Hon PETE HODGSON (Minister of Transport) : I move, That the Transport Legislation Bill be now read a second time. I would like to thank the members of the Transport and Industrial Relations Committee for the excellent work they have done on this bill. Regulation of the civil aviation, land transport, and maritime transport sectors is carried out under the Civil Aviation Act, the Land Transport Act, and the Maritime Transport Act. This bill amends all those Acts.

The select committee listened very carefully to the submissions that were received and has made a number of changes to the bill as a result. I support those changes. This is an important bill. The Government is committed to achieving the New Zealand Transport Strategy’s vision of an affordable, integrated, safe, responsive, and sustainable transport system by 2010. The Government’s achievement of this vision will see New Zealand moving again.

This bill implements key recommendations of the Government’s transport sector review. The review is conducted to ensure that the Crown transport sector is well placed to help the Government to achieve its transport vision. The bill as introduced contained measures to broaden the objectives and functions of the Civil Aviation Authority and the Maritime Safety Authority to align with the New Zealand Transport Strategy, to dissolve the Land Transport Safety Authority and Transfund New Zealand and replace them with a new Crown land transport entity—Land Transport New Zealand—and to integrate safety funding with other land transport funding.

It was pleasing to see that most submissions supported the bill, albeit with some qualifications. I take this opportunity to discuss some of the changes made to the bill by the select committee as a result of the submissions received. The transport sector review recommended that the focus of the various transport entities be expanded beyond safety to the broader approach in the New Zealand Transport Strategy. However, the review also emphasised the need to ensure that safety remained an important priority. The committee heard from a number of submitters who, although generally supporting the broadened focus of the New Zealand Transport Strategy, were concerned that the bill diluted the focus on safety.

The committee took these concerns very seriously. It has therefore recommended a number of changes to ensure that there is no doubt that safety remains a priority for the Minister and the transport entities. I endorse these recommendations. Among a number of technical changes to clarify the hierarchy between the Minister’s objectives and functions and those of the transport entities, the committee has recommended that the Minister be given a new function under the various Acts to promote safety. This new function would mirror the functions of the transport entities, which must also promote safety.

As well, the committee has recommended that the criteria that the Minister must take into account when establishing rules be strengthened with regard to safety. These criteria list a number of factors that the Minister must take into account, including the costs that particular rules might impose on the industries that are subject to the rules. Rather than taking into account the need to assist safety, the committee has proposed that the Minister take into account the need to maintain and improve safety. The committee has also recommended some refinements to the powers of the various directors who have regulatory functions under the various Acts.

In addition to the changes suggested in this safety context the committee has also recommended a number of clarifications to take into account the fact that, in the future, rules will be made for purposes other than safety. A significant policy initiative of this bill is to integrate safety funding with other land transport funding through amendments to the Land Transport Management Act. To achieve this integration, the requirement for a safety administration programme is being replaced by a new requirement for Land Transport New Zealand to complete a land transport programme. Land Transport New Zealand’s land transport programme would contain all those activities that it and the New Zealand Police wish to undertake, including those previously contained in the safety administration programmes—for example, safety information campaigns and road policing.

The funding of this programme will then be determined in the broader context of land transport funding decisions made by the new entity. In the interests of promoting integration the bill allows approved organisations, such as local authorities, to include Land Transport New Zealand’s proposed activities in their land transport programmes. This means that proposed activities of Land Transport New Zealand and the New Zealand Police can be considered in the context of, and at the same time as, the activities being considered by approved organisations.

Approved organisations must consult on their land transport programmes, as must Land Transport New Zealand on its programmes. The committee wanted to make it clear that Land Transport New Zealand need not consult on any activity included in an approved organisation’s land transport programme.

The committee has also recommended a new name for the Maritime Safety Authority. Instead of the name proposed in the bill, the committee has recommended the name “Maritime New Zealand”. The committee has also recommended that the name change be delayed until 1 July 2005. The new name is broad enough to encompass safety while encompassing broader maritime objectives. Some submitters were concerned that a name change could compromise the Maritime Safety Authority’s relationship with industry. The delay in changing the name is sensible because it will ensure that the change process can be managed well and allows plenty of time to communicate the new name to the industry.

I intend to move amendments in the Committee stage and to lodge a Supplementary Order Paper at an appropriate time. One amendment, by way of a Supplementary Order Paper, will give the Minister responsible for the Maritime Transport Act the additional function of protecting the marine environment. Another amendment clarifies that the regional land transport committees must have a membership that reflects the balance of the five objectives of the Land Transport Management Act and that people appointed to represent those objectives should come from the wider regional community, rather than from regional councils or territorial authorities.

Once again, I thank the select committee for the work it has done on this bill.

Hon MAURICE WILLIAMSON (National—Pakuranga) : If ever this House wanted to hear from a Minister a speech that contained raw passion, if ever this House wanted to hear a speech from a Minister who was committed to his portfolio, if ever members of this House wanted to be riveted to their seats by a staggeringly focused speech, that speech was not it. That was the dullest defence of any legislation before this House that I have heard, from a Minister who is clearly bored with his portfolio.

The National Party is very sad about this legislation because we could have been happy to support the vast bulk of it. It was a review of the transport organisations and a review was required. We still support some of what has been done on this bill, even though we will be voting against the legislation. I will come to the specific reason that we will vote against it at the end of my speech, but I will start with some of the good bits. I think the first really, really good bit is that it takes the policy advice functions away from the Land Transport Safety Authority and moves them back into the Ministry of Transport where the Minister has some—and I will not be so bold as to say a lot—of say over the way the ministry functions. From my experience as Minister, the Minister had almost no control over the Land Transport Safety Authority. It was a law unto itself and did what it wished. That is a good move and I think we should give the Government a tick in that column. Moving policy staff back to the ministry, where they will have to work hand in glove with the Minister about what is going on, is a good move.

The second move, obviously, is to take Transfund—which I am very proud to take the credit for setting up—split it away from Transit, and move it into the combined organisation called Land Transport New Zealand, which is a combination of the Land Transport Safety Authority and Transfund. There is some merit to that as well. We do not need two boards, two bureaucracies, two chief executives, and so on if there will be just an operational unit, which is what Land Transport New Zealand will be. Again, the National Party is happy that those two bodies have been merged. We were nervous that Transfund’s focus on what its job was would be muddied by this, but it has not been. It is a good move. We will see Land Transport New Zealand become far more focused on land transport outcomes. It is a move that we support.

Some of the legislation, I have to say, is a little bit silly. We have got to the point of renaming the Maritime Safety Authority. The debate that went on in the Transport and Industrial Relations Committee about different acronyms had to be seen to be believed. I will not even give some of them, because they ended up being so rude when all the letters were put together. Well, Mark Peck screws up his face, but I will tell him later what some of the words turn out as, if one takes the words “maritime”, “safety”, “authority”, and a few others. However, I will not put them in, because I will be tempted to give what the words were. But, no, we have come to the momentous decision—and this is something that New Zealanders have been lying in their beds at night worried about—that the Maritime Safety Authority’s new name will be Maritime New Zealand. It will rip a whole part of our society’s fabric to pieces, because of that renaming.

What I was interested in and was really looking forward to was the Labour Party’s promise from the 1990s that it would repeal the Maritime Transport Act. I was looking to see Mark Peck and the submarine Plimsoll line brigade who waged war in this House for months about the disgraceful Maritime Transport Bill. They said that when they became the Government of New Zealand, they would repeal it overnight. It would be gone, not by lunchtime, but before breakfast. It was that dreadful Maritime Transport Bill. Where are we? Have we passed Labour’s 5-year anniversary? No, it is coming up to the 5-year anniversary of the Labour Government, and there has been not a mutter, not a murmur, and not a sausage has changed from that legislation. Labour members said that it was—and many people can check Hansard if they want to look at it—the most obnoxious, disgraceful, and evil legislation in maritime transport history. I looked with great passion at this Transport Legislation Bill, and thought: “Well, obviously my good work in the mid-1990s in terms of the Maritime Transport Bill will go for a burton, once the Labour Party gets its hands on it.”, and 5 years later, those members have not touched it.

The reason the National Party is opposing this bill can be seen in our minority report in the commentary on the bill. I will read from it so that those thousands of listeners out there in drive time can hear the reason. “This legislation removes the wording ‘a cost is a reasonable cost where the value of the cost to the nation is exceeded by the value of the resulting benefit to the nation’ from all civil aviation, maritime and land transport legislation.” That is what has always been known in the vernacular as “safety at reasonable cost”. Why would one be opposed to that? Why on earth would one not want that to be the talisman touchstone of the legislation? Some lunatic Minister in the future, maybe from the Greens or whoever, could decide that: “I know what I’m going to do. I don’t care what it costs the nation. I don’t care how much the cost is, and there are almost no benefits. I’ve decided that we’re going to move logs by pushbike in this country.”, and that is what that Minister could go ahead and do. Members of the Labour Government laugh, but we must have no doubt about it. If the Greens get some control in a joint Labour Cabinet, that is exactly how logs will be transported—over the Kaimais on pushbike.

But the Government could have kept what was, as I say, the touchstone of all transport legislation. People appeared before the select committee, like Tony Friedlander from the Road Transport Forum, who was quite complimentary. He said that he thought the legislation was OK, but he asked why on earth we were removing the criteria for safety at reasonable cost. It is just a barrier; it stops ludicrous behaviour. So when a Minister wants to do something new in the transport sector, he or she has to sit down and do the numbers. The Minister will say that: “The cost of doing this is X million dollars, and the benefits to the nation are Y million dollars, and as long as Y is bigger than X—that is, the benefits are greater than the cost—let’s go to it.” But if one does the currents under this legislation, if it goes through, one can see that where the cost will be X million dollars and the benefits might be zero, the Minister can still allow it to proceed.

National’s minority report further states: “New Zealand National has serious concerns that the safety at reasonable cost concept has been significantly diluted. The new and undefined concept of ‘sustainability’ …”—and I will repeat that; it is “undefined”. We hear so many speeches from the Labour members about sustainability of transport, and it is a wonderful word, and it is a beautiful and warm, warm word. Many of us spend our weekends with sustainability on our mind, but it does not provide any definition, and it does not provide the longstanding economic discipline that was enforced through the safety at reasonable cost provision.

Finally, if this House wants one better reason to vote against this legislation, I refer members to clause 30, which inserts new subsection (4A) of section 15. Members should listen to this, as it is a blinder. Subsection (4A) states: “When preparing a land transport programme under section 12A, the Authority must—(a) consult—”, and I will go through it. For members of the Labour Party who do not even know how to spell land transport programme, it is to do with what roading and other transport initiatives will be conducted that year. The Land Transport Authority must consult “(i) Transit; and (ii) every affected regional council; and (iii) every affected territorial authority; and (iv) every affected approved organisation; and (v) the Ministry of Health; and (vi) the Accident Compensation Corporation; and (vii) the Commissioner; and (viii) the Secretary; and (ix) the Ministry of Justice; and”—it all sounds fine—“(x) land transport users and providers; and (xi) affected communities; and”—

Mark Peck: Yes.

Hon MAURICE WILLIAMSON: I am with Mr Peck so far. There are ticks all the way down. Then the next one is: “(xii) Māori; and (xiii) the public; …”. Well, what does that mean? Does that mean that Māori are not members of the public? Does that mean that they are not represented by their territorial authorities and so on? This is the same Government that preached and screamed: “We do not have racist legislation on our books. We do not tolerate racist legislation. We do not want to target any group because of their race.” But in this legislation, the Government is picking Māori out for special consultation on a road programme, far, far above any other member of the public.

DAVID PARKER (Labour—Otago) : I will not speak quite as loudly, but hopefully with close to the passion of the Hon Maurice Williamson, a former Minister of Transport. But it was sad to listen to that speech. He does identify the major components of this legislation, which will further improve our transport system by, amongst other things, creating a new agency: Land Transport New Zealand. Mr Williamson agrees that it is appropriate that the Land Transport Safety Authority of New Zealand and Transfund be merged into this new organisation. It is important that the policy arm of the Land Transport Safety Authority come under greater control of the ministry and, therefore, that we have a more accountable government for the transport industry as a consequence.

We are helping to fix the transport industry in New Zealand. We are unlocking Auckland roads. Despite the major parts of this legislation being favoured by the National Party, those members say, because of politics—although they do not say that it is because of politics, it is because of politics—that they will vote against the legislation. This is good legislation. I encourage National members to follow up on what they say about the merits of the fundamentals of this legislation, and to cast their votes in favour of it.

BRENT CATCHPOLE (NZ First) : I just listened to David Parker make a comment about unlocking Auckland’s roads. Really, Mr Parker ought to go up to Auckland some time and just see how difficult it is, and how difficult it will be, to unlock Auckland’s roads, as he says. This legislation will not unlock them. One of the problems with this legislation is that it has too many flaws in it. Unfortunately, the flaws do not overcome all the benefits. The main benefit of this legislation is that it will provide safety mechanisms, and that is one of the areas that New Zealand First has to support in this legislation. It is safety first. Unfortunately, the Minister has allowed this bill to be worded in such a way that it removes safety at a reasonable cost. Why on earth would one want to remove that part of the legislation and allow safety to be put into a numbers and cost basis?

What will happen with this legislation is that it will provide competition, and one of the disadvantages of competition is that something has to give. The thing that gives under competition is safety, and safety mechanisms. Sadly, the Minister has allowed safety at reasonable cost to be removed from this legislation.

New Zealand First hopes that the Government’s new Land Transport New Zealand will be more of a business model and business operation, that it will be progressive in its thinking, and certainly progressive in the way that it approaches New Zealand roads, to bring it into a satisfactory area for the 21st century. Without decent roads in Auckland in particular, and throughout the country, land transport in this country will grind to a halt.

The legislation also covers maritime transport. It is an area that we find rather strange when we consider what the difference is between land transport and transport by land. They are quite different when we consider that in this bill “transport by land” includes coastal shipping and also includes transport by means of harbour ferries. I wonder at what stage the harbour will dry up so that we will be on the land. It is one of those sad anomalies that the Minister allowed such legislation to include the wording as it is. That takes away from the whole—

Hon Harry Duynhoven: If it is a bridge between the two islands it is OK, but if it isn’t, it is not—is that what the member is saying?

BRENT CATCHPOLE: The real transport Minister, Harry Duynhoven, has made the comment that if we fill in the gap between the North Island and the South Island, then we will not need the ships across there—it will just be land.

Hon Harry Duynhoven: You have just answered your own question because you are not very bright on this.

BRENT CATCHPOLE: Mr Harry Duynhoven has made comments on filling in the strait.

New Zealand First has major concerns about this bill. The concerns are such that we hope we can work through them. We consider that safety is paramount, and we are sad that the phrase “safety at reasonable cost” was removed, therefore allowing for competition. I will go back to the matter of competition, because where it endangers the lives of New Zealanders, it is, I think, a dangerous line to take. We hope the Minister will reconsider this and look a little bit closer at the potential for competition and the fact that he has removed “safety at reasonable cost”.

I conclude by just saying that New Zealand First will have to support this legislation because of the safety mechanisms, but we are disappointed that “safety at reasonable cost” has been removed.

MIKE WARD (Green) : New section 14 inserted by clause 5 states that the objectives of the Minister under this Act are “(a) to undertake the Minister’s functions in a way that contributes to the aim of achieving an integrated, safe, responsive, and sustainable transport system; and (b) to ensure that New Zealand’s obligations under international civil aviation agreements are implemented.”

I want to concentrate on paragraph (a) and, in particular, focus on the sustainability provisions. During the hearings and deliberations on the bill, much was made of the emphasis on sustainability. There is little doubt in my mind that efficiency and cost-effectiveness will inevitably be considerations when deciding on our transport solutions. There can be no such certainty, going on past experience, that the sustainability and the impact of our transport solutions on the social and environmental fabric of our communities will get the same consideration. In fact, there is little evidence that any attention has been paid to the impact of New Zealand travelling habits on the lives of the travellers, or on the environment through which they travel, or to the contribution of those travel habits to the twin threats of peak oil and climate change.

The Western World’s fascination with roads and automobiles continues to constitute the greatest contributors to global warming and the depletion of fossil fuel. Nothing else has the same contribution. While motorcar devotees wax lyrical about the convenience of the private motorcar, it is worth noting that we have never spent so long in getting to the places we need to be, or so much time or money on travel.

In my childhood many of the products we bought and used were sourced from our own communities, and most people were wise enough to live close to the places where they worked, played, shopped, and went to school. Those factors alone contributed greatly to the amount of leisure that people enjoyed, the safety of our streets, the quality of our air and water, and our ease of access and participation in the lives of our communities.

Some of us saw in the Land Transport Management Act not merely a revolution in transport management, but the possibility of addressing many of the other absurdities of 21st century living. The Act alone was unlikely to be sufficient to deliver the necessary changes, without changes to the authorities charged with administering it. This bill provides some of those changes.

The very least we could hope for is an improvement in public transport services, and in cycle and pedestrian facilities. But if we go no further than making it possible to continue moving people and products unnecessarily, even by more efficient means, then we will have missed out on an opportunity to create communities that genuinely enhance the quality of our lives and the quality of our surroundings. More important, we are likely to have missed out on a last opportunity to make a meaningful contribution towards avoiding the catastrophic consequences of climate change.

