Hon BILL ENGLISH (Minister of Finance) : I move, That the Crown Retail Deposit Guarantee Scheme Bill be now read a third time. We have had a reasonably wide-ranging debate on the bill, and that was always likely to be the case, despite the fact that the bill does not have a lot of the detail of the scheme in it. The Committee stage gave members the opportunity to work through most of the substantial issues that had been considered in bringing the policy together.

The Opposition, in the spirit of cooperation around this particular issue that we have followed for the last 12 months or so, raised a number of quite reasonable points. I will respond in a very general way. A lot of the points that members of the Opposition made had merit. The Government made judgments on issues to do with coverage, pricing, and product exclusions based on the principle that we want to move back to normal market conditions in a reasonable time. I thank members for the quality of that debate.

I will just remind the House of the general principles that are driving this bill. First, we want to ensure that depositor confidence promotes system-wide financial stability. One of the advantages the New Zealand economy has enjoyed over the last 12 months is that it has retained financial stability. In part that is to do with the fact that, although they were vulnerable, our Australian banks were in good shape when the financial crisis came along. That was partly because of actions taken by the previous Government in installing the guarantees to ensure that confidence in their stability was maintained, and partly because the wide range of tools that the Reserve Bank supplied to the financial system enabled it to get through the period of crisis into a period, now, of relative stability.

The second principle driving this legislation is the need to minimise economic distortions and ensure well-priced credit markets. There is no doubt that the guarantee does create some distortions, and an obvious one is the fact that deposits into our non-bank deposit taking sector actually grew or have grown during the time of the guarantee. I think anyone would say that in the absence of the guarantee that might not have happened. We need to reflect on the fact that one of the reasons for the financial crisis was mispriced credit risk. That is why it is important that in responding to the financial crisis we do not perpetuate for longer than necessary distortions in credit pricing. It is really important that we revert to normal market conditions, where people who are making deposits and making investments are facing a realistic trade-off of risk and return. That is another principle behind the bill.

The third principle is the need to do our best to ensure a viable non-bank sector in the future. A number of speakers through the Committee stage stressed a point that I think is important about how the four Australian banks dominate our financial intermediation. A large number of businesses and activities in New Zealand are not the natural customers of those banks, and therefore the non-bank sector is important. One of the principles is to ensure that the non-bank sector consolidates and rationalises itself in a way that means at the end of the guarantee we have places where people can go to borrow money for their ditch digger, truck, or other business need that a bank will not necessarily respond to. I would keep in mind, though, that because of that demand, it is likely that other players will come into the non-bank market.

Finally, we want to manage the Crown’s exposure in terms of fiscal costs. Any institution that fails under this guarantee imposes a cost on taxpayers, and taxpayers deserve their interest in these institutions to be looked after with due care. That has ruled out options such as unilaterally or quickly withdrawing the guarantee in a way that could put taxpayers in the position of paying out hundreds of millions of dollars to institutions that fail. Those are the same hundreds of millions of dollars that we need to run our health services, police force, and schools, so we are keen to ensure that the Crown and the taxpayer enjoy the potential benefits of an uplift in the economy, where asset prices stabilise, where confidence grows, and where there is a realistic opportunity that these guarantees will not be realised. I commend the bill to the House.

Hon DAVID CUNLIFFE (Labour—New Lynn) : It will come as no surprise to the public if I reiterate that Labour will be supporting this bill. We do so because we believe, firstly, that it is appropriate for us to have framework legislation that provides powers to the Minister to bring down policy in this area, and to regularise what was necessarily done by emergency or reserve powers under the Public Finance Act after Parliament was prorogued just before the last election. The process we are going through is broadly appropriate; therefore, we support it.

It is right, as has been said by the Minister of Finance, who has just resumed his seat, that this has been a wide-ranging debate. It is right for two reasons. Firstly, as my colleague the Hon Lianne Dalziel has been at pains to point out, unfortunately there has been no select committee process, which I think is both unfortunate in itself and becoming a hallmark of this Government—that it considers that the standard safeguards of democracy are somehow pliable or dispensable.

We have a regret that in consultation on this bill we did not perhaps make even clearer our concern that there should be an opportunity to more formally question officials, and to give members of the sector and of the public the opportunity to raise their issues, because although the Reserve Bank and Treasury have been talking to the institutions, that is far from the public view. So I guess we go into this third reading debate with an enduring sense of having missed something important along the way.

I want to firstly recap briefly the Minister of Finance’s summary of the justification for the bill, because I think he has encapsulated quite well the rationale. In recalling from our first reading debate, the broad scheme of this was that there were three options. Having got the scheme in place, we could go cold turkey and let it expire at the end of next year, we could have a limited extension with limitations around risk and distortion—which is what the Government has chosen to do—or we could transition gradually to a permanent deposit guarantee scheme, which would have some enduring advantages for deposit holders. That is something we believe that the Government, rightly, still has in consideration. We commend that work, and we look forward to a good bipartisan discussion on it.

Within that the Minister has reiterated three rationales for taking the middle course. We think the middle course is the right course, but we have some questions about the nature of the rationale. The first one was system stability. Of course, system stability is important, and the Minister was kind enough to acknowledge that it was supported by the original retail and wholesale guarantee schemes that the then Labour Government put in place. I reiterate by acknowledging that it is also being supported by the strong presence of the very stable Australian banking system in New Zealand—and that is to be welcomed. It was not caught up in the derivatives-driven mess of Wall Street in the northern hemisphere, and it does provide some of the largest share of triple A rated banks in the world. We are fortunate that our system does not suffer from financial stability risk. Where we part company with the Government on this point, however, is that an acknowledgment of overall stability should not be an excuse to turn a blind eye to second-tier risks and longer-term issues that will be of strategic importance to this economy down the track. Our responsibility is to provide not only for stability today but also for sovereignty tomorrow. It is in those issues that we believe a level of concern is shared by many New Zealanders.

The minimisation of distortion is important and we agree that part of the seeds of the bursting of the global finance bubble was in the masking of risk, through other instruments than we are considering today—things like real estate - backed securities, collateralised debt obligations, and derivatives, which are a different story and not about this issue. But we agree that it is prudent to have some limitation around risk. The line has been drawn here at a credit rating of BB. We believe that there are arguments on both sides of the House. My colleague David Parker has been eloquent in setting out the pros and cons of that line and the fallout for members of the non-bank finance sector that by very issue of scale, as opposed to inherent portfolio risk, are either too small or cannot stand the transaction cost of getting rated.

The Minister responded that they have to anyway, for other reasons down the track. That does not change the fact that there will be fallout from that market, in addition to the fallout that has already occurred, and from that we will see a further concentration of that market. That is where we think the Government is on the weakest ground. We would like to have further discussion to help it out on this. The Minister said: “ensure a viable non-bank market”. That is where we believe most of the risk is here. At the end of the Committee stage debate we were coming on to the issue of concentration of risk, not only by type—95 percent, in major banks—but also concentration by source of funds, about 80 percent from Australia into our market, and by sector largely into real estate, largely fuelling the housing bubble.

There are some huge issues there for Parliament, the Government, and Opposition to work together on in the public good to, first, avoid a further housing bubble and collapse, and, second, to avoid us becoming pawns in somebody else’s banking game and to ensure that New Zealand has a diversity of sources of funds from many different lenders. We must do that so that we are insured against the marginal market problem—that is, when you are a very small borrower from a very big person and that person does not need you. Of course, the irony is that latterly we are starting to see the emergence of a different issue in that Australia is looking at New Zealand and saying: “Goodness me! You’re about, or coming up to, a third of our risk pool, and you might be riskier than some of our onshore assets. We’d like to take a closer look at your regulation.” Australia might ask the Australian Prudential Regulation Authority to oversee our financial system.

It is there that we come, whether we like it or not, to longer-term questions of sovereignty. Those are the issues that, in addition to the pass through of interest rates, the parliamentary banking inquiry uncovered in the last several weeks, and we believe, on our side of the House, that that was an extremely worthwhile exercise. We had 50-odd submissions, despite the work of the Beehive to shut the inquiry down—and I hate to be so harsh but there is no other way to put it. The Beehive tried to roll its own members to vote against the inquiry taking place, after the members had proposed a very worthwhile exercise in the Finance and Expenditure Committee. That was our first preference and where it should have happened.

I really want to thank the Green Party and the Progressive party for working very cooperatively in inviting all other parties in Parliament, but where was the Māori Party? It purports to represent people who have interests similar to Labour’s own people—the ordinary folk of New Zealand. We would have welcomed the Māori Party being there. Where was the ACT Party? It has clear views about financial regulation and speaks a lot of sense from time to time. It would have made a contribution. But oh no! The word went out from the Beehive: “Thou shalt not play.” And the word went out from the Beehive to the boardrooms of the banking sector, and they stayed away—some of them. Some of them, like Kiwibank in particular, and groups like Federated Farmers, the Manufacturers and Exporters Association, the Productive Economy Council—and even the Employers and Manufacturers Association (Northern), goodness me—had the courage of their convictions and said: “Whether you like it or not, these issues affect our members.” I commend them for coming along to the inquiry, and I am confident that with the further research that is going on, we will have a very substantive contribution to make to the ongoing debate.

In conclusion, and coming back to the substance of this bill, this is framework legislation. It provides the power for the Minister to bring down by regulation, through the Gazette, the policy that he has announced in the last couple of weeks—that is, to extend by 1 year the retail deposit guarantee scheme. In so doing we can understand that that is the middle option between three, and broadly we support both the process and the strategic option shown. But significant issues have arisen in this debate around the lack of consultation, the lack of public disclosure of issues, the concentration of risk, the fallout for the non-bank finance sector, the risks around the exclusion of collective investment vehicles, and, as the Opposition has been at pains to point out, the error, in our view, of allowing the major banks to opt out, when they represent 90 to 95 percent of the coverage, 90 to 95 percent of the revenue stream to the Government by way of premiums for this retail deposit scheme. The beneficiaries of the wholesale deposit scheme should be in the retail deposit scheme. That, in our view, was a strategic error. It will result in cherry-picking and it will result in a concentration of risk.

CRAIG FOSS (National—Tukituki) : I am glad the House is finally on the third reading of the very good Crown Retail Deposit Guarantee Scheme Bill. First of all, I acknowledge the support across the House for the bill, and the contributions of members, particularly those of the Hon Lianne Dalziel in the Committee stage. She talked about the regulatory impact statement and raised some very good questions in and around it. I acknowledge also some of the questions of some of her colleagues.

One point that kept being raised was why the bill was not referred to the Finance and Expenditure Committee. I note again that the original decision made by the previous administration to bring in the retail deposit guarantee in the first instance did not ever go before the select committee.

Hon David Cunliffe: Parliament was prorogued.

CRAIG FOSS: It was an election period.

Hon Lianne Dalziel: Parliament was not sitting.

CRAIG FOSS: That is quite correct, but, even after that, it did not go before the select committee when the new Parliament was confirmed. But there were plenty of opportunities for members opposite to ask the finance Ministers and Treasury at various stages, as part of reviews, about this particular question. In fact, many members did ask about it at the select committee.

Also, there are market sensitivities around this type of bill. I refer to equity prices and debt prices, and to whether an extension of the guarantee is assured, particularly for the lower-tiered and lower-rated institutions, which many members opposite say they are concerned about. Providing certainty as far out as possible is the best thing. I struggle to see why some members cannot see that. After the Royal assent—let us say that occurs on 15 or 16 September—any institution can voluntarily join and, basically, have the deposit guarantee for another year, subject to terms and conditions, and that will allow them to do term funding. As many members will have noticed, there is a wall of funding maturity occurring in October next year, and this bill starts to address that issue.

There is one thing I cannot let go. The previous speaker talked about risk, as did many speakers on the other side of the House. Under the previous Government, the most wealth-destroying regime in New Zealand’s history, about $9 billion to $12 billion was wiped off the Crown’s balance sheet. Members opposite should not get up, prophesy, and dictate to us about risk, when their track record is not very flash. The losses included $7 billion to $9 billion from superannuation, $2 billion to $3 billion from accident compensation, about $1 billion from the National Provident Fund, and $1 billion from the railways. Those members should not get up and talk about risk and risk management. Well, I guess they can, but they should declare what their track record is. Under the previous Minister of Commerce, depositors in various finance companies lost about $1 billion. That is not the individual’s fault; of course it is not. Those members should not get up and dictate to the House about risk and risk management, when their track record is very, very shabby. I do not imagine that the previous Government’s track record of risk management will ever be repeated for a long, long time. Certainly, in the history of this country it had never been seen before. About $8 billion to $10 billion was wiped off under the previous Government’s watch.

A couple of points were raised during the Committee stage. Members opposite talked about the exit strategy—how institutions will transition out of the new extension. They seem to forget that it is voluntary. How will institutions transition out? I go back to the original scheme. It would have stopped on 12 October 2010; it would have stopped, cold turkey, on 12 October 2010. Look at the funding maturity occurring in early October 2010. The scheme was to have gone cold turkey then. If this bill is not passed—hopefully, it will be—the scheme will stop, cold turkey. Liquidators and receivers will be in there by the dozen, simply because of the inability of the institutions to get themselves out of the current funding and liquidity trough. Members get up to ask questions about the transition phase, but this measure is the transition phase out of the existing rules. It is quite simple. It is prudential, it is common sense, it better prices the risk, and it is voluntary. I know that is a point the previous speaker has issues with, but it is voluntary. From the point of view of the Government, of the Crown accounts, this measure is a very good option. If the recession continues and/or worsens, it is there; it is virtually the status quo. If the economy improves, then the downside for taxpayers, who have underwritten all these liabilities, is very much diminished, to the tune of tens of billions of dollars. In that context it is a very, very good transitional measure out for the taxpayers of New Zealand.

Another speaker on the other side of the House seemed confused about what is insured. It is retail deposits under $1 million that are insured under the current scheme. Yes, the limit is going down to $500,000, but it is not the shareholders’ equity that is insured. Yes, the scheme helps institutions, but it is not their equity that is insured. If we want to test that, we should look at the share prices of institutions, both in this country and in Australia, since the scheme came in and see whether they have gone up or down. Share prices have actually plummeted. Again, the shareholders’ equity in those institutions, the asset valuations, are not insured; they have nothing to do with this scheme. It is deposit insurance only.

Mr Norman spoke yesterday and Mr Cunliffe picked up some of his points, as well; I guess Mr Norman will give another speech in a minute. Their solution seems to be to nationalise everything, to internalise all banking, thereby forgetting that New Zealand owes $130 billion to the rest of the world, and forgetting that in 2000 it was about half that amount. Those members are trying to forget the last few years of history. If we take the content of some of those speeches to their logical extreme, they think that if we fix the exchange rate, somehow fix interest rates, and bring in reserve asset ratios—from the book of Muldoon—then everything will be fine! It just does not seem—

Hon David Cunliffe: The Reserve Bank’s doing it; it’s called Basel II.

CRAIG FOSS: I note that the member who is interrupting has another solution, which is to potentially increase the tax rates on portfolio investment entities. He was quoted in the National Business Review about that recently. Is that a solution or not? I do not know; I am quite happy for the member to clarify that. I am sure I saw an article about it in the National Business Review recently.

Quite frankly, given the track record of the previous administration, and the track record of many of the speakers opposite who had ministerial warrants or were associated with the finance part of the previous administration, for them to get up and dictate and preach about risk and risk management is very, very hollow indeed. The numbers do not stack up. I appreciate and agree with their concerns about the vulnerability of the New Zealand financial system, but when they start talking about our losing our sovereignty to Australia, and things like that, I look at the fact that we are continuing discussions that started under the previous administration. Discussions relating to the back office and the regulatory regime involving the Australasian Prudential Regulation Authority and the Reserve Bank of New Zealand, Treasury discussions, and ministerial discussions are all continuing. Those members should take pride in the fact that they started to try to coordinate the back-office and regulatory arrangements with Australia. Much of the legislation that came in under the previous Minister of Commerce in terms of non-bank deposit takers looked at what happens over in Australia. Members should take pride in that, rather than scaring the horses about something that just does not exist.

This is very, very good legislation. It is a transition out of a very awkward situation that all members acknowledge. I for one hope this country does not ever get into a situation where such a guarantee in such unusual circumstances is needed again.

Hon DAVID PARKER (Labour) : Before addressing the bill it behoves me to respond to some of the comments made by the member who has just resumed his seat, the chairperson of the Finance and Expenditure Committee, National’s Craig Foss. I would have thought that that revisionist view of history was beneath him. It is plain that when the last Labour Government took office Government debt was 39 percent of GDP. When we left office it was 17 percent of GDP. Net debt was virtually nil—for the first time in New Zealand’s history, I understand. So, far from leaving the books in a poor state, we left them in a very good state. During the period of our tenure New Zealand’s growth rate was higher, on average, than that of Australia, the United States, Europe, and Japan. So on the growth front we did better, as well.

During the period of the Labour Government we built up savings to fund the future bulge in superannuation. We established what is colloquially called the Cullen fund—the New Zealand Superannuation Fund—which now has over $10 billion of savings in it to go towards superannuation in the future—contributions to which, of course, have been suspended by the current National Government, which is another example of its mismanagement of the economy.

Mr Foss’ contribution and criticism needs to also be reflected upon in the context of the fact that the Opposition is supporting this bill. I am afraid that Mr Foss, having served that up, will have to take a little bit back. The reality is that we expect judgment to be shown by the Government and judgment to be shown by the Minister of Finance. When he makes those sorts of accusations against us, I am afraid he will find it coming flying back, because the headline of today’s paper shows that his Government is a Government without ethics—“Fresh housing woes for English”. Mr English was trying to line his own pocket, and he showed terrible misjudgement in his personal dealings in respect of something that was going to privately profit him. So the member should not come here and lecture us about ethics when there is that sort of thing on the front page, with the Minister in charge of this bill.

I want to return to the topic, which is the financial stability that is ensured through this retail deposit guarantee scheme. Mr Foss misrepresented my colleague the Hon David Cunliffe’s comments about this being compulsory or voluntary. We have never suggested that it ought to be compulsory. The point he was making is that if an institution is going to pick up the wholesale guarantee, it should pick up the retail one as well. Otherwise we are saying that we need the guarantee for the big fellas who are lending to New Zealand from offshore hundreds of millions or billions of dollars, but ma and pa investors who are only investing $1,000 don’t get the benefit of the guarantee. That is the point the Hon David Cunliffe was making, and it should not be misrepresented by Government members.

Another own goal by Mr Foss was that he said the prior instrument was introduced without a select committee. Of course it was; Parliament was not sitting. Parliament had risen for the last election, so it could not go to a select committee. In response to that little faux pas, Craig Foss said, off the cuff: “Oh, well, of course, it could have gone to a select committee straight after the election.” He is right, but National was the Government by then, so how that was the Labour Party’s fault, I am not quite sure. I think that is 3 nil so far to the Labour Party; they were all own goals by Craig Foss.

I return to one of the other issues that my colleague the Hon David Cunliffe touched upon, because it is a concern both he and I share. It relates to overall financial stability and the size of our financial institutions. I want to place on record, as the Hon David Cunliffe did, that we are fortunate to have a stable banking sector, in no small part because of the strong major Australian banks. I am not criticising them as entities, but their interests do not necessarily always coincide with New Zealand’s interests. I am concerned that the fee structure and the limits to the ambit of the scheme are set out in a way which, again, prefers the big end of town. The major banks have a lower fee structure because, by virtue of their size and the scale of their businesses, they are more likely to get a high credit rating than a smaller financial institution. One of New Zealand’s problems is the concentration of our finance sector in four main banking institutions. That is a long-term problem for New Zealand in terms of both the effect it has on New Zealand credit markets and the effect it has on our current account deficit through the repatriation of profits of those banks, the combined profit of which is bigger—and correct me if I am wrong, Mr Cunliffe—than the total profit of the rest of the New Zealand stock exchange put together. That is an enormous issue. The profits, in total, of the four big banks are more than the whole of the New Zealand stock exchange. Further cementing the advantages that those main banks have over smaller New Zealand competitors is not good policy, because it further entrenches that advantage and will see them grow their market share further. That is one of the distortions that is extended by this guarantee scheme.

We support the scheme because we do not see that there is presently a better option. We concede that we need a retail guarantee scheme, and we think it should be compulsory for those who have bought into the wholesale scheme, but otherwise it should be voluntary. But we think that the fee structure is in some ways wrong, in that a large Australian institution gets a lower fee structure than a New Zealand building society, despite the fact that the risk profile of a New Zealand building society is quite low. I think that that is a problem.

I am quite attracted to some of the writings of Hyman Minsky, an American economist who died about 10 years ago. He predicted some of the difficulties we have seen in financial markets around the world. There were two main parts to his theory. The first was that the longer the period of financial stability, the more risk taking we see on the part of financial enterprises. That is true. They forget the last cleanout, they chase a higher market share, and they want to justify the huge bonuses the chief executives get, so they embark upon more and more risky transactions. They try and get around existing regulations by doing transactions that are off-balance-sheet in terms of the regulator. He said that that means there would be a constant update of regulatory oversight, and he was right. That is one of the problems we have seen internationally. It allowed a lot of those large financial institutions to engage in transactions that were outside the regulatory package that related to their equity requirements, and therefore they were able to embark upon very risky transactions while pretending that they were low-risk institutions.

The second part of Hyman Minsky’s theory, which I think is also sound, is that financial enterprises ought to be of a size that reflects the size of the actors in the economy. He said that we ought not to be reliant on one, two, three, four, or five large institutions to an undue extent; we ought to have a healthy, competitive array of financial institutions, and they need to be in the bank and the non-bank sector. One problem this guarantee scheme causes is that some of the non-bank scheme is hampered. One of the reasons this ought to, in my view, have had a little bit more scrutiny is that, although the regulatory impact statement says that one of the problems has been to encourage more risk-taking investment—because it has encouraged people to think that investing in finance companies is low risk because of the presence of the Government guarantee—we have not had information as to what the deleterious effect has been on other parts of the non-bank sector. I know that many hundreds of millions of dollars—if not billions; I do not have the information and I cannot get it because there is no select committee process—worth of funds have fled from other parts of the non-bank sector that are not covered by the guarantee scheme. Rather than encouraging the spread of financial institutions and the growth of a range of financial institutions, including in the non-bank sector, the guarantee scheme has the effect of concentrating the size and the market advantage of our existing major participants, and that is not good.

I think that is a real issue for New Zealand for the future. It is an issue not just related to the current account deficit, but also to the control of the economy, economic sovereignty, and the proper functioning and efficiency of credit markets. We need more smaller institutions. Having said that, the Labour Party supports this legislation as being necessary.

Dr RUSSEL NORMAN (Co-Leader—Green) : I stand to speak on the Crown Retail Deposit Guarantee Scheme Bill. The Green Party will be supporting this bill. We think that it is essential to maintain long-term stability in the financial sector.

The only reason we are here today is because of the global financial crisis. The only reason we have to deal with this bill is because the “masters of the universe”, as they like to call themselves, just collapsed the global economy. The reason taxpayers have to underwrite the banking sector, both in wholesale and retail, and the reason taxpayers have to underwrite the global financial system is that the people who were running it collapsed it through mismanagement, poor management, and genuine greed. They collapsed the global financial system and, hence, collapsed the global economy.

In New Zealand we have a particular problem. Our problem is not the same as the problems that are found elsewhere in the world. Fundamentally, our problems revolve around the distortions that are present in the tax system and in the economic system that encourage investment in property rather than in the productive sector. That is the fundamental problem we have; it is quite different to some of the problems elsewhere in the world. New Zealand has a very specific problem.

Some of the evidence we received during the bank inquiry underlined that problem. I want to point to a few statistics around it. Over the last 9 months—during 2009—the banks have loaned another $3 billion into the housing market, which takes it up to around $165 billion. At the same time, lending by banks to businesses slumped by about $3 billion. Over the last 9 months of this year, lending into the housing market increased by $3 billion while lending to businesses decreased by $3 billion. To me, this epitomises the problem that we have. We have a banking system that is accustomed to and is entirely comfortable with loaning into the housing market. It is what it does well. But we do not have a banking and financial sector that is good at supporting New Zealand businesses. It is not as easy to loan to a productive enterprise working in the tradable sector as it is to loan on housing. The banks do not do it. In fact, over the course of the last 9 months of this year they have taken $3 billion out of New Zealand businesses and loaned another $3 billion into the housing sector.

The incentives around the financial system are wrong: we are incentivising investment into the non-productive part of our economy. The cost of that is enormous. The social cost is enormous. Housing is tremendously expensive in our country, and it is now very difficult for people to get into the housing market. Housing consumes a vast amount of people’s income: they have to pay their mortgages and their rent. We have set up incentives that are not good for the New Zealand tradable sector or the New Zealand productive sector, and that, at the same time, inflate the housing market.

If we look at what those incentives are, we see that the incentives around the tax system, in particular, encourage investment in property. The reason is that by investing in property one can offset the losses on those investment properties against one’s taxable income. One of the most commonly used mechanisms to do that is the loss attributing qualifying company. Losses on loss attributing qualifying companies increased from $750 million in 2003 to $2.3 billion in 2008. We have set up a system that is encouraging people to invest in investment properties, and use the losses on those investment properties, quite lawfully, to effectively offset their income tax, so the taxpayer ends up picking up the tab. People are doing it and banks are loaning into the housing market. We have a tax system that encourages the banks to loan money to people so that they can buy investment properties. They can then offset the losses on those investment properties against their tax. We have established a stupid incentive scheme. It is bad for the New Zealand productive sector. It is bad for the New Zealand tradable sector. In the long run, it is extremely dangerous to the New Zealand financial system to lock up billions and billions of dollars into an overinflated housing market. We have set up a bad system.

