allow limited-attendance centres that look after the children of employees to also be exempt from the early childhood education regulations. Those centres will continue to be subject to arrangements with the operators of the facility, local government, and other legislative requirements to ensure the safety and welfare of the children, while recognising that parents have a responsibility to make sensible decisions with regard to minding their children.

During the select committee process the committee was asked to consider including some further amendments regarding the New Zealand Teachers Council. The Teachers Council requested those changes in response to difficulties it was having in administering its legislation. The Teachers Council has processes in place to help teachers with competency issues to improve. However, the council cannot currently show in the teacher’s registration that a teacher is going through this process. The bill has been amended to allow the Teachers Council to annotate teachers’ registrations to indicate when teachers have conditions imposed on their practising certificates due to incompetence. This will decrease the risk that schools could unknowingly employ a teacher with issues in relation to his or her competence.

A further change will correct an anomaly in the legislation that currently prevents appropriate action being taken in certain competency or conduct issues. Cases involving possible serious misconduct by a teacher mostly result from the mandatory reports submitted by a school or a teacher, but some cases result from a complaint. To ensure that children and members of the public are not put at risk, it is often appropriate that a teacher be suspended until an investigation has been carried out. However, the legislation currently allows for an interim suspension of a teacher only following a complaint. This amendment makes it clear that an interim suspension can also be made following a mandatory report of teacher conduct.

Hon Trevor Mallard: Who was the silly Minister who introduced that?

Hon JOHN CARTER: I am not sure, but I am sure Mr Mallard had some involvement in it, no doubt.

Hon Trevor Mallard: It was me. I apologise.

Hon JOHN CARTER: Well, I am sure the member will take a call and make the apology himself.

A similar issue exists regarding the actions that the Teachers Council can take if it finds a teacher to be incompetent. The Teachers Council can take action following an investigation that has been the result of a complaint about competence, but not when an investigation follows a mandatory report about competence. The bill amends the Education Act 1989 to make it clear that the Teachers Council may take action following a mandatory report or a complaint about teacher competence. This provision will help to ensure that children are safe, and will help to maintain and improve the quality of teachers in our schools.

Submitters raised a further issue during the select committee consideration of these amendments. Currently, the law technically requires a board of trustees to dismiss a teacher who is the subject of an interim suspension. In many cases, that may be unfair for the teacher concerned. There is an intention to bring forward an amendment to the bill at the Committee of the whole House to ensure that an employer of a teacher is not forced to dismiss a teacher who has been suspended while his or her case is being investigated. Once again, I thank the members of the committee for this work, and I commend this bill to the House.

Hon TREVOR MALLARD (Labour—Hutt South) : Labour members supported the Education Amendment Bill (No 2) to go to the Education and Science Committee, but we will not be supporting it from this point on. There are two major reasons for this. Firstly, we became aware that one of the major undertakings given to us by Anne Tolley was incorrect with regard to police checks on people in limited-attendance centres. Secondly, she failed to accept an approach to open up the Teachers Council disciplinary hearings, and desired to continue to hide those teachers who are abusing children. So we will not be supporting this bill to go forward.

However, I think it would be churlish of me not to congratulate the chair of the select committee, Allan Peachey, and all the members of the select committee on the contributions that were made there. I think the chair has an ability to haul together a variety of points of view—those of two ACT members, and those of National, Green and Labour members—and to work, as far as is possible with some of our different philosophies, for the benefit of young people. I think it is fair to say that we have those differences within parties as well as between parties, and there might even be some overlap in some matters.

Much of this bill is pretty much harmless. As I have indicated to the Minister of Education and to the chair of the select committee, I think the whole secondary-tertiary part of this bill is unnecessary. I think it will give us a pile of bureaucracy that we will come to regret later on. It will tie us down in a way that will mean that policy changes and improvements will be hard to make, and I regret that the Minister has chosen to take the advice of people who want to have everything possible written into legislation. I think that is a short-sighted approach on her part. It shows a poor understanding of the way both the education system and Parliament work.

The first and relatively minor point that I will focus on is the change to allow inherited rights to take precedence over local entry to State schools. It is my view that in New Zealand we are an egalitarian society. Some schools have limited places, generally because of geography and the way that populations have grown. Schools have good reputations, and they have to have enrolment schemes. Labour has always been firmly of the view that the people who live close to the school should have preference, and that a zone should be developed. If there are spare places from outside, they should be available by way of ballot. There is a method relating to current and former siblings, and people work through the matter on that basis.

The changes made by this bill state that if a child’s parent attended the school, the child will get access. That provision is intergenerational, so someone could end up having access to a school not because they or their mother or father live or lived in the zone, but because their grandparents lived in the zone. That is the idea of inherited rights to entry to State schools, while other people are excluded. Let me make this point clear; Allan Peachey understands it well. Zoning in zoned schools applies only when there are a limited number of places, and when one person gets in, another person does not. That is the way the system works, and what we are doing here—

Hon Sir Roger Douglas: It doesn’t have to work that way.

Hon TREVOR MALLARD: He is absolutely right. We can build massive schools when they are popular, then abandon them later. We can have massive capital investment in areas where schools are popular at a particular point in time, and then when they are less popular and the school down the road is more popular, we can make massive capital investment there. The member might want the private sector to do that building work, and he might want public-private partnerships in order to help his mates, but I am for the rationing of capital in schools, and for the capital going where it is needed. That is a relatively minor issue, and we probably would not vote against the legislation on that issue alone.

The next point I refer to is the issue of the limited-attendance centres. Those are things like gym or shopping centre early childhood education facilities. We received an assurance from Anne Tolley, the Minister of Education, that the people who will be leading the centres—not the teachers but the people supervising the children—would be subject to police checks. On that basis we supported the first reading of the legislation. I am not saying that she deliberately misled us. I think that in this case—

Hon Maurice Williamson: You can’t say that.

Hon TREVOR MALLARD: That has never worried me in the past. In this case I think it was genuine ignorance. I think she did not know. Maybe she was badly advised, but now she has been properly advised. She and Government members were asked to change this bill to ensure that someone who might be in an enclosed room with children and could have a long-term criminal record of sexual abuse of children should have a police check. This bill is an early childhood education sex-abuser’s charter, because it takes away, for the first time, the requirement for those people to have a police check. My view is that that is wrong, and I look National members in the eye now and ask whether they will be prepared to front up to the families of the first, the second, and the third child who is abused by someone who was already of interest to the police, someone who would have failed a police check if one had been necessary. Members opposite are saying that they want to take that police check away. I just think it is shocking.

Some other things are important for those centres. One of them is that there should be always be a line of sight. They should be open in their design; they should not be totally enclosed. One of the principles of good education now is that there should be some glass in certain areas to ensure that nothing untoward is happening in the rooms. It is a very good protection for the teachers or the people who are doing the supervision, because it can prevent false accusations. Having unregistered people in unlicensed premises without police checks and without a line of sight to where they are working is a recipe for abuse, and I think all members of Parliament should be concerned about that.