Climate change is a reality, is already happening, and is already affecting the weather in our country, but much more seriously in other countries, and that can only increase exponentially. I barely deliver a speech these days—I do not think I have delivered one for some months—without commenting on the extent of global warming. I think it is worth remembering that in the last 240-odd years carbon dioxide levels have increased by something around the vicinity of 90 parts per million—a one-third increase in the space of 240 years. This century, if we are lucky, it will double. It may travel to the highest levels in something like 40 million years, when sea levels, I might add, were 12 metres higher than they are now. It may not happen, but even if there were the remotest chance that it would, I would have thought we would be a little more careful. This bill is part of the measure to be a little more careful.

It is doubtful whether Transit New Zealand, with its very considerable skills in road building, or the Ministry of Transport, has the expertise or the experience to attempt the more ambitious goal, but the Green Party’s support for this bill is predicated on an understanding that the Minister is fully aware of the lack of expertise, and committed to finding it.

So what are the new skills? Well, most of our communities have never had to look beyond providing roads, and many have not begun to think beyond the needs of those with motorcars. The Land Transport Management Act obliges them to look at public transport and cycleways, and the needs of those who choose not to drive, or who cannot drive—they can no longer be ignored. However, it is unreasonable to expect each local authority to come up with the kind of expertise that it requires to wean people away from generations of motorcar dependency. It is not enough to provide services; genuine demand-management requires that we go out into the schools, the homes, and the workplaces to find out what the travel needs of people are, to make sure that the alternatives are in place, and to craft, if necessary, individual transport plans for the people in those communities—in our communities.

It is already happening in other parts of the world—Western Australia does it well, Perth has done it, by going out and doing just that: going into the neighbourhood and asking where people go, what time they travel, and when they come home again, and then pointing out that there are other ways of doing it. We are talking about a culture shift, a behaviour change, a move away from age-old practices that perpetuate, as ought to be patently obvious, what is bizarre and unsustainable.

I am delighted that Maurice Williamson foresaw the possibility of Greens having a greater say in transport management. We share his optimism. Brent Catchpole talked about the importance of roads. Unfortunately, that is what we have done whenever we have thought about transport in the past—we have assumed that that meant building more roads. I was up in Auckland recently. I was looking at its transport management, which is a very carefully managed transport system. For $180 million Auckland will get 20 kilometres of busway. That 20 kilometres of busway will potentially carry as many people as four lanes of motorway. I also saw 3 kilometres of motorway proposed, costing $160 million. Compare that with 20 kilometres of busway costing $180 million. The value is fairly clear.

He also made references to coastal shipping, as if somehow that was strange. If, in fact, shipping provides a smarter way of moving products, then that is the choice that communities need to make. If barges provide it, that is a choice that communities need to have open to them. If ferries are the choice, that is the choice that people need to have open to them, and this bill provides for that.

Each community will have the task, and has the task now, of preparing its land transport management strategy. These strategies are obliged to assist economic development, assist safety and personal security, improve access and mobility, protect and promote public health, and ensure environmental sustainability. The authority that oversees these has a responsibility to make sure that those transport plans do that. I am concerned that that expertise will be there so that they can make sure that these land transport management strategies are adequate.

My experience of writing these in the past is that they have been ignored more often than they have been observed. But under the Act, and this legislation, we in the Green Party are hopeful that we are making a step in the right direction, not merely in providing good transport, but in providing the kinds of communities that have a future. The kinds of communities and the kinds of behaviour that we are part of now probably do not have a future, certainly not an affordable future.

We found out last year, when we began the land transport management legislation, that, in fact, the Auckland mayors were asking for $5 billion to solve their transport problems. Most of that was aimed at building roads. By the end of the year, I think the figure they were asking for was $8 billion. By May of this year they were asking for $10 billion. If one is prepared to spend that kind of money, then there have to be smarter ways of spending it. Persuading people to change the way they travel rather than simply perpetuating the kinds of unsustainable habits that we have become accustomed to has to be the way to go.

So the Greens are supporting this legislation. We are delighted to have supported it all the way through. We are delighted to have supported the Land Transport Management Act, and we believe that it points to a future that my children deserve and that I think the world is actually crying out for in terms of examples of how we might live.

DEBORAH CODDINGTON (ACT) : I rise on behalf of the ACT party to say that we supported the referral of the Transport Legislation Bill to the Transport and Industrial Relations Committee, but as it is still bad legislation we are voting against it. The bill was meant to focus on the reorganisation of the Crown entities involved with transport, but it has gone far too far and it actually codifies the New Zealand Transport Strategy. People may remember that strategy was written by the Greens and Heather Simpson—that is the worst-kept secret in New Zealand—and it completely refocuses transport. People will be listening to Parliament and thinking: “Goody—more transport legislation. We are going to get across Auckland and get to our appointments on time. We will be able to pick up our children on time. We are going to be able to have a life, instead of sitting in monstrous parking lots.” With every piece of transport legislation that goes through this House, the ending of the gridlock in Auckland and Wellington—Wellington is getting just as bad as Auckland—gets further and further away, because of all the increased consultation and because of the magic words that were brought into the New Zealand Transport Strategy and that are now being codified in this legislation: that we will have an affordable, an integrated, a safe, a responsible, and a sustainable transport system.

The issue is the use of the word “sustainability”. There is a sustainability filter through which all legislation must now pass. We are seeing the problems out there now because this House passed legislation that had to go through the Treaty of Waitangi filter. We are paying the price for that now, and in 5, 10, or 15 years’ time people will still be sitting on the motorways in Auckland, and they will still be trying to get busways on the North Shore. The Greens talk about buses, but there is no busway in sight for the North Shore.

Hon Judith Tizard: Rubbish!

DEBORAH CODDINGTON: That member over there says “Rubbish!”. That member is the Minister with responsibility for Auckland Issues, and she told a suburban newspaper on 4 September 2002: “I am not convinced that the eastern corridor is the best solution, just so all the people in Howick can have an extra half-hour in bed.” Now the good people of Howick will be very interested to know that they do not count as Aucklanders; they are of very little concern to the Minister who is paid to represent them.

Hon Richard Prebble: No concern.

DEBORAH CODDINGTON: No concern, at all. This legislation—and we will see more transport legislation come back to the House, because legislation that amends the legislation passed only last year is to come back in the next few weeks—will not build one new road. We heard submitter after submitter at the select committee who did support, as ACT supports, the reorganisation of the Crown entities, but the submitters had huge concerns about some of the issues in this bill, the main one being that the bill gets rid of safety at reasonable cost and replaces that term with sustainability. Sustainability is totally undefined. We had the officials come back to the select committee, and I asked them to define sustainability. I asked them what that term meant—whether it was a sustainable yield, or a benefit-cost ratio. The answer was: “No, no.”

If we go back to the New Zealand Transport Strategy, which brings in the magic word “sustainability”, we see it is not defined at all. Reasonable cost is defined—there is a definition of that. A cost is a reasonable cost when the value of the cost to the nation is exceeded by the value of the resulting benefit to the nation. Let me put the concept of reasonable cost in the words of the submitter to the select committee from, I think, the Bus and Coach Association. He was a very rational and intelligent man, and he said that every year at the beginning of the school year the issue arises of putting seat belts in buses. People argue that all seats in buses should have seatbelts. Now that is a good safety measure. It is a good thing to think of—it sounds good. But he said that when one actually goes into it, one finds it would cost something like $30 million to put seatbelts in buses, and that does not include the cost of putting on extra buses to carry all the people who can no longer stand in buses. So that is what we mean by safety at a reasonable cost. We need to have an objective basis for arguing as to which changes can be made, and that is the cost-benefit ratio. That is in the current law. It is an objective basis on which the Minister and the officials can work out whether or not we should take a safety measure. If we take that out of the law, then it becomes a situation of jokers wild, and such decisions are just based on someone’s belief or opinion.

The transport industry is already very highly regulated. It is an industry that more than any other, I would say, needs any increase in compliance costs that are forced upon it to be done on an objective basis, and that is absolutely not happening with regard to this legislation. That has just gone out the window. The fact that the Government would not take any notice of the submitters who came in to see the select committee is appalling. We heard submissions from the maritime industry. The maritime industry told us that the New Zealand Transport Strategy—and we are talking about ships here that move cargo and people around, and thinking of ships, barges, and ferries as transport; but no, this Government does not think in that way—mentions the maritime industry only twice, and the fishing industry only once. It does not acknowledge the huge advances that have been made by the maritime industry and the fishing industry, in terms of reducing deaths and accidents. Whenever there is a terrible accident at sea, like the one we read about recently where a man was caught in a crusher, the industry goes to extreme measures to protect its staff and workers. There are 1,750 fishing vessels in New Zealand, and they were mentioned only once in relation to the New Zealand Transport Strategy. The Government does not care about fishers, motorists, truck drivers, or small businesses. Most businesses in the transport industry in New Zealand are small to medium businesses, and they will have extra compliance costs forced upon them.

I finish by saying that the other appalling provision in this legislation that we have to consider is that there will be more consultation now with Māori when it comes to drawing up a land transport strategy. I would like to know why this Government thinks that Māori are not included in the public. Under the individuals, authorities, or entities that an authority must consult with when it is preparing a land transport programme, the Ministry of Transport, the Accident Compensation Corporation, the Minister of Justice, affected communities, the public, and Māori are mentioned. I am sure that it is a surprise to Māori to know that they are, first, not members of the public, and second, not affected communities. This bill is politically correct social engineering at its worst, and the ACT party does not support it.

LARRY BALDOCK (United Future) : I inform the House that United Future will support the second reading of the Transport Legislation Bill. It really is one further part in the process of reform and of expediting the development of our land transport system in New Zealand. Although the bill is not to be seen as the silver bullet that will solve all our problems, it is an important part of making sure that our transport network—our transport system—functions to the best of its ability, without being overburdened by unnecessary bureaucracy, and that ultimately we build a network that serves our economy and residents efficiently.

The bill gives effect to elements of the New Zealand Transport Strategy, which is the Government’s transport sector review. The Ministry of Transport will be strengthened in order to take over the policy functions currently being undertaken by the Land Transport Safety Authority and Transfund. Both the Land Transport Safety Authority and Transfund are to be abolished. It has been United Future’s policy for some time that the Land Transport Safety Authority be abolished. In fact, when Peter Dunne was here in the House on his own as the sole member of the United party, he campaigned strongly for the Land Transport Safety Authority to be dissolved. Since that time we have seen an improvement in the authority’s ability to carry out its functions, because of new leadership in that organisation. However, we still believe that there are too many policy people in the authority, and that it will be a wise move to transfer them to the new organisation. A new slimmed-down Crown entity called Land Transport New Zealand will be established to carry out the residual operational functions currently being undertaken by both the Land Transport Safety Authority and Transfund.

Several efficiencies will be gained from the restructuring of the Government transport sector—in particular, by clarifying that the Ministry of Transport is the lead transport agency. By giving the ministry the necessary policy-making resources, the duplications and contradictions caused by having policy functions distributed among more than one agency should be eliminated. Also, merging the two current land transport funding programmes—the national transport programme currently administered by Transfund, and the safety administration programme currently administered by the Land Transport Safety Authority—will streamline the funding allocations and better align such allocations with the New Zealand Transport Strategy. The bill also resolves a longstanding issue over which agency should have primary responsibility for undertaking search and rescue coordination. Currently, the Civil Aviation Authority alone has the legislative authority for that, but this bill gives that authority to the Minister of Transport so that integrated coordination can occur between more than one agency.

The Transport and Industrial Relations Committee has done a very fine job on the submission process, and has recommended the bill back to the House with some changes, most of which are largely technical in nature. When one reads the committee’s report one does get the sense that it was largely unanimous in its deliberations, except for the issue surrounding safety at reasonable cost, which was mentioned by some of the speakers before me. It is important to see the amendments recommended by the committee in order to strengthen the emphasis on safety in the bill, and United Future welcomes that. All New Zealanders, I believe, want to see travel around New Zealand carried out as safely as possible. Too many New Zealanders still suffer unnecessary tragedies as a result of accidents on our transport network, so we are pleased to see that an emphasis is being placed on safety. I believe that that will ultimately move the Minister to be more active in building better roads within New Zealand, because only so much can be done to improve safety on our roads by the enforcement of rules and by better driver education, without also building better roads. Ultimately, it is only when we have First World - standard roads, with divided highways and fewer curves, bumps, hollows, and so on, that we will be able to travel more safely. One can never prevent someone drunk from getting behind the wheel, but he or she will not be able to cross the centre median if a decent amount of concrete, or at least a wire barrier, is there to stop him or her from hitting oncoming vehicles. So we welcome the strengthening of the emphasis on safety by the select committee.

We understand the concerns expressed by some submitters, particularly those in the transport industry, who wanted to see the wording “safety at reasonable cost” held within this new legislation. We know their concerns about how it would perhaps be possible to impose rules upon the transport industry without necessarily doing a decent analysis of how the cost benefit of that would flow on into real safety gains. However, on looking at the bill, and in particular at the requirement for the Minister and the agencies to consider safety in the light of how any proposed rule will assist economic development, I believe it gives assurance, or at least some satisfaction, that the Government will not be able to run amok with rules, without considering their effect on the economic development of our nation and on the economic efficiency of transport organisations operating within it.

Hon Harry Duynhoven: And the rules process itself requires significant consultation with the industry involved.

LARRY BALDOCK: That is correct, as the Minister has added for my benefit. I thank him. We will not be making that a die-in-the-ditch issue over this legislation. It is understandable that the transport industry, being assured by the officials that, in fact, safety at reasonable cost was contained within the bill, then questioned why it just could not see it in the legislation, in order to be sure. However, things have moved on in our transport legislation. We have now adopted new wording and phrases within it, and it is important to keep a consistent theme throughout all the reforms that are taking place within the transport sector.

We will be happy to support this legislation through its second reading, so it will move on to a Committee stage. I believe that all New Zealanders can be encouraged by the progress that has been made in this term of Parliament in many different areas, in order to address the needs that New Zealand motorists and the transport industry as a whole have been longing to have addressed over the last couple of decades, which are that we would build a better transport network, operate safely and efficiently, assist economic development, and improve access and mobility around the country.

A number of speakers have mentioned issues such as buses and the ongoing debate about whether the country needs to build more roads. I will conclude my speech with a few remarks about that, because we must not lose sight of the overall goal of dealing with the congestion that is creeping up on us in many areas around the nation. The issue of congestion faces, in particular, Auckland, and other cities like Tauranga and Wellington. The Greens continually harp on and say that the problem can be solved without building more roads. One almost gets sick of hearing that. We all accept the Greens’ point that just building more roads will not address the transport problems. We all accept that a multimodal approach is needed. We all accept that—

Hon Richard Prebble: Don’t speak for us.

LARRY BALDOCK: Except for the ACT party, we all accept that there is a place for public transport. Buses do have their place, but, of course, they run on roads. It is clear that we need to improve the roading network, that we need to continue to expand our motorway network, and that our State highway system does need constant upgrading. United Future is committed to working with the Government to see that accomplished, and we consider that this legislation takes us one step further in that direction.

JANET MACKEY (Labour—East Coast) : I have listened with interest to some of the contributions made this afternoon, and I would like to say that in the East Coast electorate we are probably not calling out for a large additional number of either buses or bicycles. What we would like to have is some legislation that addresses the problem we have: an increase in the number of logging trucks, and the inability of our roads to deal with what is very much a new use of them. The people of the East Coast welcome this legislation as the Government’s response to the needs of the transport industry, not only in areas like Auckland but also in rural areas like the East Coast. We are very happy to support the legislation.

JOHN KEY (National—Helensville) : About the best thing one can say about this transport bill before the House today is that it is like a looking glass. It is a looking glass into what life would be like under a Greens-Labour Government. My goodness! What a slow pace of life there would be if the Greens were to get into power with Labour! I make this simple prediction: if this bill becomes an Act it will be repealed.

Mark Peck: No way.

JOHN KEY: Yes, it will. It will be repealed by the time you get a job down south—

The ASSISTANT SPEAKER (H V Ross Robertson): I am not looking for a job. The member will not bring the Speaker into the debate.

JOHN KEY: I am sorry—this legislation will be repealed by the time the member loses his current employment and gets a new job, and it will be gone because, by its very nature, it is fundamentally flawed.

Mark Peck: No, it’s not.

JOHN KEY: The chihuahua over there is chipping away.

Mark Peck: Ankle-biter.

JOHN KEY: The ankle-biter is chipping away. I want to tell the House why this legislation will be gone, before the ink is even dry on the paper. The reason has been highlighted by many submitters who appeared before the select committee, and it is very simple. This bill is predicated on the Government transport sector review, which led to the New Zealand Transport Strategy. That is code for the sneaky little deal that Heather Simpson did with the Greens.

Mark Peck: No, no.

JOHN KEY: That is what that was all about. That is what Heather Simpson managed to do in the dark of the night when she was absolutely desperate to keep the Greens sweet, because she had cut a deal with a couple of other people who had managed to get more numbers. The first thing the select committee was told was that it was highly unusual and inappropriate to put the Minister’s objectives into a piece of legislation. We are codifying in legislation what Pete Hodgson thinks is a good idea. It would not be quite so bad if it was what he personally thought was a good idea, but it is actually what Heather Simpson, a paid bureaucrat, thinks is a good idea. In the dead of the night she was doing a coalition-type deal with the Greens over something she thought was a good idea. That is why this legislation will be gone before the ink is dry, when National gets into office.

Mark Peck: Even that member doesn’t believe that National is going to win.

JOHN KEY: This member is absolutely sane and rational in discussing the situation! Let us have a look at the parts of the New Zealand Transport Strategy—devised by Heather Simpson as a sop for the Greens—that will be codified into this legislation. The first objective is that transport will be affordable. Well, how will it be affordable when the Government does not want to use the private sector—a cheaper provider—to do anything in roading?