If we want in the long run to guarantee the stability of the financial sector, which this bill is ostensibly designed to do, and if we are serious about doing that, we need to address those underlying incentives. The Greens have been criticised because we want to change the tax incentives around housing and investment property, but I ask what the alternatives are. We currently have a series of incentives that encourage speculation in housing. We should change those incentives. We know what is involved. We know that we can introduce a capital gains tax, excluding the family home. We know that we can ring-fence the losses on investment properties. These policy measures are available to the Government if it has the courage to do what is in the long-term interests of New Zealand—what the Government knows is in the long-term interests of New Zealand. It is worried about short-term political risk because it has a short-term approach, I guess. But one has to look at the long-term interests of the New Zealand economy. We cannot continue to throw all of our money into housing while businesses are starved of the money they need to make investments to support productive enterprise in our country.

The tradable sector is under pressure constantly because the Reserve Bank tries to control inflation by increasing interest rates. The Reserve Bank should be cutting the official cash rate tomorrow. One of the concerns of the Reserve Bank—and why it may not cut the official cash rate—is what will happen to the housing market. If interest rates are low, then the housing market will start to bubble again, and it knows that is a problem for inflation. Why do we not have additional tools to target the housing market so the Reserve Bank can cut the official cash rate, make capital available to businesses, and, at the same time, target the asset bubble in housing so that more inflation does not come out of the housing market?

We can adopt those tools; this Parliament can adopt those tools. It would be good for New Zealand businesses. It would be good for New Zealand households in the long run to have stable housing prices. We just have to have the courage to say to people that we know they have made legal investments in investment properties, and we totally understand why they did it, but the long-term interests of our country means we have to make the decision to ring-fence those losses and move away from that system we set up. It is in our children’s interests, so that they can have affordable housing. It is in the interests of our children as well, so that they do not inherit a massive overseas debt that is being used to fund speculation in the housing market. We are handing over to the next generation a net international investment position of negative 100 percent of GDP. That is what we are passing on to the next generation. We have the choice to change direction. We have dramatically increased the level of overseas debt in order to fund housing speculation. We have housing speculation because of the tax rules. We can change the tax rules. It is within the power of this Parliament to act in the long-term interests of the New Zealand economy and the New Zealand people and change the rules.

I call particularly on Government members to embrace their responsibility. Over the course of however long their term of Government is, they will never be in a more popular, stronger position than they are now. We can all read the polls. The Government is in a very popular, strong position. Government members should use that popularity and strength to do what they know is the right thing for the New Zealand economy. Even though they know some political risk is associated with it, in the long run they know it is the right thing to do. We all know it is the right thing to do. We cannot continue to borrow to pay the interest on previous borrowings. That is the route to destitution. A country that continues to borrow to pay the interest on previous borrowings is destined to have an economic crisis. We all know that. The Minister of Finance says it every day. We have the opportunity in this House to make the changes that we all know need to be made. I call on the Government to do the responsible thing and make the changes.

Touching very briefly on affecting reserve ratios, it is true, as Mr Foss says, that in some ways it is an old-fashioned idea, but we have a specific problem. We need to look at reserve ratios, particularly loaning into the housing market. If it is a way to try to constrain the flood of foreign capital that is being channelled by the banks into the housing market, I think we should consider it. We have a major problem. We should not put things off the table just because they have been done before, and are associated with a former National Prime Minister. We should consider all options, because we now have a major problem. In order to protect our sovereignty, housing affordability for future New Zealanders, and the productive sector of the New Zealand economy we need to look at all of these measures in order to control that housing asset inflation so that we can get on and assist the tradable and productive sectors. This bill is part of that, and we will support it, but we need to go beyond the bill.

JOHN BOSCAWEN (ACT) : I start by addressing some of the issues raised by the Opposition about the Crown Retail Deposit Guarantee Scheme Bill. Opposition members talked about the growth in the finance company sector as a result of the guarantee that was introduced last year. They said deposits into the finance company sector had been declining, but, following the introduction of the Government guarantee last year, those deposits had taken a turn and were now going upwards.

The first point is that we need to acknowledge that it is good to have a very strong secondary market beyond the banks in the non-banking sector, and, to use the words of the Minister of Finance, to have someone to fund the diggers and the trucks. I ask Opposition members why they would not expect deposits to grow. Of course we would expect them to grow. Since the guarantee was put in place 12 months ago, for a 2-year term, anyone lending to a finance company was basically lending to the Government. People were lending to the Government for a period of up to 2 years; as long as their deposit did not go beyond, I think, 14 October 2010, they were lending to the Government.

The guarantee that was put in place did not actually cost most finance companies anything, because the guarantee was priced on a figure that was based on a margin over a company’s loan book at the date, plus a 15 percent margin. If a finance company owed its depositors and equity holders $100 million and had invested $100 million, it was able to get the benefit of a Government guarantee for free, as long as its loan book did not exceed $115 million—so, the base loan at the date the guarantee was introduced, plus a 15 percent margin.

I thought that the Hon Lianne Dalziel gave a very interesting commentary on this bill, and I accept her concern that it was introduced at a very late stage. The Labour Opposition has a genuine reason for expressing disappointment that it was not given copies of the bill earlier. But Lianne Dalziel talked about privatising the gains and socialising the losses. It was the guarantee put in place by the previous Labour Government that privatised the gains and socialised the losses, because although there was a need for a guarantee and although it was put in place because of international circumstances, it could have been priced entirely differently from how it has been. It would have been quite possible to put a pricing structure in place that had the finance companies paying for the benefit of what they got. In essence, the previous Labour Government gave a free gift to the owners of those finance companies. It was the Labour Government that ensured the gains were privatised.

I say that because within a day of the guarantee being put in place on that Sunday, on the Monday, I had emails inviting me to invest in various institutions. I was told the investments would meet the requirements of the Government guarantee, and I could invest in a particular institution and earn an interest rate of 7, 8, or 9 percent—and many people did. The finance companies were flooded with money, and that is why we had a growth in deposits. Those companies would have moved to drop their interest rates had they needed to pay the full price of the Government guarantee. So of course there were distortions, and those distortions were generated because of the structure that was put in place.

Hon Clayton Cosgrove: So were you against our guarantee?

JOHN BOSCAWEN: No, I am not against the Government guarantee, I say to Mr Cosgrove. What I am concerned about is the way that it was priced. If there was any reason to privatise the gains and socialise the losses, it arose from the way that the previous Labour Government priced the guarantee.

Let me move on. The Hon Lianne Dalziel made the very good point that a lot of investors have absolutely no idea of the risks they are taking. I want to come back to an issue that I raised in this House last night, and to talk about one particular finance company. That company is Strategic Finance. That company went into a moratorium. It had its bondholders, its note holders, and its debenture-holders vote for a moratorium on 22 December, 3 days before Christmas last year. The company owes roughly $400 million to its debenture-holders and its creditors. On 15 July this year, Strategic Finance announced that it anticipated making a loss of $98 million, and that was reported in the New Zealand Herald. But the report went on to say that the loss might be bigger than that, as the company was still discussing its accounts and was yet to finalise them with its auditors. Strategic Finance stated rather surprisingly: “It is the Board’s assessment that the provisional full year results have no impact on the forecast repayment of 100 cents in the dollar of principal and all interest to depositors, debentureholders or the prior ranking BOS International (Australia) facility.” It announced what amounted to a loss of a quarter of its loan book, but it said that would have no impact.

Ten days ago, Strategic Finance said the accounts were out, the auditors had signed the accounts, and it now looked as though the loss was $180 million. That is double the earlier anticipated loss. The company owned up to its investors and said it will not be able to pay out 100 percent of their invested funds to them. It said it looks as though the amount will be from 85 percent to 93 percent. If ever there was an example of investors slowly being let down, then this was it. On 22 December voting for a moratorium was held, where investors were promised that the base-case projection was that there would be full repayment of principal and interest. In July of this year they lost a quarter of their investment, and by the end of August they had lost half of it.

But the situation is worse than that. There is at least one transaction—there may be more, but I have been advised of one—where the money lent by Strategic Finance on a second mortgage was in two tiers. There was a priority second mortgage, and then the regular second mortgage. Part of that advance has been lent from funds raised from a privileged group of people who have prior rights to repayment of their money over other contributors to that second mortgage. That group of people also have prior rights to payment of their interest, so they have priority as to security and interest. I understand that some of the people who contributed to the top part of that second mortgage were still being paid an interest rate of 17 percent up until quite recently.

The tragedy of it is that the mums and dads, the people who do not comprehend the risk they are taking, the people whom Lianne Dalziel referred to when she said that such investors had absolutely no idea of the risk they were taking—all those people—rank in the bottom half of that second mortgage. Essentially, it is a third mortgage. The first mortgage is to the Bank of Scotland International, as the moratorium refers to; the second mortgage is to a priority group of people; and the rest is to the mums and dads, who will get what is left. When markets move down and a company says property values are dropping, I ask, who misses out? It is always the people at the bottom.

I am very concerned that regular mums and dads, the investors in Strategic Finance, will get far less than 85c in the dollar. I say this because the trustee of Strategic Finance, Perpetual Trust Ltd, is now in the gun. It has to make a decision as to whether it moves to put Strategic Finance in receivership. If it chooses to continue with the moratorium, I believe that matter needs to go to a court. I believe Parliament needs to pass legislation to provide that a company cannot simply go for a roll over of its moratorium. There has to be accountability. Independent experts have to take a closer look at the projections, because, surprisingly, in the year to June 2008 Strategic Finance paid a dividend to its shareholders, yet 13 months later it said it had lost $200 million. Clearly, had those losses been known at the time, no dividend would have been paid.

This area concerns me a great deal, because different classes of creditors voted on that moratorium proposal. People with priority rights would clearly have voted for a moratorium, because they would have voted to protect their own interests. I come back to the point that regular mum and dad investors—many thousands of them lost their life savings—in many cases did not understand the true risk that they were taking. Thank you, Mr Assistant Speaker.

AMY ADAMS (National—Selwyn) : It is a great pleasure to take a call in the third reading debate on the Crown Retail Deposit Guarantee Scheme Bill. I have sat in this House and listened to the entire debate on this bill. It has been very interesting, and there have been some very worthwhile contributions from all sides of the House. It certainly is good to see support from across the House on this bill.

Obviously, in effect we are continuing the scheme that was put in place by the previous Labour Government in October last year while Parliament was dissolved for the election period. At that time the scheme put in place was to expire in October next year, but it is now very apparent that a longer-term transition is needed, so now we see primary legislation before the House to put in place a new scheme. But the reality is that it is very much akin to continuing the existing position, whereby retail deposits and bank and non-bank lenders can be guaranteed by the Crown.

In the debate there has been a very wide range of contributions, and some very big-picture analysis of the economy, risk, the banking sector, what went wrong, who is to blame, and where we should go from here. All these things have their place, but I am taking a short call to go back to the fundamental operation of the bill. Really it is about investor confidence and the stability of our sector. I think it is worth reiterating the point that my friend Mr Foss made so well in his speech when he said the bill is not about guaranteeing the banks or ensuring that they do not lose money. It is about ensuring mum and dad investors, those people who have put money into the banks, can have confidence that their money will be there when they come to get it.

That confidence is important. It is important not only to look after the hard-earned money they have worked hard to save, but also to ensure that liquidity stays in our system, because those same deposits are then turned around and lent out to businesses and homeowners. Dr Norman talked about the difficulty for businesses in borrowing money. I am sure that is right, particularly at the moment. But if we do not have deposits, the banks will not lend. It is a pretty simple equation. That is why this system is so important.

In this bill we have a system that ensures that any or all debt securities, as defined in the Securities Act, in an eligible entity can be guaranteed by the Crown. But—and it is an important “but”—that is only if the Minister believes it is necessary or expedient in the public interest to do so. I make that point, and I made it during an earlier contribution, because, even if the eligibility criteria are met, it is still up to the Minister’s discretion to determine whether granting any particular guarantee is in the public interest. That is the overriding test here. It is not about what the institutions want and not about whether they want to be able to put it on their website; it is about whether it is in the public interest for that particular entity to be guaranteed and for those particular debt securities to be guaranteed.

We have a system that has a number of safeguards in place. It really makes it clear that the principle consideration in this entire system is the public interest. As I said, the public interest is about protecting the funds of the mum and dad investors, but also about the stability of our system. That stability has been more important in the last 12 months than ever before. If ever we have had to wonder about the stability of our banking system, now we know, first, that we have a fairly good system compared with the rest of the world, and, second, that that is crucial. It is crucial to New Zealand’s ability to weather the worst of the storm and to come out of it, I will not say “untouched”, because certainly a lot of people have been hurt terribly in this recession, but in a considerably better position than we might otherwise have been. The bill is a good bill. I commend it to the House.

Hon CLAYTON COSGROVE (Labour—Waimakariri) : I, like a previous speaker, Amy Adams, have spent a fair amount of time listening to the debate on the Crown Retail Deposit Guarantee Scheme Bill. It is correct to say that the Opposition is supporting the bill. The previous Labour Government brought in the initial guarantee scheme in October 2008. High priority has to be given to the security of investments and to the stability of financial institutions within an economy. That is a bedrock principle. The Opposition, though, in supporting the legislation, has raised a number of questions. If we look at the history of the initial guarantee scheme, which the previous speaker said rightly was put in place on the eve of the last election, we see that the overseas funding—the wholesale area of banking—was provided with a guarantee. Without legislation or regulation, the then Labour Government negotiated with the banks to ensure that those guarantees extended to the retail sector and to mum and dad Kiwis. There is always a lot of criticism over regulation and legislation. Ironically, this was an instance where negotiation occurred in extremely turbulent and volatile times and on the eve of an election. The banks, after discussion and agreement, actively participated in that retail space, and mum and dad investors had their deposits guaranteed.

The argument that we make here is about the question of what would have happened if the banks had not agreed to participate in that retail space. Who knows? I suspect, as we have said in this debate, that it would have been unacceptable—and it should be unacceptable today—that banks are given a cast-iron Government guarantee without the Government requiring a reasonable price. By that I mean that banks participate in the retail end of the market. The Government has guaranteed, quite properly, for overseas interests and overseas financial markets that provide equity and funding to our banking institutions that if the bank goes belly up, then those international funds are guaranteed. Why is that? As I have said, those guarantees are necessary in times such as we live in now to ensure that the money—if you like, the lifeblood—flows through the veins of the financial institutions in respect of liquidity.

What is missing, therefore, is a price for that Government commitment. I disagree with Mr Gilmore when he says this scheme will not benefit the shareholders of the banks. For goodness’ sake, as a man who purports to be the resident genius of this Parliament in the commercial and in every other non-academic and academic area, does he not realise—[Interruption] Suddenly the National members are awake. Does Mr Gilmore not realise that any time a Government—

Amy Adams: It’s very hard to stay awake.

Hon CLAYTON COSGROVE: National members chirp away when it comes to giving a wee bit of stick, but they do not chirp away when it comes to guaranteeing and supporting the average mum and dad Kiwi investor.

Amy Adams: That’s what this bill is doing.

Hon CLAYTON COSGROVE: Oh no! Bill English, as the Minister in the chair, sat there silent, as if he were dead. He might be dead politically after today’s headline, let me put it that way.

National members are very chirpy when it comes to having a bit of a dig, but when it comes to actually supporting mum and dad investors there is a deathly silence. Any time a Government gives a guarantee to a business or financial institution, that is a huge point of differentiation from any other participant in the market. If I am an investor and a bank has a cast-iron guarantee of the Crown behind it, of course I will invest in it before anything else. I could not lose, could I? Why would I not invest in a bank that has a Government guarantee? I would be in a no-lose situation. Mr Gilmore should whip back to Canterbury University and to the remedial class for the MBA programme in the economics department, dust off the textbooks, and have another go.

The problem in this debate is that the National members have reverted to type. They have backed the big end of town, but when it comes to mum and dad investors they have not required a high price from the banks, which is that they participate in the retail end of the market. We managed to do that not through legislation, regulation, red tape, or bureaucracy, but through partnership and negotiation. We put it on the banks. If they had not participated in the retail end of the market we may have had to look at other, more formal mechanisms. But we got their agreement to do it and, as a result, mum and dad Kiwi investors had their deposits guaranteed. International financial agencies—lenders to our banks—had their investment guaranteed, and, like our Australian cousins, we averted massive volatility, instability, and lack of confidence in our financial sector.

Then we come to the progression of this scheme. As I say, we support the bill, but we raised yesterday and we raise again today the question of why the Government would not go to the banks and even attempt to negotiate their agreement to participate in the retail end of the market. What is the cost? The Government would not even get the banks in a room, as we did, and say that if it was going to put the taxpayers’ money on the line to back them, they had to come to the party and back their deposit holders, the mum and dad Kiwi investors. The Government could not be bothered.

I raise that issue again because no one wishes for volatility and instability that could tip over a financial entity, as we have seen in the past, and put mum and dad Kiwi investments at risk. Nobody would wish that; nobody wants that. I accept that that is not the intent of the Government, or of this side of the House. But the problem still exists. Why does the Government give the big end of town a gilt-edged guarantee and not give the small end of town—perhaps some of the young folks who are in our schools and who deposit money every day or every week through their school account—a guarantee at the retail end of the market? I say again to Mr Gilmore that any financial entity that has a Government guarantee—[Interruption] The voice has gone up an octave. Any agency that gets a financial guarantee has a differentiation point in the market. An investor cannot lose, so will back that agency. The share price will go up as a result. That is the point.

I also make the point to the Government members that in respect of the eligibility criteria the Minister, as we know, has the authority to determine eligibility. The height bar for that eligibility is centred round the BB credit rating. Again I say to Mr Gilmore, who takes this view, that in order—[Interruption] The voice has gone up an octave again; I am not sure which member it is. For smaller financial organisations, achieving a BB rating is not a matter of simply paying the money and filling out the form. These agencies’ own financial and professional reputations are on the line, so they do not give out credit ratings just because financial organisations pay their fee. I am sure that the member, being the learned expert he is—far more so than me—will give us a dissertation on the intricate aspects of gaining a high BB credit rating. But putting the detail aside, we know that there is a cost. That cost can be marginalised, if you will, by a large financial institution, but a substantial cost is visited upon a small financial institution. There are huge responsibilities, which is as it should be, involved in gaining that credit rating. If smaller financial institutions cannot gain that rating, then the question is whether there will be flight in terms of investment. No one would wish this to occur, but it is worth posing the question of whether there would be flight in terms of investment from those smaller institutions, which would therefore create instability and the situation where they could fall over and where mum and dad Kiwi investors’ money would be in jeopardy.

Members on this side of the House support the bill, but we also put on record that we are concerned about the small end of town. Government members are concerned about the big end of town, and that is all they are concerned about.

PESETA SAM LOTU-IIGA (National—Maungakiekie) : I acknowledge the earlier speakers who have contributed to this debate. A number of issues have been raised and a number of questions have been asked. I acknowledge those who have made a contribution.

Rather than talking about the wider issues of the financial industry, we are talking today about the Crown Retail Deposit Guarantee Scheme Bill. As many members stated earlier, the scheme was put together last October with a degree of haste by the previous Government in its waning days. It was one of its last acts—

Amy Adams: 8½ years, wasn’t it, of waning?

PESETA SAM LOTU-IIGA: —yes—in Government. We stand to support the scheme. The scheme is about giving confidence, certainty, and stability to an important industry in New Zealand.

I will touch on the views held by members opposite about the role of Australian banks in this country. From the diatribe that has come from some members across the Chamber, it would seem that Australian banks are big, nasty, evil institutions, but they are not. I put it to members that without the investment in this country from the four Australian banks, our economy and our businesses would not be as well funded as they are today. We have a long way to go in terms of funding and access to capital, but to paint the large Australian banks as evil institutions is, I think, a little bit rich coming from members across the Chamber. It is about our accessing capital in this day and age—the electronic age, the Internet age—when we can access capital from around the world.

One speaker referred to 80 percent of the flow of funds coming from Australia. Yes, it would be positive if that flow of funds was diversified around the world, but it is not, and that is the situation we find ourselves in. Our economy is inextricably linked with the Australian economy. We heard a number of points raised about the way that we align ourselves with Australia, and the way that we harmonise not just our financial industry but also a number of industries across our country with those of our Australian brothers and sisters. It is a positive to work with our Australian counterparts, and a ministerial delegation went across the Ditch in the last couple of weeks.

Another point that was raised by my colleagues across the Chamber was distortions. Yes, there are distortions from this scheme being in place. There will always be distortions where there is any form of Government intervention in an industry. But to say that larger institutions gain the most benefit from this particular scheme because they have better credit ratings is to misunderstand the nature of credit ratings. The only financial institution that holds a triple A credit rating is not a US institution; it is a Dutch institution called Rabobank. Rabobank, as many members will know, is not the largest bank in the world. In fact, it is not even the largest bank in the Netherlands, where it is based. It is a bank that has a quality book, and that is what determines, ultimately, the credit rating it receives. Size and scale have nothing to do with the nature of one’s credit rating.

It is about jobs, growth, and exports, and Labour members have to admit that exports have declined, year on year, for the last 5 years. I do not know how those members can complain about some of the moves that this Government is putting in place. It is about jobs, it is about growth, and it is about exports, and the scheme will go a long way to alleviating some of those problems.

Finally, the bill provides a transition away from the scheme. By December 2011 the scheme will expire. It is our hope, and it is certainly the hope of many across this country, that the economic recession will have subsided by that time. It is our hope that this type of scheme will not be required, and that the banks and the financial institutions will be able to go out into the markets, raise capital, and offer capital for our businesses to grow and expand.

In brief, I support the bill. I think it has much credibility in terms of bringing stability and confidence, and the right amount of investment in our financial institutions. Thank you.

Hon LIANNE DALZIEL (Labour—Christchurch East) : I want to express some concern about the quality of the debate, and I do so reluctantly, having listened to the contribution from Peseta Sam Lotu-Iiga, the honourable member and councillor, who has just resumed his seat. The reason I am a little concerned about the quality of the debate is the way that this Crown Retail Deposit Guarantee Scheme Bill is being dealt with. It is being dealt with under urgency, and I believe that bills such as this one should not be dealt with as a matter of course under urgency. There is a serious issue about legislation not having the quality of scrutiny that the public would expect in the circumstances. As my colleagues have said repeatedly, the Opposition is not in opposition to the bill as a matter of principle. The underlying desire to ensure financial stability at this time is obviously a desire that we support. But Treasury officials recommended that referring the bill to a select committee for 1 to 2 days would not be a problem, and they said that it would enhance what they considered to be a flaw in their consultation process because they were not able to have the degree of consultation that they would expect.

I will say why referring the bill to a select committee for 1 or 2 days would not have made any difference. One reason is that it would not have held the bill up for a time of any great moment, and we still would have had the legislation in place 1 year before the expiry of the current guarantee scheme. We could have still met the timetable that the Government has set for the implementation of this legislation, so it was not an argument about the amount of time the bill would have spent before a select committee. Nobody on this side of the House suggested that it should go there for the normal 6 months.

The advantage of sending it to a select committee is that members of the committee get to test assumptions. All of the decisions that the Government is making in this respect are based on assumptions that have been proposed by officials from both the Reserve Bank and Treasury, and it would be really helpful to the Opposition for us to be able to test those assumptions, to push back on some of them, and to have some serious debate about these serious financial issues.

The second reason is that we can work through the analysis that lies behind the advice. How are our assumptions formed? They are based on analysis that has been undertaken. I have some issues with some of the analysis that we have been presented with in the regulatory impact statement, but I will come to those in a minute.

The third reason why select committee processes are important, even if they are truncated, is that we can get answers about the balance between what the regulatory impact statement itself says was a line call between the status quo and the extension of the scheme, especially when the banks do not favour the extension according to the regulatory impact statement. These are serious matters, and they are reasons why, with a short period of reference to a select committee, we could have dealt with this bill through its remaining stages next week, also under urgency, and there would have been less opposition from the Opposition to the process. As I say, we are generally on board with the underlying principles.

This brings me to the regulatory impact statement. I do not recall seeing such an extensive regulatory impact statement. Of course, those who know me will know that I tend to bang on about the quality of regulatory impact statements. Since we have had a Minister for Regulatory Reform the quality has actually gone down, but this regulatory impact statement stands out. It is the best regulatory impact statement I have ever seen, but it is not written in the bill. It is not included in the bill. All they did was put the executive summary in the bill and then publish the regulatory impact statement on the Treasury website. So, of course, I downloaded that over the dinner break yesterday—

Hon Simon Power: Of course you did!

Hon LIANNE DALZIEL: Of course I did, because I like doing things like reading regulatory impact statements.

But the thing that really upsets me is that the regulatory impact statement shows all of the reasons why we should have had a select committee process to work through all of the issues that it raises, and I want to go through those. I know that the Minister in whose name this bill sits, the Hon Bill English, is very famous for using the phrase “The devil is in the detail.” I have found by going through the regulatory impact statement that the devil is indeed in the detail, some of which has not yet been determined. I wonder whether this is in fact going to be the last bill we see from the Hon Bill English before he resigns his portfolio, which I suspect will be very, very soon.

The regulatory impact statement raises the following issues: first of all, on page 4, we get the reason why the decision needs to be made now. The reason the decision needs to be made now is to “Provide greater certainty to investors, and enable them to make sensible reinvestment decisions.” When does the application have to be lodged by? It has to be lodged by 12 October next year, so the whole idea that this has suddenly got to be done a year out does not make sense when entities get a whole year to apply. It simply does not make sense. When we look further on in the report, we see something very interesting: most large entities already have credit ratings, so I would say that those that want to opt in are going to opt in relatively quickly. Entities in the process of getting a credit rating will not have certainty until they have received their rating, since the credit rating of BB or above is a requirement to be eligible for the extended deposit guarantee scheme. Under the new prudential requirements for non-bank deposit-taking institutions, credit ratings are required by 1 March 2010 for entities with liabilities greater than $20 million dollars.