The other matter I will focus on is the question of the Teachers Council. I had a meeting with the Minister, and she put to me a series of propositions, which I agreed with. Most of those propositions came to the select committee. One of them did not, and that was her proposal to open up the hearings of the Teachers Council by way of a method similar to a court, and to grant suppression orders. At the moment the hearings have to be either open or closed, and the current rules do not allow for suppression orders. They could, but the only protection is a $1,000 fine, and that is not good enough. Media could ignore it. They could take that fine, and certainly bloggers do all the time.

I have drafted two amendments. One of them is very simple: it increases the fine from $1,000 to $100,000, and thereby invites the Teachers Council to rewrite its rules in order to allow for suppression orders. The other takes the approach of Simon Power by using a presumption of openness, stating that the hearing should be open, but there is room to close it and to suppress the name of the teacher and, most important, the names of any of the witnesses. I think in particular of child witnesses, because I think it would be wrong for child victims of teachers to have their names printed. I want a system where we can identify the offenders but protect the children. There are two amendments, which we will get to at the Committee stage, and I ask Allan Peachey, in particular, who understands these matters, to read them carefully and talk to his colleagues, because this is more important than politics.

ALLAN PEACHEY (National—Tāmaki) : I begin by acknowledging the opening remarks of the Hon Trevor Mallard, and I thank him for what he had to say. I join him in recognising the work the Education and Science Committee has done on the Education Amendment Bill (No 2), and the work it does generally on education issues. There are huge philosophical and practical differences between some of us on the committee, and certainly between Mr Mallard and me, but what is never in doubt is that both of us, and other members of the committee, have at heart the best interests of children and education in New Zealand. Although we have some very rigorous debates, and we do not always agree, the committee has shown an ability to find pretty broad common ground on a lot of issues. Sure, there are differences over this bill, but the committee members worked very hard to come back with recommendations that were as good as we possibly could make them. I also acknowledge Mr Mallard’s support as the deputy chairperson. He is a very experienced member with a very good grasp of the Standing Orders and procedures—

Hon Trevor Mallard: Don’t go too far, I might lose this election.

ALLAN PEACHEY: —and if I continue, I may even get him demoted to the backbenches opposite.

The Education Amendment Bill (No 2) makes changes in six broad areas, and I will run through them very quickly. The first change is the introduction of secondary-tertiary programmes to give greater opportunities for youngsters at secondary school to have part of their education in a workplace or at a tertiary institution. Secondly, the bill exempts limited attendance centres from early childhood education licensing requirements; in other words, it exempts short-stay places at shopping malls, swimming pools, and that sort of thing. Thirdly, it changes refund provisions for international students enrolled at private training organisations. Fourthly, it updates the law regarding independent schools, and in doing so responds to a Law Commission report called Private Schools and the Law. Fifthly, it makes changes to the priority order for admission to schools that have enrolment schemes. A number of us on the committee, certainly including me, reflected long and hard on that, because I understand from my own background that every time we put in a priority we are giving somebody an advantage over somebody else. I am very keen on the idea that all youngsters should have a fair crack at getting into a school of their choice. There are very good reasons why some schools are so enormously popular and others are not. I do not share Mr Mallard’s view about spreading capital around, and all the rest of it. My objective has always been to get as many youngsters as possible into the best schools.

Finally, the bill removes inconsistencies regarding the New Zealand Teachers Council and the imposition of suspensions. That issue came to the Education and Science Committee late. I appreciate the cooperation that committee members showed in enabling us to deal with it in a timely fashion. I also want to take a moment to acknowledge the contribution made by the New Zealand Educational Institute, the Post Primary Teachers Association, and the School Trustees Association. They made themselves available at very short notice, and I acknowledge that they were put under some pressure to respond to the committee. They did that and I appreciate that.

This bill amounts to an extension of the Government’s desire to maximise participation in schooling and education, to keep students engaged in education for as long as possible, and to ensure that, above all, the State gets value for its investment in education. I commend the bill to the House.

SUE MORONEY (Labour) : It is a pleasure to speak in the second reading of the Education Amendment Bill (No 2). I thank the previous speaker, the chairperson of the Education and Science Committee, Allan Peachey. He does a very fine job in the chair. He was right when he said we did have a very strong sense of cooperation on our committee, particularly when the ministry wanted to bring some late information into this amendment bill. Even though we are the Opposition, we felt that these issues were important and appropriate for this bill, so we accorded the Government our agreement to make sure that those issues were addressed.

But we find ourselves debating this bill under urgency. That is kind of ironic, really, because although we were prepared to give the Government the time on the select committee to actually address some issues that came late to the table, we now find that we are using urgency time in Parliament to debate a standard bill that should go through under the normal processes. However, here we are debating it under urgency.

I want to focus on the part of the bill that impacts on the shadow portfolio that I am involved in, early childhood education, because there are substantial changes in relation to the lowering of standards for limited-attendance centres. As I think other members have already said, limited-attendance centres are described in this bill as being the sorts of facilities that we might use when we go to the gym or the shopping centre. They are defined in the bill as being early childhood education settings where children will not be for any longer than 2 hours in 1 day. I think people will imagine the sorts of settings that those places are in. But lowering early childhood education standards for our very vulnerable children is a bit of the theme with this Government:

I will just read from a very, very good submission that the select committee received on this bill on the matter of limited-attendance centres. It was from the Human Rights Commission. I want to read its actual words, because they tell us about the human rights aspects that are under threat with the passing of this bill, which is one of the main reasons why Labour opposes it. The Human Rights Commission said it “is concerned due regard does not appear to have been given to the vulnerability of babies, infants, and young children attending LACs and the steps required to ensure their physical and emotional safety and wellbeing. … The commission understands there is doubt as to whether staff in LACs would be required to undergo a police vetting check.” Of course, these are not its words, but what we found when we closely questioned officials about that is that this bill completely does away with the requirement for police vetting checks for those centres.

The Human Rights Commission said “We welcome the Minister’s reassurance during the Bill’s First Reading that it was not the Bill’s intention to remove police vetting.”, but, of course, we know now that that intention was not followed through. The Human Rights Commission went on to say “We strongly recommend that such checks remain mandatory for any staff member who has unsupervised access to young children and that the Select Committee identifies what measures are necessary to enforce such a requirement.”

There were members of the select committee who did exactly what the Human Rights Commission asked for. They were the members of the Labour Party and of the Green Party, and those issues are detailed in the, I am sad to say, minority reports in the report-back from the select committee. Although the Human Rights Commission asked the entire select committee to identify measures that were necessary to look after vulnerable children, only the Labour Party and the Green Party were determined to make a stand on that issue.