Mark Peck: Where does it say that?

JOHN KEY: That is what it says. The member should read it before he supports it. He is going from this place, so he should cross the floor. He should take the opportunity to go to his colleagues and say: “I know bad legislation when I see it. I’m out of here! I’m going to cross the floor on this one.” As I said, the first objective mentioned in the transport strategy is that the vision must be affordable. In New Zealand that means that we cannot use the private sector to do anything.

Mark Peck: Where does it say that?

JOHN KEY: Well, the Government passed the Land Transport Management Bill. That was a complete and utter waste of time, because it virtually barred the private sector from involvement. So transport in New Zealand will not be affordable—that is point one.

The second objective is that transport must be integrated. Let us have a look at what is happening in the transport situation in Auckland as a result of this. We now have people out there trying to build train tracks and trains when there will be over a billion car trips in Auckland and a couple of million trips a year by trains. We are going to be spending hundreds of millions of dollars on subsidies, and billions of dollars electrifying tracks and buying new trains, and this is going to be integrated and affordable! Well, I think points one and two are in conflict. Quite a lot as been said about the issue of safety, and I will come back to that subject and have my 2c worth on it.

The third point, the real doozy—and Mr Peck will have noticed this; it is probably one of the reasons why he is tossing in the towel on this Government, which will be gone in just a few months—is that it must be responsive. Responsive! Judith Tizard, the Minister with responsibility for Auckland Issues, is laughing. She lives there and she has seen that the Auckland motorway network has not been completed since 1965. It certainly will not be happening under the Land Transport Management Act and it certainly it will not be happening under the Transport Legislation Bill. As I said, the third point is that it must be responsive. What does “responsive” mean? Responsive to what? It is responsive to Heather Simpson’s demand to keep the Greens sweet—that is what it will be responsive to. It means: responsive to the fact that the Government might not have to be propped up by someone whom its current support partner has absolutely no time for—and frankly, probably neither does its major coalition partner. That is the responsive bit. But in terms of getting some action on Auckland’s roads there is absolutely nothing responsive in this legislation, at all.

Now I come to the really blatant bit. It was late at night as Heather Simpson was devising this policy with the Green Party, and she just could not help herself. The Greens said: “This is the bottom line—‘sustainable’ has to be in there.” So the fifth objective of the strategy is that it must be sustainable. Mr Peck is wondering why this legislation will be turfed out by any Government that is sensible at all. The strategy is certainly not affordable, it is certainly will not be integrated, it is certainly not responsive, and it is certainly not sustainable. So it will be absolutely gone. This bill means that a Minister’s objective will be codified in a highly unusual Act of Parliament. I think that parliamentarians should be worried about that.

I am very surprised that United Future is supporting this bill. It is a party that argues for common sense. What is sensible about codifying what the Greens and Labour did, late at night, to hold together some coalition talks? Why do they want to do that? Why does United Future want to do that? There is nothing sensible about that. But I want to move on to “safety at reasonable cost”. This bill will remove the requirement for “safety at reasonable cost”. I want members to think about this for just a moment. New Zealand, rightfully so, followed many international jurisdictions when it added seat belts as a necessary requirement in cars.

Hon Rick Barker: Is this member opposed to seat belts?

JOHN KEY: I am not opposed to seat belts at all. But this is my point—

Hon Rick Barker: You like seat belts?

JOHN KEY: I like seat belts. I always wear my seat belt. Seat belts save lives. I would never let anyone go in a car without wearing a seat belt. But—and this is the point—when “safety at reasonable cost” is removed by legislation it may mean that we want to have the 6-point seat belts that we see “Top Gun” flying in. Would that make cars safer in New Zealand? The answer is yes it would.

Hon Rick Barker: Could you have seat belts on motorbikes?

JOHN KEY: Yes, there could be seat belts on motorbikes. Mr Barker is quite correct; his mind is going in exactly the same direction as mine, which is quite a scary concept. [Interruption] Yes, it would not be too long before we have ashtrays and seat belts on motorbikes.

Deborah Coddington: Crash helmets in cars.

JOHN KEY: Yes, crash helmets in cars. So “safety at reasonable cost” is a very interesting point, because let us not forget that this is a Government that, if it could get away with it, would have traffic officers hiding behind bushes to issue parking tickets and speeding tickets to people, on the basis of safety. We all know that that is a complete and utter hoax. This is not sensible legislation. This is legislation that is codifying the whim of a Minister, and which is fundamentally flawed. It has this crazy issue of removing “safety at reasonable cost”. It will be gone—probably faster than Mr Peck will be, back to his electorate.

MARK PECK (Labour—Invercargill) : I want to tell that member that after another 20 years in Opposition he might be able to revisit this matter. It is a good bill, and I support it.

Dr WAYNE MAPP (National—North Shore) : I had the pleasure of being on the Transport and Industrial Relations Committee, and I know the sorts of submissions that were made. The Minister over there—

John Key: Which one?

Dr WAYNE MAPP: —well, both of them actually—I imagine did not read the submissions. They would know, if they had read them, that there is deep and sustained opposition to the measures in this bill from the very industries that it purports to affect. We are talking about the aviation industry and the land transport industry.

Mr Duynhoven says that, oh well, yes, they are just talking about self-interest. One of the leading aviation companies in this country is Air New Zealand. This Government owns 80 percent of Air New Zealand. It is opposed to the elimination of the test of benefits at reasonable cost. This is a business that knows the importance of having reasonable and sustainable legislation, and it takes great pride and care in its reputation.

Air New Zealand knows, self-evidently, just how damaging aircraft accidents are to public confidence in the industry, so it is in a balancing act. It does have to analyse what is reasonable and what is not reasonable. This Government, and the Minister for Transport Safety, are likely to impose unreasonable and undue burdens. The reason I say that is that this Minister is the one who is promoting these changes. I have to ask this very simple question of the Minister: what was wrong with the old legislation, the legislation that this Government is now seeking to repeal, which he wants to change in order to introduce some scheme that will have people in the industry quaking in their boots? The Minister has a certain reputation around the place for enthusiasms—I think that would be a polite way of describing it. The Minister is actually quite proud of that fact. In this instance, those enthusiasms have the potential to impose hundreds of millions of dollars of unnecessary costs, to achieve almost nothing. That is the kind of thing that can happen.

It is one thing to have enthusiasms about restoring one’s own historic Porsche. That is fair enough. It is a private thing. It is quite another to exercise the power of the State, aided and abetted by its yapping lapdogs, known as United Future, to impose those kinds of enthusiasms on some of the most important industries in our country.

Hon Harry Duynhoven: Has your aeroplane got a radio in it?

Dr WAYNE MAPP: Several. That is why we are opposed to this change in legislation.

I also want to draw the House’s attention to one other important issue in this legislation, and the National minority report refers to its specifically. I want to read this out and put it correctly on the record: “New Zealand National does not agree with the separate identification of Māori in preparing a land transport programme. New Zealand National considers this is preferential treatment. New Zealand National believes preferential consultation provisions on matters of general interest will ultimately damage the health of our democracy.” I wrote those lines, on behalf of my colleagues. They come down to some very fundamental issues about how our country is governed.

This week the Government has announced that it is going to have a special committee. We do not know who will be on this committee and we do not know who it will consult, but this committee apparently is going to deal with treaty issues. Yet we find already that the Government is predicating how it views the world. The ACT party has from time to time, in somewhat amusing terms, referred to the two-world view. I guess we have all been amused at the lilt in the way the questions have been asked in this House. I say to the ACT party that this is Labour’s two-world view in action. Labour believes that the best way to develop public land transport policy is to have specific consultations, on the basis of race, on land transport.

As I travelled to the airport this morning I was listening to Mr Shane Jones on the radio. He is going to be the Labour candidate for Northland. I can assure him that he will not win that seat, so he need not put too much effort into it. He knows that, and that is why he is going for a high place on the Labour list. He is deeply concerned about the creeping way that the treaty is insidiously getting into all aspects of public policy. We are not talking here just about Māori land, language, culture, and things like that. We might expect the treaty to have some relevance around settlements. We are talking about issues of general policy. He said that that view is so 20th century, so last century.

That tells us something about the thinking of this Government, does it not? These are people whose ideas were formed in the universities and the polytechnics in the 1970s and 1980s. I have read Steve Maharey’s book Alternatives: Socialist Essays for the 1980s. Those were the formative days of this Labour Government. It is that kind of thinking that has permeated its way into contemporary legislation, not just on things that directly affect Māori and in which there are special Māori interests, but rather on all things that affect New Zealanders in a general way. That causes me profound concern.

For the last 12 months we have had a Coordinating Minister, Race Relations who has talked about policies on the basis of need not race, and a Government that, purportedly, is trying to give to the public the impression that it is on to these issues. In fact, what it is doing by way of clause 30(2) is quietly and in a sneaky and devious way inserting subsection 4A(xii) into section 15 of the principal Act, specifically stating that Māori are to be consulted. They are a group different from those of “affected communities” and “the public”, both of which are also specifically mentioned.

How can the public have any confidence that the Government’s review of the Treaty of Waitangi will be an honest, open-minded, and fair one, when, in the very week it makes that announcement, it inserts a provision like this into legislation? It is surely undermining the confidence of New Zealanders that we do not have a Government that will govern for all equally, without favour to any particular group, on issues of general interest—and the transport system is surely that.

One can understand treaty references on issues like settlements, on languages, on the Māori Land Court, and on other such matters—one would expect that—but in this area where it is a matter of general applicability, that is where the line is drawn. Mr Shane Jones, who I imagine will be a member of the next Parliament, has said very clearly to Labour members to think about what is required for modern New Zealand and to look forward to the future, not the past, because that is the only way we will build progress in this nation.

Hon RICK BARKER (Minister for Courts) : That last speech left me with the overwhelming impression of sliding ever downwards into a quagmire of cold, sticky porridge—words, words, words, no substance, no strength, nothing. That speech is a very good metaphor for why the National Party will be in Opposition for, as my good colleague Mr Peck says, over 20 years. The National Party is about being muddled and befuddled, and taking no action. This Government is about having clear ideas and taking action. That is why I support this bill.

Hon RICK BARKER (Associate Minister of Justice) : I move, That the Electoral Matters Bill be now read a second time. I thank the Justice and Electoral Committee for its consideration of this bill and for the amendments recommended to it. The bill amends section 55 of the Electoral Act, which relates to when a member of Parliament must vacate his or her seat. It also cures an anomaly in section 55E of that Act that could see the Governor-General or a senior judge take a role in the party-hopping procedure. The bill also makes a number of procedural and technical amendments to the electoral broadcasting regime, to allow the Electoral Commission to allocate funds for electoral broadcasting for the next general election more effectively.

I now turn to the main amendments to the bill recommended by the committee. Firstly, the purpose of the bill is to clarify when a member of Parliament is required to vacate his or her seat. In the 21st century, New Zealand people with dual or multiple citizenship are becoming more and more common. This also applies to members of Parliament. However, it is essential that members of Parliament demonstrate an ongoing commitment to New Zealand and the people they represent. The bill amends section 55 of the Electoral Act, to set out clearly that a member of the New Zealand Parliament must be a New Zealand citizen at all times, and the circumstances when an MP must vacate his or her seat. The committee recommended some changes to the circumstances in which an MP must vacate his or her seat. These include if an MP accepts nomination as a candidate for election to a Parliament in a country other than New Zealand. The committee recommended including a reference to a governing body, which might not have been included in the term “country”—for example, an Australian state. The committee also extended the prohibition to include local government, with the inclusion of the word “municipality”. The committee also recommended that it be made clear that an MP must vacate his or her seat if he or she agrees to an appointment to a governing body.

The bill also includes a number of straightforward amendments that will allow the Electoral Commission to allocate funds for electoral broadcasting for the next general election more effectively. It does this by removing some of the well-recognised anomalies and administratively burdensome processes of the current broadcasting regime. These amendments have been recommended following inquiries into the 1996, 1999, and 2002 general elections.

The major changes in the bill to the electoral broadcasting regime are, firstly, that the bill will repeal the outdated requirement for the Electoral Commission to invite broadcasters to provide free or discounted time for electoral broadcasting. Secondly, the bill amends the provision of the Broadcasting Act so that only registered parties will be eligible for allocations of time and money. The committee also recommends some changes to these provisions. The committee clarified that additional members of the Electoral Commission appointed for the allocation of broadcasting time and funds must not be included in decisions to refer suspected broadcasting offences to the police. This is to avoid conflicts of interest, as the additional members of the committee are also members of this House. The committee has also recommended that any money allocated to a political party that is not utilised by that party must be returned to the Crown by the Electoral Commission. These funds are appropriated by Parliament solely for the purposes of enabling parties to meet the costs of broadcasting election programmes. If this money is not spent by political parties on election programmes, it should be returned to the Crown.

The committee accepted TVNZ’s submission to allow non-political commercial advertising between different opening addresses. Election programmes that are aimed at influencing voters must not be broadcast between different opening addresses. Either non-political commercial advertising or non-electoral programmes may be broadcast during different closing addresses, which must be broadcast on the same night. One reason for treating closing addresses differently is that there is limited ability for a reply.

The committee also considered the matter of electoral signs. The committee acknowledged that the inclusion of any recommendation on that matter would be outside the scope of this bill. However, under MMP it is difficult for political parties to conduct nationwide campaigns for the party vote, as each local authority has its own requirements. I have held discussions with the Society of Local Government Managers and Local Government New Zealand to explore whether the matter could be resolved by voluntary guidelines. Despite the goodwill demonstrated by the local government representatives, there are doubts as to whether the guidelines can be implemented into bylaws and district plans in time for the 2005 general election.

I therefore intend to introduce a Supplementary Order Paper for consideration by the Committee of the whole House. The Supplementary Order Paper amends the Electoral Act to provide for a national standard for managing electoral signs. The maximum size of electoral signs is proposed to be 3 square metres. Electoral signs that meet the specifications may be displayed for a period of up to 2 months before polling day. In addition, regulations may be passed to standardise the design of electoral signs, and to set out the procedures to be followed by any person before displaying an electoral sign.

Extensive consultation is to be held before the regulations are finalised, and I welcome contributions from local government. My discussions with representatives of local government suggest that local authorities want to continue to have the ability to control the location and density of electoral signs, fees payable, and actions in relation to non-complying electoral signs. Local authorities are in the best position to take into account local conditions in managing those matters, and I agree with their proposal. However, since starting on this process it has come to my attention that the National Party will oppose this Supplementary Order Paper, which every other political party has, at this stage, indicated support for.

I want briefly to refer to the select committee’s report to this House. The select committee took up the matter of electoral hoardings and said that it was concerned—that was the unanimous view of the select committee, which has two National Party members on it—that variations in local authority rules can unnecessarily impinge upon free political speech. It said that because some local authorities were setting controls on what could be on an electoral hoarding. The committee noted that any proposals to change or to deal with that issue would be outside the scope of the bill. It then stated: “We encourage the Minister to address guidelines for hoardings at the Committee of the Whole House stage (if his discussions with the Society of Local Government Managers have not had satisfactory resolution by that time). We propose that minimum levels could be set, where appropriate, for size, content, and display period.”

The Supplementary Order Paper, which I am in the process of discussing with all the parties in the House—and I have submitted a copy to them—proposes to do that by regulation. The reason it is to be done by regulation is that my officials advise me that it would be very difficult, if not impossible, to identify all the Acts of Parliament that would need to be changed, and to include them in this primary legislation. By giving regulatory power, we have the time to consult with local government and with all the political parties, and then can bring in regulations that will cover all of those contingencies.

The National Party has also claimed that that process of having regulation would enable the Government of the day to bring in electoral hoardings to suit itself. It has indicated that this Government would want the hoardings to be all red and simply praising Helen Clark. That is ludicrous. The person who made the claim knows full well that before regulations can be promulgated they have to be discussed with the parties affected. In this particular case, they would be discussed with all political parties and local government, so there could be no sneaking up of issues on anybody. The second thing is that any regulation has to go before the Regulations Review Committee, which is chaired by an Opposition member. If, in fact, the Opposition parties felt that something was wrong, it would be brought back to this House and dealt with.

I want to make it very clear that I am putting forward this Supplementary Order Paper with a very open mind as to how we can effectively change the words to convey the required intent. There is no intention whatsoever to play any dirty pool as claimed by the National Party spokesperson. I am consulting very widely. If we cannot reach an agreement on the Supplementary Order Paper, if it does not have the support of sufficient numbers in the House, then it simply will not go forward, and an opportunity will be lost.

The point is that, under MMP, the hoardings that go up across the country are for the party vote, and the country has to be looked at as an electorate as a whole. For some members of Parliament to have to have five different sizes of hoardings that are to be set up on five different dates and to have all sorts of different words on them makes it impossible. The select committee recommended a change in that area in 1996, 1999, and 2002. Those concerns have been brought to local government, and it is time for this House to take some action on them. We have said to local government that Parliament is concerned about three things: size, content, and starting date. For local government, the issues are location, density, and non-compliance. We agree with those.

I recommend this bill to the House.

LINDSAY TISCH (National—Piako) : National supports this legislation. The Minister, Rick Barker, commented on the Supplementary Order Paper that he will be introducing and that we heard about for the first time last week. It is not something that National will rush into lightly. We are concerned that there has not been any consultation on the areas he mentioned. The Minister mentioned that they were matters outside the scope of the Justice and Electoral Committee report. That is exactly right; that is why we did not take them any further. One would think that if they were outside the scope of the bill, that would be the end of the matter until further discussions could be held.