Why not link the application to the close-off date for the non-bank deposit takers’ credit rating requirements of the new prudential supervision arrangements? I do not understand why that is the case. That is why reference to a select committee would have enabled these questions to be asked and answered. So to say that the depositors will have the assurance they need is just nonsense, because we know that the assurance is in relation to the finance companies. Entities in the finance company sector do not get to do this until they have got the BB rating. The ones that are in the scheme at the moment do not all have BB ratings, therefore there is a period of time of uncertainty that does not link to this urgency we are seeing here today.

The second point that the regulatory impact statement raises is the question of economic distortion. The point is raised in paragraph 26 on page 5 of the report, and I think that it really does identify the line call that the officials made when they made the recommendation to the Government: “Allowing the DGS to lapse”—which is on October 2010, obviously—“avoids the additional period of economic distortion.” We have all agreed that economic distortion happens when we have a retail deposit guarantee scheme. “Moreover, the DGS ceasing in October 2010 would avoid the possibility of firms using the longer DGS period to imprudently grow their retail deposit books, increasing the Crown’s exposure.” Actually, that is what this is about. It is about the Crown’s exposure to the risk of failure, and the view that this would all collapse around the October 2010 deadline. We do get it.

I guess that the real motive for the change is certainly spelt out on page 8: “If the DGS ceasing in October 2010 resulted in concentration of defaults in the lead up to the end of the guarantee period, then that could also lead to assets being realized over a short period, depressing asset prices and reducing recovery rates and so increasing the net costs to the Crown of the default event.” That is perfectly obvious in the discussion documents, but we have not had this debate in the House. We have not had the opportunity to get that exchange happening that we would have had at a select committee hearing, which is my point.

The final element contained within the report is the option beyond the status quo, which is essentially to extend the deposit guarantee scheme under tighter terms. That is what the Government has been trying to say, but not saying very well. It is about easing the process out of the market so that we can return to a period where the entire sector is operating in a guarantee-free environment. We do get that, but I think it is really important for the House to remember that when we are dealing with issues of such substance, we really ought to have officials in front of the members of a committee so that there can be that exchange.

On that note, and as many of my colleagues have said, I say we are supporting the passage of the bill. Other considerations could have been taken up in the way the scheme is being developed, but I would like to hope that because this is framework legislation and the detail is still to be worked out, the Government will extend the cooperation we have extended both ways on a lot of finance company issues to engage with us on some of the detail about how the scheme might progress into the future. I will certainly be pleased to see the bill pass its final stage.

AARON GILMORE (National) : That was Lianne Dalziel, the previous Minister of Commerce in the Labour Government that oversaw a large number of finance companies lose, I think, about a billion dollars during the time of her reign. But I think I heard more validity and understanding of the finance sector regulations in that last speech than I did in her speeches in her entire time as Minister of Commerce. Some very good points were raised by the previous Minister of Commerce in that last speech.

I will raise a couple of issues, including why this legislation is going through under urgency. It is pretty simple: the financial sector is unbelievably sensitive to information about changing a regulation. The financial sector is one where people have a good understanding of what goes on, and when we look at what has occurred we see that even Treasury—in its great regulatory impact statement that Lianne Dalziel, the member over there, was speaking about—talked about the need for urgency for this legislation. The finance sector needs certainty and surety in relation to this legislation being passed. Even the regulatory impact statement goes into some detail about the need for urgency. The previous scheme, which this scheme is replacing, was implemented urgently without any select committee process. Giving a number of days for a select committee process would only drag this legislative process out and remove the certainty the finance sector needs for such legislation.

I will touch a little on credit ratings. There have been a number of statements about credit ratings, and a bit of misunderstanding about what a credit rating is: what is in, what is out, and how people get one. I suffered here from statements from a member on the other side of the House who criticised my understanding of credit ratings. I will say two things. The first is that on 1 March 2010 all non-bank deposit lenders with assets of over $20 million will be required to have a credit rating—all of them. That is existing law. Secondly, the reality is that, yes, for about $100,000 anybody can get a credit rating. Apart from that, people do not know what credit rating they might get until they go through a process.

Amy Adams: Like a box of chocolates.

AARON GILMORE: Like a box of chocolates. When one goes through the process one might get A, AAA, B, BBB, or C, but one does not know until one goes through the process. There are very well defined guidelines and rules about what credit ratings are given to what entities, given their financial strength. That is well-known public information: to get the grade one has to go through a process that will cost about $100,000.

We also heard an outcry from the other side of the House about why we need to guarantee the banks. We believe that this regulation is needed to lubricate the wheels of industry. Lubricating the wheels of industry is very important. We heard from the Greens earlier today. Those members do not want to lubricate the wheels. They want to put a grinding halt on them and throw some sand in the wheels of industry. They want to control everything under the sun. What that says is that we would have no lending at all. I would look forward to that situation under that member’s control. I do not think many members on this side of the House would want to be in New Zealand.

We also heard about the lack of consultation on this bill. Again, the grand regulatory impact statement stated that the Reserve Bank and Treasury have had large amounts of consultation with many players in the industry: finance companies, banks, and everyone else in between. I think it is remiss to ignore that consultation.

I want to talk about one more aspect, and that is the issue of the fees. That is linked to the issue of the credit rating. Obviously, the fee scheme we have here is risk-based. If one is riskier to the taxpayer the users will pay more.

The final aspect that I want to touch on is the aspect around whom this guarantee covers. It does not cover the banks and it does not cover the finance companies; it covers the people who give their money to the banks and to the finance sector. I think that is a good thing.

As the final National member to speak on this bill, I think I have outlined that there are a number of good aspects to it. Hopefully, it will be passed, and will give confidence to the finance sector. I think that is a good thing for New Zealand.

STUART NASH (Labour) : I rise to support the Crown Retail Deposit Guarantee Scheme Bill in its third reading. It appears that there will be two things that will expire in October 2011—the Crown retail deposit guarantee scheme, and, by the look of things, the National Government. Bring that on! As has been previously alluded to, the Crown retail deposit guarantee scheme was urgently put into place by the Labour Government for a number of social and financial reasons. The main financial reason, however, was to create a level of global confidence in the New Zealand banking sector through the provision of Crown guarantees, thereby allowing the level of liquidity required to allow New Zealand - domiciled banks to operate. Put more simply, the scheme allowed our banks to continue to borrow money when there was a risk that they could not. That risk was not good. Australia had instigated a similar scheme just the day before, I believe, and if New Zealand - domiciled banks were to be able to gain access to a very tight pool of global funds, the scheme was imperative.

Members will remember at the time—a year ago—global financial institutions and household names like Lehman Brothers, Bear Stearns, Bank of America, Fannie Mae and Freddie Mac had either failed or were in the process of failing. They were huge institutions with enough leverage to cause the type of credit crunch that the world was beginning to experience. At this point we were not sure what depositors in New Zealand would do. Would they do what they had previously done to the finance companies—namely, start a run on deposits caused by a crisis of confidence leading to a sector-wide collapse and near extinction? The scheme came into effect on 13 October 2008 and was to last for 2 years. Hence the reason we are in this House today debating the passage of this bill.

As I mentioned, and many of the Labour speakers have mentioned it, I have some concerns over the urgency nature of this bill, because I believe it favours the rule of money over the right of the people to have their say through the select committee process, which is a fundamental principle of our democracy. Of course, the dire and urgent circumstances under which the first Crown retail deposit guarantee scheme was implemented are markedly different from the state of the current global financial sector today. The reason the original scheme did not have its own legislation is simply that the House had been dissolved in the countdown to the general election, and, therefore, technically there was no ability to take this through the legislative route, but, most important, in October 2008 the world’s financial system was in meltdown, and decisive action was required. That is why it was done in 24 hours and implementation was immediate.

The times have changed. If nothing else, we now know the state of the global economic situation and this knowledge has allowed Governments around the world to put in place packages that have alleviated the worst of the effects of the global meltdown. That knowledge has allowed prudent banks, including those operating in the New Zealand market, to rethink their fundamental philosophies around the pricing of risk and the management of growth. That has allowed them to develop strategies that are in line with the state of the market as we now know it. Actually, we are now at the point where the large banks are currently analysing the cost versus the benefit of their participation in the retail deposit guarantee scheme. There is a price for participation. For example, a bank with $20 billion in retail deposits would pay around $15 million in fees per annum. That is more than the Government has cut from adult and community education in the Budget, which means that, for example, in Napier no high school will be running night classes in 2010. So the 6,000 students who took those classes in Hawke’s Bay will not have the opportunity to upskill, socialise, or improve themselves personally or professionally. Our people in our communities are the worse for it. But that is another story.

The reason that I bring up the change in circumstances is that this bill need not have been forced through under urgency. It could have had a very tight reporting-back time. As a member of the Finance and Expenditure Committee, assuming that the bill had come to that committee, I would have been most interested in hearing submissions from all affected parties, especially submissions for the major banks—except that the major banks are averse to presenting submissions. That is the irony of this bill. The major Australian banks have done very well out of this scheme, as have the New Zealand economy and New Zealand depositors. Do not get me wrong; I understand the value to the New Zealand economy of the big Australian banks. But the irony of this bill is that the banks have taken advantage of the scheme, but they have refused to appear before a banking inquiry to alleviate the fears and dispel the rumours about the current state of the banking industry and the way they are treating ordinary Kiwis in terms of the amount they are charging on short-term floating mortgage rates. I spoke to one of the bigwigs of one of these large banks and asked him why he did not just come along to the inquiry just to show and prove to Kiwis that in fact the banks are not ripping off ordinary New Zealanders, to dispel that rumour and dispel that perception. He said: “Cobber, you are probably right.”, but it did not change the bank’s stance.

Anyway, as I was saying, the true urgency has actually now disappeared from this scheme. It has another 13 months to run in its current form, and, therefore, there is enough time to follow the proper course for passing legislation. The Minister of Finance told us yesterday that he made a call due to the need for certainty. I accept the fact that financial markets operate optimally in an environment of certainty, but I would contend that we could still have afforded certainty 13 months out. I also ask, if this bill was important enough to rush through under urgency, why it was not on the Order Paper 6 months ago when we were debating the secondhand-car dealer bill or other legislation that, although important, perhaps did not have the same national interest as this Crown retail deposit guarantee scheme does. After all, this bill will protect over $120 billion in deposits currently held by the banking and non-banking sector. Did Gerry forget to put it on the Order Paper?

That Minister of Finance, coincidentally, was also the Minister of Finance during the last crisis of the 20th century. Most economic commentators and historians have concluded that he handled that crisis pretty badly. Coincidentally, he is still trying to implement 20th century stimulus packages, when the rest of the world has left Friedman behind and started limiting economic measures to those targeted at people who need them—those on low and middle incomes—instead of a third of all tax cuts going to the top 3 percent of wage and salary earners. Do members know that if a person earns under $40,000 that person receives nothing from the Government tax cuts? In Hawke’s Bay that is around 75 percent of the population who receive not a penny in tax cuts from Mr English and the National Government. Anyway, I digress.

Hon Dr Nick Smith: How much did Labour give in 9 years? They put their tax up for 9 years.

STUART NASH: That is very interesting, because I would say that the Labour Government was, in fact, the only Government in two generations that cut the corporate tax rate. And do you know what? Nick Smith voted against it. Nick Smith voted against a cut to the corporate tax rate. Goodness me! Anyway, I digress.

Along with all my colleagues, I support the substance, intention, and philosophy of this bill, but I reiterate my grave concern about the lack of any sort of transparent consultation with the wider community. In my view, meetings with Treasury and the Reserve Bank do not constitute wide consultation with the affected participants that make up the bank sector and non-bank sector, in all its many and varied permutations. Thank you, Mr Deputy Speaker.

• Bill read a third time.

Hon Dr NICK SMITH (Minister for the Environment) : I move, That the Resource Management (Simplifying and Streamlining) Amendment Bill be now read a second time. I would first like to thank the Local Government and Environment Committee, which considered 840 submissions on this huge bill. The select committee did a good job on what is a very complex area of law, and in a tight time frame. The House should acknowledge the huge number of submissions received and heard by the committee, the long hours it worked, and the considered way that it dealt with a number of very contentious issues.

The bill was developed with the assistance of the Resource Management Technical Advisory Group, led by practitioner Alan Dormer, which I appointed last December. I thank that group for its hard yards, I thank the expert panel that was appointed by the committee for its assistance, and I thank the officials whose work on drafting the bill was done to a pretty challenging timetable.

This Government was elected on a platform of reducing unnecessary bureaucracy, and specifically on a programme to streamline and simplify the Resource Management Act. Our focus has been on reducing the costs, reducing the delays, and reducing the uncertainties of the Act without compromising its underlying environmental integrity. This bill is about addressing the vexatious, frivolous, and anti-competitive objections that can add tens of thousands of dollars to the costs of ratepayers and consent applicants. This bill is about getting a single-step process in place to enable major infrastructure projects to get consent in a more timely way. We want to consign to history the notion that it takes longer to get a resource consent for a piece of infrastructure than it takes to actually build it. This bill is also about speeding up resource consent processing for smaller projects. I do not think there is a member of this House who would not know of a resource management horror story in his or her electorate. The Government wants to give council officials much more discretion when the effects of a resource consent are minor. We want to simplify the decision making, but we also want to hold the councils to account for processing consents in a timely way.

The bill is also about improving the separation of powers that operate within the Act. Politicians, nationally and locally, make rules and laws, but it is for the courts and for independent commissioners to make decisions on individual consents. That is why, under this bill, applicants and objectors are being given the choice of having independent commissioners, and it is why Ministers in future will not be able, as we have seen occur in relation to restricted coastal activities, to overrule decisions made by independent commissioners or the Environment Court.

The bill also tackles the arcane bureaucracy of blanket tree protection rules whereby people have to apply for a resource consent to do none other than trim their own tree. The 5,000 consents in this area cannot be justified. I am sure that in the Committee stage we will debate those provisions some more, but I say that an underlying principle is that before a council restricts what homeowners can do with their own trees, the council should consult them and go through a process of listing those trees, or groups of trees, in a district plan or schedule.

The bill is also about improving the plan-making process, because anyone who works in the area of the Resource Management Act knows that it is only as good as the quality of the local plans. The bill also strengthens compliance with the Resource Management Act by upping the penalties for those who breach the Act. It provides that the Crown can be prosecuted like anybody else, and it provides for a wider range of enforcement measures.

I want to note a number of the changes that were made by the Local Government and Environment Committee. First, the committee has dropped the proposal in the original bill to do away with the non-complying activity class. It is my view that our Resource Management Act has too many activity classes and that adds to its complexity, and that if we were to start afresh, we probably would not have this class. However, given that we are 18 years down the track with this Act, the select committee had to weigh up the gains of removing that activity class compared with the costs that removing it would impose on the councils. I think the committee has fairly concluded that the provision is not worth its salt.

The most challenging job for the committee was the issue of plan changes, further submissions, and appeals. The changes made by the committee reflect just how hard this area of law is. People want their say, they want their cross-submission rights, and they want their appeal rights, but they all agree that the process is too cumbersome and slow. The bill contains some useful amendments, which will improve things in this area, but we will have to give this issue further consideration as we move into the Government’s second phase of reforms.

I particularly commend the committee for its work on timely resource consent processing. After the bill was introduced I received, and the committee studied, the latest report of the Ministry for the Environment on resource consent processing. It shows that in 28 percent of cases consents are not processed on time, and, worryingly, that does not even take into account the 31 percent of consents where the councils grant themselves extensions. What is of concern is that this situation has become worse with every single survey since 2000, and that there has been a ninefold increase—ninefold—in the number of times when councils grant themselves extensions. The select committee’s changes in requiring the councils to report on the processing of consents, providing for a nationwide system of financial penalties, and restricting the extension of consent processing times are, in my view, a very strong step forward. I am confident that these changes will result in the more efficient processing of consents.

I also note the committee’s caution in respect of the changes to designations and notices of requirement, and where the decision making lies. This is a complex area, and in the second phase of reforms we need to take into account the select committee’s conclusions.

I conclude by making two points. First, the Resource Management Act is by nature a fraught area of law. We all believe we should be able to do whatever we like on our own property, but if our neighbour wants to do anything, we expect to have a say and to be consulted. This bill is about improving the balance by reducing the bureaucracy in some of the more arcane areas while maintaining the underlying environmental integrity of the Act. This bill will make a positive difference, but it is only the first phase of the Government’s changes to the Resource Management Act. We have 10 important work streams going on in water, aquaculture infrastructure, urban design, further work on the Environmental Protection Authority, and work on the interaction of the Resource Management Act with forestry, with building, with conservation, and with the Historic Places Act. As well, further work is being done on some generic issues that could not be advanced in the time frame required of this first reform bill.

Again I thank all those involved in the hard yards of progressing the bill through to this point, and I look forward to the more detailed debate in the Committee stage. I am pleased to commend the Resource Management (Simplifying and Streamlining) Amendment Bill to the House.

Hon SHANE JONES (Labour) : Tēnā tātou katoa. It is a rather unusual feeling I have. As a youngster in the late 1980s I was a member of the core group, reporting to Sir Geoffrey Palmer, that wrote the Resource Management Act, along with Denise Church, Kathryn Ashley-Jones, and Joan Allen. That some 20-odd years later I have the privilege of sitting on the Local Government and Environment Committee to work on improvements to the legislation shows that I am growing older, but hopefully wiser.

Labour will support this bill, but with some important reservations. Colleagues of mine will be addressing those reservations during the Committee stage, which with flair and a bit of innovation will prove to be a very focused and, I think, entertaining debate. Firstly, let me join with the Minister in acknowledging the work that was carried out by the officials. This is a complex area, and select committees are really only as good as the quality of the advisers, consultants, etc., and the actual clerical staff of the committee. The committee was well served during that period.

This bill deals with a number of very deep issues. The first issue is devolution. We have a system, which this bill largely keeps intact, of enabling New Zealand citizens, through the agency of both regional and local government, to influence plans, policies, and allocation decisions that are made in relation to the environment they live in. I think that spirit of fairness, deeply rooted in the Kiwi personality, means they should be allowed—and the law should sanction it—a whole host of rights to participate, and, indeed, to go on and appeal those decisions.

Against that right, which is what led to some of the more creative debates in our committee, there is the fear that 50,000 statutory consents is quite excessive. It represents a cost and a burden upon ordinary citizens trying to do things with their property, upon investors, and, indeed, upon others who fear that some of the decisions that are being made are not in the best interests of either the community they live in or the environment. As a Parliament this is a debate for us. Have we got it right? Ought devolution remain the exclusive basis upon which our major resource management decisions are made, or should they be moved to a level that some might argue is more efficient? We look forward to phase two. Yes, this bill is a simplifying and streamlining initiative, but the big business I rather suspect lies in phase two. I look forward, along with my colleagues, to receiving briefings from the Minister in that regard.

Let us turn to some of the important innovations in this bill. The bill will create an Environmental Protection Authority. We do not know what it will fully do. We know that Gary Taylor has written a paper on the issue. I am not entirely sure whether that will provide the policy basis for the Minister’s new Environmental Protection Authority. We on this side of the House have not been briefed and we do not know the final functions of this authority. But there is an awareness that if it represents a more efficient way of dealing with large, resource-intensive resource management decisions, then that is not bad. The fear, however, lies in local communities feeling that their local directly elected representatives are either being circumvented or being completely written out of the script. That is the first thing I would like to point out.

Secondly, there was a fear, and fortunately the select committee was able to address it, that people were going to lose the ability to contest a statutory decision on the basis of merit. As you know, Mr Deputy Speaker, along with the rest of us, a lot of these resource management decisions are not quantitative decisions alone. They are highly emotional and they are highly expensive, and people are making decisions not just on what can be counted, but on what can be felt. It was a pleasure to find that colleagues on the other side of the House, along with ourselves, agreed that New Zealanders ought to be able to contest environmental decisions not on the basis of black-letter law alone, but on the basis of merit or, dare I say it, virtue.

That was one of the key improvements in this bill. But that in itself is a reflection of how difficult it will be for any Government to buy into a corporatist approach of environmental management that does not allow local communities to continue to have their say. My colleagues from Auckland will be amplifying that message, no doubt, when we get to the children of Tāne Māhuta, dwindling in number in Tāmaki-makau-rau as we speak.

There are three elements that we did not agree with. The first is the role of the Minister of Conservation in the coastal environment. For us, it is quite a simple issue. If I, as an owner of property, learn something is happening with my property I ought to be entitled to have a say, yea or nay, as to whether the proposed usage on such property should be tolerated. That will no longer happen. Once the Minister of Conservation as the putative owner, on behalf of the nation, of the coastal environment is written out of the script, the Crown will be reduced to the role of rule maker or regulator, not proxy owner for the nation. Not surprisingly, as the people who are still working through the detritus of an earlier attempt to deal with the seabed and foreshore legislation, we see a strong ongoing role for the Crown in that regard. We will have Supplementary Order Papers in that respect.

The second point is notification. The only reason notification has loomed large is that it is the trigger that allows a neighbourhood either to learn or to participate in a decision that they rightly or wrongly believe will affect their quality of life. That is a fundamental tenet about where social democracy meets resource management. For those reasons we do not feel that the bill has the mix right.

The third point, and obviously I have already referred to it, is the insistence by the current Government that while it is building a super-city for Auckland it will deny Aucklanders the ability to derive their own rules and regulations as to how they deal with that aspect of the local environment called trees. This is not just about the number of permits. This is a deep issue. It has resulted in the Government’s forcing its will on the neighbourhood, the citizenry, and the broader community of Auckland as to how they want to deal with trees. The Government, through this bill, is depriving the Auckland elected local government people and their advisers of the ability to do that. But more on such matters later on.

As I have said, Labour will be agreeing with this bill, but the big unanswered questions lie in phase two. We are glad that certain things have been tossed over to phase two, not the least of which is designations. Therein lies a great debate as to where social democracy ends and economic efficiency takes over. They are legitimate, hotly contested issues and there is no better place to have these arguments than in this House.

The number of submissions was extensive, but, unfortunately, a number of them were driven by fear because the Government sought to compress far too much in the 100-day initial period of its reign. Had more time been taken and had a greater amount of resource been dedicated to the technical advisory group, the committee that tidied up the bill possibly would not have been so busy.

Just before I sit, I say that we experimented with an innovation in our committee time. We secured access to four advisers. They looked at various drafts of the bill, and I think both my colleagues on the other side of the House and, dare I say, even the Minister can see that because of the collective wisdom of these people, Judge Skelton and others, the bill is a better product, is more user-friendly, and will actually achieve some of the objectives that Kiwis want, which is the ability to make decisions in the most efficient, friendly manner to the environment and to their quality of life. Kia ora tātou.

CHRIS AUCHINVOLE (National—West Coast - Tasman) : I am honoured to speak during the second reading debate on the Resource Management (Simplifying and Streamlining) Amendment Bill. As chairperson of the Local Government and Environment Committee, I would firstly like to thank my fellow committee members, who considered 840 submissions on the bill. The committee heard 339 of those submitters during 68 hours of hearings. It was an interesting, dynamic bill to have before the committee, and I am grateful to all members of the committee, particularly to those who could bring to bear their experience in earlier practice associated with the Resource Management Act. All members and all parties certainly worked very hard to get the best result, and I can honestly say I cannot recall a single partisan issue being raised throughout the weeks and months of the committee hearings.

As stated by the Minister for the Environment, the improvements made to the Resource Management (Simplifying and Streamlining) Amendment Bill provide a useful reminder of how much can be achieved through solid engagement by everybody in the select committee submission process. This is a significant piece of work, and very serious legislation. I would like to also acknowledge the hard-working officials, and the assistance of the expert panel mentioned by the previous speaker, Shane Jones, in delivering a finely tuned legislative amendment back to the House.

The Resource Management Act is the core of our legislative framework, and with it comes all the heartfelt appeal of what makes New Zealand what it is today. It reaches into property rights, values, and culture. On the whole, however, it reaches the right balance between the economy and the environment. These amendments have not altered that balance, but they have looked at the processes under the principle that the Act balances. National, on coming into power, had strong support for amending the Act. Officials, the electorate, business, and communities supported our policy.

I am pleased to say that the bill as reported back is much improved. The Local Government and Environment Committee has reversed some of the headline proposals in the bill, especially those concerning plan appeals and non-complying activities and designations, and has made it more modest and considered legislation. Even so, it delivers a substantial shake-up to the Resource Management Act regime, and we can expect more changes from the phase two reforms.

The bill contained a number of contentious proposals, and the select committee decided that a couple of them would result in more costs than improvements, so changes have been made. However, there are many that we considered to be appropriate. In the light of the submissions received from both business and communities, the planning process remains intact, as in the original Act. However, this means that more considered work is required in phase two of the resource management reforms. Although there are improvements to the further submission process and decision processes, there is no single silver bullet to fixing the planning process.

The select committee recommends some useful refinements. There will be new scope for combined regional policy statements and/or plans, which will encourage greater consistency and quality in plan making. Whole-of-plan reviews will be replaced by 10-yearly rolling plan provision reviews. Councils will apply the cost-benefit disciplines intended by section 32 of the Resource Management Act, and this is a helpful change. The 2-year time limit for councils to issue their decisions on plan submissions and the ban on whole-of-plan appeals should speed up decision making, even if in reality there will be little sanction on the laggard councils or determined litigants who frame their appeals to cover almost all the plans. Councils do not have to issue decisions on each and every submission. A single decision from the council is all that is required.

Unfortunately, the bill presented to the committee will not fix the very significant costs and delays associated with the planning processes. These are the biggest headaches of the Resource Management Act, especially in regard to issues of regional resource allocation and management, where many councils are hopelessly behind. Typically, even modest plan reviews are taking a decade or more to complete. If we put that against 10-yearly review cycle plans, then plans will be outdated even before they become operative.

This is not to say that real streamlining and reform in the planning process area is not possible, but the problem is multifaceted and not open to a quick or even single solution. This will be the role of phase two resource management reform. Phase two now provides an opportunity to take a more rounded look at planning processes, and inefficiencies and their causes, in order to identify truly effective solutions. The committee looks forward to the next instalment in this regard.