The submission went on to state: “The commission would be concerned if deregulation of LACs reflected any perception that caring for a group of young children is unskilled work with few responsibilities or that it does not require training.” But, of course, that is the view of the National Government, and we know that not only because of this bill but because of its determination to reduce the number of qualified staff in the early childhood education sector right across the board. In the Budget this year one of the largest cuts to any portfolio was to early childhood education, and that cut was meted out in particular to centres that dared to go after the goal that Labour had set when it was previously in Government—having 100 percent of the staff qualified. But John Key and Anne Tolley have said our children in New Zealand do not need or deserve to have 100 percent of the staff qualified. They say the children do not matter and it is good enough for 80 percent of the staff to be qualified.

We see exactly that attitude coming through in this bill. The National members do not understand that those young children are engaged in early childhood education. They see early childhood education as being glorified babysitting. That is why they have taken the knife to qualified teaching staff in early childhood education centres, and it is why they have moved to completely remove any standards and any form of regulation from these limited-attendance centres.

The Human Rights Commission went on to outline the safeguards that it wanted to ensure were in place. It wanted someone who is qualified in first aid to be available at all times. The Government members on the select committee did not see fit to do that. It wanted sufficient staff to be available, including cover for times when a staff member may need to locate a parent urgently. The Government members did not see fit to do that for limited-attendance centres. The Human Rights Commission wanted, as a bare minimum, staff to be aware of relevant child protection and abuse protocols. The Government members would not even agree to that. The last minimum that the Human Rights Commission wanted was for adequate records to be kept so that staff could ensure that children did not attend more than 2 hours a day. The Government members on the select committee could not even agree to that as a very, very basic level of protection for preschool children.

The Human Rights Commission gave a very well-thought-out submission, but unfortunately for the majority of the select committee, the Government members, it fell on completely deaf ears. It fell on completely deaf ears because this Government fundamentally does not believe in the value of early childhood education. Government members do not understand that the commission was in fact saying there is a vulnerability on the part of babies, infants, and young children. They think they do not deserve protection, but parents and families look to the Government for that protection.

I believe that in a country like New Zealand, a country that has always had very high educational standards, when parents drop off their children at a limited-attendance centre in a creche, a gym, or a shopping centre, they will expect some minimum standards to be set for the people who are charged with looking after their children. Parents will expect in a country like New Zealand that the Government has the courage to make sure their children are be safe, and that at the very least there will be police checks and, as my colleague Trevor Mallard said, a line of sight, for example. Those are just some very basic things that ensure the protection of young children when they are away from their parents or their primary caregivers—that is not too much to ask. They are very, very basic standards, but the Government members could not even bring themselves to recommend them.

I do not think it is too extreme to say Government members are potentially leaving these babies, these infants, and these children at the hands of potential sex abusers whom the police already know about. What will the Government’s response be when something happens? I would like to say “if something happens”, but I think my colleague Trevor Mallard is right to say the people who operate in this field will look for these opportunities. They will see this gap, and they will know that they can have access to young children who are unsupervised by their parents, without having to face a police vetting check. I think the Government members should think very seriously about the vulnerability of children and the position that they are putting them in. I really do hope that during the Committee stage we can find that there is some heart on the National benches.

CATHERINE DELAHUNTY (Green) : Tēnā koe, Mr Deputy Speaker; tēnā koutou katoa. The Green Party is opposing the Education Amendment Bill (No 2), and I am pleased to have the opportunity at its second reading to explain why. I would like to acknowledge the Education and Science Committee, and the committee chair, and all the work that the committee does, but I cannot say that I found this particular bill edifying or coherent. Although it does have some value, the Greens will not be able to support it. This bill is so broad and diverse that the net effect is a strange mixture of the perfectly reasonable and the completely unreasonable. We have waded through this bill with the assistance of the small number of submitters who actually knew what it was about, and the result is as disparate and mediocre as when we started.

So I will begin with talking about what is reasonable in the bill. It is reasonable in Part 1 to provide a legislative framework for the secondary-tertiary programmes. These programmes are not new. There have always been these types of programmes, but there is probably no harm in updating and clarifying them in terms of some of the issues raised; whether or not it is necessary, it is not essentially harmful. I have no problem with issues such as recognising the providers, and the obscure issues that are important—which are not actually obscure—like pastoral care for students of school age. We must remember in debating this bill that the students are school age. We support clarification of the lead provider role.

The secondary-tertiary programme clauses support an existing provision of more options for young people who have an active interest in learning trades while still of school age, and this is a positive and practical development, so we do not have a problem with it. However, there are four main other issues that we have tried to contest, which prevent us from supporting the more reasonable provisions.

Firstly, I would like to speak about limited attendance centres, which have been well covered but there is more to say. The clauses on childcare provision at gyms and shopping mall creches remove the early childhood centre requirements but throw the baby out with the bathwater. Of course creches at malls and gyms are not formal educational establishments, but as the previous Labour speaker, Sue Moroney, pointed out, young children are learning at all times; it is a matter of what they learn and from whom they learn it. We cannot stop them learning and we need to protect them and create environments where that learning will support their well-being. This bill removes all requirements to ensure police vetting of staff, staff-to-child ratios, and health and safety provisions particular to the care of children.

It was said at the committee that there would be health and safety provisions as standard in any gym or shopping mall. Well, we are not talking about adults here. We are talking about the particular care of children. The argument that the parents will be nearby, so there is no need for extra protection, does not ring true. Meanwhile at the other end of the gymnasium or the shopping mall—and some of them are vast, with loud music deafening the ear—an untrained person may be trying to care for someone’s toddler, two 6-year-olds who did not like each other on sight, and a crawling bottle-fed baby, without facilities. I am not saying there should not be a creche at these places, but the public would assume—parents would definitely assume—that there are standards for care and protection. It is a given in a so-called modern civilised society that people’s children will be protected by the State when they enter into any formal environment, that at some level there will be that protection. That is a given that citizens and parents will assume. They will be astonished—any of them who know about this—to realise that the police vetting bottom line is not there.

The only argument that was raised at the Education and Science Committee on the issue by the Government was that parents could choose to use those facilities and would make their own calls about safety. The Green Party does not believe that parents will even know. There is not likely to be a sign outside the creche saying “No Police Vetting Here”; it will not really happen like that. The parents will not know about this law, which removes standards, and we cannot agree with that. We believe that removing the formal education requirement could happen in a sensible way without lowering the standards for safety and making them non-existent in terms of children and babies.

I do wonder how much imagination is needed to figure out what could happen if there are not enough staff or facilities or safety measures, in terms of police vetting for small children. But then, this is not about children, is it? This is about the ideological opposition to standards and regulation, and it is an opportunity—an inappropriate opportunity—to cut those at the expense of families, because the parents will not know, and the staff will not be trained. The children are the people we should be concerned about. So I really fail to understand how we got to this place. It is very bizarre.