We cannot dictate to councils what they should be doing. We acknowledge there are differences in the way councils operate under their bylaws. Some councils in my area do not allow signage, at all. One particular district council allows only two signs per candidate in its area. In other areas it is open slather—one can have as many signs as one likes. There is an inconsistency, and that is acknowledged. But the Minister has come out with a draft Supplementary Order Paper without any consultation with the parties as to what is intended—such as regarding the colour one can use on a sign. Certainly, National will not want to use red colours on its hoardings, but that could be dictated in the final determination on that issue. In terms of size, a 3 square metre sign is quite big. We could probably accommodate a 3 square metre sign, but, at the same time, to be allowed to put it up only 2 months in advance is something we could not support. Nothing in the Electoral Act states that one could not put up one’s signs today. I have been looking at section 214 of the Electoral Act, which states that signs could go up now, but the Minister’s draft Supplementary Order Paper states that we could not put up signs until 2 months out from the election. That would mean that section 214 of the Electoral Act would need to be changed.

In section 214B(1)(b), “election activity” refers to a number of things, and promotes posters, billboards, signage, and whatever. Paragraph (d) refers to election activities occurring in the 3-month period before polling day, but the Minister has just said that we cannot put up signs until 2 months before an election. That means that the Electoral Act would have to be changed, just to accommodate the 2-month provision he mentioned. I do not know that the Minister has thought this through. The current law states that I can put up my signs now. They still have to be authorised. It has been suggested that they should be authorised by the Electoral Commission and the Chief Electoral Office. I have been in touch with both those organisations in the last couple of days, so I am not speaking off the cuff on this. I have done some research in this area, and there is nothing to suggest that those signs cannot go up right at this very moment. So when the Minister says: “Ha! You can put up the signs only 2 months out from the election.”, I say to him that some major changes will have to occur to section 214 of the Electoral Act. At the moment I can put up those signs today.

I do not have the provision in front of me, but I think that section 214B talks about signage in the 3-month period as being when the $20,000 we would have to account for comes into effect [Interruption]—I am not confused at all; I have this in writing. That is a major concern. It is one of the reasons why we will not be supporting the Supplementary Order Paper. Although the intent of it is fine—and I was on the select committee that looked at this—we are certainly not going to rush into something just because of the whim of the Minister that it needs to happen.

I come back to the bill and to some of the other provisions that we think are important. Although I said at the outset that we will be supporting the bill, it is interesting to see in the introduction to the commentary on the bill that the Electoral Commission will no longer be required to invite broadcasters to provide free or discounted time. That is an interesting point, because it is really only Television New Zealand and Radio New Zealand that actually do so. When I was involved in the 1996 election campaign as National’s campaign manager, I found that the possibility of getting any free or discounted time from broadcasters was pretty remote. So we have no difficulty with the commission saving itself a lot of time by going specifically in future to those broadcasters, which are State-owned.

The next point in the commentary, which is that only registered parties will be eligible for allocations of time and money, is also important. The current law has provided that a political party can get an allocation of funds for its broadcasting activities right up to the time of allocations. This bill states quite clearly—and it is something we agree with—that the party has to be registered at the time the election is called. I think it will limit a lot of the fly-by-nighters—parties that come along at the end of the day. Although it is not specifically mentioned in the bill—certainly, I mentioned it in the first reading debate—I think the increase in the allocation for broadcasting money from $2 million to $3.12 million including GST is significant. Over time there have been increases in costs. It is not specifically mentioned here, but we certainly discussed the fact that over time we have seen huge increases in costs. What we need to be able to identify and use, with those costs, is a fair allocation of time.

One of the areas we have major concerns about is the creation of vacancies. It is interesting that we were in urgency on 6 August 2003 when we went through all the stages of the Electoral (Vacancies) Amendment Bill, which overrode section 55 of the Electoral Act to allow a member sitting here this evening—the Hon Harry Duynhoven—to remain a member of Parliament. Section 55(1)(b) of the Electoral Act provides that a seat becomes vacant when a member swears allegiance to a foreign State or power. Section 55(1)(c) provides that a member’s seat be vacated if the member is a citizen of or takes out citizenship of another country, or takes some other action like renewing a passport. We voted against that piece of legislation. We said that it was a cynical manipulation of Parliament and that it was absolutely outrageous that the law could be changed retrospectively where someone had broken it.

The point I make here is that when we look at page 2 of the commentary on the bill, we see that that member would not be a member of Parliament under this provision in the clarification of the current legislation. It states quite clearly: “We support the requirement that a member of Parliament seek a fresh mandate from voters …”. That is what we said at the time. We said that there should have been a by-election, and that is what the commentary states—that there should be “a fresh mandate … if he or she acquires a fresh foreign allegiance while in office.” It goes on to state: “We also recommend that new section 55(1)(cb) be clarified so that a member of Parliament will have to vacate his or her seat if he or she accepts nomination as a candidate for or agrees to appointment to a governing body which might not have been included in the term ‘country’, for example, an Australian state.”—and it goes further than that.

So here we have in the bill, which National is supporting, a provision that clarifies the law. Had this provision been in the legislation at the time, the member who was able to get in under the Electoral (Vacancies) Amendment Act would not be here today. These are major concerns. Although we support this piece of legislation, it cannot go by without our saying that the provision enacted at that time under urgency was a manipulation of the system that, in my view and in National’s view, brought Parliament into disrepute. This bill tidies it up, and that is why we are supporting it.

MARK PECK (Labour—Invercargill) : Unfortunately, that speech in support of the bill was somewhat churlish, I thought, and it did not deal with the issue of explaining why the National Party has opposed the Supplementary Order Paper without even knowing the full details. I would have thought that any mainstream political party would at least take the opportunity to learn what was in the Supplementary Order Paper before making a caucus decision about it. It certainly flies in the face of logic, and tends to leave absolutely open the issue of what National would do in the unlikely event that it ever became the Government of this country again, because the Supplementary Order Paper is a significant improvement on the very hodgepodge arrangements that exist amongst local authorities at this particular point in time. We deserve to hear quite a bit more about the National Party position in respect of this. It simply defies logic, and I think that those members will find themselves somewhat exposed in this debate on the matter.

If the Minister is forced to pull the Supplementary Order Paper because of lack of support, at the end of the day, it will be on their heads. We will then go back to the hodgepodge whereby some local authorities say signs can be up for 3 weeks, and some local authorities say they can be put up 3 months in advance, and they regulate size.

I think that given Lindsay Tisch’s position as campaign organiser for the National Party on one occasion, he knows the stupidity that situation causes for those who have to organise the campaign for the party vote. It is a sensible Supplementary Order Paper and, frankly, I find the National Party’s position absolutely scurrilous.

STEPHEN FRANKS (ACT) : First, on the question of the Supplementary Order Paper to prevent local authorities from interfering with free speech in electoral advertising, I believe that it will be possible to produce some provisions that all parties should agree to. I hope to work with the Minister to improve the wording on the draft that has been circulated. It appears to me that the fears people have that this is an attempt by the Cabinet to get control of advertising could have been avoided if that had been made clear in the draft. It has not been, but I think that it can be done. Much more important is that this bill is the sort of routine tidy-up that occurs after every election, when issues are raised. But this time it goes to some reasonably crucial issues and, in particular, electronic advertising.

One of the features of the New Zealand electoral scene is the vital control exercised by a few journalists. When Television One decides what it is going to cover in an election, TV3 tends to follow suit, and the other media regard what is being dealt with on television as the election issues. If that had been the case in the United States or in Australia, for example, there might well have been completely different election outcomes, because in those countries, election speech can be a debate between—

The ASSISTANT SPEAKER (H V Ross Robertson): I am sorry to interrupt the honourable member. The time has come for me to leave the Chair for the dinner break.

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

RICHARD WORTH (National—Epsom) : National supports the Electoral Matters Bill but, as I will later detail, has some reservations about a proposed Supplementary Order Paper dealing with advertising hoardings for the next election. The electoral framework and its integrity is the hallmark of a constitutional democracy. New Zealand has no written constitution. There are only three developed countries in the world that do not have a written constitution and they are Israel, New Zealand, and the United Kingdom. That is not to say that we do not have a whole lot of written constitutional material, but it falls short of a written constitution in the normal way. It is mainly a question of definition. We have an assemblage of statutes, parliamentary Standing Orders, and conventions. The statutes include the Constitution Act, the New Zealand Bill of Rights Act, and the Electoral Act. We are here tonight looking at the Electoral Matters Bill, which proposes some amendment to the principal Act—the Electoral Act.

There are amendments in respect of this bill that run in two directions—firstly, there are amendments to the Electoral Act, and, secondly, there are amendments to the Broadcasting Act. The history of the changes to the Electoral Act has been canvassed by other speakers. Members may recall that in 2003, in circumstances of urgency and asserted need, the Electoral (Vacancies) Amendment Bill was rushed through this Parliament under urgency, suspending the application of section 55(1)(b) and (c) of the Electoral Act in respect of members of the current Parliament until the close of polling day for the next general election, and requiring a member of Parliament to remain a New Zealand citizen at all times.

Fairly or unfairly, the finger was pointed at Mr Harry Duynhoven and the actions that he had taken. But it is a fair point that New Zealand law tolerates, and even encourages, dual nationality. That is clear from the Citizenship Act. Double nationality frequently occurs by descent, as it did in Mr Duynhoven’s case. Dutch nationality has to be governed by Dutch law, so there was an argument that the retrospective nature of the law that was passed in the Parliament of the Netherlands meant that Mr Duynhoven had always had Dutch nationality. In New Zealand, of course, the New Zealand Bill of Rights Act provides that every New Zealand citizen who is of, or over, 18 years qualifies for membership of the House of Representatives.

At the time when the Electoral (Vacancies) Amendment Bill was passed it was asserted by some that 20 members of Parliament might have been captured by the current law. Those issues are now matters of history in the context of the report back of the Electoral Matters Bill and its second reading today.

When comparing the bill with section 55 of the Electoral Act, I note that some significant changes have been made. They are reasonable changes, I would assert, in the context of what has been done. The inclusion of the phrase “foreign Head of State” with reference to swearing allegiance to a country is akin to swearing allegiance to King and country or Queen and country. The other change that has been made, which I think is also reasonable, is a change to provisions by addition so that a member of Parliament will have to vacate his or her seat if he or she accepts a nomination to a governing body that might not fall within the definition of country. That might include, for example, the Northern Territory. There was an opportunity for the select committee to say that it is not really on to be a mayor or a councillor and a member of Parliament in this country. But that was not the choice that was taken.

The other significant changes are to the electoral broadcasting regime. In the time available I do not have sufficient remaining to discuss those changes in any great detail.

Simon Power: Seek an extension.

Darren Hughes: We’ll agree!

RICHARD WORTH: With an invitation to seek an extension and with agreement from the junior Government whip that seems to be the most happy outcome. At the close of my speech I will seek a short period of, say, 20 minutes to make the amplifying comments that I would like to make.

The three key points that lie behind the broadcasting regime are: firstly, the Electoral Commission will not be required to invite all broadcasters, which used to be the case, to provide free or discounted time for election programmes, and that is a good move because surprisingly not all broadcasters have any interest in politics and were not prepared to respond to those invitations; secondly, to ensure that only registered parties will be eligible for allocations of time and money; and, thirdly, to provide more clarity around the issue of advertising during opening and closing addresses.

When the Minister spoke at the commencement of the second reading he referred to a Supplementary Order Paper, which presumably only has the status of a draft. It has caused some real concern to the Opposition parties because of the ambiguity of its content and the uncertainty of its width. The Justice and Electoral Committee made comment about the need for something to be done in connection with electoral hoardings. That was not a new issue. It has been raised a number of times, most recently in the 2002 general election report where the comment was made that amendments to electoral legislation for the 2005 general election should include national guidelines on hoardings. But the problem here, of course, is that such changes are outside the scope of the bill. That is apparently why the Government is proposing this Supplementary Order Paper.

The concern of the select committee was quite manifest. We were concerned that variations in local authority rules can unnecessarily impinge on free political speech and add to the costs of advertising. The Government is incredibly reluctant to amend the Resource Management Act. Why that reluctance is there is not immediately apparent, unless it is that people like the Hon Marian Hobbs cling to the view that it is fine legislation. It may have good elements but time has shown it to be truly flawed. In the context of what we are talking about here, the situation was that there were completely different rules between various local authority districts. So if a particular hoarding was proposed, then in some districts it was necessary to make—in the jargon of the Resource Management Act—an application for a non-notified planning consent. For others a notified consent was required.

It all underscores the fact that the administration of the resource management legislation in New Zealand is incredibly uneven and inconstant around the country. That is because different local authorities approach issues in different ways and have a different view as to how much regulation is appropriate. It is appropriate that those issues be standardised, so it is good that the issue has come to the committee.

I imagine, in principle, that a well-drafted Supplementary Order Paper would draw support from National. But that can scarcely be the case when the current draft Supplementary Order Paper would give to councils such swingeing powers covering the size of hoardings, colour of hoardings, and placement of hoardings. Just imagine if the Governor-General made regulations by way of Order in Council that required all the signs within a district to be in National Party blue.

MURRAY SMITH (United Future) : The Electoral Matters Bill covers a small range of matters in terms of elections. There is meant to be a more profound review, which has been called for by justice and electoral committees for several years, but this bill really deals with two principal matters: the Electoral Act and the Broadcasting Act. In terms of the Electoral Act, the key provisions relate to the vacating of a seat by a member of Parliament, and the membership of the Electoral Commission. In terms of the Broadcasting Act, there are really three matters that are being dealt with in this bill. They are the provision for all broadcasters to provide indications of broadcasting time for elections, the provisions to give broadcasting funding to political parties or parties standing candidates, and the opening and closing addresses. I will deal with the latter matters first, which are smaller matters. There will be an opportunity, no doubt, during the Committee stage to deal with the membership issue, and I will save my comments till then.

In terms of the Electoral Commission membership, the minor parties in this Parliament are very unhappy about the fact that Labour and National have members on the Electoral Commission, and believe that that is quite contrary to the MMP environment we have. I note, and people who have read the bill as reported back from the Justice and Electoral Committee will also have noted, that ACT, United Future, and the Greens were all unanimous in their view that, effectively, there should not be political party representation on the Electoral Commission. New Zealand First, by way of interest, took the view that New Zealand First should be on it but nobody else apart from National and Labour should be, which shows the degree of arrogance that has been built into New Zealand First. However, certainly when the Electoral Commission is dealing with things that are matters of the election process, which is owned by all New Zealanders and is critical to our democratic institutions in that it involves the election of a new Parliament, it is quite inappropriate that political parties have representation on that commission, and, particularly, it is inappropriate that only two of the political parties that exist, and only two of the nine that are represented in this House, are represented on it and are able to have input into it, while the others are not. That ought to be changed, but my guess is that while we have the domination by Labour and National they will not be prepared to let that go.

In terms of the Broadcasting Act, as the Act currently stands the Electoral Commission must approach every single broadcaster in the country and ask it to indicate what free time it might make available. I have been involved in the administration of the last three elections, in the last two as party secretary of Future New Zealand and United Future respectively. I know how much of a nightmare that issue has been for the Electoral Commission. It has to send out hundreds and hundreds of letters, and to follow up all the replies from the broadcasters, which invariably come back and say they will not provide any free election programmes, but offer to make available discounted time. I think there will be quite a saving of the Electoral Commission’s time during the very busy election period in that it will not have to send letters to all those broadcasters. In fact, there are only two that it will need to deal with—that is, Television New Zealand and Radio New Zealand. I think that is a good move. It makes a lot of sense, and it certainly saves a huge amount of time for everybody who is involved in the electoral process, from the Electoral Commission down to the political parties and their secretaries at the time.

In terms of the provision of election financial support, currently the law provides that registered parties and parties that will stand at least five electorate candidates are eligible. In three MMP elections we have seen that no party has put up at least five electorate candidates without also being a registered party. That is not at all surprising; as we know, the list vote is really the critical vote, and the chance of independent people, representing either themselves or small parties that have only a very few candidates, getting representation through the electorate vote is highly unlikely. Therefore, I think it makes sense that, effectively, registered parties should be the only ones that are eligible. Any party that stands an electorate candidate who has a reasonable opportunity of winning a seat will inevitably register as a party, because that might mean it gets a second seat if it does well through that process.

The critical issue, though, in this part of the bill is the opening and closing addresses. Here, we are really just talking about TVNZ and Radio New Zealand, and the fact that Radio New Zealand is non-commercial means that when we talk about the advertising during the period of the opening and closing addresses it is really only TVNZ that we are talking about. Certainly, in response to TVNZ’s submission, the committee’s view was that we should not place undue restrictions on the ability of TVNZ to sell advertising during the time of the opening addresses in particular. We felt that, on balance, that was an unnecessary restriction. Essentially, the opening and closing addresses are to take place between 7 p.m. and 9 p.m., and we have provided that the closing addresses will take place on only 1 day. Typically, in the past, TVNZ has allowed about 35 minutes for all parties’ closing addresses, which is a relatively brief time. Therefore, we thought it was quite reasonable to have those closing addresses one after the other, without any break for advertising. In terms of the opening addresses, however, they can easily be spread over more than 1 day—a longer period. Therefore, we felt it was appropriate to allow advertising.