Another contentious proposal that has also been dropped is the removal of non-complying activity status from the plans. The committee’s decision not to proceed with the proposed repeal of the non-complying activity category should also be generally welcome. The category was a very important model in protecting investment quality plans, and can be an important shield for major infrastructure or industrial activities against the risk of more sensitive uses being established near them, which is known as the reverse sensitivity risk. If the Government was starting with the Resource Management Act legislation again, it probably would not include non-complying activity as a consent category, but we are not in that situation and the provisions should stay. The retention of non-complying activity status means that councils will retain the ability to say no if development proposals with more than minor environmental effects are contrary to the plan’s objectives and policies.

A high-pressure change that was sought by many submitters that was not made was the removal of tree protection provisions in district plans from 2012. That is disappointing, and I am sure we will hear more about that issue as the bill proceeds through the parliamentary process. I would like to spend a bit of time on this provision, clause 52 of the bill, because I think people have their perceptions and their noses too out of joint on what is being achieved. The intent of the clause that relates to the removal of blanket tree protection rules and plans is to reduce cost and time spent by the community on applying for resource consents for relatively minor matters. Of the 50,000 resource consents that are applied for every year, 5,000 are for tree trimming or removal. They are applied for because of unnecessary tree protection rules in council plans. The cost on individuals is unjustified, the approach is blunt, and the law is lazy.

The amendment bill as reported back from the select committee has quite rightly retained the provision of clause 52. Only a few councils have sought to put in place such blanket tree protection rules, but, really, when we think about it—and I look forward to discussing this in the Committee stage—almost all the consents are granted, so where is the problem? Why have the consents? Many cities such as Christchurch, the garden city of New Zealand, Hamilton, and Wellington do not have the same rules; they rely on protecting those trees of significance through scheduling them in the district plan. I also note that one council where the issue is most significant, Auckland, has supported the change.

Clause 52 does not take effect for some considerable time, by which time the councils will have had time to amend district plans and put in place non-regulatory means of encouraging residents to retain vegetation on their properties. The intention of these reforms—simplifying and streamlining—has been achieved, and the Minister for the Environment should be pleased with that outcome. In addition, the fast track for major infrastructure projects remains largely intact, so development interest should be satisfied.

Overall, the proposed amendments can be seen as a win for the environment and a win for major infrastructure providers. I am pleased to have been part of a process that had a Minister who was prepared to listen and a committee that was prepared to shift ground where needed. All members of the committee got involved, shoulders to the wheel, and made the best they could of the bill before us. It was innovative on the part of the committee to include a group of specialists for a final look before we reported back on the bill. That was a most worthwhile exercise. This is a much better bill than when it started out, one that will simplify and streamline the Resource Management Act. Thank you, Mr Deputy Speaker.

PHIL TWYFORD (Labour) : As my colleague the Hon Shane Jones said, Labour is supporting the passage of the Resource Management (Simplifying and Streamlining) Amendment Bill, with three main reservations; I intend to focus my comments on one of those reservations, clause 52. This debate should be dedicated to the Lorax, Dr Seuss’s character who spoke for the trees. Someone has to speak for the trees in this debate, because the National-ACT Government surely will not. The contributions from the other side of the House could be dedicated to Ronald Reagan, the late President of the United States, who once said “Once you’ve seen one tree, you’ve seen them all.”, and that is pretty much the philosophy demonstrated by the National Government on this issue. The first thing to say about this is that it is a heavy-handed intervention by the Government.

Nikki Kaye: Where was your minority report on section 52?

PHIL TWYFORD: This is very, very interesting; I tell Miss Kaye that she will keep. This intervention by the Government is taking away tools from local government. This is the Government that says local decisions should be made by local communities. Is this not all a bit nanny State? As the New Zealand Herald said this morning in its editorial: “Rules governing the urban environment should be left for local councils to decide. The Government is grossly overstepping its responsibilities.” Labour believes that local authorities should be able to choose how they protect the trees in their communities.

The Resource Management Act provides avenues for parties to alter plans to remove general tree protection rules if the community is unhappy with the status quo. The process of developing the district plan and the normal political processes of local government are designed to give citizens the political power they need to hold their representatives accountable and to determine the rules for how their community is developed. It is a fundamental principle of the Resource Management Act to provide for localised decision-making on local issues, a principle that this Government often trots out in this House. But this clause is an unwarranted intervention and intrusion by central government, by this National-ACT Government, in the affairs of local communities.

What is next? Will the Government write district plans for councils? Is that what is coming down the track? Clause 52 is a kind of trophy in the Government’s crusade against red tape, but what confidence should it give us in the quality of the Government’s regulatory reform agenda? Is this the high-water mark of the Government’s commitment to smart regulation—regulation that preserves a careful balance between the public interest and private property rights? Actually, it is a case of wham-bam-thank-you-ma’am, and to hell with the consequences for our trees and our communities. We should be improving the quality of our regulation, not taking an axe to environmental standards.

Do not tell me it is not possible to improve the tree protection rules; it is. The Minister for the Environment, the Hon Nick Smith, rejected out of hand very sensible compromise solutions prepared by Jeanette Fitzsimons, the former co-leader of the Green Party. The irony is that the Government says it wants to cut red tape, but the effect of clause 52 is to force a council to individually list every single tree it wants to protect. It is common sense that that would require an army of tree inspectors going around the suburbs and identifying and assessing each tree. It is obvious that that would be so expensive and so impractical that it will not happen. As the New Zealand Herald said this morning, “the procedures of individual tree protection would place far more red tape in the path of protectors than the current rules impose on felling.”

Here is the rub: the Government does not care, because that will not happen. It will be too expensive for both councils and citizens. This Government does not care. It has ignored expert opinion from the arborists, the Tree Council, and numerous organisations that submitted to the select committee. Of those who submitted to the select committee on this issue, 78 percent called for the deletion of clause 52, but this Government is not listening.

The Government wants to frame this issue as being about trusting homeowners, as the Minister just said; opponents of this provision assume negative motives of property owners and only councils value trees. What pathetic nonsense! Does the Government think that Aucklanders are fools? Everyone agrees that most property owners and most people want to protect their trees. The point of the law is to protect the sensible majority from the rogue minority. We have so many laws in place that aim to do that, so why not apply the same principle to trees?

It is especially disappointing that this provision throws out of the window any sense that big, historic, or valuable trees are a community asset that we all have an interest in protecting. On average, we stay in our homes about 7 years. In a real sense we are all the guardians of our properties for future owners. The law recognises that—that our neighbours and the wider community have an interest in big trees, even if they sit on our private property. To again quote the New Zealand Herald: “It has therefore been deemed reasonable that the property owner should need the consent of the community’s representatives before destroying a feature of its skyline.” It goes on to conclude: “This is hardly a frightful interference with private property rights.”

Nikki Kaye, the member for Auckland Central, has been in empathy overdrive in recent weeks as she tries to convince her constituents that she really cares for the trees. She did not care enough to front up to a public meeting in Grey Lynn, where 200 people were protesting this policy by the Government. She did not care enough to front up, and nor did any of her National Party colleagues. But Nikki Kaye wrote to her constituents “I do have concerns about clause 52.” Well, if she has concerns, now would be a good time to hear about those concerns. She says “I am currently working within Government to see what I can do to allay those concerns through legislation and policy. I will keep you updated with the outcome of these discussions.” I tell Miss Kaye that now would be a very good time to front up and share with the House her concerns, and what she has been able to do about them. We want to hear Miss Kaye’s concerns. This is the second reading, and I challenge Miss Kaye to cross the floor and vote with this side of the House to support amendments to clause 52.

National likes to say that 90 percent of councils, including cities like Christchurch and Wellington, do not use general tree protection rules, and that there is not problem with the trees in those places. I have a question for the Minister: how many new trees have been added to the schedule in Christchurch in the last 10 years?

Hon Dr Nick Smith: I raise a point of order, Mr Speaker. The member has asked a question—

Mr DEPUTY SPEAKER: No, that is not a point of order.

Hon Dr Nick Smith: To answer the question?

Mr DEPUTY SPEAKER: No, that is a debating point.

PHIL TWYFORD: I will tell that member how many trees have been added to the list in Christchurch: zero. Not a single tree has been added to the list, because it is too complicated, too onerous, and too expensive. If clause 52 goes through unamended, thousands of trees across Auckland, many of them hundreds of years old, will be at risk. Developers will be able to clear-fell private property sites with impunity. There will be no mechanism in place for them to be required to do remedial planting. Trees that were previously saved from being chopped down will be the first on the list to go.

Think about the pōhutukawa trees that fringe our coastal suburbs. What tree is more symbolic of our environment? Who will stop private property owners and developers from taking a chainsaw to those pōhutukawas to get themselves an unobstructed view? The Prime Minister said that we will not see some kind of chainsaw massacre. That is an interesting choice of words. Councils can protect trees through individual notifications. The New Zealand Herald said this morning that if the Prime Minister believes that, he is dreaming. He is, in the words of his deputy, “bouncing from cloud to cloud”.

JEANETTE FITZSIMONS (Green) : The Resource Management (Simplifying and Streamlining) Amendment Bill is vastly different from the bill that came before the House in February. For that difference, I thank warmly the hundreds of submitters who took the trouble to come to the Local Government and Environment Committee. For most of them it was unpaid time; the bill would be much worse without their efforts. But that cannot disguise the fact that the bill’s true purpose is to remove the obstacles of public participation from the path of developers wanting to make their money at the expense of the environment and other people.

The Resource Management Act has always been about how we resolve the conflicts in our increasingly overpopulated world between short-term economic gain and the long-term health of the environment that supports out lives. The Act, as initially written by Labour and passed by National, set out some bold principles. It was to enable people to provide for their economic and social needs while maintaining “the life-supporting capacity of air, water, soil, and ecosystems;”—even trees. That is the ecological bottom line set out in Part 2 of the Act, but these days it is hardly ever referred to. Meanwhile our biodiversity plummets, and the kōkako and the mohua head for extinction. Our waterways have become filthy, and our urban air will not meet World Health Organization standards.

There has been an incremental process since 1991 to weaken environmental protection under the Act and to weaken the powers of communities to have a say about the places where they live. And here we go again. Nothing could illustrate more clearly the attack on nature, even the little of it that remains in cities, than the proposal to end protection for urban trees. A city without trees is hot, dusty, shadeless, and ugly. It is a city not worth living in. But so often developers want to cram the maximum possible number of sections into a subdivision, and the trees are in the way. Most councils manage without blanket rules for tree protection, but the areas where we find them are areas of rapid growth, urban infill, high land prices that attract greedy developers, and where the community values its trees and wants to protect them, such as Auckland and the Kapiti Coast.

It is true that processing consents takes a lot of time and cost for the council. That is why the Greens proposed an amendment that allowed reasonable trimming, but not felling without a consent. That would have more than halved the compliance costs. But was the Government interested? No. We will move that amendment later today, but the Minister for the Environment, Dr Nick Smith, has already turned it down. Instead, he proposes to saddle councils with the time and cost of describing every tree that is worth protecting and scheduling them, and dealing with every submission that opposes scheduling a tree. That will be enormously more trouble than processing consents. Most councils will not do it or will leave out very significant trees that the community values. The Minister knows they will not do it. We will lose the green spaces in our cities, the shade, the habitat for birds, the dappled light, and the cooling in the summer heat. Where are the Bluegreens on this issue? Where are their proposed amendments to the bill?

The attack on community participation begins with the reinstating of the power of the Environment Court to require an objector to put thousands of dollars up front as a bond before he or she can be heard. The Government and the developers know the court will only do this in extreme circumstances, but community groups who are having their first tangle with the Resource Management Act do not know it. So it becomes a fearsome weapon that applicants use to deter local people from ever setting foot in court. Planning cases are not just arguments about competing property rights and whether someone’s building blocks someone else’s view; often they are David and Goliath struggles between well-resourced corporates with the best lawyers and community groups with little experience of the law who are running cake stalls to pay for some professional advice on how to protect the natural values of the places where they live. They do not need to be intimidated by the threat of ordering security for costs, even if it is unlikely that the judge would ultimately issue such an order. Such groups are to be further disadvantaged by the removal of their right, under section 274, to join an appeal brought by another participant. No big firm with full-time lawyers would ever need section 274, but volunteers with a day job and a family often find out too late what is going on, and section 274 has enabled them to join the action and to put their case by piggybacking on the submissions of other parties.

Local knowledge counts. When a goldmining company applied to build a mine in a tailings dam in the beautiful Waitekauri Valley near Waihī, those who had lived there for generations told the hearing that the land was unstable. It had slipped before in extreme rainfall and could threaten the integrity of the dam and risk toxic sludge sliding into the Ohinemuri River. But they did not have the money to bring in expert geologists. The mining company did, and it found overseas experts to testify that the land was stable. A few years later, the land cracked and slipped so badly that it cost $20 million to stabilise it, and we still do not know for sure that it really is safe now. But the Minister wants to shut out these people with his changes, including the Supplementary Order Paper, which further raises the hurdle for public notification. I will expand on that Supplementary Order Paper during the Committee stage.

The Greens also object to the removal of the role of the Minister of Conservation in consents for restricted coastal activities. These are high-impact activities carried out on public land in the coastal marine area for private purposes. The Minister is there on behalf of all of us who are joint owners to consider the wider public good of the coastal ecosystem that is under threat. There are undoubtedly areas where the local iwi should be in this role, and others where perhaps the power should be exercised jointly under a co-management regime. But we should not do away with the power of the joint owners of the commons to decide what can go on there. I am heartened that the select committee and the Minister think that the role of the Minister of Conservation and coastal planning should be examined again in phase two of the reforms. But when we look at the history of allowing the privatisation of public space against the wishes of most local residents, I am not too hopeful.

I want to record again my appreciation of the 850 people who took the trouble to bring to the committee their concerns, their expertise, their knowledge, and their skills. I am pleased that with their help we managed to reverse the proposal to allow no appeals against plans and plan changes, because getting the plan right is at the heart of the Resource Management Act process. A poor plan will lead to poor consent decisions for years. It is the most important time for the public to engage, and the council cannot be left as the sole arbiter of what will meet the purposes of the Act. Likewise, the committee has restored the opportunity to put in cross-submissions if another submitter proposes changes with unwanted effects. Green members sought input on the removal of the non-complying category for resource applications from all the councils that appeared. They told us of the huge cost in workload to rewrite their plans, so this silly proposal has gone too.

I want to record the enormous help given to the committee by a panel of experts—Professor Peter Skelton, John Hassan, Helen Atkins, and Ciaran Keogh, all of whom submitted on the bill—who were engaged to advise us on whether the drafting reflected the policy intentions of the committee. They raised many issues that led to substantial clarifications in the bill. The purpose of this bill is supposed to be simplifying and streamlining. No one could object to that purpose. Yet the bill itself adds many pages and layers of complexity. There are now multiple routes to a centralised planning process that can be initiated by the Minister, the applicant, or the council, and that can pass through the Environmental Protection Authority or through the Minister’s office, and that can result in either a call in to a board of inquiry or direct referral to the Environment Court—all to achieve basically the same thing. The expert panel noted in its interim report to the committee that the bill, as it stood at that time, did not simplify and streamline, but rather complicated and confused those processes. We are indebted to the panel for its meticulous work with officials under great time pressure to remove many opportunities for misunderstanding and litigation.

The environment needs more protection, not less, if the places we value are to endure, and if biodiversity, soil, water, and air quality are to be there for our children’s children. Communities need more say, not less, about the nature of the places where they live, and of their landscapes, built environments, urban trees, coastal marine areas, and waterways. This bill will not help, but at least it will not hinder to the same extent that it would have done in its original form. The Greens will still be voting against it.

DAVID GARRETT (ACT) : I rise to speak on the second reading of the Resource Management (Simplifying and Streamlining) Amendment Bill. In years gone by—or perhaps one should say centuries—a man’s land, as well as his home, was his castle. [Interruption] Or a woman’s land, indeed, although I do not know whether many castles were owned by women centuries ago.

Nicky Wagner: They just did all the work.

DAVID GARRETT: They did all the work, yes, or some of it. There was a breakthrough in the 19th century. I say “a breakthrough” because I am a member of the ACT Party, not of the Libertarianz. I do not believe that I should be able to put up a chemical factory on my lifestyle block because it suits me. I do not support the idea that anyone can do anything on their land. The first breakthrough in curbing the idea that a person’s land was his or her castle, and therefore that a person could do anything on it, was a case called Rylands v Fletcher in the 19th century. Simply put, it was ruled that people who, I think I can remember from law school, brought filth, privies, or stenches on to their land were not permitted to do so if the natural course of events would see that material flow on to others’ land.

But that principle has gone far too far. The Resource Management Act, originally written by Sir Geoffrey Palmer, then superseded a year later by an amendment Act that was twice as long as the original Act, has been inhibiting people for far too long. For far too long the Resource Management Act has been misused by too many people in order to get the results that they want, regardless of the costs to those who simply want to enjoy their property as they see fit. Those who designed the Act could not—well, let us charitably hope they could not—have envisaged that it would be hijacked by those who see any kind of economic development as taking us one giant leap towards extinction. Were those people around in the 19th century, they would have thought our ancestors were mass murderers. The reality is that without the hard work of our ancestors, we would not have an economy or a nation of any worth whatsoever. We would have lots of trees, but not much else—and I will talk about trees in a moment. If we fast-forward from the 19th century to 2009, we can see that the Act is doing its best to choke out our entrepreneurial spirit. Every council and MP has encountered people who want to abuse the Act for their own ends.

Like, I imagine, all other members of this House, I have been besieged by a buzzing BlackBerry in the last few days, with emails from people who wish to see clause 52 be deleted from the bill.

Phil Twyford: It was a chainsaw, not a BlackBerry.

DAVID GARRETT: They all think that there will be some kind of chainsaw massacre, as Mr Twyford has just suggested. I will give members an illustration of why that is silly, erroneous thinking. I live on a lifestyle block out in the country, and the very first thing we did when we moved in there, after we whacked down all the 4-foot high weeds, was to plant trees. Now, I am a right-winger. I am a supposed mad, right-wing maniac, but the first thing I did was to plant trees. I was not unusual in doing that. When my neighbour Nick bought his house down the road, the first thing he did was to buy 400 trees and plant them around his boundary. Now he has so many trees that one can hardly see his house. A bloke has just built a house down the road. I have not met him yet; he has been there only a short time. There are great piles of rubbish from the construction outside the house, but what was he doing on Sunday? Planting trees! The very first thing he has done, before his wife has even hung the curtains—I am not allowed to say that; before they have hung the curtains—was to get out there and plant trees. The idea that everyone will go mad with a chainsaw is just silly, like so much that comes from the party on the other side of the House.

This amendment bill achieves a number of things. It gives the courts more power to punish those who misuse the Act’s processes, and it gives people greater control over their own land, without giving them carte blanche to do anything.

I wish to talk for a short time about the removal of the blanket protection of trees. It has been very interesting that among the avalanche of emails, some of them relatively pro forma in nature, that I have received regarding clause 52 of the bill, there are one or two little currants in the pudding that have said what a good idea it is. One that struck me in particular was from a person in the North Shore of Auckland who has a large pōhutukawa tree on her land. It is well past its best; an arborist says it is diseased. Various branches fall off it from time to time, and they have not killed anyone yet, but they have damaged a car. The tree does not even have much greenery on it any more, because it is too old. But, because it is a large pōhutukawa, that homeowner has to go through God knows how many hoops in order to try to remove or even trim it. She is still fighting that battle now. She is delighted at the inclusion of clause 52 in the bill, because she can finally remove an old, diseased tree that is doing absolutely no one any good, and that is not a feature or an enhancement of either her environment or ours.

Another example, I think coincidentally on the North Shore, is a tree that is poisonous. I think it was mentioned again in the paper this morning. It has taken a resource consent application, several hearings, 13 written submissions, and a number of reports to gain consent to remove a palm tree that was injuring people, and a shrub that has leaves that are lethal when eaten by children. If a city council’s parks department has to jump through as many hoops as that, where does that leave the individual landowner?

Some people out there worry that everyone will, as I say, go wild with their chainsaws and chop down all the trees. In the eyes of what most people would refer to as the extreme green movement, trees have greater rights to live on the Earth than we do. Well, I am afraid I do not subscribe to that view, although my house is surrounded by trees and will eventually be obscured from view by them, I hope, like Nick’s house down the road is. To the extreme greenie it does not matter much what sort of tree it is—perhaps it is a native tree and it looks pretty—because the rights of the property owner are trumped by others who remain unaffected if the tree blocks the owner’s light or falls on his or her house. Mr Twyford’s speech gave an example of that when he said that no matter what the circumstances were, a pōhutukawa should be preserved because it was a pōhutukawa. The example I have just given illustrates that that should not always be the case.

In Auckland, if a tree becomes tall enough, the council effectively becomes the owner or custodian of it. Property owners cannot remove such a tree unless they get permission, no matter what damage the tree is causing to pipes, views, or physical safety. This bill, thank goodness, will remove that stupid law from the books.

Here is one further example. It is the case of a lady called Alice Presley, who had a 14-metre high liquidambar tree—which, to the best of my knowledge, is not a native—on her property. For 10 years it caused no end of problems. Falling leaves made her driveway slippery, she had to spend $600 to keep branches away from power lines—there was no choice in that matter; she was forced to do so—and the tree was contaminating her water supply. Alice applied twice to the Auckland City Council for permission to remove the tree, and twice she was declined. As the landowner, she knew better than anyone the dangers that the tree posed to her property and health. So she cut it down. Good on her! As a result of doing that, she was prosecuted and sentenced to 180 hours’ community work, as though she was some thug.

In removing the blanket protection of trees, this bill gives property owners a small level of trust and a small level of responsibility, which is something they should have always been allowed to have in the first place. Most people, contrary to Mr Twyford’s opinion, are not mad axemen or mad chainsaw wielders; they like trees. Much more still needs to be done in order to restore some sanity to the issue of private property rights, and the ACT Party looks forward to the next round of reforms to the Act to deliver on that. Thank you, Mr Assistant Speaker.

TE URUROA FLAVELL (Māori Party—Waiariki) : Tēnā koe, Mr Speaker. Kia ora tātou katoa i tēnei ata. I do not intend to use all of our allocation for the second reading to open up all of the questions in respect of the Resource Management (Simplifying and Streamlining) Amendment Bill, but I will make some general comments in regard to the Māori Party’s stand, and then I will focus on some of the things we want to put to the House by way of Supplementary Order Papers as we go to the Committee stage.

The Māori Party is committed to keeping our natural resources and environment healthy, safe, and intact for everyone. Within this, we are committed to assisting whānau, hapū, and iwi, as tangata tiaki, to take whatever measures are necessary to ensure the well-being and future good health of the environment. And so we welcome this bill to amend the Resource Management Act 1991, because of the two key words: “simplifying” and “streamlining”. We fully support the intention to reduce costs, uncertainties, and delays, by simplifying procedures and streamlining appeal processes. At the same time, we realise that the penalties must be sufficient to discourage inappropriate practices. Those general statements put fairly clearly the Māori Party’s position in general terms.

I am advised there was a strong theme in the submissions from iwi to the select committee. They seemed to focus on the notion that the Crown guaranteed to protect the special relationship between tangata whenua and their landscapes and natural environments. It is a consistent theme. We are likely to hear it at many hui with Māori. A Māori world view would be that the Treaty relationship should be accorded respect in any aspect to do with environmental integrity. In fact, Māori spend so much time telling agencies about the need for respect for the Treaty of Waitangi, Te Tiriti o Waitangi, that some members might have heard about a new concept that has risen throughout the Māori world called “hui fatigue”. “Hui fatigue” was expressed as an issue at the Sustainable Water Programme of Action hui, which closely followed hui on the foreshore and seabed, land access and aquaculture reforms, and the review of the Resource Management Act 1991, with Treaty negotiations also proceeding in some areas. For those unaware of what “hui fatigue” is, it comes from the notion, I suppose, of saying the same thing over and over again without actually being heard.

And so we are here today putting forward four Supplementary Order Papers—maybe more as we investigate the bill even further—to ensure that the Treaty is acknowledged, and the implementation is secure, in any development of the resource management legislation. The Māori Party is tabling amendments to strengthen the role of tangata whenua in the Resource Management Act. The first of our Supplementary Order Papers strengthens and elevates Te Tiriti o Waitangi provisions already included in the Act, and the second will enable hapū and iwi to initiate a transfer of powers from the councils so that mana whenua can manage their lands, their waters, wāhi tapū, and other taonga.

The Treaty of Waitangi is the basis of resource management law and practice, and it needs to be recognised as such. We want to ensure that local governments acknowledge the mana and authority of mana whenua. This will require robust and accountable work practices by local government and regional authorities when working with mana whenua, as well as a commitment to establish effective strategies for engaging Māori communities and advancing Māori representation. Issues around water must include mana whenua, including water rights and privatisation. Treaty claims to water ownership and interests in fresh water must be resolved in the context of the Resource Management Act, and to do so requires respect for Treaty provisions. So our amendments will strengthen the requirement for all persons to uphold the Treaty of Waitangi in the implementation and administration of the Resource Management Act. This addresses the concerns of whānau, hapū, and iwi that resource management appropriately reflects obligations under the Treaty of Waitangi.

The second set of amendments address the transfer of powers from the councils to hapū and iwi authorities, which for some is probably a fairly radical move. These amendments will allow hapū and iwi authorities to request a transfer of powers for them to manage their lands, water, sites, wāhi tapu, and other taonga, when they determine that they are better able to meet the purposes of the Act. We think this is a pretty innovative line to take. Local authorities will be required to give full consideration to the matter, including completing a comprehensive evaluation of the request for transfer, reporting on the evaluation, and making the report publicly available. At present, hapū and iwi authorities are not empowered to initiate a consideration of transfer of powers. It relates, too, to the need to strike the best balance between conservation and the use of natural resources. The law already allows councils to transfer their functions, powers, and duties under the Act, and our amendments simply take that one step further to specify that mana whenua can initiate a transfer of powers process, and if they decide to do so, the councils must seriously consider their proposal.