The second issue is private school governance. The Law Commission review into private schools made a large number of recommendations, five of which this bill picks up. However, this bill is a missed opportunity. There are some gaps around the information to parents about suspension and expulsion in particular. The Law Commission recommended that there be transparency in terms of the suspension and expulsion policy being available to students and parents in the interest of natural justice and the welfare of children. In recommendation 28 and recommendation 29, the Law Commission has made two clear recommendations on appealing suspension and making disciplinary procedures available to families upon request. These were not included in the bill, so we cannot trumpet this bill as a celebration of the interpreting of the Law Commission’s recommendations. It is not. It has missed out some of these vital things, and this was brought to our attention by a couple of people. It may not be a major issue, on its own it might not have been enough for us to vote against the bill on this, but I can see what the Law Commission is saying in the interests of natural justice.

A more serious issue for the Green Party and a more profound issue is the out-of-zone enrolment priorities. At a recent Victoria University seminar on inequality—in fact, this week—a comment was made that social origins and inheritance matter more in less egalitarian societies. This change to out-of-zone enrolment priorities to offer priority to students of former pupils and children of board members, is simply reinforcing inequity. That might be a tenet of private schools but it does not belong in the public system. We wholeheartedly oppose this principle. Why would we want to increase privilege and inequity and create more power for social origins and inheritance than the ability to attend one’s local school, unless we want a less egalitarian society? If we do, let us come out and say it. Let us come out and say that we do not want egalitarian societies and we do not want public schools available to everybody, and that we want to create inherited privilege. That is fine, that is what the private school system does. But we will fight tooth and nail for the rights of children to go to local schools and we are absolutely opposed to this.

The amendments that came to the select committee late are of great concern to us, and not so much for the content. The amendments were regarding the Teachers Council. We do not have a problem with the annotation of the Teachers Council registers in terms of a teacher’s history, and neither do the unions, but I do have a problem with the process. It was the last days of consideration when these amendments were brought forward. The teachers’ unions and the staff had less than 2 days to consider them and make submissions. It was acknowledged verbally in the committee as a bad process. The issues in these amendments need to be tightened up, and if teacher suspension needs new law, then teachers themselves need to be consulted, and they need to take ownership of those changes. We have enough conflict going on at the moment between the Government and the sector without adding to it. We need good faith, and the teachers’ unions showed a clear willingness to look at the issues raised. They did not have a problem with looking at the issues around suspension, or even the suppression orders, but they did have a problem with being told they had 1 day to consider those issues.

These groups are representative groups. They wanted to go back to their members and talk through these issues, because it vitally affects those members. The issues around suspension and pay affect the daily lives of teachers, and maybe they need to be tightened up, and maybe there is room to improve the ability for hearings to be made more public and for names to be made more public. But we do not give them 1 day to consider it. I have been talking to those unions, and they said to me that they wanted to go back and talk to their members. That is what they do. They do not do Draconian decision-making on behalf of others. They are not the elite who speak on behalf of others. They speak with their members.

Given all of those issues combined, the Green Party is unable to support this bill. The education sector and the Government are in what I consider to be crisis, but we are spending a lot of time talking about things like the small centres where children will not get protection. We are spending a lot of time talking about how to privilege those people who already have an inherited relationship with a school. That is not actually what I thought we would be doing when I joined the select committee. I thought we would be at the heart of the debate, but we are not. In fact, there are a number of very negative things happening in the bill, and for those reasons the Green Party will not be supporting it.

RAHUI KATENE (Māori Party—Te Tai Tonga) : I am pleased to stand and speak on the Education Amendment Bill (No 2) today. A very interesting assessment of the current state of our education system was made in the Post Primary Teachers Association (PPTA) submission to the Education and Science Committee on the bill. A comment was made by the former Deputy Minister of Education from Ontario, Professor Ben Levin, that when we look at New Zealand education policy, we see “lots of good projects, but no strategy.” They are words that could very well have summed up this bill.

It is a pretty good idea to refund course fees for international students who leave their courses before they are completed, but what about the bigger strategic direction in respect of international education or student fees? Another great idea is to stipulate specific requirements that would enable managers of private schools to be assessed as “fit and proper” for the responsibilities of managing a school. But, again, I ask what strategy is emerging from private schooling.

In Budget 2009, an extra $10 million was announced to supposedly make private schools more affordable, with $2.6 million going into Aspire Scholarships to provide assistance for students from low-income families to attend private schools. But how do we know whether that funding has made a difference? Was it just a nice gift to independent schools? How many Māori families have benefited from that gift? How effective has it been in overcoming the long tail of underachievement and system failure, which is consistently reported in the education sector?

There is also the issue of the removal of early childhood education regulatory requirements for limited-attendance centres. These centres are set up to provide short-term care in places like gyms or shopping malls. Again, it seems a good idea that there should be a different set of standards in place for such short-term centres. The last thing we want to do is make the compliance costs so burdensome that parents are stung by over-the-top fees for what is essentially an hour or two of supervision.

Some parents have it so easy. I remember when I had to go shopping with my five children. We did not have childcare centres there then. I had to take my five children with me, and they screamed around the supermarket and the mall. But now we have shopping malls with childcare centres, and that is a fantastic idea. But we should not make it too burdensome for parents to be able to leave their children there. We are not expecting such centres to provide comprehensive and developmentally appropriate learning opportunities. But on the other hand we do not expect those centres to compromise the health and safety of our precious children. So we take on board the concerns of Te Tari Puna Ora o Aotearoa, the New Zealand Childcare Association, that safety and well-being must not be compromised for short-term gain.

Finally, we come to the project proposed to open up secondary-tertiary programmes. We were interested to see that this project received support from as wide as the Human Rights Commission and the PPTA. The commission said that the experience of the Manukau Institute of Technology in seeking the opportunity to enable a tertiary high school to operate there should be supported in other centres. The PPTA did suggest, however, that the legislation would do well to learn from the successful models of secondary-tertiary partnerships, which have been trialled and positively evaluated to support students into work or further training. It talked about the fact that in most areas industry training organisations, polytechnics, and some private providers have successfully built partnerships that enable students to pursue alternative pathways towards work and further education while still at secondary school.

The Māori Party is willing to support this bill to enable opportunities to enhance education that will result in positive outcomes. But we do return to the question of the proper strategy to really make the difference. In essence, the ideas in this legislation are just tinkering around the edges, leaving the enormity of the problems confronting the education sector untouched. This bill will not make the difference that is desperately needed. Although that does not mean we should vote this bill down, it does mean we will continue to be vigilant in asking the Minister of Education about what she is doing in respect of general schooling and making the gains that we expect to see for Māori children.