When we are talking about advertising it is important that we distinguish between advertising programmes and election programmes, with election programmes being ones that encourage a person to vote for or support, or not to vote for or support, a particular party. They will be banned during the period that opening addresses are being conducted. We felt that was quite appropriate, so that people do not get unfair advantage in terms of that period. That means there will not be able to be advertising in the middle of an election opening address, but there will be able to be advertising in-between opening addresses. In particular and importantly, there will be able to be advertising between 9 p.m. on 1 day and 7 p.m. on the next day, if the broadcaster decides to have the opening addresses over 2 days. Of course, it would have been a bit of a farce to have a situation where the broadcaster was unable to have any advertising for a 24-hour or 26-hour period, so it was important to address that. The bill as it stood was quite ambiguous in that regard, and we have tidied it up with the amendments that have been reported back.

There are opportunities for abuse. In particular, there are opportunities for abuse by people advertising in-between two parties’ opening addresses. For example, United Future might well want to see an advertisement for sexual services of one sort or another put before and after the Labour Party’s opening address. That might go down well! However, there would also have been opportunities for abuse if we had not allowed that advertising. In particular, it was pointed out that, effectively, if we did not allow it, then people who had opening addresses on the first night might be able to advertise during that day and that evening the fact that their opening addresses were going to come up that night, whereas the next night that could not happen. Conversely, people whose opening addresses were on the second night could then follow up with advertising after their addresses had finished. So there was the prospect of manipulation there. Because of the opportunity for abuse, we felt that at the end of the day it was for the broadcaster to make sure that advertisements that were broadcast in-between the opening programmes were not, effectively, election programmes and were not advocating election things. We felt that, given that the broadcaster would commit an offence if it allowed that, it would take a conservative approach to ensure as far as it can that advertising that occurs between the opening addresses is not of the kind that is influential on voters or potential voters who are watching those opening addresses.

One thing that I was concerned about is a relatively small point. Clause 18 provides that where there are unused funds, funds the invoices for which have not come into the Electoral Commission within the stipulated 50-working day period, the Electoral Commission is banned from paying out on them. The effect of that will be that if a broadcaster sends its invoice through to a party and the party does not pass it on in the due time, then the broadcaster will not be paid, and the political party will not be able to pay it, either. That is a concern I have, and I will address it more at the Committee stage.

NANDOR TANCZOS (Green) : I rise on behalf of the Green Party to support this bill and this Justice and Electoral Committee report back. I will not make a lengthy speech, because I sat in on only part of the select committee consideration of this bill. My co-leader Rod Donald was there for the bulk of it, and of course he is well known for his erudite positions on electoral matters. I will not be able to do him justice if I carry on for too long, so I would like to address just some of the issues, in brief.

We do support this bill, because we think it makes a number of useful amendments to electoral matters. In particular, the Greens are pleased to see that some of the recommendations that select committees have made over the years have been picked up. Recommendations from 1996, 1999, and 2002 have been picked up, particularly those in relation to broadcasting matters. If we look at the report back we can immediately see that three major things have been picked up: that the Electoral Commission will no longer be required to invite all broadcasters to provide free or discounted time for election programmes; that only registered political parties will be eligible for allocations of time and money; and the creation of more clarity around the issues of advertising during opening and closing addresses. Those are matters that we are supportive of and commend.

We are also pleased to see clarification of the law around when MPs must vacate their seats because of their relationships with foreign nations. In particular, there is clarification that MPs must vacate their seats when they acquire a fresh foreign allegiance while in office—an allegiance to a foreign State, head of State, or power. That provision is broadened slightly to cover situations where the allegiance is to a person rather than a country or State. Also, the allegiance has to be a fresh one. The bill clarifies areas where there has been confusion before. A member who had dual citizenship who was simply renewing a passport might, in the past, have been seen to be breaching the Act. The bill now makes it clear that is not the case. That is an obvious and sensible thing to do. And the bill clarifies that where a member accepts nomination as a candidate for a foreign governing body, that is obviously a situation where a member has a clear conflict of interest, and that person should have to vacate his or her seat in those circumstances.

However, we were, along with other members of the committee, incensed at the continued domination of the Electoral Commission by the old parties, and their refusal to acknowledge that we are no longer in a first-past-the-post Parliament, that this is an MMP environment, and that things have changed. The question of party representation on the Electoral Commission has to be addressed. It is interesting to see the old parties of Labour and National find their common interest when it comes to these things, and shut out all of the other, smaller parties. Yes, it is a shameful thing, but that is what they did in the select committee. I have to say it was quite bizarre to hear discussions in the select committee in which both National and Labour members were adamant that when their party was the non-Government party its representative was able to represent all of the other non-Government parties of Parliament. They were saying that when they provide the Opposition representative, that representative can represent everyone. The Opposition representative technically covers everybody, including United Future members, who support the Government on confidence and supply issues while at the same time viciously attacking it for its “think pink” policies at every opportunity, and attacking the very principles that underpin the Labour Party—they do that at the same time as they say they support the Government—and also the Greens, who have helped the Labour Party Government pass all of the progressive legislation that it has passed. All of the progressive legislation that it has passed has had the support of the Greens, yet at the same time we have had the door slammed in our faces when it comes to developing a more friendly working relationship with the Government. The National Party thinks it is able to represent the full scope of these things, and that is quite bizarre.

Of course, it is quite unacceptable that only two parties are represented on the Electoral Commission when it comes to defining and deciding issues around funding for political parties with regard to broadcasting and other matters. The Greens, ACT, and United Future have said that party representation should simply be abolished; that, actually, it is not just a question of getting more representation, that there should not be party political representation on that body, and that it is quite inappropriate that it should continue. It is unfortunate that it has remained in place.

Judy Turner: I agree.

NANDOR TANCZOS: We do agree on some things. I have to say I was even more disgusted by the position of New Zealand First, which looked like it would support the position of the Greens, ACT, and United Future on this matter, then suddenly turned round and presented the committee with the comment that the commission should have two additional members: one for New Zealand First, and one for the other parties represented in Parliament at the time. What a bizarre thing to say! That party had five members in the last Parliament. Their luck is in and their numbers have gone up in this Parliament, although some members of the public could be forgiven for thinking there is actually only one member of New Zealand First. I think some of its own MPs think there is only one member of New Zealand First, judging by their own comments in the media. When asked: “What do you do?”, one of them—I cannot remember which one—said: “Oh, I don’t do anything. I leave it to Winston.” We can all be forgiven for thinking that there is really only one member of New Zealand First, and the others are just kind of voting fodder to make him look good by showing he has some back-up. That was quite a weird reference to find in the report back of the select committee.

It is not acceptable that party political representation on the Electoral Commission remains, particularly within an MMP environment. As I have said, it shows how the T. rex parties find their common interest when it comes to these matters, and we think it is a real shame. Nevertheless, we do support the bill.

DIANNE YATES (Labour—Hamilton East) : I wish to speak on the Electoral Matters Bill and to comment on some of the comments made by Richard Worth of the National Party.

Hon David Cunliffe:Who?

DIANNE YATES: Yes—who! I was amazed that he was commenting on national policy statements, because I remembered that when a certain party was in power for 9 whole years, and Simon Upton was the Minister for the Environment, in those 9 whole years there was only one national policy statement. I find the comments that Richard Worth made in the debate tonight absolutely amazing.

Hon David Cunliffe: National is not good on policy.

DIANNE YATES: National is very good at procrastinating in this particular instance. Simon Upton is a lovely chap, but in 9 whole years there was only one national policy statement on the environment. This bill does some very, very good things, tightens up many procedures, and makes many technical amendments to the Electoral Matters Bill, which should make the next election much more efficient.

Hon TONY RYALL (National—Bay Of Plenty) : In taking this call on the Electoral Matters Bill on behalf of the National Party in Opposition, there are two points in particular that I want to discuss. The first concerns the words, which are so much at the head of the commentary on this bill, that the Justice and Electoral Committee unanimously supported the requirement that: “a member of Parliament seek a fresh mandate from voters if he or she acquires a fresh foreign allegiance while in office.” Well, well, well!

Members of this House will recall that we had the Prime Minister, I am sure, stand up in this House and say that this clause would be changed. She said that the situation of denying members of Parliament their seats because of some anachronism of 1886, or whatever it was she was going on about, was beyond justification. She asked why in this day and age we would have such a separation.

So we had this incredible situation where the law directed the Speaker to expunge a member from this House if he or she breached the Electoral Act, yet a member was allowed to sit in the Chamber, clearly in breach of the law, all that time. Although clearly in breach of the law that member was able to stay in this House, and this Government brought in special legislation to legalise and validate a breach of the law. The law was clear. In those circumstances, when a member has taken a foreign oath the Speaker should kick him or her out of the House. That is what the law said the Speaker should do. Well, it did not happen that way. According to this law, the Speaker—Parliament’s man—should have required Duynhoven to leave this Chamber—

The ASSISTANT SPEAKER (H V Ross Robertson): The member will use the member’s full name—Speakers’ rulings 26/7 and 26/8.

Hon TONY RYALL: —Mr Duynhoven to leave this Chamber—but he did not. So the Government then wrung its hands and said: “The legislation should be changed. It shouldn’t be allowed to happen. Whoever thought that would be the case?”. We suspected it was because we know that there was probably more than just one case on the Government side on that issue.

I notice we have not heard a single thing from Tim Barnett. We have not heard a single thing from Taito Phillip Field. We have not heard a word from them on this whole issue. What we have here is this bill, now saying that if a member of Parliament takes an allegiance to a foreign power then he or she will be kicked out. Well, I do not know whether that will count for much. It still requires someone to exercise discretion and obey the law, and have somebody kicked out of Parliament.

The Government would argue that it has put up an amendment that says that Mr Duynhoven was solely renewing his passport. Was it not the actual fact that the Dutch Government had passed a law to remove people’s citizenship, and then decided to reinstitute that law? Therefore there was no renewal of a passport, because the passport was invalidated. It ceased. There was no right. The Government in Holland brought in a new right that people could apply for their passports, and Mr Duynhoven went to get one. So this Government stood up in the Parliament and said: “What Mr Duynhoven did was no big deal. No one ever thought it would happen that way. The law is hundreds of years old and will be changed.” What do we have in this bill today? Exactly what the Opposition was saying at the time: Harry Duynhoven broke the law and the Speaker, according to the law, should have vacated that member’s seat if that person did, in fact, take allegiance outside of this House, and outside of this country. The Government has not changed that. If Harry Duynhoven applied for a British passport under this bill, he would be out, and I would expect the Speaker to exercise his responsibilities under the law and vacate that seat.

Judith Collins: It would certainly have happened, had it been one of us.

Hon TONY RYALL: It would definitely have happened, I am sure, regardless of which party the member came from. I cannot believe that a Speaker would have exercised favouritism on the basis of which party Mr Duynhoven was from. I do not believe that. But I would say this. If Mr Duynhoven had applied for his passport under this law, unanimously supported by the Labour members—and I do not think they realised this when they voted for it—they are saying what Harry Duynhoven did was wrong, it was against the law, and he should have had his seat vacated. But members will recall it was at a time when this Government did not want a referendum in a coastal electorate on its handling of the seabed and foreshore issue. Therefore there was all this jiggery-pokery so that no one actually had to consider whether he had broken the law.

Speaking of political shenanigans, what about the shocking revelation from the Hon Nick Smith today? This Government came to the Opposition seeking support for a bill that would have allowed the Labour Party to decide the colour of every other party’s political hoardings. Labour would have been able to decide where they go, the colour, the design, and the layout of everybody’s election hoardings. That is what Rick Barker tried to bring into this Parliament, under the approval of the Prime Minister. It was discussed in Cabinet that Rick Barker would go and try to pull the wool over members’ eyes. You know how it was done, do you not, Mr Speaker? Members were telephoned and told: “Oh, we’ve just got this little innocuous amendment based on the unanimous recommendation of the select committee, and we would like your support for it.” Well, thank goodness the National Party’s Richard Worth was on to this. When he got a copy of the bill it was clear that we were not going to support the Supplementary Order Paper that the Government was proposing.

Here is another one of these mistruths that we get from the Government. Did members hear on Morning Report the Government saying: “It was a unanimous recommendation of the select committee that the Government should have the ability to regulate and decide the size, colour, and format of the hoardings.”? Well, do members believe that? I thought it was Lianne Dalziel speaking on the radio when I heard that. But I looked at what the recommendation was. Basically it was a comment from the select committee, saying that it wanted the Minister to look at some levels and guidelines for hoardings, not a law that lets the Government decide the colour, size, and design of everybody’s election hoarding in New Zealand. Is that not a rort? That is the sort of thing that goes on in Mississippi, where the governing party decides what everybody else’s election hoardings will look like and what colour will be used. Does one member in this House not think that the Government would rule out the use of blue, black, green, yellow, or purple? Of course it would.

This is a desperate Government that knows its separatist agenda will be its undoing. This is a Government that has divided this country on a separatist, racially based policy setting, and it will be this Government’s undoing. Its separatist agenda of forcing racial preferences and separatism on this country will be the undoing of this Government, and that is why it desperately wanted to have—[Interruption] I hear Mrs Hobbs. Let us turn to what people’s declarations are on their enrolment forms. Do we want to go there? No we do not, because that is a rort, and what the Government was proposing is a rort. Thank goodness it has ended.

• Bill read a second time.

Hon RUTH DYSON (Minister for Senior Citizens) : I move, That the Social Security (Long-term Residential Care) Amendment Bill be now read a second time. The current legislation regarding income and asset testing of older people in residential care is unfair. Older people are required to use up their assets to contribute to the cost of their care, whereas younger people do not. In deciding the best way to change the policy the Government had the difficult task of balancing considerations of fairness for older people against the significant cost of changing the current asset-testing provisions and the demands of other priorities for social spending. The New Zealand population is expected to age significantly in the coming decades. This will increase demand for funding for age-care services. So to address this in a fiscally responsible manner a staged approach to reduce the impact of asset testing has been chosen.

The bill sets out the residential care subsidy scheme in a clear and comprehensive manner and includes aspects of the income and asset-testing regime that are currently found only in administrative policy and practice. The regime is complex, and setting it out clearly in one piece of legislation is a significant step forward. The Social Services Committee has reported the bill back to the House after receiving and considering 33 submissions. It made a number of changes, clarifying some of the definitions and other aspects of some of the provisions. From 1 July next year people aged 65 and over who require residential care indefinitely will retain significantly more of their assets than under the current regime. Currently, single people in care can retain $15,000. Couples where both partners are in care can retain $30,000, and this figure will increase to $150,000 from 1 July next year.

However, the committee made a substantive change to the bill regarding the asset threshold for couples with one partner in care. It changed the provisions so that couples with one partner in care can opt instead to be tested against the $150,000 threshold, which will also rise by $10,000 a year. I support that change. It will bring greater equity to how different types of assets are treated. It is also consistent with the asset threshold for single people and couples with both partners in care.

We consider that it is legitimate to expect people to contribute towards some of the costs of care, because those costs would need to be met if the person were living at home. As such, the income test is retained. At the moment the partner of a person in care is required to contribute towards the cost of his or her partner’s care, up to a maximum of $636 a week. This creates disincentives for paid work. Therefore, from 1 July next year the partner of an older person in residential care will not have to contribute from his or her personal earnings from paid employment for the cost of his or her partner’s care services. People will be able to retain a substantially increased amount of assets. Income from those assets, such as rent, will be included in the income test. The first $780 of income from assets will be exempt from the income-testing regime each year. That is broadly equivalent to the interest generated from $15,000 in the bank.

The select committee amended the provisions regarding the respective liabilities of people requiring care, and district health boards to pay for care, for clarity. It is now clearer that a resident can choose to pay more for services that are additional to those covered by the contract between the district health board and the provider. The committee also amended the regulation-making power. It now provides for some of the amounts in the bill, such as for prepaid funerals and gifting, to be amended, providing greater flexibility.

The total cost of the changes is forecast at $110 million in the first year of implementation. This figure will rise substantially over time, reflecting the $10,000 annual increase to the asset threshold, and the growing number of older people in our population. The Government has made separate provision for the additional funding to pay for the changes in the legislation.

I have released a Supplementary Order Paper to the bill that addresses further issues, including the maximum contribution, the gifting provision, and the income from assets exemption. The maximum contribution at present sets the amount at $636 a week, adjusted annually in line with the consumer price index, from next year. Many of the submitters commented on that to the select committee. The Supplementary Order Paper proposes that people who pay privately for their care should not be required to pay more than the Government for the same set of services. Therefore, we intend to amend the maximum contribution to set it at the same level as the price of the contract between district health boards and residential care providers in each region.

To ensure that providers are not worse off than at present, where the rest home contract price is below $636 per week, the maximum will remain at that level. A minor amendment is proposed to the gifting provisions. At present a person applying for the residential care subsidy can gift up to $5,000 per year for up to 5 years prior to entering care. That time period and amount are currently set out in the bill, but are able to be amended by regulation. For greater flexibility, the Government proposes to remove that period and amount from the bill so that they can now be prescribed by regulation. As I have stated, the first $780 of income from assets is to be exempt. The Government proposes to adjust this amount annually to reflect changes in the consumer price index so that the amount does not lose relative value over time.

In concluding, I sincerely thank the Social Services Committee for its consideration and amendments. I also thank the officials for their considerable work on this legislation. I commend its progress to the House.

Dr LYNDA SCOTT (National—Kaikoura) : This is a prime example of the “Maharey principle”. This Government is doing in Government what in Opposition it said it would not do, and Steve Maharey said: “That’s just what you say when you’re in Opposition.” We heard this Government say at every Grey Power meeting from one end of the country to another that it would abolish income and asset testing. That is what it said, time and time again. Then that promise was watered down to “the Government would remove asset testing”. I think that was on the pledge card.