The rationale for our approach comes from the common call for a shared understanding about the relationship of Te Tiriti o Waitangi to everyday life. We believe that many so-called Treaty issues are community issues that are best handled through face-to-face discussion and debate at the local level between the people who are directly affected. There is nothing people need to fear when the Treaty of Waitangi is in discussion.

The third set of amendments we will be submitting to the House focus on the removal of security for costs and the reinstatement of the ministerial veto for coastal permits. These amendments reinstate the provisions of the principal Act whereby the Environment Court does not have the power to order a party to give security for costs. We noted in the report of the Local Government and Environment Committee that many submitters were opposed to the repeal of the provisions preventing security for costs, as it may limit public participation in resource management decision-making to those who are simply able to raise the security. We say that is unfair. The Māori Party also proposes that we reinstate the decision-making powers of the Minister of Conservation in relation to coastal permits for restricted coastal activities. The report of the Local Government and Environment Committee again revealed that many submitters, including Māori, were opposed to this amendment. The ministerial power of veto remains important to properly protect the coastal environment.

Finally, we will be putting to the House a set of amendments relating to projects of national significance, which could go to boards of inquiry and be subject to appeals to the High Court if needed. Some might suggest that these mechanisms make for more bureaucracy and hold up the process even further. But, on the other hand, we of the Māori Party believe that these protection mechanisms need to stay where they are to ensure that our place, the Māori place, is still intact if it comes to the crunch. This Supplementary Order Paper introduces a number of amendments to Part 6AA, which deals with proposals of national significance. Boards of inquiry will be required to include a representative appointed by mana whenua, and will also be required to seek the advice of mana whenua in any matter being considered, and to reflect that advice in any decisions and recommendations they make. Any draft and final reports produced by boards of inquiry will be required to be sent to mana whenua, and to any other relevant hapū and iwi authorities. The Supplementary Order Paper will remove the limitation applied to appeals, so that appeals against decisions based on merit can be brought before the High Court.

I remind the House that the Māori Party believes in the efficient use of water, the conservation of energy, and the need for active environmental management. We certainly support the call for simplicity and streamlining, and our amendments are put forward in that context. We will be putting up further amendments to address clauses in the bill that hamper Māori involvement in resource management.

Iwi see the amendment bill now before Parliament as an opportunity to discuss some longstanding issues. As is our practice and our desire, we will be advocating on their behalf to ensure their aspirations, their voices, are heard. We support the second reading of this bill at this stage, pending the discussion on the Supplementary Order Papers we will be putting before the House, and we reserve our right to vote against the last stage. Kia ora tātou.

NICKY WAGNER (National) : I rise to support the Resource Management (Simplifying and Streamlining) Amendment Bill. I am enormously pleased that the bill has finally come to the House. It has been a long haul, but it has been a very important, interesting, and worthwhile process. I will echo others in thanking everyone, including the submitters, the two advisory groups, officials, Crown Law, and the Local Government and Environment Committee members, who have all worked hard on the bill and added value. The bill is very different now as it comes out of the select committee process.

The promise to streamline and simplify the Resource Management Act was something National campaigned on before the last election. We promised to deliver a bill to the House within 100 days—and we did. The bill is phase one of a significant reform of the Resource Management Act that is ongoing. However, the Resource Management Act will still be the principal statute for protecting and managing natural resources in New Zealand. There are no changes to the purposes or principles of the Act, and no reductions in environmental protection. The bill provides for significant improvements to the implementation of the principles behind the legislation.

Over the past 18 years that the Resource Management Act has been in place there has been increased criticism from all parts of the community—from environmental groups, local government, and businesses—about slow and expensive planning and consent processes. There are absolutely no benefits to the environment from heavy-handed bureaucracy, lengthy delays, and expensive legal arguments. In fact, the length and expense of planning processes have often meant that the environment has suffered. The average time taken for a council to produce a full plan is over 8 years, and when it requires several million dollars to be invested it is not surprising that plans are often too inflexible to deal with environmental issues as they arise.

The bill provides a suite of amendments that will make plan-making more effective, more efficient, quicker, and less costly, but it does not compromise the intent of the Resource Management Act, which is strongly supported by New Zealanders.

The bill has now been through a very robust select committee process. As we have heard today, there were over 800 submissions, and we heard nearly two-thirds of submitters. We worked long hours and we worked well together as a committee. After hearing submissions, we have made significant changes to the bill. The key provisions of the bill include the establishment of an environmental protection agency and improved processes for proposals of national significance. The bill provides for a one-step consenting process for resource consent applicants and notices of requirements for designations through direct referral to the Environment Court.

The bill introduces provisions to deal with the longstanding problem of the Resource Management Act being used for trade competition purposes. The new measures include the introduction of mandatory damages, rather than discretionary damages, when a party seeks damages against a trade competitor. This will increase the deterrent effect. The bill also reinstates securities of costs. It is true that many community groups were concerned about this provision because they felt that it may have excluded them from participating in environmental decisions. However, when we reviewed court decisions from the past, when the provision was in place, we felt that judges had used it with discretion and that genuine environment groups with genuine concerns were not disadvantaged. It may be that environmental groups need more information about the provision so that they can work with it.

After listening to submitters we have several provisions that we will not be proceeding with. We will not be removing non-compliant activities and we will not be limiting appeals on plans to points of law. We have deferred changes to decision making for designation until the next phase. Again, after hearing suggestions from submitters, we have also amended several of the provisions of the original bill in order to improve their outcome.

The bill is better as a result of there being much debate and a robust select committee process. The major areas of contention have been worked through successfully by the committee, and modifications have been made. Only a very small number of differences of opinion now remain. The bill will streamline and simplify the Resource Management Act, but let me make it very clear that it does not compromise the intent of the Act or reduce the level of protection of our magnificent national environment and natural resources. Thank you.

Hon DAVID PARKER (Labour) : I rise to talk on the Resource Management (Simplifying and Streamlining) Amendment Bill. In doing so I want to place on record my view that the Resource Management Act is one of the most important pieces of legislation in our country. It is obviously important that we protect the environment and protect neighbours against industrial intrusions in residential zones. That is achieved through the Resource Management Act.

The Act is cornerstone legislation. When it was passed by the previous National Government back in the 1990s, having been designed by Sir Geoffrey Palmer in the prior Labour Government, it was world-breaking legislation. It has stood the test of time. It is now 18 years old. It was passed in 1991; it is now 2009, so it is 18-year-old legislation. Although it is in need of a bit of an update and some housekeeping, which this amendment bill largely achieves, the underlying principles of having environmental legislation that regulates activity according to its effect on the environment remains sound. That is the underlying principle here; we ought to be preserving the environment so that subsequent generations inherit an environment that can sustain them in the same way as the environment has sustained us during our lives.

The principles of the Resource Management Act remain sound. There was a lot of talk by the National Party before the election. One would have thought the Resource Management Act was why New Zealand had some sort of poor growth rate. The reality was that during the 9 years of the previous Labour Government New Zealand had a higher growth rate, on average, than Japan, the United States, and Europe, and an average that was on a par with Australia, which is one of the strongest economies in the world. So the idea that somehow the Resource Management Act was an enormous handbrake on economic activity is something that this side of the House has never accepted. I think history will show that after the Resource Management (Simplifying and Streamlining) Amendment Bill is passed, New Zealand’s growth rate is not all of a sudden going to jump as a consequence.

There has been a lot of exaggerated rhetoric from the Government as to the importance of the bill in economic terms. Having said that, I think the bill makes some wise changes. I am very pleased that the Local Government and Environment Committee, with the agreement of the Government, has changed an issue that I spoke of in the first reading debate, which was the limitation on the ability to participate in appeals against plan changes. The fundamental rules that we reply upon in our cities, towns, and provinces relate to the rules that are effectively in the delegated legislation that is promulgated under the Resource Management Act. That delegated legislation is the district plans and regional plans that are produced by district and regional authorities.

As originally promoted, the bill severely limited the rights of citizens to appeal against changes to plans. In fact, there were going to be limitations to appeal only on matters of law, which would have excluded the ability of people to appeal when they had a matter of substance, a matter of fact, that they wanted to challenge. That would have been the most egregious change to the Resource Management Act and it would have severely undermined the effectiveness of the Act to properly protect the environment. So I congratulate the Minister for the Environment, the Hon Dr Nick Smith, because I think he has made a wise decision to keep appeal rights in respect of plans.

There are a couple of negative points that I must mention. The first relates to coastal permits. This was another of those dog-whistling issues where the Government said that it was somehow improper that the Minister of Conservation retained the right to veto coastal permits. These are developments that are proposed in the coastal area. If there is a development on private land, the private landowner can effectively veto it by saying that it will not happen on his or her land. In respect of public lands, there is no private owner, so we are reliant on an arm of the Government to exercise that right on behalf of us all. The Government is standing in the shoes of the citizens of New Zealand to control what happens in that coastal space.

The provision that allows the Minister of Conservation to veto proposed developments in the coastal area is but another example of the landowner, or the seabed owner in this case—or the person who has custody of it, even if he or she does not own it; given the foreshore and seabed debate, I should be careful that I do not talk about ownership here—controlling what happens there. The person who is effectively the proxy controller on behalf of us all in respect of that space is the Crown, and the person within the Crown who exercises that right of control is the Minister of Conservation. So it is quite proper that the Minister of Conservation has the ability to veto proposed developments in the coastal space.

That ability to veto is not unconstrained. Principles of law have to be applied by the Minister of Conservation when exercising the discretion of whether to veto a proposed development. We have seen cases in recent years where the decision of the Minister of Conservation was overturned by the courts because the courts found that the Minister had improperly exercised that discretion. That does not mean that the rule that allows the Minister of Conservation to veto certain developments should be completely done away with. In fact, that court decision shows that there were proper limits on that right of veto anyway and that there was no need for more intervention from Parliament to remove that right of veto.

I for one think that it is sad that we are saying that the Crown no longer exercises its right to control what happens in that public space, because I expect the Crown to look after that public space. I expect the Crown to let me veto what happens on my land, but I expect the Crown to make similar decisions on behalf of the people of New Zealand in respect of the public space in, for example, the coastal marine area.

I will raise another issue, which is the fact that under urgency we are considering this bill and we also have Supplementary Order Paper 39, which is 45 pages long. I hope that Dr Nick Smith has the decency to smile in respect of this issue, because that Supplementary Order Paper in relation to the size and complexity of the bill is two or three times the size of the Supplementary Order Paper in respect of the emissions trading scheme that we considered last year. I do not know whether Dr Smith can remember as far back as that, but if he cares to reflect on the Hansard, he will note that he was here criticising that Supplementary Order Paper as being a constitutional outrage.

A couple of comparisons should be made. For a start, the proportionate length of the Supplementary Order Paper here is far, far longer. The second point to be made is that when we produced the Supplementary Order Paper to the emissions trading scheme legislation, we made it intelligible for people by producing a redline version, with struck-out provisions in redline, highlighting the changes that were made in the bill, whereas with the bill now before the House we are effectively blind as to what the effects of this legion of drafting corrections to the bill are. We are told that there are no policy changes and that they are matters of technical drafting. Well, I have to say that if these are not policy matters but are matters of technical drafting, then it points to pretty slack and sloppy practice on the part of the Government.

Hon Darren Hughes: He was going to change all that.

Hon DAVID PARKER: That is right; Dr Smith said that would never happen on his watch. Not only is it happening to a greater degree under this National Government but also it is whacking the bill through under urgency. We did not pass the emissions trading scheme under urgency. We used the normal processes of this House and, to aid members, we showed them that the amendments were merely technical and not policy changes. We produced a tracked changes version of the bill to show how those amendments were to be incorporated. We do not have the advantage of that good process on this occasion.

I also mention a concern about notification rules. The Resource Management Act changed the old status quo under the Town and Country Planning Act. Under the Town and Country Planning Act one used to have to prove what was called status, in legal terms, before one could turn up and exercise one’s rights to participate in planning processes. The Resource Management Act changed that and essentially gave people who thought they were interested parties the right to turn up and have their say. The Government not only is trying to constrain that through the reintroduction of rights in respect of security for costs, and there are arguments for and against that, but also is going further. The Government is saying that in terms of the notification process that precedes the ability of people to know whether something is happening and, therefore, to take an interest in it, it is changing the onus. It is changing the rule under the Resource Management Act that stated that on the balance of doubt, notify. If there is any doubt, one should notify.

NIKKI KAYE (National—Auckland Central) : I rise to speak on the Resource Management (Simplifying and Streamlining) Amendment Bill. The Resource Management Act came into force in October 1991 and replaced or amended more than 50 other laws relating to town planning and environmental management. This complex statute is designed to help manage a wide range of issues including conflicting values, expectations, and rights with regard to the environment. In the 17 years since the Act became law there has been criticism of the legislation’s ability to effectively manage complex environmental issues, and complaints about slow and costly plan preparation and consenting processes.

The purpose of this bill is to begin to redress the balance of environmental protection versus economic growth. The key message that I want to get across is that sometimes this can be a very delicate balance. Overall, I think that this bill will improve the legislation, but I have raised some concerns, particularly about trees, as people will be aware, and I look forward to a robust debate on that issue.

We are delivering on our promise to streamline the Resource Management Act. For too long it has imposed unnecessary cost not only on businesses but also on communities; I have seen this in my electorate. The main purpose of this first phase of Resource Management Act reforms is to reduce the time for processing consents and reduce the paperwork required without compromising our obligation to our environmental heritage. We are here because we know that the uncertainty and delays of the current Resource Management Act are adversely affecting New Zealand jobs, infrastructure, and productivity, and they are causing economic frustrations for homeowners, small businesses, farmers, and community groups. The bill before us cuts across aspects of the principal Act to simplify and streamline processes such as developing and making changes to plans, making decisions on proposals of national significance, preparing and implementing national instruments, resource consent applications, decision making, and the penalty regime. Other than in relation to processing applications for proposals of national significance, the roles and functions of the Environmental Protection Authority are not defined in this bill. They are to be expanded upon in the next phase of the Resource Management Act’s reform.

I thank all the members of the public who made submissions on this bill. The Local Government and Environment Committee considered 840 public submissions, with 339 submitters appearing in person. As a result of the select committee process, significant changes have been made to strengthen the provisions to ensure the timely and efficient processing of resource consents. The reason this is needed is that the Resource Management Act biennial survey for 2007-08 showed that only 69 percent of applications were processed within the statutory time frames. The bill includes changes to limit rather than remove further rounds of submissions on plan changes, and to strengthen the process for national consenting and national environmental standards. It also defers the changes around requiring authority decision-making to the broader phase two process. Overall, as I have mentioned, a sensible balance has been struck between reducing bureaucracy and ensuring proper process and environmental protection.

I will cover a couple of key important aspects of this legislation, including proposals of national significance, the Environmental Protection Authority, and, of course, trees. The bill seeks to streamline processes for matters of national significance by providing more clarity and certainty around the board of inquiry process and by improving the process for consenting nationally significant proposals. Matters of national significance could include applications for resource consent or change in resource consent conditions, local authority plan changes or variations, requests for plan changes, requests for preparation of regional plans, and notices of requirements associated with a proposal of national significance.

The other key aspect of this bill, which a lot of people are looking forward to and have come to me to talk about, is that it seeks to establish an Environmental Protection Authority. The full powers and functions of the authority are to be considered in phase two of the reforms, as mentioned by a number of speakers.

We now come to trees. Firstly, I acknowledge the consistent approach of the Green Party on this issue, particularly that of Jeanette Fitzsimons, who has worked constructively on this issue for a long period of time. I acknowledge the hard work that she has put into this issue.

Hon Dr Jonathan Coleman: I raise a point of order, Mr Speaker.

The ASSISTANT SPEAKER (Hon Rick Barker): Point of order, Jonathan Coleman.

NIKKI KAYE: For the Labour Opposition to suddenly be concerned about this issue—

The ASSISTANT SPEAKER (Hon Rick Barker): Order! I am on my feet, and I have called order.

Hon Dr Jonathan Coleman: I raise a point of order, Mr Speaker. I think the barracking has got out of hand. Members are here, wanting to listen to this speech. Occasional interjections are fine and are in the tradition of the House, but I think there is an attempt over there to break up this member’s speech.

The ASSISTANT SPEAKER (Hon Rick Barker): I would have some sympathy for the member’s point of view had there not been a barrage of interjections from the seats just in front of the member. There has been quite a robust exchange, but the point is made: interjections should not be to the detriment of the speaker speaking. The person wants to be heard. I invite Nikki Kaye to continue.

NIKKI KAYE: For the Labour Opposition to suddenly be concerned about this issue is absolute politics. I want to use the “h” word, but I will not. Members on that side of the House—including Mr Twyford, Mr Hawkins, and Mr Jones—supported the tree provisions and failed to put in a minority report on this issue. There is no minority report. They are not interested in the policy; they are interested only in politics.

I personally believe that the current system of tree rules is fraught, and has led to individuals and councils spending excessive time and money on resource consents for trees. Most people, environmentalists, community leaders, and local authorities believe that the current system is not working. The question needs to be asked: how do we fix it? I believe that it is reasonable for individuals to be able to prune and trim their trees without getting resource consent, which is what this law change will achieve. My concern lies in Auckland, and it lies specifically with the ability of local authorities in Auckland to adequately protect high-value trees via scheduling. Ironically, with the reforms in Auckland governance, scheduling may become easier, with one system for tree scheduling in the future. However, rather than politicking on this issue, I have been working with the Minister regarding my concerns.

Jeanette Fitzsimons: I raise a point of order, Mr Speaker. We sometimes find in the House that men with very loud voices are able, despite the lack of microphones, to completely shout down women who are speaking, and I think this is such an occasion. I am not trying to shut down interjections either, but in my view this has gone a bit too far.

Hon Trevor Mallard: I could hear the member from here. I could hear her well. She appeared to be coping quite well. I think the sexist implications from that member are regrettable.

The ASSISTANT SPEAKER (Hon Rick Barker): Regrettable or not, members are entitled to their opinions, and this is a place of free speech. They are entitled to express their views strongly and robustly. I think that is a fair enough point. A point of order was raised before by the Hon Jonathan Coleman about the noise, and as long as people can be heard I am reluctant to stop interjections. I thought that I had left a hint for some members to ease back a little, but it was not taken. Before I invite Nikki Kaye to continue with her speech, I say to people that interjections are fair enough but not such that they drown out the person. It was getting very close to that point. Interjections are fine, but they should not drown out the speaker, who is entitled to be heard.

NIKKI KAYE: I reiterate that Jeanette Fitzsimons has worked very constructively on this issue.

Rather than politicking on this issue, I have been working with the Minister for the Environment with regard to my concerns. The question I have specifically put to him is that if this legislation is passed, how can the people of Auckland have confidence that between now and January 2012 high-value trees and areas of bush will be protected through scheduling? I have asked the Minister how he can ensure that councils will undertake this work in a consistent, efficient manner at a reasonable cost. I know that in the Committee stage the Minister will set out how he will ensure that Aucklanders can have confidence that tree scheduling will work in Auckland. I choose to work constructively with local authorities and the Minister to ensure that that will happen.

Except for my reservations with regard to clause 52, I think that this bill will help to redress the balance between environmental protection and economic growth. Overall, this bill will be good for New Zealand.

SU’A WILLIAM SIO (Labour—Māngere) : Tēnā koe, Mr Assistant Speaker Barker. Talofa lava and kia ora tātou katoa to members of this House. The member who just spoke, Nikki Kaye, said that she was concerned, and she is right to be concerned. I have here copies of over a hundred emails that have come to me from Aucklanders expressing their outrage about a particular amendment in the Resource Management (Simplifying and Streamlining) Amendment Bill. Many of the people who have sent emails are from Auckland, and at the very top of the list of people they have sent emails to is the name of that particular member, so she needs to be concerned. The big question that people from the Auckland region will be asking her is what she will do about the particular amendment they are concerned about.

Labour voted in favour of this bill during its first reading. The reason was that the bill could advance to the select committee process, thus providing the public with the opportunity to participate by way of public submissions. National rushed through the first reading of the bill, and Opposition members had fewer than 24 hours in which to consider the detail of the bill at its first reading. So it was important that public consultation take place, and it was important that Opposition MPs were given the opportunity to more fully consider the potential merits, or otherwise, of a large number of the proposed amendments, as outlined by the Minister for the Environment, the Hon Dr Nick Smith. Labour expressed some real concerns about the detail of a number of those provisions. We also expressed our willingness to work constructively with the Government to improve the operation and performance of the Resource Management Act, provided that the proposed changes did not undermine environmental protection and public participation.

Labour members extend our sincere appreciation to those who took the time to give evidence to the Local Government and Environment Committee on this important bill. There were over 840 submissions and we heard directly from about 339 submitters. Other submitters were heard via teleconference. Although there was support from obvious quarters for the Government’s proposed amendments, the bill received significant criticism in the select committee for poor drafting and the introduction of unnecessary amendments, which were described by submitters as confusing and too complex. I, like other MPs in this House, continue to receive emails from individuals, community groups, and small businesses, outlining their strong opposition to particular amendments in the Resource Management (Simplifying and Streamlining) Amendment Bill by this Government. Later I will share with the House some of that feedback.

The Resource Management Act is a balanced piece of legislation, which provides for sustainable development, local participation in decision making, and protection for the natural and physical environment. Labour is generally supportive of ongoing moves to improve the operation and performance of the Resource Management Act. Labour will support measures that reduce unnecessary costs and the delays and objections motivated by trade competition.

The bill underwent significant changes during the select committee stage, which highlights the haste with which the Government put together the changes to this significant Act. Although Labour supports improvements to the bill, it does not support proposals that will rebalance the Resource Management Act in favour of development at the expense of environmental protection and public participation in decision making. Labour believes strongly that we should not allow New Zealand’s environment to be degraded. Although we support streamlining the consent process, we do not support removing the safeguards for protecting the environment. New Zealanders are rightly proud of our “clean, green” brand, and there are strong views in the community that the Government simply cannot be allowed to ram through its pet projects without adequate public input and scrutiny.

One of the principles that undergirds the Resource Management Act is the principle of community participation. The Resource Management Act is about making sure that development is enabled, but also that there is collective responsibility for the management and development of valuable natural resources and our beautiful environment. The Resource Management Act permits this by allowing communities and individuals to get a chance to have their say in the development of their local areas. It is important to ensure that communities and people that are adversely affected should be able to have their say. In fact, the Minister said in the first reading of the bill: “No changes are proposed to the purposes or principles of the Resource Management Act. I believe that those principles are sound.”

Labour agrees that the principles of the Resource Management Act are sound. However, we believe that there are three key areas that, if the Government were to go ahead with them, would undermine these sound principles and ultimately undermine the democratic rights of local communities, their rights to participate in the local decision-making, and the need to protect our environment for the benefit of not only present generations but also future generations. Labour does not support the changes to the way resource consents are notified. Labour does not support the removal of the Minister of Conservation’s decision-making powers in relation to restricted coastal activities. Labour does not support the prohibition of district rules that allow local authorities to have general tree protection rules in their district plans. Labour is concerned that the removal of the presumption in favour of notification will undermine public participation and the ability of local communities to be involved in decisions that affect them.

The bill raises the threshold of affected parties to narrow the scope of parties that need to be notified. It raises the threshold for effects on the environment before a local authority needs to notify an application. The committee received about 395 submissions on this proposal, and 75 percent strongly opposed the change. The main concern of submitters was that the changes would reduce public participation. The removal of the Minister of Conservation’s decision-making powers in respect of coastal consent for restricted coastal activities will lessen the environmental protection of the coastal area under the Resource Management Act. The Minister of Conservation’s decision-making powers allow the Minister to advocate for the public interest on proposed coastal developments. These powers provide an important environmental check on proposed coastal developments. Eighty-three percent of submitters on this amendment strongly opposed it.

Labour does not support the prohibition of district rules that allow for the general protection of trees. This proposal undermines local decision-making powers and the ability of communities to determine development in their area. Local authorities should be left, through their elected representatives, to make their own decisions about the protection of trees in their communities.

I want to share with you, Mr Assistant Speaker, and with members of the House some of the concerns that have been shared with me, and I suspect with many other members of this House. I have here an email from Amanda of Auckland. She says she is standing up to those who think they are king. She expresses her concern and asks that clause 52 be deleted. She says that we need to “retain the existing tree protection provisions and seek to meaningfully engage with local communities in respect of any modifications of existing tree protection rules.” I have an email here from Tony of Pīhā, who says that he lives overlooking the valley of all the old pōhutukawa that line the hills. “Every tree that I can see from here is on private land. If clause 52 of the proposed Resource Management (Simplifying and Streamlining) Amendment Bill goes through, they are all at risk.” Tony’s request is simple: “Please delete the clause and talk to the communities about what level of protection they would like to see.” I have here an email from a Dr Andrew of Mairangi Bay, who says: “I request that you delete Clause 52 … retain the existing tree protection provisions and seek to meaningfully engage with local communities in respect of any modifications of existing tree protection rules.” I have one here from Wendy of Auckland, who says: “Trees are an important part of the landscape and provide oxygen to the environment, and hold the surrounding land together more than we might think. The loss of large historic trees from my neighbourhood would be devastating for me, as well as the birdlife that live in them. Please reconsider the above clause.” I have many, many more.