The Hon Dr Pita Sharples is working in the area of kaupapa Māori education. He has announced a national review of Māori language education, and is helping to keep a focus on quality and excellence in kaupapa Māori schooling. But the reality is that less than 5 percent of our kids are in kura kaupapa education, leaving the great bulk of Māori children in the general system, in the mainstream. The 2005 annual report on Māori education showed that Māori students in year 11 who attended schools where teaching was in te reo for between 51 and 100 percent of the time had a higher rate of attaining National Certificate of Educational Achievement qualifications than Māori attending other schools. We have known that fact for 5 years, yet it still seems we are doing very little other than Te Kotahitanga to make the difference we need for Māori children to succeed in general schooling.

I have outlined the strategic questions that we expected this bill to cover. But they are not covered. I guess we have to admit that the bill was never set up to answer those questions, but it does not mean to say that the bigger questions should not be asked.

COLIN KING (National—Kaikōura) : It is a pleasure to rise and speak to the second reading of the Education Amendment Bill (No 2). This bill is another part of this Government’s relentless push towards educational excellence, which is certainly is a priority for this Government. There is a lot of work to be done. We spend $12 billion on behalf of the taxpayer to ensure that all children have access to excellence in education, and we recognise the importance of that money being spent wisely. We do value early childhood education; we spend at least $1.3 billion on it. We have taken approximately $100 million out of the Budget to prioritise increased participation, because we know that there are areas in New Zealand where as many as 24 percent of children are not yet engaging in the very, very important foundation of early childhood education.

I would like to focus on the work the bill addresses. We have heard from members on the other side of the House that secondary-tertiary educational programmes are alive and thriving. I would say that there is a major issue in this area. We have failed miserably. We have focused on, basically, an academic pathway, and we have neglected the better part of 70 percent of hands-on learners in our schools. I believe that the way this bill is structured will empower a level of cooperation. It gives a very clear message about what we expect that relationship to look like.

The reason why it has not happened, as far as I can see, is that there is an issue over where the money goes. It is a real tragedy that when we look at a country that is considered a First World economy, we do not have an abundance of money to be able to spend and prioritise in this particular area. We have to spend it very carefully, because even though we spend $12 billion on education it is spread quite thinly.

Whenever I talk to tertiary providers and colleges, I hear that the colleges are very keen to see some of their children go across into high-quality tertiary education, with hands-on skills that lead to apprenticeships and high-quality trades. But it comes down to a question of where the money goes. I must mention the Manukau Institute of Technology, and Stuart Middleton, who has worked relentlessly on behalf of hands-on learners and who focuses his attention on how he can best do that. I think he will be very satisfied with this.

This Government has really focused on the youth guarantee, which relates to 16 and 17-year-olds. Hands-on learners are fascinated with learning. They have to have opportunities opened up to them where they can engage and get their hands on things. They design, build, and then understand why they must drill a hole in the right space, in respect of measurement and maths. They also have to be able to read and interpret plans and designs.

This bill takes us to another level. The Government has set a goal of starting at least five trades academies by 2011. I encourage everyone in the House to really get behind the initiative, because the biggest destructive aspect in education often is the politics. If we could get rid of the politics and get the cooperation going, we would certainly be doing a lot better.

I want to touch on an issue that is mentioned in Labour’s minority report. It talks about giving people privilege over one another, and it probably illustrates where we in the Government differ from the Opposition. When we turn to the Education Act 1989, we see section 11F, “How to select applicants who live outside home zone”. Subsection (1) states: “The order of priority in which applicants who live outside a school’s home zone are to be offered places at the school is as follows:”. The Opposition was saying that schools will manipulate their zones to exclude certain people and get the people they want. Well, members on this side of the House do not feel that that will be abused. That is a difference between the Government and the Opposition.

This is a very positive bill. It is relentlessly pushing forward to educational excellence, and I am pleased that the Government has had the internal fortitude to really make sure that tertiary education takes centre stage. I have pleasure in commending this bill to the House.

KELVIN DAVIS (Labour) : The main parts of the Education Amendment Bill (No 2) have been described by other speakers, but I will run through them quickly. As we have heard, secondary-tertiary programmes are part of this bill. It updates and clarifies the law affecting private schools, it changes the refund provisions for international students enrolled in private training establishments, and it exempts limited-attendance centres from early childhood education licensing standards to make it easier for recreational facilities, shopping centres, and similar organisations to provide short-term childcare. The bill also makes changes to school enrolment scheme priorities to make it easier for the children of board members and former pupils living out-of-zone to attend a school.

Labour will not support this bill because, as Trevor Mallard has said, a number of changes that the Labour members of the Education and Science Committee wanted were not included in it. I was not a member of that committee, but I have my own reasons for believing that this bill will do very little whatsoever to make a difference for the core purpose of education. This bill, in my opinion, tinkers at the margins. It does nothing to address what really needs to be addressed in education in order to improve outcomes for kids and in order to shorten the tail that we hear so much about.

Everybody in this House needs to realise that when it comes to talking about educational policy and educational legislation we need to fix on what will make the biggest difference in raising achievement. We make the biggest difference in raising achievement when we focus on teachers—no, not even on teachers but on teaching. It is not teachers who raise achievement; it is what teachers do that raises achievement. We will not raise achievement until our legislation and our policies send a laser beam down on what teachers do and how we can support them to better do what they do.

The person whom the Government refers to most of all when it wants advice on education policy is Professor John Hattie. He has done his best to create a science out of the art of teaching, and I agree with a lot of what he says. One of the big things that he says in his book Visible Learning is that teachers engage in about 136 strategies, and he makes it easy for us because he lists those strategies in order of what is most effective to what is least effective. He talks about strategies with an effect size of zero. Anything a teacher does with an effect size of zero will have no impact on learning. Of those 136 strategies, about five have an effect size of less than zero. So about five strategies actually make kids dumber. That means that all the other strategies do have a positive impact on student achievement. But there is no point fixating on those strategies that have an effect size just above zero. Professor Hattie says that the strategies we need to use are those that have an effect size of 0.4 or higher, because they are in the top half of the strategies that make a difference. He is not saying that we need to follow those strategies as a recipe and just tick them off; we need to focus our policy on those strategies because they have been proven to make the biggest difference in raising educational achievement.

Rahui Katene mentioned Te Kotahitanga. Te Kotahitanga is about the relationships that teachers have with their students. But on that scale that Professor Hattie talks about, relationships are No. 11. They are the 11th most effective strategy that can be employed. That means there are 10 other strategies or things that we can legislate for and can support teachers to do in their classrooms that will have a bigger impact on educational achievement than the Te Kotahitanga programme. And we all know that Te Kotahitanga is extremely effective.

It is not until this House fixes its educational legislation and its educational policies on those strategies that are proven to make the most difference to raising achievement that we will address the tail of underachievement and lift up everybody. I implore the Minister of Education, when she brings the Education Amendment Bill (No 3) to the House, to make sure that what is included in that bill focuses squarely on those strategies that are proven to be the most effective at raising achievement.