Darren Hughes: No, it wasn’t.

Dr LYNDA SCOTT: Well, the Government said that at every Grey Power meeting. I was at many of them and that was said from one end of the country to the other. The problem was that when Labour got into Government it found out that the cost would be phenomenally high, and it backed down on that promise. The Government has spent 5 years getting to this point with continual promises. Now it has added a gradual phased process, and Grey Power is not happy, because the Government has broken its promises.

Ruth Dyson said that the Government wanted to contribute in a fair way to older people and to other social spending. The amount people can keep in assets has been increased to $150,000, which means that the cost to the Government will be $110 million in the 2005-06 year. But this Government, along with not keeping its promise on asset-testing removal, has not invested in other aged-care services.

Grey Power said that today it has joined the growing campaign seeking urgent funding support from district health boards for elder-care facilities. District health boards now look after aged-care funding, and they have offered a 1 percent increase in fees nationwide. This Government has kept money that should be going into all sorts of aged-care services simply and utterly for that promise—one it is not even fully delivering on.

Since 2001 rest homes have been faced with an increase of 1.83 cents per unit in the cost of electricity. Rest homes now have to provide transport and a support person to accompany any resident who goes to a specialist medical appointment, and that cost includes the time of that person away from the hospital and the need for replacement. Often, the cost can be up to $100 per trip. The cost of cleaning and other products used has gone up approximately 15 percent. The cost of medical supplies, incontinence products, and doctors’ visits have all increased markedly. While rest homes are funded for $12 per visit, visits now actually cost between $20 and $30, depending on the time of day. Then there is staffing. The Government has not been able to increase the level of funding for staffing.

So this Government has not been investing in the care of older people when those people go into rest homes. It is all very well to say that older people can keep more of their assets, but those rest homes have been run down considerably under this Government. It does not care about older New Zealanders. Grey Power national president, Graham Stairmand, said the 1 percent offer was not fair or equitable, and demonstrated that the Government did not value elderly people. The head of Grey Power said about this Government that it should stop being complacent.

Inflation, as we know, is running at around 3 percent. An offer of 1 percent will lead to the closure of homes—indeed, we already know that the Mary Potter Hospital in Christchurch is going to close. That hospital has been there for 90 years. Since 1913 it has been run by a Catholic order of nuns. Now, 68 frail elderly people are going to be kicked out, because the order cannot manage to keep the hospital going. It cannot be said that the hospital is making a profit, because it is not. We have also seen that Presbyterian Support has sold its facilities in Nelson-Marlborough, Canterbury, Hamilton, Tauranga, Thames, Whakatāne, Kerikeri, and Auckland. Why? It is because this Government does not care about the elderly. It is all very well keeping this political promise in a half-hearted sort of way, but when people actually get into elder-care homes they cannot get decent care because the homes are not being funded.

This Labour Government had better just shake itself up, because Grey Power now thinks the Government does not care about the elderly, and that is true. The managers of those homes know they cannot deliver quality care with the level of funding they get, and we all know that district health boards are in deficit, are cash-strapped, and cannot offer any more. We needed this Government to give more funding to aged care, but it has kept the money to deliver on an income and asset-testing promise.

The Government said originally it was going to fund $200 million. We hear tonight from Ruth Dyson that it is $100 million. What happened to the other $100 million? It was not spent on dementia units, where our frailest elderly are kept. It was not spent on our home carers.

What about the carers? This Government has previously said it stood up for carers, but what happens now? There is no increase in funding for our carers—not those who care for the elderly so they can stay in their own homes. In 5 years there has been no increase in the earnings of carers. I point out that carers in rural areas travel a long way to give somebody a shower, help with a dressing or with medications, or cook a meal. They do not get funded for their transport. They earn $10 an hour, and out of that they have to pay for their transport.

Rural Women New Zealand is saying that that situation cannot continue. Grey Power is saying that the situation cannot continue. This Government has not been funding elderly people’s care. The Government has been keeping that money to pay for this promise, but it is a broken promise and only half-heartedly delivered.

I want to say what a National Government would have done. Indeed, when we were in Government we increased the income and asset-testing level—the amount that people can keep. That is quite justifiable, which is why we have been supporting an increase in the asset-testing level. But getting the balance right between the other areas of aged care—equipment management, home support, carers, carer support, dementia care, hospital care, and rest-home care—is where the extra money needs to be. So we would not have raised the level as high as this, but we would have made sure that extra money went into aged-care services.

If someone is looking after a husband or wife who happens to have dementia, then the carer needs support. Elder-abuse services have not had that support. The National Government set up 20 elder-abuse services in this country. They have not had any increased funding or any expansion. We all know that elder abuse is increasing, especially financial abuse, but we have not seen any increase of funding in that area.

What have we seen from this Government in relation to aged-care services? There has been nothing—no increases in any other form or shape—and we have Grey Power saying that this Government does not value the elderly. Grey Power wishes to see an increase in that area, and it says there are 800 aged-care providers in this country, and they have 25,000 staff. Public hospitals used to provide the level of care for our very frail elderly people, then those people were moved into residential facilities in the community, nearer to their families. I thought it was a very good idea when I was working as a geriatrician, and fully supported it. But these nursing hospitals have nurses in them. Such hospitals have to have registered nurses, but they cost money and these hospitals can no longer afford to pay for staff members at a level sufficient to recruit staff.

The issues of recruitment and retention of carers and nurses in our aged-care sector are at crisis point. I have here an article in my local paper: “Aged-care operators may quit”. This appeared just 2 days ago. Throughout the country every MP will have people knocking on their doors. Every MP will have people calling in to say that their aged-care sector is under immense pressure, and this Government is doing absolutely nothing about it. The wage that staff in rest-home care get paid per day is $78. That is low. It has been held at that level for the whole time this Government has been in office.

We know we have an ageing population, and that that puts increased pressures on the sector. We must make allowances for that, but we must care for our frailest elderly in this country and help people to stay in their homes. This bill is just a broken promise by this Government.

DARREN HUGHES (Labour—Otaki) : Of all the issues for the National Party to attack a Labour-led Government on, those concerning older people would have to be the last that that party would have the gall to raise on the floor of Parliament. That is the party that promised in 1990—“no ifs, no buts, no maybes”—that the surcharge would go. That was the party that in coalition with New Zealand First in 1996 promised that party it would abolish asset testing and income testing, not just in the public sector but also in the private sector. That is the party that now, in Opposition, will not even tell older New Zealanders what its policy will be on superannuation. That is the party that, when Mrs Shipley was its leader, cut superannuation for older people. So, as we approach the second reading of the Social Security (Long-term Residential Care) Amendment Bill, I am sure the House will forgive me if I am a little bit cynical that National Party speakers have the cheek to get up and criticise the performance of the Labour-Progressive Government.

This bill improves the situation for older people. Every time we deal with matters affecting older people we make things better for them. We might not deliver nirvana, we might not make absolutely everything perfect, but we improve their situation. We leave them better off as a result of our policies, not worse off. The National Party’s record, every single time it has tried to do something for older people, is that it has made them worse off. It is no surprise to me that the National Party could find only one of its retiring members of Parliament to stand up tonight and attack this legislation, because in my electorate of Otaki, which has the highest number of people over the age of 65, I know that this bill will make a difference. I know that this Labour-Progressive Government is introducing legislation that will improve life for older people, just like we improved it when we increased superannuation in 2000.

This Government helps older people. We are on their side, and National Party members should plead guilty to their years of neglect, decline, and absolute betrayal of older New Zealanders.

BILL GUDGEON (NZ First) : Dotted throughout the country are people who have gone without—especially people living in rural areas. A lot of them still carry water from the creek to wash their clothes and live in housing that is not up to standard. Many of them take risks with their health in not visiting their doctor about problems with their eyes or other matters, and also in attending to their household shopping. Many, because of the state of their health, are unable to read their prescriptions properly or to take the advice of their doctor and carry out the instructions. I would say that most of the elderly in this country have done their share. They have worked very hard and they have played their part in the economy. Many have received a good education, but, because of their financial situation, they have had to rely on other sources and means to survive.

As I listen to the comments being made by members from the Government and the Opposition, I realise that it is all about throwing stones at each other. Why are we not taking care of the elderly? I know and understand that Grey Power people are not happy with the decisions that have been made, because to them a promise is a promise. At the last election a promise was made and not carried out. So why are the people who are in this category and at this stage of life dismayed at the decisions being made by the people in power? Most of them are honest, law-abiding citizens. They need help, and that is what we are here for.

I refer to the purpose of the bill. The aim of the bill as introduced is to amend the Social Security Act in relation to the income and asset testing of older people who have been assessed as requiring long-term residential care indefinitely. In particular, its aim is progressively to increase the assets people may retain before being required to use them to pay for care. Another purpose is to remove asset testing for people aged 50 to 64 who at present are required to use their assets to pay for their care. The other purpose is to exclude from the income test the earnings of the spouse of a person in care, and the first $780 per person per year of income from assets.

What are the main changes in the bill? Listed are changes that affect the accommodation supplement, the disabilities allowance, and beneficiaries in hospital. If these people are to survive comfortably until the end of their days on this earth, they should be taken care of. They have contributed to the tax take of this country and to its exports and imports. They have paid taxes all their lives, and they need to be taken care of. Although New Zealand First has disagreed with the promises the Government made, and is disappointed in them, we support this bill because of the steps being taken to look after our elderly. They are steps in the right direction. But let me say this to the Government: they need to improve greatly.

I am not here to throw stones at the Government. My responsibility as an Opposition member in the New Zealand First Party is to remind the Government of its responsibilities in its administration and care of our people. This goes right across the board. Some of the people we see when we travel to rural areas are still living in the 1930s and the 1950s—and we say we are taking care of them! Do we take care of them only to get the vote and after that wash our hands of them? We have to face the issues of where we will take care of our people. If the responsibilities are ours, then we should carry them out to the best of our ability, and with honesty and integrity.

Grey Power people have not been happy. We see this when we visit the different electorates. They ask: “What are you going to do, New Zealand First?”. We will challenge the Government on the issues, just as we have in the past. The Government needs to be reminded that if it is going to make promises, then it has to keep them. If the Government makes promises before the election, those promises need to be followed up. [Interruption] Yes, we will carry them out.

Why do beneficiaries who are in hospital have to struggle to be taken care of? I remember a lady who was not allowed to drive because of her eyesight. Her nearest shop was about 45 to 50 kilometres from where she lived. She went to the hospital on the East Coast, but it could not do anything for her. She then went to the hospital in Gisborne and it could not do anything for her, until her doctor asked: “Why is it that these operations are costing less overseas than the operations our people are paying for here?”. When that was revealed, her operation was taken care of. It did not cost what initially it would have cost had she had been by herself.

That is just one of many, many examples of the issues our elderly folk have to put up with because of decisions made not only by this Government but by the previous National Government. We have supported decisions that have been good for the public, and I say to my fellow colleague on the Government benches that we will continue to do that. It is not like the docking of tails. Why? We have been doing that all our lives, on the farms. [Interruption] Is the member going to say that to the farmers?

Dianne Yates: Farmers don’t do it.

BILL GUDGEON: The tails still get docked. New Zealand First will support this bill, with the recommendation that the Government will improve on the decisions it has made. That was our decision in the Social Services Committee, and we will continue to follow up on the issues. Hopefully, elderly members in our community will be in a better situation than they are at the moment. We hope they will flourish and continue to flourish, and that their health problems and whatever else they need to be taken care of will be taken care of.

SUE BRADFORD (Green) : As I pointed out when this bill to amend the asset-testing regime for older people was first introduced to Parliament 9 months ago, the Green Party cannot help but give qualified support to this legislation, given that it is our policy to abolish asset testing for residential care for the elderly. Like many submitters to the Social Services Committee, we see the current asset-testing regime as iniquitous, discriminating as it does against one part of the population—the elderly. In 1999 the Labour Party promised to remove asset testing. At that time Labour seemed to appreciate, like the Greens, that older people have already spent a lifetime paying taxes, which they presume will assist with their care and support in later life when they need help the most. Through the asset-testing system they become now the only category of citizens who have to pay twice for long-term residential health-care—once out of their taxes, and then all over again if they have sufficient income and assets basically to be taxed twice.

Like many submitters, the Green Party recognises, however, that while this bill is far from satisfactory, in that it does not remove asset testing altogether or solve the other very real problem of adequate funding for residential care all round, it does take significant steps in the right direction. These include progressively raising the value of assets that people can keep before they have to use them to help pay residential care costs, removing asset testing for people aged 50 to 64 who currently have to use what they have to pay for care, by excluding the spouse of a person in care from the income test, by making $636 a week the maximum contribution payable, and by a number of other measures intended to make the system somewhat clearer and simpler to administer.

The Government has made it clear that the reason it cannot go further, or even all the way, towards redeeming its own election promise to end the asset-testing regime lies purely in the cost. The Green Party recognises that while we can, and should, continue to press Labour to go further in this direction, we have to be realistic too and, to some extent at least, accept the fiscal constraints under which the Government is operating. The fact that the Government cannot, or will not, go as far as we would like does not mean that we should not support this bill. After all, many, many of our older citizens and their spouses will breathe a huge sigh of relief, once this bill becomes law, and I do not believe there is any virtue in standing in the way of that positive outcome.

We have also taken on board the submissions and other representations from the many rest home proprietors who express anxiety about the future of long-term residential care in this country, because of inadequate funding and other matters. In particular, we note all the submissions that stated that the $636 a week cap is unrealistic, in that if inflation had applied over the last 10 years the rate would now be over $750 a week.

However, the Green Party recognises the positive commitment by the Government as outlined in the commentary on the bill, in which the select committee was informed that Cabinet is considering this issue further. What is more, I also note our recommendation to alter the bill’s commencement date to 1 July next year, which will mean that the bill comes into effect on the date that the maximum contribution rate will have had its first consumer price index adjustment upwards.

There is no getting away from the fact the bill does not even attempt to resolve the difficult issues underlying and surrounding it. Discrimination against the elderly should be carefully and deliberately phased out over time. Above all, we should look seriously at what alternatives there might be to the current rest home funding model. Why are property value gains excluded from the equation when taking into account rest home profit and loss? Do we ever stop to consider that the quality and cost of residential care might improve, along with staff wages and conditions, if perhaps the Crown provided land and buildings for rest homes in the future, just as it does with State housing, hospitals, and schools? We need to find a more equitable long-term solution to the current inequities and difficulties in this sector, but it is not the elderly themselves who should continue to bear the brutal costs of a discriminatory regime. This bill does make progress, but, from whatever perspective one likes to take it, we still have a long way to go.

Dr MURIEL NEWMAN (Deputy Leader—ACT) : I stand on behalf of the ACT party to vote and speak on this Social Security (Long-term Residential Care) Amendment Bill. The ACT party will not be supporting the bill. However, it is important to remind listeners, and the Government, that when a political party campaigns on a promise such as removing income and asset testing, which the Labour Party campaigned on in the lead-up to the 1999 election, then the public of New Zealand should be able to expect that promise to eventuate. We have to look back and ask whether Labour did anything by the last election. The answer is no—absolutely no. Here we are almost upon the next election and it has introduced this bill on long-term care, but does the bill remove income testing? No. Does it remove asset testing? No. Is it good legislation? No. Should it be supported? No. What will the bill do for New Zealand? It will put an enormous cost burden on younger New Zealanders forever, because once Parliament brings in these types of laws it is very, very difficult for future Governments to repeal them.

This bill is a cold, clinical, political move by the Labour Government to buy the retired voters of New Zealand. It is the most clinical legislation that has yet come through this House. It is not driven by any passionate desire of Labour to bring in laws to sort out a problem based on need. No, the legislation is being brought in to sort out a problem based on voter support at the next election.

This essentially means that this Labour Government will take money off families who are struggling to pay for the residential care of people who in many, many cases could well pay for it themselves. One has to ask oneself whether that is fair. Should laws be fair? Yes, they should. Is this a good, fair law? The answer is no.

If one thinks of those New Zealanders who at the moment are having a bit of a tough time—I tend to think of those who are coming out of universities, polytechs, and training programmes, with big student loans; they cannot even afford to have children or buy a house—it is those people who Labour wants to pay more and more tax to fund New Zealanders who could care for themselves. It is not based on need. That is the problem. If laws are based on need, then I think most parties believe it is fair to support them. This one is not based on need.

If we look at the numbers, we see that the costs will be $110 million in the first year and $126 million in the second year. It has been estimated that 15 years on, this law change will cost $350 million. The number of New Zealanders who are retiring every year is about 15,000. In 30 years’ time, that number will almost quadruple. It will be almost 60,000 a year. One would have to say, then, that the cost of this policy will be more than $1 billion a year. Can the country afford it, when we have an ageing population and our birth rate is not even keeping up with the number of people who are moving out of the workforce? The answer is no. This is a policy that will help bankrupt this country in times when we do not have an economy as buoyant as today.

This bill makes a huge rod for the back of taxpayers. In question time in Parliament today, we heard that the average household in New Zealand today pays 46 percent of its income in tax. Forty-six percent of everything the average family in New Zealand earns today is paid out in tax, and that is without this bill in place. When the impact of this legislation bites hard, we will find families paying well over half their income in tax to the Government, and that will not even include all the other charges that families have to pay, such as rates, petrol tax, and all the other levies and hidden, stealth taxes that Governments like the Labour Government introduce.