Dr CAM CALDER (National) : Thank you for the opportunity to speak on the Resource Management (Simplifying and Streamlining) Amendment Bill. National promised to introduce legislation into the House to amend the Resource Management Act within 100 days of forming a new Government. We have kept our promise. This bill is the first phase of a two-stage process to reform environmental resource management. The Local Government and Environment Committee has been working in a collegial manner on the Resource Management Act. I mention collegiality advisedly. The measured, mellifluous Scottish brogue of the chairman sought and received valuable contributions from all members of the committee. I wish to express my appreciation of the efforts of all members, submitters, and officials whose input informed and shaped this bill.

There is a broad understanding and appreciation that changes to the Resource Management Act are required to ensure a better balance between environment protection and economic growth, and that the cost, uncertainty, and delays of the current Act are adversely affecting New Zealand. Understandably, there are points of difference. The major urban area affected is Greater Auckland, where a number of councils have general tree protection laws. Clause 52 is being used to address this issue. There is a school of thought that clause 52 will countenance widespread rapine and plunder of our precious urban arboreal resource. What is it about Auckland and those who live there that should occasion such concern? Are all these good residents vegetal Visigoths? Are they Philistines of philodendrons? Are they pillagers of Pūriri, castrators of Kauri? They are not. Are these good people ravagers of rhododendrons? We will talk about this later, in the Committee stage.

The CHAIRPERSON (Lindsay Tisch): In accordance with a decision of the House, there will be a 5-hour debate, with members having an unlimited number of speeches of 5 minutes each. At the end of 5 hours all the provisions of the bill will be put as one question. The amendments will be put before the question on the provisions.

Hon SHANE JONES (Labour) : Tēnā koe, Mr Chairperson. I say before we start that it was very enjoyable having you in Te Tai Tokerau to show you the Marsden Point oil refinery and to learn what your party really thinks about climate change. However, that is for another time.

I want to focus on three elements before my colleagues contribute. The first is notification, the second is the coast, and the third is the decimation of the trees. No more tōtara, no more rimu, no more pōhutukawa; all we will find in a National-dominated Tāmaki-makau-rau is puha and wīwī. I want to know why Government members are spending all this time on developing a super-city but are unwilling to give the authority to the super-city to generate rules, plans, and safeguards for the resources of that particular area. They are insistent on carrying on with this. It looks like a “ninny State”—a nanny State development out of the National caucus, much to the detriment of our people in Auckland.

However, let me come back to notification. Notification is referred to in one or two of the Supplementary Order Papers, and the reason why we are very, very reluctant to allow this to go unchallenged—and why we will not be agreeing with this particular provision in the context of the Committee debate—is that this is the first opportunity New Zealand neighbours and residents have to know about a proposed activity. We are entrusting far too much to the bureaucracy of the local government as to whether a matter is of a minor character. Once people lose that opportunity, they lose goodwill, and people feel that they are being denied a key part of what resource management married to social democracy means: a chance to have an influence through a guided process—not a gilded process but a statutory process. That chance has been removed. There has been a presumption that this bill is neutral. We would have preferred to see that citizens could rely on the fact that where an activity is proposed they will receive notice of it. It is highly likely that that activity will not have a deleterious effect on them anyway—

Hon Tau Henare: What?

Hon SHANE JONES: I shall repeat the word “deleterious” for Mr Henare because it has further to travel in order to educate him. However, that is another matter.

That is why we will focus on the area of public notification.

I move on to the matter of the coast. The Minister in the chair, the Hon Dr Nick Smith, has had experience of this issue. I am really looking forward to hearing him explain how we account for stripping away from this area of the law any reference to the putative owner of the coast. Admittedly it is in the context of stewardship. The Minister has told us that the preferred model he presents in this legislation is a focus on rules, on effects, and on the regulatory responsibilities. But who owns the coast? The Government will not give it back to the tangata whenua, and now it does not even want the Crown to hold it. It is almost as if ownership is floating around in some sort of ether. The public of New Zealand, for public weal purposes, need to know that the Government of the day is prepared to intervene and make a decision on such matters as whether a proposed project or activity ought to occupy that part of the coastal environment. That decision is not made just as to the ability of us to understand the effects; it is made as to whether New Zealanders through the agency of the Crown are comfortable with that portion of our environment being exclusively occupied for a given commercial purpose. That provision has been stripped out. We would like to see that provision not only restored but possibly enlarged so that we know, as we move through these treacherous waters as to the Māori claims and the takutai moana, that the Crown is not absolving itself of its Treaty responsibilities and its obligations to its Treaty partner.

I come back very briefly to the matter of the trees. The issue has become very vexed and unfortunately members on the Government side of the Chamber have decided that Aucklanders cannot be trusted to come up with a solution. That is a bad decision, and we will have more to say about it.

Hon Dr NICK SMITH (Minister for the Environment) : The environment spokesperson for Labour, Mr Shane Jones, identified a number of issues that Labour wants to debate in the Committee stage. I think he has done a pretty fair measure of identifying the controversial issues: the issues in respect of trees, the issues in respect of notification, and the issues in respect of the ministerial veto that we are removing in respect of coastal consents. I am looking forward to the debate over the next 5 hours as we canvass some of those issues.

I want to go straight to the issue of trees. When the environment spokesperson for Labour, Mr Shane Jones, gave his second reading speech his very first comments were that 50,000 resource consents for New Zealand were too many and we need to have fewer. I agree with him. If we ask officials where there are a whole lot of meaningless resource consents that cost a whole lot of money and achieve absolutely nothing, the answer has to be tree trimming. Let me give members the numbers. We have 5,000 resource consents per year for people who trim trees. Do members know what the most remarkable fact is? That number is for only eight of our 86 councils. There are 5,000 resource consents per year so that people can trim a tree. Does this Parliament really distrust ordinary New Zealanders so much that if they want to trim a tree over 3 metres in height they need to get an arborist’s report and lodge the resource consent with their council? The council official has to consider the consent, visit the tree, and check that it is a proper resource consent. And 97.6 percent of them are approved. Members opposite say that this legislation will result in a chainsaw massacre and that the beautiful landscapes of Auckland will be lost. Well, I have just had lunch with the Mayor of Christchurch. Do they have such rules in the Garden City? No, they do not. Are there fewer trees in Christchurch as a consequence of not having these nanny State rules? Of course there are not.

Then there is the argument from Labour. I have to say that I particularly enjoy the contributions from “Mr Triffid”. You see, he has gone out publicly—

Hon Steve Chadwick: I raise a point of order, Mr Chairperson. His name is Mr Twyford.

Hon Dr NICK SMITH: I was interested to note that Mr Twyford was a member of the Local Government and Environment Committee. I would have thought, with all his comments criticising the Government, that there would be some comments in the select committee report from Labour about urban trees. I searched through all 221 pages. Surely, if Mr Twyford has the time to call public meetings, and to put out press releases attacking the arrogance of the Government, there should be a comment from him in the select committee report on urban trees. But there is not a single sentence—not a word—from Labour in the report. I think that speaks volumes about the ineffective Opposition members. They make a huge deal out of urban trees but when they had the opportunity in the select committee—

Hon Member: Nothing!

Hon Dr NICK SMITH: Not only was there nothing in the report, but they voted for the provisions in respect of urban trees. Labour members should get their act together. If they really believe that people should need a resource consent to trim a tree, they have learnt nothing from the last election.

Hon Steve Chadwick: Trim or chop?

Hon Dr NICK SMITH: The law right now, and for 9 long years of the Labour administration, is that if people in Auckland want to get a tree trimmed, they have to get a resource consent.

Then the members were saying that this is a case of Parliament overruling Auckland. Well, what did the Auckland City Council submit to the select committee? The Auckland City Council submitted to the select committee that this provision was ineffective and inefficient, and that we should pass this provision to change it. Members opposite are saying that we are overruling the views of Auckland. Do they think we have come down in the last shower? The real motivation of the members of the political left around this issue is that they do not trust homeowners. They basically believe that good old Auckland homeowners should not be trusted with their clippers. They are a real threat to mankind with their tree trimmers, and unless we get them to get approval of a council official, then they should not be able to use them!

Yes, there has been a pretty active campaign. The Arboricultural Association and a number of the commercial players in Auckland have been very critical of the provision in this bill, and I do not blame them. You see, for the 5,000 resource consents per year that are required for these tree provisions, the average cost of getting a council report from an arborist is a bit over $400. People then have to use one of those businesses. They cannot go out there themselves. They cannot chop down or trim their own tree. Is it surprising that the arborist businesses of Auckland would not want this provision? They have employed a flash Wellington public relations consultancy to advocate the cause for them, and I simply say that this Parliament needs to get some principles right.

The principle in this bill around urban trees is actually very straightforward: if a council wants to put controls on the trimming or the removal of a tree, it has to talk to the homeowner. Is that not a radical concept? If the council wants to put a restriction on the capacity for a person to be able to trim or remove their own tree, they should talk to the person who owns the land. I think that is a very reasonable provision. If we look at the provisions of this bill, we see that there is 2½ years in which councils can identify trees. I had a discussion with the Mayor of Timaru, which has a beautiful landscape with a large number of trees. Do members know what that council did? It advertised for people to put forward the trees that they thought were worthy of protection. I think that is a pretty smart approach, and I encourage the councils of Auckland to do what councils in every other part of New Zealand have done and actually identify the trees and the groups of trees that warrant protection; there certainly are some. It can be done quite effectively and result in the proper protection of trees in Auckland without the bureaucracy that we are proposing to replace with this bill.

The last point I want to make on trees is that I have seen pictures in newspapers of people in reserves saying that the trees are at risk of being cut down, or of people saying that trees along the main streetscape of Auckland are at risk. No, they are not. This bill deals only with trees on private land, and actually it is about a reflection of property rights. It is the view of members on this side of the Chamber that if one owns the property, one has a legal right to trim a tree or to remove it, as a general rule, unless it is a tree of sufficient significance that it is properly listed in a plan, and one has had an opportunity to be consulted about that listing. It is a straightforward provision that makes good common sense. It will reduce hugely the bureaucracy around tree trimming, which needs to change, and I urge the Committee to support it.

JEANETTE FITZSIMONS (Green) : The whole process around the Resource Management (Simplifying and Streamlining) Amendment Bill has been rushed and slipshod. It came to the House later than the Minister promised, and he was in a big hurry to get it through. The Local Government and Environment Committee sat for a lot of hours to deal with it, and the Green Party is the only opposition here. The Labour Party and every other party in the House except the Green Party is supporting this bill. I think that people who are listening need to know that that is the case.

The first evidence that this bill was rushed and slipshod was the interim report of the expert panel from which the select committee asked for assistance to determine whether the drafting in fact reflected the policy intention. The panel advised us—actually, in quite strong language—that the bill as it stood then would not simplify and streamline the Resource Management Act but would complicate and confuse it, which is what we in the Green Party have been saying since the beginning. The bill adds many pages to the Resource Management Act, and that is hardly simplifying and streamlining. It puts a lot of words in where there used to be few. It does not clarify; it confuses.

The Greens asked the expert panel to work with officials, and they did, under great time pressure, and they substantially changed and improved the drafting of the bill. However, there was not time to do it properly. What do we have now? We have the 44-page Supplementary Order Paper 39, which amends clauses from the beginning of the bill all the way through to the end, and, among other things, completely replaces new Part 6AA, inserted by clause 91. New Part 6AA was in the bill as it was amended by the select committee, and then, under the advice of officials, who have presumably cleared it with the Minister, in the Committee the Government has completely rewritten and replaced Part 6AA in the Supplementary Order Paper. In the reported-back version of the bill we can see that the whole of Part 6AA is underlined as new, but now we have another replacement of Part 6AA. In the space of a couple of weeks they decided they needed to do it differently again. The meaning of those changes is not possible to determine overnight. I do not know. I have looked at the two texts side by side, and they seem to bear little resemblance to each other. We have to take the Minister’s word that there is no substantive policy change there.

This reminds me of a series of speeches made last year by the then Opposition spokesman on climate change, who relentlessly attacked the previous Minister for climate change on the basis that he had introduced a Supplementary Order Paper to the legislation that set up the emissions trading scheme that was extremely long and made a lot of technical corrections. When we compare the two we will find that, proportionally, this Supplementary Order Paper is larger in relation to the bill it amends than the one that the previous Opposition spokesman on the environment attacked the previous Government for. So I am looking forward to an explanation from Nick Smith as to why, now that he is a Minister, it is OK to bring in a Supplementary Order Paper—

Hon David Parker: Under urgency.

JEANETTE FITZSIMONS: —under urgency, that is so large in relation to the original bill when that was not OK last year for a bill that was opening new ground and dealing with new technicalities. Parliament has dealt with the Resource Management Act lots of times. The courts are familiar with it, councils are familiar with it, and Parliament is familiar with it. There should be much less reason to have to change it all at the last minute than there was last year.

I want to speak now about the question of notification. Notification is how one gives effect to the fundamental premise of the Act—that people have a right to be involved in discussing the changes that others want to make to the environment where they live. There have always been two grounds for a notification. One is the effect on the environment, where everybody has some right to have a say, because we are talking here about the natural environment, the resources we and future generations depend on, and the other is the right to have a say on something that may affect one’s property rights as a near neighbour. The Resource Management Act has always had two tests for notification.

This bill changes the wording yet again. The rules on notification have been rewritten so many times that I sat in the Local Government and Environment Committee saying that it was impossible to know just what these changes would mean in practice. The one thing they will mean is that all the case law will be chucked out and the courts will have to start again and define all the various terminology because the tests have changed.

I had just reached the conclusion that, apart from destroying existing case law and requiring it to be rebuilt, there was not a lot of change of meaning in the bill as we reported it back. But, hang on, now the Minister has announced a Supplementary Order Paper that raises the hurdle higher for notification so that fewer applications will get notified. The bill as reported back said that a council must notify an application only if the application may have adverse effects on the environment that are more than minor. The Minister has now changed those words to “will have or is likely to have”, so a council now cannot notify an application unless it is pretty sure that the adverse effects will be serious. If the adverse effects are unknown but could well occur, the council is not allowed to notify; therefore it does not get any evidence from anybody else in the community as to what those adverse effects might be. So the bill will shut out key information that, if it is not brought to the Environment Court, never goes in front of the judge and never gets considered in the decision making. We have already had a lift in the threshold from “less than minor” to “more than minor”; now we have “may” becomes “will” and “likely to”. So if a council has any doubts at all about the seriousness of the effects, it must not notify.

The Minister came to the select committee and met with us. I appreciated that, because Ministers often do not do that with select committees and their bills. He told us that under the changes to notification he did not expect fewer applications to be notified. What he was trying to do was to cut the paperwork for the council. However, yesterday he told a briefing of other parties that he did expect fewer public notifications under this changed wording. Obviously, the Minister has had another turn against the rights of the public in the 2 weeks since the select committee reported back. The other thing that the notification provisions do is put councils beyond the reach of judicial review of their notification decisions, by making it clear that they have absolute discretion as to how they interpret terms like “minor” and “very likely”. In the past there have been some appalling council decisions on notification. People have come home and found huge holes in the section next door that they did not know were going to be dug, multi-storey buildings going up, and huge areas of trees removed. I fought hard in previous years to get an amendment accepted that would give effect to what the Environment Court itself has said, which is that challenges to bad notification decisions should be heard by the Environment Court, not by the High Court. The High Court can consider only matters of law. It has no expertise on the facts. The Environment Court is a court of expertise on the facts; it could deal with them very quickly. We got that into section 115 of the 2005 amendment Act, but with a provision that it would not come into force until it was brought into force by Order in Council. Successive Governments have refused to bring it into force; I suspect that was always the intention, anyway. This Government tried to delete the clause with this bill, but we got that changed. It is still not in force, so one can still challenge notification decisions only by going to the High Court, which is hugely expensive. No ordinary person can afford judicial review, and therefore it will not happen.

So we should expect more cases where the bulldozers move in before the neighbours have any inkling the development is happening, and where the bush is felled and the coastline is altered without people’s input because the council could not be sure that the adverse effects would be more than minor. When that happens, expect to have no recourse to legal challenge to those council decisions. I want to end with an example. A 15-house subdivision in Waitakere was not notified although it directly bordered 17 neighbouring properties. One neighbouring resident was not aware of the consent until she came home and saw 2,000 square metres of exotic and native trees and bush being cleared from the site right next door. The consent stated that there was no need for notification, as all effects were deemed to be internal to the site, despite a new road, earthworks, bush clearance, loss of shelter, privacy, and birdlife, and destruction of an ecologically significant stream on a neighbouring property. We are going to see a lot more of cases like that as, with every amendment that goes through the House, notification is tightened.

Less than 5 percent of applications are notified now. I would like the Minister to say whether he thinks that should go to less than 4 percent or less than 3 percent, or just where the ultimate destination is; or are we heading for the kind of State where developers can do what they like, and the public be damned?

CHRIS AUCHINVOLE (National—West Coast - Tasman) : It is a pleasure to speak in the Committee stage of the Resource Management (Simplifying and Streamlining) Amendment Bill. I would not use the words we heard from the previous speaker, Jeanette Fitzsimons, to describe the way the bill has gone through the House; I would use the words “thorough”, “totally engaged”, “committed”, and “diligent” to describe the Local Government and Environment Committee’s work, and the conduct of each and every member of it. I am surprised. The fact is that the Greens do not like the bill; they have said so from the beginning. That has always been acknowledged. It was not a matter of contention or debate. We approached the whole thing as everybody working together, and I am sorry that they wish to downplay the activities of the select committee and sell its work a little cheap. I am sure that the previous speaker did not really intend to do that, because we met regularly and we met often. We discussed a wide range of activities. A lot has been said about trees, and I will speak about them in a minute. We also heard from some serious, committed, diligent people from councils. We heard from the Porirua City Council that 90 percent of the consent applications they receive are not in a state ready for processing. This was echoed by other councils. The interesting thing in the whole approach to this bill was the level of support we received from councils, planners, and people who are involved at the coalface.

According to planners I have spoken to, the changes to notification will save huge amounts of time because of the freedom from needlessly writing reports to justify why they have not notified a particular application.

Hon Shane Jones: It’s democracy!

CHRIS AUCHINVOLE: That is right. This is democracy. The bill is neutral on the issue of notification. It does not impose restrictions and it does not prevent notifications from being made. The honourable member opposite, Mr Jones, who was very good to work with on the select committee, talks of democracy, but it is sometimes hard for people to see the wood for the trees. That is an appropriate phrase to use in regard to clause 52. Trees will not be put at increased risk as a result of clause 52.

It is interesting to note that as a legislator one gets a lot of attention from lobbyists. Just a scan of the emails I have received in the last week would make interesting reading for someone from outside Parliament. I have been getting about 150 a day.

Hon Shane Jones: Thousands!

CHRIS AUCHINVOLE: How are they interesting? I will tell the member how they are interesting. I have been getting two sorts of emails. Half of them tell me I should be smacking kids, and half of them tell me I should be hugging trees. I like to think that it is the other way round. In fact, I misread some of them and I became confused. I thought they said that I should have an approved contractor for smacking. I guess that used to be the role of schoolteachers. All of these emails have been coming from Auckland. I do not think, from a casual analysis of them, that a single one has been written by people who are worried about trees that they own being at risk under this new law. That is not the case. They all say that they are worried about what will happen to other people’s trees, or about what other people will do to their trees.

I cannot quite see why a change of law will result in—[Interruption] My colleague across the Chamber says that Husqvarna shares are going through the roof. Developers have not been cutting trees down. They have not been clear-felling. Developers have been getting consents. Very few applications are denied. What will change? I will tell members what will change. The $1.8 million that Devonport, or North Shore City Council, spends on processing applications might be used for other purposes. It might be used for planting trees. There is a novel thought! Instead of using all that money to get people to ask if they can trim a tree, councils could use the money to plant a tree—if they could find nurseries that supply substantial trees.

I planted substantial trees in Devonport, which was mentioned before.

Hon Shane Jones: Flagstaff Hill!

CHRIS AUCHINVOLE: No, no. The Chair is ringing the bell; I will not take a long call.

Hon Gerry Brownlee: Please do!

CHRIS AUCHINVOLE: That member would like me to. Very well. The Leader of the House has asked me to, and that is kind.

Hon Gerry Brownlee: I am leaving now, of course.

CHRIS AUCHINVOLE: Ha, ha!

I planted a row of poplars in Shoal Bay Road in Devonport between my house and the houses of two neighbours. It was not very many years before the poplars were huge. They grew beautifully and everyone commented on them, but then they blocked the drains between us and our neighbours, and a sewerage pipe, as well. They were the most inappropriate species of trees to plant in that particular place, so down they came. No permits or consents were required. At the same time, my wife and her friends suggested that it would be nice to have double flowering cherries and peaches on the berm down the middle of Shoal Bay Road. The community bought the trees and we planted them. The council said it would help maintain them,

Phil Twyford: Where is this going?

CHRIS AUCHINVOLE: Those trees are still there. They will not be cut down; everyone likes the trees. Why do members on the other side of the Chamber seem to imagine that everyone hates their trees? They love them. Give them a chance.

To echo the opening comments of the Minister for the Environment, I say that one wonders whether the Opposition has learnt from the last election. People wanted change, and they particularly wanted change to the Resource Management Act.

Hon Steve Chadwick: The trees will be chopped down instead of protected.

CHRIS AUCHINVOLE: They will not be cut down instead of protected. I have yet to hear—and I look forward to hearing it in the next 4½ hours—any solid reasoning why this cutting-down business could not be done presently. Thank you.

CHARLES CHAUVEL (Labour) : I will take a call relating to the changes being made to notification in the Resource Management (Simplifying and Streamlining) Amendment Bill. I do not think that the previous speaker, Chris Auchinvole, was right when he said that the legislation somehow creates a neutral position, and I would be interested to hear from the Minister on that. In reading the bill afresh it seems to me that it removes the presumption in favour of notification, so that there is now a presumption the other way, in favour of non-notification. That means that instead—

Chris Auchinvole: Why do you say that, Charles?

CHARLES CHAUVEL: —because it is on the face of the bill, I tell Mr Auchinvole—of the council having to notify an application except in certain circumstances, a council will now not have to notify an application except in particular circumstances. That is what we call a reversal of the presumption in favour of notification. Under the current provisions of Resource Management Act resource consents, they are to be notified unless a consent authority can establish one of three things: that they are satisfied the effects will be no more than minor and approval of the affected parties is obtained; that the application pertains to a controlled activity as defined, in which case public notification is not required unless a rule, a plan, or a proposed plan requires it, but notice still has to be served in those cases on an affected person; or that the relevant plan specifically states that notification is not required.

As I read new clause 68, I see that it will repeal existing sections 93 to 95 and substitute new sections 93 to 95F. Under clause 68 the proposal is that the process for notification be altered so that the following three things occur: the presumption in favour of notification of resource consents comes out—it is gone. So the bill has no general presumption in favour of notification, as is the current position. The threshold for when public notification is required is changed, in new clause 68, when the effects beyond the immediate environment are “more than minor”, and the threshold for affected parties is raised when effects on them are “more than minor”, and those are the words in the bill. The bill, in new section 95A, changes the requirement to notify if the “adverse effects of the activity on the environment may be more than minor;”, but as amended by Supplementary Order Paper 39 the requirement is if “the activity will have or is likely to have adverse effects on the environment that are minor;”. That is a significant change. It means that the requirement to notify an application is significantly confined.

The changes to the notification process that I have just outlined cannot help but reduce public participation under the Resource Management Act, because the threshold for notification is set higher. That will inevitably lead to fewer resource consent applications being notified. It was interesting to see kids from Tawa College up in the gallery before. I was out in Tawa last month at a community meeting, and the changes to the Resource Management Act, particularly the changes proposed around notification, and the changes that make it more difficult to access the Environment Court, are a real concern to people. People are worried about losing their ability to have a hearing in the Environment Court over local issues that matter to them, and that is something that this Parliament should be very, very concerned about and very, very slow to support. We are lowering the ability of the public to have a say on the adverse effects of an application, and Labour cannot support those sorts of proposals. They significantly undermine the ability of local communities to participate in decisions that affect them, and this proposal in particular—to remove the presumption of notification in favour of non-notification—increases the thresholds for notification. It is an inevitable way of doing things; if we do the one, we get the other. It clearly undermines the ability of the public to participate, and members on this side of the Chamber simply cannot support that level of undermining.

Hon Dr NICK SMITH (Minister for the Environment) : I want to respond to a couple of the points that have been made. The first of those is in respect of the timetable and the intent of the bill. I know it may be a novel concept, but the Government is doing what it said it would do. We said we would introduce a bill to streamline and simplify the Resource Management Act within our first 100 days in office, and we did. We also said we would pass that bill into law within a period of 6 months, and we are doing so. I am surprised that other members in the Chamber are criticising us for doing exactly what we told the electorate we would do.

Mr Charles Chauvel made a thoughtful contribution around the issue of notification. He raised a point that was also raised by Jeannette Fitzsimons of the Green Party. It is a very important point around the thresholds for notification. It is proper that the Committee debate those. In Supplementary Order Paper 39, in terms of adverse effects that may be more than minor, my intention is to remove the words “may be” and substitute the words “likely to be”—and I ask members to remember that the consents I am talking about are the minor, small ones that are on the margin as to whether they should be notified. We do not want council officials having to spend huge amounts of time trying to work out what is minor, so we are saying in the Supplementary Order Paper that those consents are minor or likely to be minor. We are quite deliberately providing a bit more cover for council officials in that regard.

Other members have given examples, but let me give the Chamber an example. There is a real shortage of early childhood centres in my electorate. There are children who cannot get into an early childhood centre and get an early childhood education. I do not think there is a member of this Chamber who would not say that parents living in central Nelson need to have a place for their children to get an early childhood education.

I have an application from a person to build an early childhood centre. The council said that all the neighbours agreed. The neighbours said they wanted to have the children around. But the people six doors down said there would be increased traffic flows in their street, and they insisted on the right to be notified. So the council officials asked what the current law says. The law says that a consent needs to be notified if it has an effect on other people. Well, the early childhood centre will have an effect on that street. I would argue it would be a minor effect, but it will have an effect.