The secondary-tertiary programmes that are being talked about here probably will make a difference, I believe. They may not make a huge difference, but they may make some difference. What the secondary-tertiary programmes are doing is, as Colin King mentioned, providing another pathway for students to learn. They change the context in which they are learning. In themselves, they may not make a difference. It depends, again, on the teachers of the kids in the secondary-tertiary programmes; it is what they do that will make the difference. I think it is good that the Government is thinking along a different context.

I want to bring up something Allan Peachey said in a book he wrote, which I read while I was still a principal. He wrote that New Zealand is scared to allow students to specialise at an early age. I think we could be a bit braver in allowing students to specialise at an earlier age. We have in this bill the secondary-tertiary programmes pathway, and we already have the academic pathway that is going on in schools at the moment, and not all kids are successful at that pathway. We should try to think outside the square and come up with other pathways that students can participate in. One of the pathways that I believe we should look at is, quite simply, the art of teaching kids how to make money, how to use money, how to invest money, how to be entrepreneurs, and how to be enterprising. If students do not want to go off to a technical school or a practical school, or to do the academic stuff, but might want to set up their own business before they leave school, then that is a really worthwhile avenue that we could focus on.

Another strand could be that we allow students to specialise in sports. I am not saying that a sporting academy, for want of a better name, should be any less academically rigorous; it is just about changing the context of those kids’ learning, so that instead of learning in the traditional classroom with fours walls, a whiteboard, and a teacher standing at the front, they are learning in a context based on sports. If we look at the career pathways that that could lead kids into, we see that they could be trained to become All Blacks, or netballers, or rowers, but also sports managers, sports psychologists, personal trainers, physical training instructors, nurses, or doctors. It is all about giving kids a whole heap of options and pathways forward to their futures. We should not think that because we have secondary-tertiary programmes we are catering for all the needs of all the kids. I think we need to be brave and bold, and explore other pathways for children to achieve beyond their potential.

Finally, I am a very concerned about the limited-attendance centres not having to screen employees. It is very dangerous that people can just set up shop as an early childhood centre in a mall or shopping centre and start looking after kids. I think that is a really dangerous thing for us to pursue.

LOUISE UPSTON (National—Taupō) : I am always proud to speak on education legislation in this House, particularly as part of this Government when the largest amount of money ever is being invested in education. Budget 2010 is investing $12 billion in education because this side of the House recognises that education is so vital for this country, for lifting achievement, and for growing our economy. We recognise that this legislation, the Education Amendment Bill (No 2), covers a number of areas, and I thought I would just cover them briefly and also bring in some practical examples of how these changes will be applied.

The first one is the trades academies, which as part of this bill will be able to function with the flexibility that they need to provide options for people in our high schools. I am sure many members in this House will have been at high school prize-givings in recent weeks. I know they are always a time of celebration when we see how fantastic our young people are and how well they are achieving in a range of topics and subjects such as sports, drama, and academics. This is something that provides further opportunities to make some of the policies we have been elected on come to fruition. We heard a number of speakers talk about the technical changes we made in the select committee, particularly around the New Zealand Teachers Council. I will not spend any more time on that, because I think it has been well covered in this second reading debate.

In terms of the six broad areas, as I said, the introduction of secondary tertiary programmes gives greater opportunities for young people in secondary schools up and down New Zealand to spend time learning in a tertiary environment or in the workplace. This is allowing us to have some flexibility to provide learning opportunities for young people that will better suit their needs. I want to come back and speak in a bit more detail about the exemptions for the limited attendance centres from early childhood education licensing standards, because I think we have heard a bit of dramatisation about what this part is about. It is changing refund provisions for international—[Interruption] It is fascinating to hear the comments that are being thrown across the House.

Let us talk about it now. As a mother with three children, I have had my children placed in early childhood centres, but this is quite different from that. We are talking about someone like me, who perhaps goes to the gym for an hour to hop on the indoor bike, and there is a glass panel over there—my children are not in preschool any more, but they were, not so long ago—that I can see through to my 4-year-old happy child. It is my decision to leave my child there. As a parent, I really like having the opportunity to leave my child in an environment where I am not far away. It gives me the flexibility to undertake some exercise, and we all know, particularly with Diabetes Awareness Week this week, how important it is for parents to be able to engage in exercise and for a gym to be able to offer that as a service.

If I as a mother make a choice to do that, it is my choice as a parent to do that. Therefore, there is some responsibility on me to be comfortable with the environment that I am leaving my children in. I trust parents to be able to make a decision if they want to go to the gym for an hour, to leave their child just over there where they can see them. It is the same with Sunday school. At Sunday School, if I want my children to be looked after for a couple of hours while I am in church, in the building next door, then actually I am quite comfortable with the fact that the person who is with my child or children for perhaps an hour or less—a maximum of 2 hours—will not be teaching them how to read, write, and do maths. I am quite comfortable with the fact that they are going to be looked after, which is very different from the rigour of the regulations that are required for a licensed early childhood centre. So this is about just bringing some common sense back to this sort of area.

I think back to when the present Opposition made this change initially, and I think back to some of the comments, and the horror and disgust and annoyance, from parents because of the overly bureaucratic, nonsensical regulations that that Opposition, when it was in Government, wrapped around a centre like this one—limited attendance. I am pleased I was able to put the record straight on this, because this is another measure that this Government is taking to get rid of stupid bureaucracy—absolutely stupid bureaucracy—and measures that assume that parents do not have the ability to make a decision for their children, and for parents to be able to exercise, perhaps for an hour in the gym, while their children are just there.

What else? The other thing I was really excited about in this bill relates to the member’s bill I put forward—I put it in the ballot—to change enrolment zones for schools. I was very excited when the changing of priorities was brought into this legislation, because it allows for children of board members and former pupils to get some priority in the enrolment schemes. This is important, and it is why I put it into the ballot in the first place, because I recognise that schools have a strong sense of community. I think it is really important for the achievement of children to have some connection to the school they are with, and those connections are often stronger and those bonds are deeper when they have a parent who has been there—obviously siblings are already one of the priorities—and also the pupils of board members. Board members have a strong connection to the school, and it makes sense, in terms of keeping that connection strong, that their children should be given priority to enrol in that school. I am proud of that amendment, which has been put into the Education Amendment Bill (No 2) as a result of a member’s bill that was on the ballot, and adopted to be incorporated into this legislation.

What else does the legislation do? We have talked about the limited-attendance centres. I could speak quite happily for 10 minutes on that subject alone, because I think it is so important. I will come back to a comment that was made earlier in the House about cuts to early childhood education, because I am sick to death of that comment, when I think that—and this is where the maths lesson comes in—an extra $107 million has gone into early childhood education.