When will the burden stop? When can working families think to themselves: “Thank goodness we haven’t got a greedy Government that will try to take more and more of what they earn.”? The only time that will stop is when we have a change in Government. So for people out there right now who feel they are struggling, who feel they are working harder and going nowhere, the only answer is a change in Government.

Already we have 62,000 New Zealanders on waiting lists, waiting for operations. Why does the money that this Government is putting into ill-advised legislation not go into helping those people on hospital waiting lists get fixed, or into getting the health care they need? But, no, the Government is happy to see them in pain and suffering, because it wants to buy the elderly vote.

Ordinary people around New Zealand are fearful. They are afraid at night and go around their houses, checking that all their windows and doors are locked. The reason is that New Zealand is one of the most under-policed nations in the Western World. We would need another 2,500 police to match the policing levels in Australia. Why does the Government not put some of the money that is going into bad legislation into funding the police properly so that New Zealanders can feel safe in their streets?

If Government members sneer at that, then I want them to know that in Whangarei, where I live, this year alone we have had 14 armed robberies, and that is in a town that has had only one armed robbery over the last number of years that anyone can remember. Since February there have been 14 armed robberies in that town alone, and that is during a time when the Government has chosen to take three police officers off the beat, reducing the number to one, and when it is disestablishing the drug squads. We know that the problem is the methamphetamine epidemic that is taking over New Zealand. This Government should be putting money into initiatives to keep New Zealanders safe, instead of putting it into legislation that will bankrupt our country in the future and that has no sound principle, except a huge, huge election bribe, driving it.

This is intergenerational theft of the worst order. This Government is making working New Zealanders, who are struggling to raise families and to pay mortgages, student loan debts, and all the other bills they have, pay for people who are at the other end of their life. Elderly people may have $150,000 sitting in their bank, and we are not asking them to contribute to their own care. I think the Government should stop and think about what it is doing. The Committee of the whole House is ahead. It could still pull this bill, realising that it is not fair to burden New Zealand with the cost of this legislation.

I finish by asking whether we can trust this Government. I want it to tell us what has happened to the $7 billion surplus from the last Budget. Where has the $7 billion gone? I think it has squandered it away. I think that that money has vanished, with nothing to show for it. This is a Government that one cannot trust. It is putting through legislation that will be too expensive for a small country like New Zealand to cope with, especially when we have an ageing population and a shrinking workforce. If this Government cared about those elderly New Zealanders, it would cut taxes and allow people to plan for their own retirement, so that when people did retire, they would be wealthy and well able to cope with what lay ahead.

PAUL ADAMS (United Future) : Poor Judith Collins! She has been so patiently trying to get a call.

Lianne Dalziel: I would rather listen to you, dear.

PAUL ADAMS: I thank the member. This bill is interesting. I found it a very interesting bill to deal with at the Social Services Committee. I heard young Darren Hughes, the only passionate member of the Labour Party, speak on this bill. He probably looks at me and thinks that I am elderly, also. I say to him that one thing about becoming old—as long as one does not die in a crash or something else—is that it happens to us all.

It is interesting to think of the people this bill will affect. They are people who have lived through a period of time that has probably seen more changes than any other generation. I think of my children’s great-grandmother. She recently passed away at 98 years of age. She saw many changes in her generation, yet she still had certain principles in her life. Even in her latter days, when she was living by herself in her own home, on her little pension, she was still able to pay out cash, from the savings that she had prudently put away, to her many children, grandchildren, and great-grandchildren.

This legislation deals with those elderly people. If we are honest, we would say that there are two areas of society that we really need to take care of: children and the elderly. In many ways, there are similarities between the two groups. Little children do not understand every issue of life, and they can often be confused and fearful if they are not understood. Likewise, as we age, similar concerns can come back to us. In other words, we can tend to become like little children in our old age. Therefore, I think that if we are to be a responsible Parliament passing legislation that affects the elderly, we must be concerned with all generations, yet too often we look at things and ask what they will cost us now. Sometimes things do need to cost us now.

As has been said by previous speakers, many of the elderly have worked very hard. Many of them have contributed greatly to our country. Many of them have raised their children well, and many paid a tremendous price as they lived through the Depression and wars. Yet I have noticed, as the bill was going through the select committee, that while United Future is supporting this bill—because we absolutely support the removal of asset testing on our elderly—the Labour members of the House have been very quiet with regard to broken promises. I do not think it is acceptable for Labour members to say: “Well, we didn’t say exactly that.” I say to Darren Hughes that in the simplicity of campaigning, people understand what we are saying. They understand a broken promise.

I think the Labour Government needs to look at what has happened in the elections in the United States and Australia. People have been getting tired of all the testing with regard to families and society in general, and they are swinging back in a huge way to a more conservative view on life. Some parties in this House are taking no notice of that. I want to address the press tonight and say that they are taking no notice of it. I point out to them that they have missed it in every election in the United States and Australia of late. They need to wake up and understand that there is a swing in this nation that will gain momentum. It will not slow down. People are becoming concerned about their families.

What frustrated me during the select committee process was that we would continually hear something brought forward—for example, the issue of rest homes and their daily rate of pay—and were told that that was nothing to do with this legislation; that it was Government policy and that we could not address it. If, as we now understand, those major issues facing the care of our elderly in this nation are Government policy, then I encourage the Government to address them. Rest homes are businesses. There is nothing wrong with making a profit in business, but those rest homes are competing for staff such as nurses and others who are needed to care for the elderly. The staff are unable to get an increased income until the Government decides to change the policy. It needs to be done this side of Christmas, but I suspect, after reading these Supplementary Order Papers, that it has already been pushed way out into the new year. I say to the Government that that is totally unacceptable. The elderly in this country deserve to be cared for correctly and properly. They need to know, especially if they are prepared to contribute to their own costs, that they can have the type and standard of life in their latter days that they desire. I think that to treat them like a political football is absolutely disgusting.

This bill was not contentious at the select committee. I notice that the only minority view is from the ACT party, which opposes the bill because of the asset-testing scenario. I think that, in general, all members on the select committee were frustrated that most of the submitters’ concerns on the issue of caring for the elderly in this country were thrown straight back at them with the explanation: “That is Government policy”. If this Government is interested in Grey Power members and in the elderly in this country, then all members in this House need to put pressure on Cabinet to address those issues, because they certainly need to be addressed.

We have an ageing population. Surely the Government wants to make sure that long-term residential care systems are in place, and that care of the elderly becomes a growth industry. There will be more elderly people in the future, yet I have heard, as I have visited rest home after rest home, that many are having to close their doors. At two or three rest homes I have been to, people have said that it would be best to stop caring for the elderly and put the rooms out as student accommodation instead. In Auckland, for example, where there is Massey University and Auckland University, the owners of many of the facilities that currently care for the elderly could make far more money by turning their properties into accommodation for students.

One thing that did impress me about the owners of all those homes is that they would do that as an absolute last resort. Those people are not in that business because they want to make money. The people who work and labour in those homes have a personal relationship with their customers. They know them by name, they know their various needs, and they know their various medical requirements. They really do love those people, and those people love them. The rest home is a place where they can gather and have social contact. They can have games together and go on visits together.

I believe that the Government, which is failing to address the urgent issues that are currently before it, needs to hang its head in shame. The select committee could not address those issues, much as we wanted to. The select committee—and I believe this was the case across all the parties—could hear the heartfelt cry from those people. We could see the need. As I listen to the Government members tonight, it absolutely amazes me that this disgusting state of affairs is taking so long to be addressed. The Government needs to address it and needs to do so tonight.

United Future is supporting the bill, because at least the bill is going in the right direction with regard to the removal of asset testing. But that is not the major problem that is currently facing the many elderly people and the many rest homes in this country. I challenge the Government tonight. We will support this legislation, but when will the Government address the parts of its policy that only the Government can address? Will the Government do so this side of Christmas? Will it bring some relief for the elderly?

NANAIA MAHUTA (Labour—Tainui) : This bill signals yet another election commitment by this Government that has been kept. Can we fix it? Yes, we can. Will it matter? Yes, it does. Is this a Government that cares? Yes, it is. Around 31,000 older people will benefit from this bill. That amounts to about 7 percent of our population. In 1999 the Government promised to introduce legislation to remove asset testing from all forms of long-term care for older people. This bill is a step in the right direction. Asset testing is unfair. If only Māori lived to be 65 and older, they would get the benefit of this legislation. If only Māori had assets valued at above about $200,000—

Lianne Dalziel: Who put asset testing in?

NANAIA MAHUTA: The previous National Government did. When that Government introduced asset testing, in no way at all did that benefit Māori. I hope that in the years to come we will have a lot more Māori living beyond 65 and realising the benefits of this legislation. Having said that, it is a step in the right direction. It is a step that clearly signals that we are moving towards a fairer system. Although the policy contained in the bill will not be retrospective—it will be implemented on 1 July 2005—it is a good bill and a step in the right direction. It will help many older people, and it will make a difference to many people.

Pita Paraone: What about Māori?

NANAIA MAHUTA: As soon as Māori get out and walk the pavements, and live to a ripe old age, they will certainly reap the benefits of this legislation.

JUDITH COLLINS (National—Clevedon) : The debate tonight has been very interesting. I particularly enjoyed the contributions of Paul Adams from United Future and of Dr Lynda Scott, who speaks from the experience of being a geriatrician and a member of the Social Services Committee, which dealt with the bill. I was on the select committee for the submission part of the process, along with Paul Adams. The bill is a disappointment, in many ways. I think we should acknowledge that there are some good moves in it, but it is a tragedy that people are now being told that they will be able to retain some more of their assets when they go into a rest home, when all around the country rest homes are in absolutely dire straits and are looking to close. The submissions to the select committee on the bill were an absolute eye-opener to me. Like many people in this House, I had parents who were elderly before they passed on, but I was certainly not aware of the dire straits in which many rest home owners, and the people who work or live in them, find themselves. That is because my mother always used to say to me, when I was a little girl growing up, that I should never put her in a rest home—and of course I never did; none of my family would ever have done that.

One of the best things about the asset-testing regime is that it actually acknowledges that most people wish to age in their own homes, with their own families. One of the really good things about the programme that National brought in in the 1990s is the ability for caregivers to come into the home, so that people can age with dignity in their own homes. But there comes a time—and I certainly heard this from the submitters—when many people who are near to the end of their life simply cannot manage in their own homes, and need to go into much more intensive care than they would have needed, on average, some 20 years ago, when people often stayed in rest homes for 10 to 15 years before they passed on. We now find that people are often much sicker, much older, and much nearer to the end of their life before they enter a rest home. I understand—and I am sure Dr Scott can correct me if I am wrong—that the average time for a resident to be in a rest home is about 3 to 6 months.

Dr Lynda Scott: In geriatric hospitals.

JUDITH COLLINS: That is on the geriatric side. Consequently, the costs involved for rest home owners have grown significantly. We have all been inundated by letters from rest home owners and from residents themselves about the dire straits that the owners are in.

I was shocked that The Salvation Army came along to the select committee and said that it was thinking of closing its homes, because it could not afford to keep them open. It is an appalling situation that such not-for-profit organisations are the very ones that are finding it harder and harder to keep their premises open and continue their operations. The Government has set in law a figure of $636 per week for the care of the elderly. That is the same as it has been for the last 10 years, Mr Assistant Speaker. You may well raise your eyebrows at that, and so may we all raise ours. The fee has been the same for 10 years. As Dr Scott quite rightly pointed out, it is $78 a day. That is less than the cost of a motel that provides no care, whatsoever. It is totally unfair to expect rest home owners, who have to have qualified staff, including registered nurses on at nights and other times—qualified enrolled nurses, and caregivers who are now going through a qualifications process, which is as it should be—to operate on that basis. Because the Government is so mean about giving people a fair go when it comes to paying for the costs of care, rest homes are being run down and driven to the wall, while all the time the Government consistently increases the costs for those small businesses—and it certainly has done that.

I have had information given to me by a rest home which states that there was in fact a review by PricewaterhouseCoopers over 3 years ago, and it showed that a 20 percent increase in funding was required then. Since then, rest homes have not had anything. They have now been offered a 1 percent rise to pay for the additional costs, and that is a total and an absolute insult. We have had the caregivers from those places coming along to the Health Committee and saying to us that they need to be given decent wages—and they do. Some caregivers who work in rural communities and who work outside the residences—the people who have to travel in their cars and get themselves to one home after another—are not getting any more, after they pay their petrol money, than about $4 or $5 an hour before tax. That is an absolute disgrace. This Government has sat there for 5 years and mouthed on about what it will do for the elderly, yet it has allowed that situation to continue. Government members talk and talk about giving caregivers qualifications and about doing all sorts of lovely things like that, but that does not pay the bills. Those people get $5 an hour for the hard job of looking after elderly people and making sure that their health is not worse today than it was yesterday. They often have to do all sorts of housework for them, and to lift them in and out of the bath.

Caregivers are being abused by the Labour Government, which refuses to treat them with decency and honesty. If it does not have the money to increase the payment for care, it should tell them so. But we know that the Government does have the money for that. The Government has more and more money for all sorts of little schemes that may win it a few votes, yet it continues to treat caregivers like dirt. It does so mainly because the unions have sucked in those poor workers, who think that the unions are on their side. If the unions were on the caregivers’ side, they would be taking some action against this Government. They would be marching in the streets, and I would be there with them. Those people are being abused and used practically as slave labour by the Labour Government, which will not do a thing to help them because all that it is concerned about is sucking up to its mates. The Government thinks it can take those poor people for granted. The unions sell caregivers a T-shirt with a union logo on it, and those poor people are supposed to think that the unions are on their side, when they are not. The Labour Government has the power to do something about the situation—and it does have the money for that, because it has so much in the way of taxpayers’ money—but it will not do anything for those workers. It is just not fair that caregivers are being treated like that, day in and day out.

Then we get this paltry, pathetic excuse for a bill, and we are all supposed to become excited about it. The only thing that I get excited about is the way that caregivers are being treated.

Lianne Dalziel: Who brought in asset testing?

JUDITH COLLINS: That member, Lianne Dalziel, turned up with a petition at the select committee. She has told us time and time again that she supports caregivers. I ask her who brought in the $4-an-hour pay rate for them. That member has been in power for 5 long years, and she sits in the select committee and bleats on that she is there for the poor caregivers. Lianne Dalziel has been in Government for 5 long years, and the Government has not given one thing to caregivers. Labour takes caregivers for granted and does not care one scrap for them, because they are nice, honest, decent people who care about the people they are looking after.

This bill is an absolute travesty. It does not go nearly far enough for the working people whom it should be for. It is all about giving them a little bit and making them think that that is OK. It is not OK—it is definitely not.

SIMON POWER (National—Rangitikei) : I am delighted to take a call on the Social Security (Long-term Residential Care) Amendment Bill. I find myself taking a very keen interest in this bill at short notice. The thing that I am most looking forward to about this bill is not the discussion or the debate that we have in this House, but more particularly the debates and discussions that will occur on the platform during the election campaign next year when we are able to have a discussion with the public on the issues around the Government’s original promises to remove income and asset testing. I am very much looking forward to asking the Labour candidate in my electorate exactly how that candidate, along with previous candidates and MPs who are currently in the House, has got around the issue of having stood on a platform of removing income and asset testing, when that has not occurred.

But the Labour Party did not just quickly scuttle to the current position that we see before us in this bill. We have seen a series of scuttles occur since 1999. Initially, the promise was held out to the elderly of New Zealand that income and asset testing would be removed. Then the Government softened that position considerably and said it would simply remove asset testing. Then it changed its position again by saying that it would keep the regime for asset testing in place and raise the level of assets that an elderly person can keep to the $150,000 mark with $10,000 a year added to that. But that is not what Labour MPs sitting in this House promised the elderly of New Zealand prior to the 1999 election.

I tell members opposite that they and the candidates they choose in electorates around New Zealand during the general election next year will have to face down the question as to how they campaigned in 1999 to remove asset and income testing, which they did not do. Those candidates and sitting MPs will have to face down the question as to why asset testing was not removed. Then those candidates and sitting MPs will have to face down the question as to why that regime has remained in place.

National will not sit silently at those meetings and let those candidates get away with convincing the elderly of New Zealand that they have their best interests at heart. We have seen here a direct and unequivocal broken promise from Ruth Dyson. To be honest, I would have expected more from Ruth Dyson. Members can say what they like about her, but I would say that she is a bit of a straight shooter. I am pretty disappointed that we now find ourselves in this situation. I do not believe for one moment that Ruth Dyson is happy with this. Minister Dyson should not grin across the House. I would think that she feels completely bought off and cheapened by the little scuttle-bug deal that has been done to pull up short on promises to the elderly people of New Zealand. Although I do not agree with a lot of Ruth Dyson’s politics, I know that she will not be happy with this because she has a reputation as being a bit of a straight shooter and this legislation sells her considerably short. I think that is a shame because Minister Dyson had the opportunity to fulfil the election promise of 1999 to the elderly people of New Zealand and she has been pushed out by the rest of the Labour Cabinet to take the fall with the senior citizens around this country.

Ruth Dyson is the person who will have to front up during the election campaign and give the answers to questions that she wanted to answer completely differently, had she not been the fall person for this miserable Labour Government. On one hand it takes $7 billion worth of surpluses from the hard-working taxpayers of New Zealand, and, on the other hand, instead of redistributing that money in a way that many of the Labour members would feel proud of, and which is in keeping with the great Labour mantra of redistribution, it does nothing—despite having run two election campaigns with promises of scrapping asset and income testing.