Now, the impact of all of that and of the old law was that it cost the development of that early childhood centre an extra six months in time and an extra $20,000. Who do members of this Committee think will pay the $20,000? It will not be the fairies. There is no money tree. It has to be paid for by the parents of those children. So in this debate about notification, I make no apologies for saying that the effects have to be more than minor in order to justify the cost, the time, and the expense of notification. That is all the Government is saying with respect to these provisions. It is my view that the extra wording that has been developed with Local Government New Zealand—that is, in terms of effects that are or are “likely to be” more than minor—simply gives councils a little bit of room to apply some common sense. If there is anything that we need to get into the administration of the Resource Management Act, it is a good dose of common sense, because right now we are adding too much in cost.

The last point I want to make is that there is a balance to be struck between a level of public participation and the costs and delays because of that participation. In response to Mr Chauvel, I say that the Government makes no bones about the fact that we are shifting that balance. If public participation is to be the only criteria under which we run this Act, we will be relaxed about the fact that it took 17 years for some consents and a very long time for many others.

Dr RUSSEL NORMAN (Co-Leader—Green) : I want to start in this debate by making some general comments, because I think in all the detail we do miss some of the general points about the Resource Management Act. I think the Resource Management Act is one of the most maligned, misunderstood, and misrepresented Acts in our country. It has been attacked repeatedly, over and over, by vested interests. It has been subjected to absolutely vitriolic attack by those who want to advance the interests of developers, and so forth, yet the Resource Management Act exists to protect our environment.

There are two fundamental principles of the Resource Management Act. One is protection of the environment, and the other is public participation in decision making. Those are the two fundamental planks of the Resource Management Act. In the midst of the debate around red tape, cost, and so forth, I think we forget that the Resource Management Act is one of the primary bulwarks to protect the New Zealand environment on which we all depend. It is about protecting our land, our water, and our wildlife.

I think we also take it for granted that this is New Zealand—clean, green, and 100 percent pure. We forget that the reason why we have any kind of protection in our country is that community groups have been able to use the Resource Management Act to protect their local environment. As I travel around Aotearoa New Zealand, time after time it is community groups, it is hapū, and it is iwi who find themselves in front of consent panels and in front of the Environment Court, doing the hard yards to protect the environment of our country. Yet we have an Act that changes the balance. It changes the balance against the community so that it is harder for the community groups, the people, the not-for-profit groups, and the volunteers who do the work to protect New Zealand’s environment, day in, day out and year in, year out. These are the people who come before the Environment Court and get vilified, often by National and others, because they dare to stand up for the environment. They dare to clog up the courts, as it is told, because they dare to stand up for this country.

The Government of the day has now decided it needs to tilt the balance against the volunteers, the iwi, and the hapū of our country, who constantly stand up to protect the environment. The Government wants to change the balance against those voluntary groups, in favour of those who want to destroy the environment. That is what the Government is trying to do with this legislation. It is undermining the fundamental purpose of the legislation, which is environmental protection and community participation.

When we look at New Zealand and at our economy, we see that it is highly dependent on being clean, green, and 100 percent pure—more than most other places. In fact, it is built on the work that all of those not-for-profit groups and volunteers have done. We have built our economy on their backs. The people who have protected our environment are the people who underwrite and have formed the foundation for the New Zealand economy—the environment. This applies to every economy in the world because every economy, of course, is entirely dependent on the environment. But it applies to New Zealand in particular because we have decided to build our entire brand—as the Prime Minister calls it, the “master brand” of New Zealand—on being 100 percent pure, clean and green.

Those people who protect the environment now have a much harder job doing what they do best, which is looking after our country. This bill changes the balance against them. As the Minister quite rightly said, it is restricting community participation. Yeah; that is exactly right. It will make it harder for the non-governmental organisation sector and harder for community groups to do their job. In the Green Party, we think that is disgraceful.

I think we need to appreciate, as well, that if we were working against a backdrop of dramatically improving environmental performance, if we had biodiversity that was going through the roof, and if we had a background of environmental performance whereby we were getting better and better, year after year, then we might have some argument. But the reality of Aotearoa New Zealand is that we are seeing a decline in biodiversity. We are seeing a decline in the quality of our rivers and lakes, we are seeing a decline in the environment that underpins everything else, and here we are, weakening the law that is designed to protect the environment. We are seeing a decline in the environmental standards, the biodiversity on which we all depend, and that underpins the New Zealand economy. National, ACT, and the Māori Party so far, and Labour, are all voting for a law that weakens environmental protection.

Why would we weaken environmental protection, when the reality in our country is that we already have a declining and degrading environment? Why would we vote for a law that weakens the power of community groups to protect the environment? Why would we do that, when we already have declining environmental standards?

We need to address the broader picture, which is the ideology that says New Zealand is bound up in red tape; that somehow our country is completely bound up in red tape. I have in front of me the World Bank Group’s report Doing Business. This report ranks economies all around the world on the ease of doing business. The most recent report Doing Business 2010: Reforming through Difficult Times put out by the World Bank Group covers June 2008 through to May 2009. The easiest country in the world to do business in, and the one that has the least red tape, is Singapore, which I am not sure we really want to model ourselves on in all respects. The second easiest country in the world to do business in is New Zealand.

When we look at the international comparisons done by international bodies looking at the ease of doing business in the world, New Zealand is the second easiest place to do business. So all this rhetoric about how it is really impossible for New Zealand business to get ahead because of all the red tape falls flat, when we look at an independent report—rather than just an ideological position statement, as comes out from the Government so often—done by the World Bank Group where New Zealand comes out as the second easiest place on the planet to do business.

If we dig into the report a little bit deeper and look at some of the detail, we see a section called “Dealing with Construction Permits”, which looks, in particular, at obtaining a resource consent, obtaining a water consent, obtaining a building consent, and getting an inspection from the district council. If we look at those categories, they all go to inform the overall rating that New Zealand has as the second easiest place on the planet to do business. New Zealand ranks fifth on the planet for dealing with construction permits, which includes all of the resource consent permits and the water consent permits. When the ideological position is put forward that New Zealand is bound up from top to tail in red tape, I ask people to look at the evidence rather than listen to the ideological positions that are coming out of the Government.

In fact, when we look at New Zealand’s performance, one of the reasons we perform so poorly in terms of protecting the environment is that we are not using regulations properly. Where are the national environmental standards? Where are the national policy statements that were always supposed to be part of the Resource Management Act, and that were a key part of protecting the environment? If we put up those “terrible” national policy statements and national environmental standards, we would be told that we are generating more red tape and more regulation. Those kinds of regulations provide consistency for business and protect the environment, and they were always assumed to be an essential part of the Resource Management Act framework.

If the Government wants to put energy into developing national policy statements and national environmental standards, then the Green Party will stand alongside them, as long as they improve environmental standards rather than set a maximum, more of which we will talk about later. At this stage we have this so-called streamlining bill, which seems only to be reducing environmental standards, thereby making it harder for community groups to protect the environment. It will make it harder for community groups to do their job and to do what non-governmental organisations have done for years in our country, which is protect the environment on which our economy and our quality of life depend.

Why is it that we have this ideological position around red tape, and all the evils of red tape? Where are the Bluegreens in all of this? The member for Auckland Central is voting for a bill that will result in the loss of tree cover in Auckland. Why are the Bluegreens standing behind a bill that will weaken the Resource Management Act? Fundamentally, that is what this law does and what it is designed to do—weaken the Resource Management Act.

I also ask the Bluegreens to look at the membership of the technical advisory group that formed this bill to start with. There was one—at least one—environmentalist on the technical advisory group; I give you that. But the technical advisory group membership was dominated by those who were not out to promote environmental protections; they were there to do the opposite.

NIKKI KAYE (National—Auckland Central) : I will make a quick point in response to Mr Norman regarding the fact that bureaucracy often holds up good environmental progress. A good example is Akaroa, where it has taken 2 years to get a resource consent around water treatment.

The other point I will make is around trees and clause 52 of the Resource Management (Simplifying and Streamlining) Amendment Bill. We have heard a little bit about that clause today. I acknowledge the stance the Greens have taken on this issue, but I also acknowledge the temporary tree-huggers, the Labour Party. Those members failed to put up a minority report on this issue. I have concerns about the legislation but I am pleased we are having this discussion. I believe that the current system of tree rules in Auckland is fraught, that councils are spending excessive time on this issue, and that many individuals are spending excessive money on resource consents for trees. The question that needs to be asked is not about politicking, but about how we fix this. I believe that it is reasonable for individuals to be able to prune and trim their trees, so that is quite a positive change that will be made as a result of this bill.

However, I have a specific concern about tree scheduling. I want to ask the Minister in the chair, Nick Smith, and I would like him to take a call on this, how the people of Auckland can have confidence that between now and January 2012 high-value trees and bush will be adequately protected via tree scheduling. I think there are some benefits in respect to the Auckland governance reforms in that there will be fewer systems in place. There may be one team, if you like, that will be responsible for tree scheduling; I think that is positive. It is also positive that the Auckland governance reforms are coming into place because I think it will be easier to do scheduling. I invite the Minister for the Environment to take a call on that matter.

Hon Dr NICK SMITH (Minister for the Environment) : The member for Auckland Central, Nikki Kaye, raised quite an important point. The Labour Party has not yet learnt the degree to which it alienated the voters of Auckland Central. You see, Labour lost that seat for the first time ever—the first time ever—and I would be happy to bet the best bottle of Nelson wine that Nikki Kaye will be returned at the next election. Every member has been impressed with the way in which Nikki Kaye has represented that community. I am happy to bet with any member of this House that she will be returned at the next election because of that effective representation.

Hon David Parker: I raise a point of order, Mr Chairperson. I cannot see how that in any way relates to the Committee stage of the Resource Management (Simplifying and Streamlining) Amendment Bill. I ask that the member be called to order.

The CHAIRPERSON (Lindsay Tisch): I thank the member for those comments. There was an interchange earlier on, and the Minister is responding to those. However, I will ask the member to come back to the essence of the bill.

Hon Dr NICK SMITH: The member had a very sensible question, and that was how we can be sure that the councils of Auckland, particularly given the scale of change that Auckland is involved in, will get on and do the sensible thing, and, like every other council in New Zealand, schedule both groups of trees and individual trees that warrant protection. It is a good question.

Phil Twyford: They’ve already said they won’t.

Hon Dr NICK SMITH: They actually have not said that, and I would be happy to take up Mr “Tryford” in a moment. The issue that, I think, in a sensible way forward—

H V Ross Robertson: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Lindsay Tisch): I know what the member will say. I say to the Minister—and it has been brought up before—that the member he is referring to is Mr Twyford. I ask that the Minister respects his name, either calling him Mr Twyford or Phil Twyford, but not any other name.

Hon Dr NICK SMITH: I am happy to get Mr “Tryford’s” name right.

H V Ross Robertson: I raise a point of order, Mr Chairperson. The member has been here for a considerable number of years. He should be aware of Speakers’ rulings 27/6. In reality, he did not say Mr Twyford’s name correctly. He mispronounced it again. I suggest he have another go. It is rude and unacceptable.

The CHAIRPERSON (Lindsay Tisch): I understand. I have asked the Minister to reflect on that, and to use the member’s correct name.

Hon Dr NICK SMITH: The question that has been asked is what process we can put in place to ensure that the Auckland councils sensibly address this issue. I think there is quite a sensible process, and I would be happy to take up the challenge from the member for Auckland Central. There are powers that I have as Minister for the Environment around the issuing of directions to councils. I am reluctant to use them, unless councils will not do what I think is sensible and what this Parliament would expect. My intention would be to write to each Auckland council and ask them to set out their programme of work for identifying the trees of significance and that should be specifically, by group or individually, listed in their district plans, and to require those councils every 6 months to report to me on the progress they make.

I will make a couple of points about this issue. One of the really important things members opposite need to recognise is that from 1 October these councils will not have to spend millions of dollars, and will not have all sorts of staff tied up, with the 3,000 consents a year required for tree trimming. As of 1 October, that will no longer be required. The message I have for Auckland councils in response to the concerns that have been raised by Nikki Kaye is that the resource processing all those tree-trimming consents should be redirected, so representatives of the councils can get out and talk with people in the neighbourhoods and communities about what sorts of trees should be protected. This could happen over lunch, for example. I spoke with the Mayor of Timaru about what happened there. The first thing the council did was to invite the residents themselves.

Hon David Cunliffe: A member of the National Party.

Hon Dr NICK SMITH: I do not think so. It is interesting that David Cunliffe always goes down that line.

Hon David Cunliffe: I think so! Ask Jo Goodhew; they are good friends.

Hon Dr NICK SMITH: I will simply address the issue. The Timaru council advertised and asked people to bring forward trees to be considered for protection. Within a period of 12 months it had brought together a sensible schedule of trees that should be protected. If the good city of Timaru can do it—in fact, if 75 councils around New Zealand can do it—then why is it that Auckland cannot? I am interested in a contribution from a member.

The last point I will make is a very simple question that I would like members on the Labour benches to address. The select committee received submissions on the tree protection rules. The Labour members have deeply held concerns that it is the end of the world for Auckland trees. Why, then, in this 250-page report from the select committee, did Labour members vote for the changes in the tree protection rules, and why is there no word in the report of any concern about those changes?

Phil Twyford: It’s in there.

Hon Dr NICK SMITH: Oh, it is in the report! Well, I have actually checked the minutes. The minutes of the select committee show that the member who interjected, Phil Twyford, actually voted for these provisions.

Hon DAVID PARKER (Labour) : The Minister who has just resumed his seat, the Hon Nick Smith, said he had read the commentary on the bill and found no reference to Labour members’ concern about changes to the tree protection rules. The commentary on the bill makes the point that not all of the committee supported the prohibition on blanket tree protection. I will read from the commentary: “On balance most of us supported prohibiting blanket tree protection rules in planning documents. A number of us, however, regard clause 52, as amended, as unsatisfactory and would have preferred a more comprehensive solution for protecting urban trees.” There it is; there is exactly what the Minister said was not there. The Minister has not even read the commentary from the select committee. He has made that same reference twice.

I will return to some of the other serious issues in the bill—firstly the Environmental Protection Authority. I encourage the Minister to build up the capability of the Environmental Protection Authority with the Resource Management Act. In 2005 the Minister, with me and Jeanette Fitzsimons, was on the select committee that considered the previous major amendment to the Resource Management Act. We were somewhat dismayed at the quality of some of the drafting and some of the suggestions that came forward. With respect to the officials, there have been similar concerns about some of the amendments that were put forward for the legislation that went to the select committee this time. That is a matter of concern. I know that the Resource Management Act is a complex document, but there is a need for more capability within the Ministry for the Environment in respect of what is its core legislation. The fact that the ministry needs to do better in that regard is pretty clear from some inadequate drafting and advice in respect of both pieces of legislation. I am not making a political point here, because the last time it happened was under a Labour Government; this time it is under a National Government. There is a need for better understanding within the ministry of the detail of its own legislation. If it does not have such understanding internally, then it needs to contract it in.

The second point I will make is in respect of notification. I agree with comments that have been made by Jeanette Fitzsimons and Charles Chauvel. The Supplementary Order Paper that has been brought forward today dramatically changes the notification rules from those that were reported back. Until now the version of the bill that came back from the select committee stated that if there may be an adverse effect that is more than minor, then it had to be notified. Notification is the prerequisite to public involvement. If people do not know about something, they cannot submit on it.

According to the version that was reported back to the House, people have to be notified if there may be an environmental effect that is more than minor. The wording now gets changed so that it has to be proven to the satisfaction of the consenting authority that there will be an adverse effect that is more than minor, or there is likely to be such an adverse effect. Rather than it being a case of there may be an environmental effect that is more than minor, there now has to be a probability that there will be an environmental effect. Councils will be advertising and notifying fewer applications as a consequence. Therefore, people will not be informed of more applications that may have an adverse effect than was the case previously. That is a very significant change, and I am surprised that it has been done late by way of a Supplementary Order Paper. Again, that amplifies the point I made earlier in terms of capability within the Ministry for the Environment on Resource Management Act matters. It is a poor change, and it is something that I would like to see overturned in the future.

There are some good things in the bill, which I acknowledge. There is always a need for housekeeping legislation. Again, I repeat the point I made that this legislation is vastly improved compared with its first reading version because we have restored rights to appeal on the merits against plan changes, which were absolutely essential changes. If it had not been for that change, Labour certainly would not be supporting the bill, with reservations.

I will make two other references—firstly to the Minister of Conservation’s power. Under the existing law, if an application is made that affects land above the high-water mark, that land is generally owned by somebody, and the owner of that land has the right to say that he or she does not want that happening on his or her land. The owner effectively exercises a right of veto. The owner or occupier of land has an effective right of control to say “No, not here. It’s not right. It might be permitted under the plan but I don’t want it.”

Under the prior legislation, in respect of areas that are in the marine environment, they are not owned by private landowners. That right of veto is effectively held on behalf of all New Zealanders by the Crown. That is how it should be. The Crown deals with that through the Minister of Conservation having a right of veto and being able to say, on behalf of the Government, the Crown, and the people of New Zealand, just as if he or she was a private landowner, “No, it’s not going to happen here; we don’t think it’s the right thing.” Of course the Crown should have the right to do that; it is one of the responsibilities of the Crown to look after the wider public interest in respect of areas that are being managed for public purposes by the Crown.

The existing rights are constrained. That was shown clearly by the marina decision that the Minister relied upon in saying there was a need for change. In fact, in relation to the marina decision, it was found through a High Court review of the Minister’s discretion that in that case the Minister had incorrectly exercised his discretion. There is no shame in that; sometimes these mistakes are made. But it showed that the system works, because there was not an inappropriate withholding of consent.

Paul Quinn: Abuse of power.

Hon DAVID PARKER: The member says it was an abuse of power. No, it was a mistake, according to the court. It was not some sort of machiavellian abuse of power. The Government’s response is to say that there should be no power of veto on the part of the Crown. I fundamentally disagree; the Crown is effectively the de facto owner—not an owner in the foreshore and seabed sense—controller, or protector of those spaces on behalf of the public. The Crown should maintain that right. There are ways in which the mechanism could be improved. I agree that those decisions should be taken earlier in the process, rather than waiting until the end of the process when someone has spent a lot of money on planning and probably spent money on engineers, consultants, and resource consent applications, only to have the Minister say he or she cannot do it. I do not think that is good process. The Minister’s decision ought to be brought forward to earlier in the process. I would willingly agree to that. The Minister’s discretion ought to be retained so that the Minister, on behalf of all New Zealanders, can veto inappropriate developments in the coastal space, just as I can veto inappropriate developments on land that is under my ownership or control. I have a Supplementary Order Paper to that effect—to retain the veto—and I hope that members of the Committee support it.

I will also make reference to the tree provisions. We heard Nikki Kaye wringing her hands and saying there is a terrible problem here. I am one of those people who think the existing law goes too far in the absolute prohibition on removing trees, including pruning. The Greens have put forward an amendment, which is supported by Labour, that deals with that issue and allows pruning. The Minister represents the current situation as prohibiting the cutting or pruning of all trees. It does not do that even now. A minimum size applies before that rule applies. In any event, the Greens’ amendment is sensible.

There is a degree of overregulation now, which could be remedied through the Greens’ amendment. It permits pruning but states that local authorities that want to control the cutting down of all trees over a certain size can do so. If councils want to do that, why should they not be able to? If people disagree with those plan provisions, they can appeal to the Environment Court. If the Environment Court disagrees with them, they can strike it out, as it often does with other inappropriate plan provisions. Why does the Minister feel the need to control that by way of central government limitation of the powers of councils under the regional district plans? It seems to me to run in the opposite direction of the one that the Minister in the chair, the Hon Dr Nick Smith, says that he is in favour of, which is to delegate these proper powers to councils to exercise. The Labour Party will be supporting the Greens’ amendment—

Jeanette Fitzsimons: It’s just a nanny State.

Hon DAVID PARKER: It is a nanny State response; I thank Ms Fitzsimons. It is an overreaction. Having said that, I agree that there is currently a degree of overregulation, but the Greens’ provision fixes that. Nikki Kaye pretends that she is interested in the issue, but she will not even vote in favour of the Greens’ amendment. They are crocodile tears. She turns up to public meetings, says that she shares the public’s concerns and that she remains concerned, and then she does nothing about it. She had a staged little comedy act with the Minister in the chair about how it will not be that bad, but she will not vote in favour of the Greens’ amendment.

Hon Dr NICK SMITH (Minister for the Environment) : I will make two responses to the contribution from Mr Parker. The first interesting thing in his speech was that he said he accepts that the current tree rules are an overkill and should be changed. He also said in respect of the other area on which he focused his speech that he does not necessarily think that the law as it relates to the Minister of Conservation’s veto is right, either. Well, is it not interesting? Labour had 9 years in Government to try to fix these bureaucratic problems with the Resource Management Act—

Hon Members: How long?

Hon Dr NICK SMITH: The Labour Government had 9 long years and it did not do it. When National becomes the Government and gets on and fixes some of these problems, Labour members get into the exercise of trying to niggle over an area where they say the reforms are inappropriate.

I will deal firstly with the coastal permit veto that is available to the Minister of Conservation. Let us look firstly at the powers the Minister of Conservation has. The Minister of Conservation has the power to write the New Zealand Coastal Policy Statement—the rules that relate to the coast for the whole country. The Minister of Conservation has the power to approve or not approve every regional coastal policy statement. That is the Minister’s second lever. The Minister’s third lever is being able to appoint the people who sit on the decision-making panel. That is the third power the Minister of Conservation has. The Minister’s fourth power is to submit to the hearings committee on any restricted coastal activity. Beyond that, the Minister of Conservation also has the power to appeal. The Minister has five powers, and members opposite say that the Minister needs the power to veto, as well.

Let me deal with the veto. I have checked the numbers. During my period as the Minister of Conservation there were about 280 applications in relation to restricted coastal activities. People lodge a consent application, and a whole lot of evidence is heard at the committee. Often those hearings take weeks, if not months. The decision goes off to the Environment Court, which potentially hears a whole lot more evidence. When I was the Minister of Conservation, in not one single case did I see merit in changing the decision on a consent application, but going through the process added, on average, 6 months to it.

In fact, I say to Mr Parker that since 1991, when the veto was put into law, there have been only two cases in which Ministers have used the veto—only two.

Hon Members: So why is it a problem?

Hon Dr NICK SMITH: The members ask a very good question, and if they can wait I can give them the answer. Why is it a problem? I will tell members why. It adds approximately 6 months on to the process.

Hon Steve Chadwick: Does that matter? It protects the environment.

Hon Dr NICK SMITH: Labour members say it does not matter. Actually, that is the problem. Members opposite do not seem to understand that time is money. An extra 6 months on the process does matter, from our point of view.

The other reason is an important constitutional point. Members on our side of the Chamber believe that it is proper that Ministers write laws and proper that they make rules and approve plans, but it is not proper for Ministers to overrule decisions of the Environment Court. Let us be real here. How much time do members think Ministers spend considering resource consent applications in relation to the coastal environment? The reality is that the Minister will receive, on average, about two applications a week. On average, each of those applications will have spent 5 or 6 weeks before a hearing.

Hon David Parker: Oh, rubbish!

Hon Dr NICK SMITH: No, it is true.

Hon David Parker: No, it’s not.

Hon Dr NICK SMITH: Well, the truth is that if we take the Whangamata example, I say to Mr Parker, the reality is that it was a 9-week—

Hon Trevor Mallard: That’s not a typical example, at all.

Hon Dr NICK SMITH: Mr Mallard says it is not a good example. Do members know why? It is because the previous Labour Government got caught out. The High Court of New Zealand found that the previous Minister of Conservation, Chris Carter, broke the law. Chris Carter broke the law. One of the reasons for this provision is that a large number of New Zealanders said that it is not fair. It is not fair.

Paul Quinn: Abuse.

Hon Dr NICK SMITH: My colleague said it was an abuse, but I would go even further than that. Let us read what the High Court said. The High Court said that the powers of the Minister are nothing like what Mr Parker said they are. Mr Parker said that the Minister of Conservation is exercising the powers of the landowner. He said that if the landowner wants the power then he or she can have it, but the landowner does not have to have the power if he or she does not want to have it. The High Court decision makes very plain that the Minister’s powers are incredibly narrow.

Hon David Parker: You’ve already said that.

Hon Dr NICK SMITH: Well, let us go through it, because Mr Parker and Mr Chauvel think they are the great judicial brains of the House and that we mere engineers cannot have a view on such things. I ask members to read the decision of the High Court, because it shows that the powers of the Minister to overrule the consent process are so incredibly narrow that, frankly, they are worthless. If we are serious about simplifying and streamlining the Resource Management Act, then the power of the Minister of Conservation to overturn a decision of the Environment Court—which is not provided in any other part of the Resource Management Act, nor should it be provided here—is not needed.

The final point I will make is that removing the ministerial power to veto is what we promised to do. I know that Labour makes promises and does the opposite thing, but National said we would remove the ministerial veto, and we are delivering on that promise.

SUE KEDGLEY (Green) : Jeanette Fitzsimons said this morning that the Government cannot disguise the fact that the true purpose of the Resource Management (Simplifying and Streamlining) Amendment Bill is to remove the obstacle of public participation from the path of developers wanting to make their money at the expense of the environment and the community. That is absolutely clear. That is the underlying intention of the bill. The intention has been disguised by good words and so forth, but the hundreds and hundreds of submitters on the bill are very well aware that that is the true purpose of the bill.

One of the ways to remove the obstacle of public participation is through the notification provisions. The Government is tightening up the notification rules so that councils will have to notify affected parties about a development only if the effects “may be more than minor”, whereas previously councils had to notify affected parties if the effects “will be more than minor”. That might seem to be just a minor quibbling over words and not of great significance, but I assure people listening to this debate that the changes to those words are hugely significant. Some people have already predicted that they will effectively make non-notification the norm. Non-notification is virtually the norm already, because 95 percent of resource consents are not notified. Only 5 percent were notified under the previous rules, and now that they are being tightened up I predict that very few developments will need to be notified.