Sue Moroney: It’s true. Go and visit the early childhood education centres in Taupō.

LOUISE UPSTON: That is a plus sign. How is the member’s maths? One hundred and seven million dollars extra has gone into early childhood education, so that people in my electorate, the Taupō electorate, can access early childhood education. I believe that every child has the right to a place in an early childhood centre. I am really thrilled to be supporting this legislation, because we are a Government that is committed to education.

DAVID SHEARER (Labour—Mt Albert) : First of all, I will say a few words on the cooperation that happened at the Education and Science Committee in respect of the Education Amendment Bill (No 2). We have voiced some of our real opposition to the bill, but at the select committee itself there was some reasoned and good discussion around the some of the issues. But, ultimately, they went to the Minister of Education and were turned down, and I think that is very sad. I am pleased that the Minister, Anne Tolley, is in the House, because in a minute I will talk about limited-attendance centres, which are an appalling part of this legislation.

This bill is a mixed bag. There is the good, the bad, and the downright ugly. I will go through a couple of the bill’s provisions that are reasonably good. One of them—some members have already spoken about this; Louise Upston talked about it, as well—is the interface between secondary and tertiary. I am not 100 percent sure that this needed to be legislated for in the way that it was. Nevertheless, it does provide some opportunities for kids, particularly as they progress through secondary school, and it helps them transition into tertiary education in a way that will help them and ensure that some them stay at school longer, continue on to acquire more and better skills, and, therefore, move into tertiary education.

New Zealands needs, perhaps more than anything else, well trained and well-educated young people coming into the workforce to upskill it, and this bill will help in that regard. I acknowledge Colin King’s mention of Stuart Middleton, who was a former teacher of mine when I was in the seventh form, and who is still going strong with passion and zeal at the Manukau Institute of Technology.

The bill will enable the Minister to approve a board of trustees, a registered private school, a tertiary institution, or an industry training organisation as a lead provider of a secondary-tertiary programme, and then they can enter into a partnership or an agreement. The agreement or partnership is specified in the legislation. It will help 11 to 13-year-old students in particular to continue on. Some parts of this legislation are useful, but it is basically housekeeping. There is a tightening up in the international education area. Growth in the international education sector happened largely under the Labour Government. It is now a $2 billion industry. It needs to be well legislated for in order to ensure, as this bill does, that there is no waka jumping between various institutions and that the international education arena maintains standards and stability. That is a useful tightening of the legislation and it needed to happen.

Members have spoken about hereditary entitlements to attend schools. I am of the opinion that schools should be of excellent quality no matter where they are, and that if an element of competition is introduced, all that happens is the school that is most favoured—the best school of the day—gets bigger and bigger at the expense of the school down the road. As Mr Peachey knows, that can reverse when there is a change in the economic status of a particular area. When that happens, immediately people start flowing out of that school and into another school, which then gets bigger and bigger, and the first school is left with empty classrooms. It is inefficient in a State education system. What we have at the moment works. Although we do not necessarily agree with the provisions in this bill, it not necessarily something that would cause us to oppose it.

What causes us to oppose it, more than anything else, is the provision that brings in limited-attendance facilities. I will refer to two of best submissions the select committee had on this particular subject. Sue Moroney has mentioned the submission made by the Human Rights Commission. The submission mentions, of course, that the bill proposes to amend section 310(2) of the Education Act 1989 so that the limited-attendance centres would no longer be regulated as early childhood education centres. Labour does not have any problems with the education element of this, but it does have a problem with the lack of safety and care for children.

This is what the Human Rights Commission said: “The Commission understands there is doubt to as to whether staff in LACs would be required to undergo a police vetting check. We welcomed the Minister’s reassurance during the Bill’s First Reading that it was not the Bill’s intention to remove vetting, and we strongly recommended that such checks remain mandatory”. That did not happen. The Human Rights Commission was warning us. We had solid evidence from the Human Rights Commission and the New Zealand Educational Institute, which said more or less the same thing—that it was a cause for worry.

Louise Upston mentioned that she is OK about it because she goes to a gym and her gym has a glass panel. There is no requirement in the legislation for children to be visible from a gym. There are lots of gyms and lots of shopping centres that do not have that facility. The person responsible for the children is not required to have a police check. Would that not be the first thing that we would want to do if we had someone looking after our children? Would we not like to know that that person is not a child abuser? I would like to know that. I would like to think that I could leave my children at a gym and not have to ask about that. I would like to think I would not have to ask whether the person who is looking after my child has been vetted and is OK to look after my child.

Let us look at it another way. Why do we not have a sign outside all of these limited attendance centres saying: “Please note that the Government accepts no responsibility.”? Why do we not have a sign saying: “This person not been vetted for child abuse. This person does not necessarily have a first aid certificate. This person may leave children unattended while they go to the bathroom. This person does not necessarily have any qualifications or any knowledge about children and childcare.”? Let us have a sign outside every limited attendance centre saying that.

This legislation is effectively saying that this Government accepts no responsibility. This bill is an appalling bill. It goes backwards. [Interruption] I say to Louise Upston that it has nothing to do with over-regulation. That is complete nonsense. It has nothing to do with over-regulation, but it has everything to do with the safety of young people in this country. In a country that has some of the highest levels of child abuse in the world, we are enabling child abusers to go into these sorts of centres and wreak havoc. I do not believe that Louise Upston actually wants that to happen, but that is what this bill will do. That is what the Minister of Education is allowing to happen.

When the first instance of child abuse happens, I wonder what the Minister will say. It will be very interesting to hear what the Minister will say. She will say: “It is not my fault. It is the parents’ fault. They knew that nobody there knew how to look after children. The parents knew that nobody there was trained. The parents should have known that nobody there knew anything about first aid.” That is what will happen.

As Mr Mallard said, with this legislation we are opening the doors for child abusers and rapists to be in places like this and to abuse our children. I do not think it is good enough. It is kind of ironic that this Government has also brought in national standards—uselessly, I would argue. My child’s report arrived the other day, under the new national standards reporting facility. It is incomprehensible. I have no idea what it says compared with what it said a year ago—absolutely no idea. The Government is bullying schools to bring in national standards, but it is completely leaving out the most important thing, which is the safety of our children. It is absolutely appalling.

JO GOODHEW (National—Rangitata) : If ever there was an opportunity to see the philosophical differences between members on that side of the House and members on this side, now is the time. I will not spend a lot of time on the Education Amendment Bill (No 2), because I think a lot of it has been said, but the one thing that I want to finish on is very simply—

The ASSISTANT SPEAKER (Eric Roy): I know that there is a degree of strong feeling about this bill, but a constant barrage is out of order. Members should look at Speaker’s ruling 63/4. It does not stop members from making a point, but a constant barrage is disorderly.