That will be this Government’s legacy. If it was able to stand on a platform and say that it is genuinely a party that believes in the redistribution of wealth and with one hand it will take $7 billion of taxpayers’ money but with the other hand it will farm it out to the elderly of New Zealand, then, whether or not people agreed with it, that is a genuine political philosophy that other political parties in this House—not National—may hold to. But it cannot even do that with honour. It takes with one hand and it holds on with the other hand. Ruth Dyson is the fall guy for this legislation, which can be summed up in a series of very simple words: broken election promises.

• A party vote was called for on the question that the Social Security (Long-term Residential Care) Amendment Bill be now read a second time.

JEANETTE FITZSIMONS (Co-Leader—Green) : I raise a point of order, Mr Speaker. Please could I register a vote? I did not hear the call to vote, because I was speaking to the Minister about the bill.

The ASSISTANT SPEAKER (Hon Clem Simich): Yes. Please exercise your vote.

Dr the Hon LOCKWOOD SMITH (National—Rodney) : I raise a point of order, Mr Speaker. I would appreciate your guidance on the issue that has just arisen. I accept that it is now past, so I am looking to the future. As I recollect the situation, and I have been in the House, it seemed to me that a party was not present in the House while a vote was taken. A member of that party then came into the House and sought to lodge a vote. That would seem to me to be inconsistent with the Standing Orders, and I would appreciate your guidance on the matter.

The ASSISTANT SPEAKER (Hon Clem Simich): The member was present in the House before the vote was concluded and, accordingly, I allowed her vote.

Jeanette Fitzsimons: I raise a point of order, Mr Speaker. Could I please just clarify that I was present in the House, and have been since 5 minutes past 9, not just before the vote was concluded. I was speaking with the Minister about the bill itself.

The ASSISTANT SPEAKER (Hon Clem Simich): I accept that. I said that the member was present in the House at the required time.

Dr the Hon LOCKWOOD SMITH (National—Rodney) : I raise a point of order, Mr Speaker. I am just seeking your guidance, so that we understand how the Standing Orders are applied. If you have called a vote and a party is not present in the House when you call that party, and if a member of that party subsequently comes into the House, is it in order then for that party to seek to be able to lodge a vote? What is the ruling in respect of that? Obviously, while it is not particularly important on this vote, one can imagine a situation where it would be important, and I wonder at what point is the cut-off for a party to come into the House to vote.

The ASSISTANT SPEAKER (Hon Clem Simich): This does not concern Jeannette Fitzsimons, of course, but it is as long as the member who wishes to vote is in the House before the vote is concluded. That would be my interpretation of it. We could look at it further, but that would be my interpretation. As long as a member is in the House before the vote is concluded. So we have proceeded correctly.

SIMON POWER (Senior Whip—National) : I raise a point of order, Madam Chairperson. There does not seem to be any copies of the bill on the Table, and I wonder whether that has any impact on our ability to proceed on this matter.

The CHAIRPERSON (Ann Hartley): I apologise. It does not have any impact, but they should be here. We will rectify that.

Dr the Hon LOCKWOOD SMITH (National—Rodney) : This is important legislation before Parliament this evening.

Simon Power: I raise a point of order, Madam Chairperson. I apologise for interrupting my colleague, but I seek a point of clarification for future reference. Is the Committee able to proceed with the debate if copies of the bill are not on the Table? My understanding, and I am open to correction, is that we are not able to proceed if copies of the bill are not on the Table.

The CHAIRPERSON (Ann Hartley): That is not correct. The bill is available in the Bills Office and, yes, the Committee can proceed.

Dr the Hon LOCKWOOD SMITH: As I was saying, this is important legislation. It contains 235 clauses, and this part we are debating right now contains amendments to the Goods and Services Tax Act, the Taxation Review Authorities Act, the Income Tax Act 1976, the Taxation Review Authorities Regulations, and the Partnership Act of 1908. That is fairly important legislation, and I suggest that this Labour Government is treating this Committee of the whole House with contempt, because there has been no attempt by the Government to explain either to the Committee or to people listening to this debate what on earth this is all about. The Government is showing contempt. Does it feel so little concern for the people of New Zealand that it thinks it can push legislation through. Members are meant to be examining the bill clause by clause, yet Government members do not even bother to get to their feet to tell the people of New Zealand what on earth the Government is trying to do?

What that invites us to do is to actually define what the Government is trying to do. I simply come back to something Government members do not want to talk about, and that is their colleague John Tamihere. I want to know, under Part 4, about the fake invoices at the Waipareira Trust that were overseen by John Tamihere. We all know that invoices are meant to be GST invoices, but these were fake invoices. What does this amendment to the Goods and Services Tax Act do to get John Tamihere off the hook in respect of those fake invoices, which may also have defrauded the taxpayers of New Zealand of GST?

If we look at other clauses in this bill—not in this part, so I will not spend too much time on them—there is a reference in the next part to an amount distributed to a member by a Māori authority. I think that if Government members do not treat the Committee with more respect and get to their feet to explain what all these amendments do, we will make our own interpretations and challenge this Government to prove that there is nothing in here to get John Tamihere off the GST commitment for the fake invoices. I challenge members opposite to get to their feet and explain how the GST was treated on the fake invoices for which their Cabinet colleague John Tamihere was responsible. When he gave a personal explanation in this Parliament they got to their feet and applauded him.

There is a question for these Labour members about the amendments in Part 4, because we have all sorts of amendments to do with GST—such as, zero rating of services, taxable period returns, and special returns. Is there something in clause 127, “Special returns”, that means it is a special provision to enable John Tamihere to file a tax return for the fake invoices? Is that what that provision is doing? I ask the Minister in the chair, the Hon David Cunliffe, to treat the public of New Zealand with respect and get to his feet and explain what these clauses are doing, because they are not just technical amendments. There are significant issues here, and why should the public not expect anything other than this?

After all, we know what this Labour Government did when its colleague Harry Duynhoven broke the law. It amended the law to get him off the hook. That is what it did to get him off the hook. We know what Helen Clark thinks of the law. When she was found to have forged a painting, she would not cooperate with the police so they could find out the truth of the matter. So why should the people of New Zealand not think that Part 4, where it talks about amending special returns for GST, is anything other than a provision to get John Tamihere off the hook in respect of his fake invoices?

PANSY WONG (National) : I think my colleague Dr the Hon Lockwood Smith’s various questions deserve answers because he is right. The Government has not even bothered to take a call to explain to the public the various amendments to Part 4, particularly those to the goods and services tax. I will come back to the fake invoices later on.

Let me start off by saying that GST was introduced by a more progressive, liberal Labour Government in the 1980s. The Government that introduced that broad-based, indirect tax was a much cleverer Government. [Interruption] My colleague Richard Worth notes that that was in the 1980s. The David Lange Government understood that bringing down individual personal tax and bringing in a consumption tax was a much better, fairer tax system. It was not like this regressive minority Labour Government at the moment, which has increased personal tax. Today in question time my colleague John Key brought up the issue that this Government is daily raking in an additional $8 million of tax from direct-source deduction. We want the Minister in the chair, the Hon David Cunliffe, to take a call and explain to us whether Part 4, in any intentional or unintentional way, might distort that broad-based consumption tax, GST. After all, there are quite a few amendments—to the definition of goods and services in relation to financial services, to what a special return is, etc. While on this side of the Chamber the National Party is very supportive of GST, we feel that the Minister, to earn his salary, should at least attempt to take a call to explain what the consequences of those amendments are.

I would like to repeat some of the concerns raised by my colleague Dr the Hon Lockwood Smith about the implication of GST on fraudulent invoices. Would the Inland Revenue Department have got the input and output tax reconciliation when fraudulent invoices were issued? How do they get picked up? Do the trusts furnish a GST return? If that is the case, what is the implication if fraudulent invoices are GST inclusive? Would the Inland Revenue Department have started to demand that the proper tax be deducted? Would the trust actually be entitled to a refund? Did it furnish that tax in the correct taxable period? I really think the Minister, who receives a ministerial salary, should at least attempt to take a call to answer what the implication is of GST on fraudulent invoices. Does the fact that it is a fraudulent invoice mean that the input tax—in this case, it is probably an output tax—has been deducted and furnished to the Inland Revenue Department, and what implication does the amendment in this part have in those circumstances?

While National continues to support GST—a good indirect consumption tax, which is a much fairer tax—we want to know whether the amendments in Part 4 in any way have tainted the legislation.

Hon RICHARD PREBBLE (ACT) : In rising to speak to the Taxation (Annual Rates, Venture Capital and Miscellaneous Provisions) Bill I invite the Minister in the chair, the Hon David Cunliffe, to participate in the debate. The Minister’s failure to do so turns Parliament into a rubber stamp.

Some quite serious points have been raised, one of which goes to the integrity of the whole process we are dealing with. The Hon Lockwood Smith has asked a perfectly reasonable question with regard to this part, which talks about GST and refunds of tax. Of course, it carries on further from what we have already passed in Part 3 in relation to time limits on charging GST. He asked what the effect would be on the Waipareira Trust. I say to the Minister that the ACT party has received correspondence from accountants who have said that they have been reading with incredulity statements about the trust, about false invoices and the like, and they have asked: “How can this happen if the trust has been paying GST?”. If it has been paying GST, there ought to be a clear paper trail showing what has happened. Apparently, when one looks at the reports that are coming out, one finds that one thing that does not exist is a clear paper trail. That can only be if GST was not being paid.

The Minister was asked that by Lockwood Smith, and I now join him in asking that. While we are making changes to the law here, and to the position of taxpayers, are we, in fact, assisting the Waipareira Trust? Indeed, I asked the other day whether, when the Government drafted this legislation, it knew that it would be assisting a fellow Minister. Is that the purpose of this part? I say that the Minister has an obligation to get up and tell us what he knows about this provision. Does it assist Mr Tamihere—he is not the Hon Mr Tamihere now; I understand he is Mr Tamihere, but all members are honourable members—or the Waipareira Trust? These are reasonable questions to ask, and so far they have not been answered.

It appears to me that the answer is one of two explanations. The worst explanation is that it does and the Government does not want to tell us, but the more likely one is that the Minister does not know. I just say to him that that is not acceptable. He ought to know. He ought to be asking those questions, and he should not be presenting a bill to the House that could create an impression—which may not be deliberate—that this Government is prepared not just to bend the law to assist a colleague but to rewrite it.

Dr the Hon Lockwood Smith: It did it for Harry!

Hon RICHARD PREBBLE: That is true; the Government did it for Mr Duynhoven. But at least in the case of Mr Duynhoven Government members were brazen about it. They came here and said: “We’re fixing it up for our mate.” They told us that. But here we have a situation where they may or may not be fixing it up for their mate.

I actually think the Minister does not know, but I also think he does not want to know. Well, I tell the Minister that that is not good enough. He ought to be able to get up and go through the provisions. We had the Minister of Finance in the House when we were debating the matter earlier, and he started to say that, no, it did not help them. When we drew to his attention what was actually in the bill—and I suspect that Mr Cullen is so busy that he either did not know or had forgotten what was in the bill—I could see on his face that he had started to realise that this bill most certainly will assist the Waipareira Trust, from the facts that we know, and from the facts that we suspect.

I suspect that the trust has not been paying GST. One of the great advantages of GST, and one of the reasons accountants like it, is that in order to fill out one’s GST return one has to have a decent set of accounts, which is better for a business. It also follows that if one does not have a decent set of accounts—and I have to say that the Waipareira Trust is not the only outfit I know that has not paid GST; I will be right up front and say I do not think the Pipi Foundation paid its GST, either—one would find it difficult to reconcile one’s GST. The difference between the Government and myself is that I think that is outrageous.

RICHARD WORTH (National—Epsom) : It is a privilege to rise on behalf of National and oppose the Taxation (Annual Rates, Venture Capital and Miscellaneous Provisions) Bill. It was truly said by Benjamin Franklin many years ago, in a letter that he wrote to Jean Baptiste Leroy-Beaulieu, that in this world nothing can be said to be certain except death and taxes. Part 4 is a complex and technical part of the bill, and I join with others in condemning the reluctance, or perhaps it is the refusal, of the Minister to stand and participate in this debate. I do that with a sense of sadness, because Mr Cunliffe came to the House quite recently as a new member with a great future—or so some people thought. Here he has an opportunity to show off his knowledge and his intellect, and to show that he is a capable and conscientious Minister with some knowledge of this bill. Does he take the opportunity to demonstrate his skill to the Committee? No. Are some of us questioning whether he has that skill? Yes. Is it probable that he lacks that skill? Yes. That is why I want to pick up on a number of technical issues in connection with Part 4—to prod the Minister from his seated position in the Chamber and his apparent lack of interest in this legislation, so he will rise and make some limited substantive comment on the issues I raise.

Part 4 contains a number of changes that amend various statutes. Other members have referred to changes to the Goods and Services Tax Act. There are amendments to the Taxation Review Authorities Act that I would like to deal with at some length in later calls. Also, there are amendments to the Income Tax Act 1976, particularly with regard to voting and market interests, amendments to the Taxation Review Authorities Regulations, and a very significant change to the Partnership Act of 1908—that old legislation.

I start the analysis by looking at the changes to the Taxation Review Authorities Act, which are set out in clause 141. That Act is not well-known legislation. Certainly, the role of the Taxation Review Authority is clear, and it has been discharged manfully by officials and members of the authority for a number of years. Why is it, I ask the Minister, that there has been a change in clause 141 that replaces the figure of $15,000 with the figure of $30,000? The question must be asked as to why there is no alignment between the position in a civil jurisdiction in respect of small claims and a different, and apparently seemingly illogical, alignment in connection with the Taxation Review Authority’s legislation. Surely the issues must be the same in both circumstances, and the monetary jurisdiction should not alter. Small claims are small claims, and across the broad brush of Government legislation there should be constancy. That is the first question I would like to raise.

The second aspect concerns the amendment to the Taxation Review Authorities Regulations. I am glad that the Minister is listening closely to this point, because I husband the hope that he may rise and make some contribution, other perhaps than belching, to the discussion that centres upon clause 144. For the first time, it seems, there is a definition in clause 144(1) of the meaning of the word “precedent”. I do not think it is a remarkable definition, but it states: “precedent means a decision of the authority that affects, or may affect the outcome of a separate and unrelated dispute between—”.

CRAIG McNAIR (NZ First) : I am sorry to interrupt the member while he was on such a roll.

Simon Power: Yield to him, then.

CRAIG McNAIR: I am probably not sorry enough to do that.

Opposition Members: We would rather listen to you.

CRAIG McNAIR: I thank the Opposition members who say that they would rather listen to New Zealand First than to National members. At least it shows that New Zealand First is the voice of reason in the Chamber. That is where I will leave that matter. I would like to speak to clause 132, “Payment of tax”. I will not take the same approach as other speakers from the Opposition side of the Chamber; I will take a different approach. I want to ask a question of the Minister in the chair, the Hon David Cunliffe. When people pay their tax—whether it is 39c in the dollar, or 30c in the dollar, or whatever it is—

Simon Power: Is this about GST?

CRAIG McNAIR: Whether it is GST, income tax, or whatever it is—[Interruption] I am speaking about GST, but I am also speaking about taxes in general—

Hon Richard Prebble: I raise a point of order, Mr Chairperson. Mr McNair is trying to make a speech. I am trying to listen to him, but his difficulty is that he is being interjected on by people who are sitting right behind him. It is breaking up his speech. It does not enable him to make a coherent speech, and therefore I cannot follow it. I really think the members who are sitting closest to Mr McNair should give him a fair go— he gave them a fair go—so that we can hear him properly.

The CHAIRPERSON (Hon Clem Simich): I thank the member for raising that point on the correct procedure in the Chamber. There should be no interjections from members sitting directly behind the member who is speaking.

CRAIG McNAIR: Thank you, Mr Chairman, and I thank the member, as well. It is a lot easier to speak when one does not have people interjecting from behind. I am very well aware that Part 4 deals with amendments to the Goods and Services Tax Act, but I am trying to make the point that whatever that payment of tax—whether it is tax paid by a business, by an individual, or by whomever it is, and whether it is GST, income tax, or another form of tax—I wonder whether a portion of that tax could be put into people’s savings for the future. That is the point I would like the Minister to comment on, if he wishes. I want to know from the Minister’s end where the Government is at on that issue. Has it given thought to whether some tax could be channelled into individual accounts? I would like the Minister to tell us where the Government is at, and what its view is, on that.

One of the biggest tragedies we are coming up against is the lack of savings by younger couples, and by anybody else for that matter—the negative state whereby people do not have any savings. In fact, most New Zealanders are in huge, huge debt. My question to the Minister is about where the Government is at in terms of being able to channel some of—

Lianne Dalziel: There was a referendum on that, but the people voted against it.

CRAIG McNAIR: A former Minister interjects. That is right; a referendum on that was lost. But I still think it is fair to ask that question, because the Government does have a superannuation fund. It has gone one step in the right direction, we would say, but it is a long, long way off from where we would like to see it go. I would like the Minister to tell us where the Government is at in terms of channelling certain amounts of tax into the savings area. No matter where that money comes from—whether it is from GST or whether, as is more likely, it is from income tax—it should go towards people’s long-term savings for their future. I think that is a very reasonable question.

The Government says the country is experiencing an economic boom. I do not think it is, because if it was the Government would be taking tax payments and using them for something that would really benefit people, and especially young people. Superannuation payouts are not likely to be available to them, especially if they happen to retire under a National Party regime and have to look after themselves. I say that we need to make life more certain for our younger people and younger couples. Not only do they have huge amounts of debt but just about every New Zealander is in that situation, if we go by the statistics.

• Progress reported.

• Report adopted.