JO GOODHEW: Thank you for your assistance, Mr Assistant Speaker. I want to put a very simple point on the record. Members on this side of the House believe in rational thought. We believe in people taking responsibility for themselves. We believe that people who go into business want to protect their businesses, and that people who are in the business of looking after young children, albeit for just a short period of time, will run police checks on the people who work for them. It does not need to be regulated or legislated. They will make sure they know how to give first aid; it does not require a law. Members on this side of the House, unlike members on the other side of the House, know that it will happen without those people being told to do it. That is probably a very good place to finish.

IAIN LEES-GALLOWAY (Labour—Palmerston North) : I am slightly surprised to be on my feet and taking a call on the Education Amendment Bill (No 2). People who are regular watchers of Parliament will know that Labour has taken up its full number of calls, but the Government—in particular, the Government’s junior partner, the ACT Party—for some bizarre reason has chosen not to take its calls on a bill that you rightly pointed out, Mr Assistant Speaker Roy, is raising a lot of passion and a lot of concern. I think the Government should be taking its full number of calls to explain to the public why this bill is a good bill, to explain why it is urgent, and to explain why putting New Zealand’s children at risk of harm is such a good idea—

David Shearer: Under urgency.

IAIN LEES-GALLOWAY: —under urgency. This Government is shirking its responsibilities and it does not even have the guts to stand up and tell New Zealand why it is doing so.

As has been made quite clear by Opposition members, we oppose this bill. Although it has a number of fairly inconsequential matters in it, a number of things in it are of such consequence that it is clear we have to oppose this bill. One key area is the exemption of limited-attendance centres from early childhood education licensing standards, and, in particular, the requirement for those taking care of young children to undergo a police check to make sure they are of good enough character and do not have anything in their history to suggest they are unfit to take care of small children. The other area of particular concern to us is, of course, the hereditary entitlement for children who would not ordinarily qualify to go to a school within a certain zone to be bumped up the list. Jo Goodhew mentioned ideological differences; I suppose that the idea of inherited entitlement is an ideological position of National. It fits quite well with those members, so it does not come as much of a surprise. [Interruption] What was that, Colin? Mr King has something to say.

Colin King: It fits very well with yourself—entitlement.

IAIN LEES-GALLOWAY: The member has lost me. He has lost most people in New Zealand, to be fair.

I will address some of the comments made by Louise Upston. I have had a chance to spend some time with Louise Upston away from Parliament, and I know that she is passionate about education, but I thought that some of her contributions on this bill were, at times, somewhat nonsensical. She started off with the old chestnut that the Government is spending more than ever before on education. That is absolutely true. It is true because every single year every single Government spends more on education than it did the year before. It is just like health. The question is whether that increased funding is keeping up with inflation and whether it even allows the system to stand still. It does not matter whether the Government is spending more; Governments always will. That is one thing we can rely on. Death, taxes, and Governments spending more on health and education—those are the three certainties in life. But to get up and crow about it and say it is something special that this Government has achieved may show that the Government has achieved so little that its members need to crow about something as insignificant as that.

Louise Upston went on to say that trades academies will be able to function with more flexibility. That is not true. The policy legislated for in this bill, first of all, did not particularly need legislation, anyway. It is one of the schizophrenic parts of this bill. On the one hand the Government seeks through this bill to cut red tape, but on the other hand the bill is unnecessarily bureaucratic with regard to its provisions for secondary and tertiary education. Trades academies will not be able to function more flexibly. Ms Upston—

Louise Upston: Mrs.

IAIN LEES-GALLOWAY: —OK, Mrs Upston—talked about many members having recently attended prize-givings around the country, and that is true. I have, and probably just about every other member has. I have seen plenty of awards being handed out by trades academies and industry training organisations to school students who have been engaging in the transition phase between secondary school and trades or tertiary education. A number of students have been studying at university level, as well, which is pleasing to see.

Sue Moroney: Not new.

IAIN LEES-GALLOWAY: It is not new. Louise Upston said it was a very important policy that National had stood on at the last election. Well, that is interesting, because it was Labour policy. If National members are proud of Labour policy, then that is good news. We will take that one, and notch up another one for Labour.

With regard to limited-attendance centres and glass panels, Louise Upston focused a lot on the fact that her gym has a glass panel and she can see her children through it. First of all, this bill is not just about centres at gyms; it is also about centres at shopping centres. The weight of responsibility should not sit on parents’ shoulders when they go to a shopping centre. Parents should not have to figure out whether the centre has employed someone who is capable of taking care of their children. They should have that certainty. Parents should have the certainty—

Sue Moroney: Anne Tolley says they should just ask them.

IAIN LEES-GALLOWAY: That is right; Anne Tolley says they should just ask: “Excuse me, are your staff members child sex offenders? Could you tell me about that, please?”. I would like to see the Minister of Education going into a centre and asking that question. Parents should not have to ask that question. They should have certainty available to them. The Government is saying to parents that the Government takes no responsibility. If something goes wrong and a parent’s child is abused, the Government says: “That’s your fault. That’s your responsibility. You should have taken more care about where you left your children.” That is absolutely wrong. It is far too much to leave up to parents. Parents should have certainty. The Government should create an environment where parents have certainty.

Jo Goodhew said that businesses will not want to put themselves at risk. I think that is a fair call. For the most part, businesses will not want to put themselves at risk. But these provisions are not about early childhood centres that have an interest in the well-being of children; they are about businesses that have nothing to do with children whatsoever—be it a gym, a shopping centre, or whatever it is. They are not people whose bread and butter trade is dealing with children and the safety of children. When the squeeze goes on, as in the post-recession times we are in at the moment when costs are being cut and people are looking for every last little place where they can cut costs, maybe it will be overlooked; maybe the police vet that National members say the business will take responsibility for will be overlooked. Why? Because the business does not need to do it. It is a cost that it does not have to include, and overlooking it might just help make the bottom line look a little better.

I agree that 99.9 percent of the time things will go smoothly, but would the Minister like to be the parent of the child involved in that 0.01 percent situation? Would the Minister like to be the parent of that child?

Hon Anne Tolley: Ask the centre.

David Shearer: Pass the buck!

IAIN LEES-GALLOWAY: Yes. The Minister says that it is not her responsibility as the Minister of Education, as a Minister of the Crown in this Government, to create an environment in New Zealand where children are safe and where parents have certainty about the safety of their children. “It’s not my responsibility.”, says the Minister of Education. How about that for a message to the parents of New Zealand. The Government says it is not prepared to ensure the safety of children in New Zealand. That is the message the Government is giving in this bill.

Hon Anne Tolley: That’s not right.

IAIN LEES-GALLOWAY: That is absolutely right. That is the message that you are sending to New Zealand.

The ASSISTANT SPEAKER (Eric Roy): Order!

IAIN LEES-GALLOWAY: I am sorry; that is the message that the Minister is sending, certainly not you, Mr Assistant Speaker.