It is a very subjective rule, and councils interpret it differently, but I can say that when I was a councillor on the Wellington City Council for 8 years, lack of notification was the most common issue that I had to deal with in my constituency. People would wake up one morning to find a development going up next door. I well remember hearing from a guy in Hataitai who had woken up one sunny morning and looked out of the window to see his neighbour with a wheelbarrow. When he waved at him and started chatting to the neighbour he discovered that a huge building—a three-storey dwelling—was to go up outside his house without his being notified. A few months later all he could see out of his enormous windows was a great big concrete wall 1 metre away. That was a non-notified development. I could tell members numerous examples of what I had to deal with as a city councillor.

An enormous building is going up in Oriental Bay that was non-notified. It has had a huge impact.

Paul Quinn: That’s where you live, isn’t it, Sue?

SUE KEDGLEY: Yes, it is. The building can be seen from this side of the harbour. It has had an enormous impact on the environment. It was not notified. Non-notification is going on and on. A 15-house subdivision was not notified in Waitakere, although it directly borders 17 neighbouring properties. All of those examples happened under the existing rules, but now that the rules are being tightened up I warn people that non-notification will effectively become the norm.

I will use the example of cell towers in order to warn New Zealanders what will happen when this legislation goes through and non-notification effectively becomes the norm. When I was a city councillor I sat on many hearings about cell towers, all of which had to be publicly notified. There was always a consent process. I remember the meetings in Ngaio and so forth, and there were days of hearings. The telecommunications companies decided that it was very irritating and annoying to have to spend all those hours going through hearings, so they lobbied the Government. First of all, a provision was passed that stated that provided the land that is designated for telecommunications purposes was in a district plan, then telecommunications companies could build cell towers on that telecommunications land as of right. Then the companies went round councils, getting all sorts of areas notified as telecommunications land so they could build cell towers on it as of right. But then they wanted to make it even easier for themselves, so they lobbied the previous Labour Government and got the so-called national environmental standard rammed through Parliament last year—an “environmental standard”, what a misnomer! The standard allows cell towers to be erected, effectively, on every telephone pole in New Zealand as of right.

The Green Party stood here in this Chamber and tried to oppose that Draconian provision. We tried to warn New Zealanders, we did action alerts, and we said “Wake up New Zealanders! You are going to wake up in a year’s time and you are going to look out of your window and find some cell tower being erected outside your house.” Nobody listened, and the media ignored us. But what has happened? The provision went through last October, and now, I can tell members, not a week goes by without my getting emails from distressed New Zealanders, from all over New Zealand, who have woken up to find cell towers being erected outside their homes.

I was at a public meeting in Point Chevalier last week, and there have been public meetings in Papakura. A woman spoke at the Papakura meeting and said she had woken up to find she had eight cell towers just across the road from her home. She is extremely distressed about it, as are people all over New Zealand. People are asking me how this happened. They are asking how it can be that we need a resource consent to do minor alterations on our homes but telecommunications companies can erect some huge cell tower outside our homes without requiring any resource consent or notification of any kind. Of course, the answer to the question is that the previous Labour Government, with the support of National, rammed through the standard that allows these cell towers to be erected as of right. We will have to revisit the issue in this Parliament, because it is causing such distress around New Zealand. I hope the Local Government and Environment Committee will address the issue, because we have several petitions on the issue before the committee.

I use that example as an illustration; that is what will happen when this legislation goes through. People are going to wake up, as so many of the people in Wellington, and I am sure other places, have already done, to find that these huge developments are taking place and will have an enormous impact on neighbours and on neighbouring properties. Those people will find that they have never been notified of the developments.

I assure National members that as more and more people find it happening and ask how it has happened, the explanation will be that it is because National, with the support of Labour, has rammed through this resource management amendment bill and has tightened up the notification rules to the point where notification is no longer the norm. More and more people will then realise what has happened in the House—what is happening here today—and they will realise that Jeanette Fitzsimons was absolutely right: the purpose of the bill is to remove the annoying obstacle of public participation from the path of developers who want to make their money at the expense of the environment and the community.

The issue of notification is a huge issue, and hundreds and hundreds of submitters were concerned about it. They recognised its implications, and there will be great distress in the community when they realise what has been done by tightening up the notification provisions even further. Thank you.

LOUISE UPSTON (National—Taupō) : I am pleased to speak in the Committee stage of the Resource Management (Simplifying and Streamlining) Amendment Bill. One of the things that I think has been missing is the focus on the fact that it is a simplifying and streamlining bill.

We have had a lot of debate about trees, which might be of interest to some of the Aucklanders, but other councils around New Zealand have adequate protection for trees—protection that works. Cambridge is a town of trees; it has fantastic trees. It does not have blanket tree protection, but it has the most beautiful trees in the country. The Taupō District Council, which is also part of my electorate for obvious reasons, does not have blanket tree protection.

I will turn this debate, therefore, towards the issues that actually matter to the majority of New Zealanders—the majority of New Zealanders who wanted a National Government because we promised them we would deliver changes to the Resource Management Act. And that is what we are doing: we are delivering a promise that we made to New Zealanders.

I will address the comment the Green Party made that we have rammed through this legislation. I am, quite frankly, disappointed with that. The Local Government and Environment Committee worked together very, very well. We had a great discussion and we made several changes. As a result of discussion on the first draft of the bill and the submissions, we have had many, many changes. We have had healthy discussion and healthy debate, and there have been significant changes from the first draft of the bill. We have come to a good position, and of course Labour thinks it is a great bill, as well. Labour members voted for it. They did not bother to put into the report as a minority report any comments they have said in the House today, because, inherently, they agree with the position.

I will come back to what many New Zealanders are interested in with regard to the Resource Management Act, which is its simplifying and streamlining. I will put in a plug for hard-working New Zealanders who want to build a garage on the back of their property, who want to extend their existing house, or who—though how dare they, if they are in Auckland—might want to trim a tree. It is actually those guys who will have huge benefit from this legislation.

I will give members the example of my brother. He wanted to build a fairly simple extension on to his house. We would have expected the resource consent to be back in 20 days. But because he had not done this before, he went to the expense of getting a planning consultant to advise him on the process, and to make sure that he came out with a successful resource consent at the end of it.

Hon Member: How much did that cost?

LOUISE UPSTON: Oh, no, it was not really about the cost, initially. It took 7½ months.

Hon Members: How long?

LOUISE UPSTON: It took 7½ months for a resource consent for a minor addition to his house. That is the sort of thing I am talking about. When New Zealanders are out there listening to this debate, they want this bill passed, because they do not think it is good enough to wait for 7½ months for a resource consent. They know, unlike some of those members on the benches opposite, that time is money. Let us say that my brother had a builder lined up to do those extensions and was ready to go. But all of a sudden that builder did not have work because the council had not been able to process that consent for 7½ months. So some of the measures that we have put into place in this bill that I will focus on are about improving the processing of those consents.

There has been a lot of discussion about tree protection, but what about some of the other measures? In terms of the notification of resource consent applications, the Minister has explained it. There has not been a change in the policy, in terms of the Supplementary Order Paper; there has been further clarification that the presumption has been neutralised. It has not been changed in favour of non-notification; it has been neutralised so that the presumption is not on notification. That alone will save council officers months of time on processing consents, because they will not have to justify something that does not have to be notified. Currently, they waste time having to write reports to justify 95 percent of the consent applications that will not be notified anyway. This Government is focusing on getting rid of that waste, and this measure is the sort of thing New Zealanders are looking for. The guy who wants to build a garage on the back of his property or who wants to put on an extension to his house will not be sitting there waiting for months.

We also know that important strategies have been put in place for improving housing in this country. They have been brought in by our good Minister of Housing. We want those houses built. We do not want people sitting around waiting for months and months for houses to be built. That is exactly the sort of progress that this Government is focusing on.

We are not doing this at the expense of the environment. I am a particularly proud member of the Bluegreens organisation in the National Party, and Taupō is hosting the Bluegreens forum next month. The Bluegreens are an important part of National, so it is absolute rot that the Opposition would have people believe that National is not into environmental protection. This legislation gets the balance right so that we are able to best protect the environment and still manage—

Hon Shane Jones: What part of you is green?

LOUISE UPSTON: I am from Taupō. Has the member considered the Taupō electorate and its extensive tourism appeal because of our clean, green—

Hon Shane Jones: Labour policy.

LOUISE UPSTON: Not at all. National has a very strong blue-green movement and that is why we are getting this balance right. We have sought advice from an experienced technical advisory group, we have had great discussions in terms of the select committee process, and we have got the balance right to make sure that the hard-working New Zealanders who want to make changes on their own property can do that without spending months and months bogged down in a council process.

The other thing that we have not heard a lot about today is the number of submitters who came out in favour of the changes we are making because they know it will be a significant improvement on what we have now. We had close to 900 submissions.

Hon David Cunliffe: They haven’t read one.

LOUISE UPSTON: Does the member want a bet? We had close to 900 submissions, in boxes this high. Our hard-working team on this side of the House reads the select committee papers. We read the submissions, we took them on board, and we were able to make changes from the first draft of the bill to make sure that we ended up with something that is great.

The CHAIRPERSON (Eric Roy): I am sorry to interrupt the member. Interjections are permissible, but we are getting to the point where there is too much discussion from the cross benches.

LOUISE UPSTON: One thing that we are doing to improve the resource consent process that will have a big impact on the little guy who wants a resource consent—and I am speaking for such people—is to limit the ability of councils to stop the clock. Basically, it means that they will not have an endless stop-the-clock process, where they can draw out the amount of time they take to process a resource consent. If the expectation is 20 days, then councils on most occasions should be adhering to that expectation.

We have also introduced in this bill a complaints process and a discount fee for consents that are processed late. We think that is fair. In business practice, if one does not deliver something on time, then the customer should not suffer. In this instance, that is what we are talking about. If the council has not processed the consent in time, then the customer who has applied for it should get a discount. We had a great discussion in the select committee and I do not think anyone disagreed with that point. In this Chamber we have spent too much time focusing on issues such as trees.

Another point, which the Green Party was particularly supportive of, is that we are increasing the fines for those who break the law. For those who breach their resource consent, we have increased the fine to $600,000. That is far more in line with what those people should be paying, and this measure is part of National’s commitment to the environment. So I will not sit here and listen to conversations where it is claimed that National is not for the environment, because that is rot. Here we have a $600,000 fine for a serious breach of a resource consent for companies, and a $300,000 fine for individuals who breach resource consents. That is really important in terms of getting the balance right in this legislation.

We have streamlined decision making. We have improved the workability of the Resource Management Act and we have streamlined the consent process.

Hon STEVE CHADWICK (Labour) : I congratulate the Minister in the chair, Dr Nick Smith, on taking so many calls on the Resource Management (Simplifying and Streamlining) Amendment Bill to put his perspective to us and to help clarify some situations, but I am concerned about the removal of the Minister of Conservation’s decision-making powers in respect of coastal consents for restricted coastal activities. I was Minister of Conservation for only a year, but in that year I recognised that the public of New Zealand felt a sense of security because of that role of the Minister of Conservation. That role is repealed by clause 20. I think a feel-good factor was there about the Minister of Conservation being the activist and the protector on behalf of New Zealanders as a last resort. It gave New Zealanders a lot of confidence that the Minister would exercise that role; it was not used with gay abandon, as the Minister for the Environment said it was. There were only two cases in which the role was exercised, but I believe it is absolutely critical to have it there.

I ask Dr Smith what we heard from Local Government and Environment Committee responses to the repeal made by clause 20. Eighty-three percent of submissions felt opposed to it. I think that says a lot about New Zealand. As well, 76 percent opposed changes made by clause 83. I think this shows that New Zealanders do not feel comfortable with this change. Just having those powers there was a means of protection for all New Zealanders that they were comfortable with.

I picked up another issue when I was the Minister of Conservation, and that was the overlapping issues with the Foreshore and Seabed Act. Many were still disaffected, particularly in the Whangamata marina case, about protection aspects of land that were subjected to a Treaty claim. I think we need to look at that issue very closely. One cannot look at the Resource Management Act just on its own, take away the powers of the Minister of Conservation, and think that solves the problem. It will leave a legacy for iwi with cases that they are really unsure about. Within some common-sense applications regional councils are over-exercising their powers without oversight of the Minister of Conservation, but under the jurisdiction of another Minister—the Minister for the Environment. That really worries me. I think that power of veto was wonderful. It was not abused; it was exercised with due constraint. We may have got it wrong on the Whangamata decision, but in the end the working through showed that the issue there was process. We always said that the process needed to be clarified. When this bill was first put before us in some rushed state we said we should look at the UK model, where the Minister of Conservation is involved at the front end of the process for restricted coastal activities. That model works. But the Government is simply taking away the powers of the Minister of Conservation. I think it is a very sad day for us all in New Zealand.

The Minister in the chair also mentioned national policy statements and the Coastal Policy Statement. One piece of work that I was particularly proud of was the work that Judge Shonagh Kenderdine got moving on the Coastal Policy Statement. I can remember when the Minister in the chair was the National spokesperson on the environment. He asked me several times in the House what had happened to the national policy statements. Well, I ask Dr Smith what has happened to the Coastal Policy Statement. We quite rightly said that the report should come to an incoming Government, but that was in November. What has happened to the report from Judge Shonagh Kenderdine, which she prepared with very learned people who went around the country working on the Coastal Policy Statement? Where is that report? Why is that thinking not factored—

Paul Quinn: It’s coming.

Hon STEVE CHADWICK: It is coming? Here we are, considering simplifying the Resource Management Act, and we do not even have a major implicating instrument, which is either a national policy statement or the Coastal Policy Statement. I think that is very dangerous. We obviously have to wait until phase two of the reforms, and that is where the process itself really concerns me.

We all said in our opening speeches that the Government wants to simplify and streamline the bill. We did not have problems with that. There are many aspects in the bill, and the previous speaker was particularly bitter about the fact that we worked on so much of this and got it right. But we agree with the Greens and Jeanette Fitzsimons that we have unduly complicated and confused the processes. I think the powers of the Minister of Conservation are now absolutely complicated and confused. The Minister in the chair talked about five steps in which the Minister of Conservation has a role in terms of restricted coastal activity. What does that simplify? Is that what the Minister has done in terms of simplifying? I say to Dr Smith that other models could have made it so much simpler. I think he has made the role of the Minister of Conservation unduly complex, and it will confuse applicants when it comes to activities that protect the coastal margin. We know that in New Zealand if we do not show due process and care for the coastal margin, especially with the impact of climate change and also with development pressures moving along the coastal margin, these restricted activities will become more and more fragile, and will require greater protection. I believe that the role of the Minister of Conservation in relation to restricted coastal activity should have stayed in the Act.

I remain very concerned about the overlapping implications on the Foreshore and Seabed Act. This bill gives us no assurance that the processes will be clarified, streamlined, or simplified. As a Minister, I saw that that was particularly an issue for Hauraki. I think it is wrong to remove that power of veto of the Minister and say that five steps will assure the public of New Zealand that the coastal margin with restricted coastal activities will be protected environmentally. It makes it unduly complex. Overlapping regional councils all coming together to work on one plan is great, but the Minister of Conservation is informed only at the end of the stage, not right at the beginning. I think that is a big mistake.

Dr CAM CALDER (National) : It is a privilege to stand again to address members on the Resource Management (Simplifying and Streamlining) Amendment Bill. My previous oration this morning on the issue of trees was cut off somewhat; one could say it was truncated. I would like to return to that subject. As the Minister observed, we need to apply a good dose of common sense in the Resource Management Act, and I think that with the broad cross-party support we have received on this issue, we are getting it.

Clause 52 of the bill, which deals with the general protection of trees in the urban environment, has occasioned much correspondence from the community, mirrored by the debate in the House. The major urban area affected by clause 52 is Greater Auckland, where a number of councils have general tree protection rules. There is a school of thought that clause 52 will countenance widespread rapine and plunder of our precious urban arboreal resources. What is it about Auckland and those who live there that should occasion such concern? As an MP who is resident in Auckland and fortunate to have his office in the green and leafy electorate of Epsom, I feel I must stand and speak on behalf of those residents who wish to trim or remove a tree on their property, without the time-consuming and expensive process of seeking a consent. This Government believes that citizens who own their properties should be able to do just that.

Are those good residents, as I asked this morning, all vegetal Visigoths? Are they philistines of Philodendron; plunderers of pōhutukawa; pillagers of pūriri; or castrators of kauri? I suggest that they are not. Are those good people ravagers of Rhododendron; topplers of tawa—

Hon Shane Jones: I raise a point of order, Mr Chairperson.

The CHAIRPERSON (Eric Roy): I hope this is a serious point of order.

Hon Shane Jones: As a descendant of the proud Ngāpuhi tribe, I cannot let that remark go unchallenged.

The CHAIRPERSON (Eric Roy): That is not a point of order. The member is interrupting the speech.

Hon Shane Jones: Castrating a kauri, for goodness’ sake! What next?

The CHAIRPERSON (Eric Roy): Please sit down.

Dr CAM CALDER: We have heard from the Hon Shane Jones that we are not likely to see any castrators of kauri in the far north. I am relieved to hear that. I put it to the Committee that neither are we likely to find them in Auckland City. Will people take an axe to every akeake within sight? I respectfully submit that they are not likely to, and they will not.

What is it about the good citizens of Auckland City, North Shore, Waitakere, and Manukau City that causes them all to be portrayed by those opposed to this amendment as rabid pillagers and plunderers, who are straining at the legal leash of section 76 of the principal Act? I remind members that clause 52 is designed to amend that section, which is apparently the only restraint on the lust and naked greed that would otherwise see people sacrifice huge numbers of prized, significant specimen trees on the altar of Mammon. Are the good citizens of Auckland, North Shore, Waitakere, and Manukau City any more likely to act in that manner than the worthy burghers of Christchurch, Hamilton, and Wellington?

Jo Goodhew: And Timaru.

Dr CAM CALDER: And Timaru, thank you. I respectfully suggest that they are not.

Ninety percent of New Zealand cities do not have blanket tree protection laws, yet all communities face developmental pressure to a greater or lesser extent. Four of New Zealand’s largest cities, as we have heard—Wellington, Hamilton, Timaru, and Christchurch—do not have such blanket tree protection. There is no endemic problem with regard to the loss of urban trees in any of these cities. Indeed, it would not have escaped the attention of anyone in the Chamber that Christchurch enjoys the sobriquet “the garden city”. These reforms are about pulling back on expensive and unnecessary bureaucracy. We have had some concern raised about the Bluegreens. They reinforce National’s blue-green principles that being pro-environment does not equate to being pro - red tape. We find it unacceptable that concerns about minor projects, such as trimming and removing a small tree, can cost more than the projects themselves.

As a case in point, about 5,000 of the 50,000 resource consents that are applied for every year are for tree trimming or removal, as we may have heard earlier—5,000, which is almost 10 percent. Very few of these consents are declined. However, this process is estimated to cost Auckland City almost $2 million. “How much?”, we might ask. It is $2 million, which could be used to treat stormwater or, perchance, could be used to purchase small parcels of urban land dotted throughout the community that could become treed, or that are treed already.

To reiterate, I say the consent process for trimming or removing trees costs individuals and ratepayers considerable time and money, although it shows few benefits. This Government believes these costs are unjustified. Thank you.

Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) : I rise to speak after that entertaining interlude. There is a saying in Māoridom: “When one tōtara falls, another one stands.” But in the Opposition, when one tōtara falls, another building is built. After hearing Cam Calder, I say that his speech was very entertaining. We know now why it took such a long time for him to have another speech.

I want to go back to a speech made by a colleague of the member, the member for Taupō, Louise Upston. She talked about getting the balance right. If getting the balance right means we have a top-heavy model weighted in favour of developers, at the expense of public participation in the Resource Management Act, she can have it. I know that there are a great many more people in the Taupō community who have very real concerns about the way in which the changes to the Resource Management Act are weighted in favour more of developers and less of the community, public participation, and certainly iwi and hapū input into decision making.

I listened to the Minister’s previous contribution and I say that one thing is for sure: under the previous Labour Government, when it came to the Resource Management Act, the ability of the public to have input into the consent and planning process was never under threat. It was never under threat, and there was no misunderstanding about it. But what good ideas did we get from National members in their 9 long years in Opposition? Their ideas were to gut the Resource Management Act of any public participation in the resource management process, limit notification, and make it really hard for appeals to happen. We have to ask ourselves whether this is the track that this country, which we are proud to call a clean, green nation, wants to go down. I suspect not, because many submissions were heard during the first tranche of Resource Management Act amendments, and many submitters supported the retention of a high level of public input into decisions made in their local community.

We talk about limited public notification and minor adverse effects. Minor adverse effects are a matter of perspective, and a lot of smaller communities said that a lot of things that were happening in their backyard were of real concern to them, and the only way they could have a say was through greater input into the public process. When we talk about limited notification, in fact a lot of submissions said that people were very concerned about that move. Indeed, only 5 percent of consents are notified, so why change something that is not broken, and why limit the ability and the opportunity of communities—good, thinking citizens, who are concerned about preserving the quality of life in their communities—to have a say on what is happening in their backyard?

A fine example was raised with regard to minor modifications and housing improvements. But let us go to the other end of the spectrum where earthworks are happening that are significant to many communities. There are major earthworks where trees were being cut down on the corner of Grey Street in Hamilton by a developer who had no regard whatsoever to the interests of the community, and who would have rather stumped up with the $50,000 fine than preserve the quality of life and the green space within that part of the Hamilton City community. There are real issues for Māori landowners who, under a minor works umbrella, have seen that, in order for a lines company to clear space under, say, fallen lines, they have actually had another major road ploughed through the middle of their land. That is not minor; those landowners consider it to be very major. When we talk about minor adverse effects and when we talk about raising the threshold of notification, we have to look at a range of examples and not just at the one pointed to by members of the Government. We say that there are works happening under the label of minor adverse effects that need to be notified and that the public should have a say on, because, from the perspective of the local community, people are concerned about the impact on their quality of life and about what is happening in their community.

Again, I say to the Minister that many, many submissions on the issue of limited public notification said that there was really no need to change it—only 5 percent of consents are notified at present. What is the real intention here? It comes on the back of not listening to submissions on Auckland governance, on the back of not listening to a public referendum where a lot of people have spoken, and on the back of ramming through a number of amendments. Clearly the public sentiment has been to ask why we should change some of those things that do not need to be changed. The Minister really needs to provide greater clarity, because on the surface of it, the way in which these types of amendments are moving are weighted more in favour of developers’ interests rather than public input and public participation in the decision-making process. Again, I say that the Minister has taken a number of calls on the bill, and it is important to clarify those things, just so that there is no misunderstanding about what the second tranche of Resource Management Act amendments might foreshadow.

On the issue of Whangamata, one can hardly say that all the issues around it were an everyday type of scenario. But I want to provide my perspective, because it was this issue that, in many respects, provided probably one of the most difficult ranges of interests, and they were not all given equal weight in the consideration of that application. It was the interests that were promoted by Hauraki iwi Ngāti Hako and Ngāti Hei, and endorsed by the Hauraki Māori Trust Board, around really simple things such as that, if there were to be a marina in that space, it would significantly impact on our customary fishing interests, specifically the gathering of pipi in our pipi beds. It was very simple. But the weight of those interests against big development interests with a lot of money behind them was lost in the white water, so to speak. There was never really a sense from local hapū that the severity of their concerns about major impacts—protecting the pipi beds, protecting the natural habitat, and concerns for the moko skink in that area—was ever taken into account.

On the question of retaining the role of the Minister of Conservation, those powers have rarely been used. Why get rid of them? They should be retained for the public interest, and, more important, for the interests that exist amongst hapū with regard to some of the issues that are never really given much weight in the Environment Court, because hapū do not have the resources to have the technical support to provide the level of intensity in their argument within the Environment Court context. I want to support and endorse the contribution made by my colleague Steve Chadwick on the issue of retaining the role of the Minister of Conservation. She makes the good point that now, since the Foreshore and Seabed Act, in Whangamata the car park space, in a strict sense, would be considered as foreshore and seabed area. If we take out the role of the Minister of Conservation, who protects the public interest there? If customary interests are yet to be determined, who then fills that space? Where customary interests have not been determined, I do not think it is the Minister for the Environment. In fact, it should be the Attorney-General. In my mind there needs to be further thinking about how the gap that has been created should be rightly filled by the best person or position. I would say it should be the Attorney-General with regard to the foreshore and seabed space, to ensure that the opportunity for the customary interests of hapū to be claimed can be held, and the space can be preserved in the meantime for the rest of the public. That is the best way. We cannot assume, I say to the Minister, with respect, that the Minister for the Environment is the best Minister to preside over decisions on questions of that nature.

On that front, again I would argue strongly that this role has not been used very often, and there are obviously very specific limitations on the way in which the Minister of Conservation can make decisions. The court said that the process appears to have let the former Minister down on the Whangamata issue. However, let us not throw the baby out with the bathwater. Let us have another look at the implications of the issues of the space that we are talking about, especially when it comes to the foreshore and seabed. I think the Minister needs to revisit the question of who fills that gap. With respect, I do not think it should be the Minister for the Environment in a carte blanche way. In fact, I would petition the Minister strongly to do an assessment and scoping of the various lands that are captured in that domain, and ask for advice to ensure that the Attorney-General be considered as the most relevant person to fill the space, if it is not the Minister of Conservation.

Hon Dr NICK SMITH (Minister for the Environment) : I want to respond to a couple of the points that have been raised by Nanaia Mahuta in the Committee stage of the Resource Management (Simplifying and Streamlining) Amendment Bill. Firstly, regarding the issue of the Minister of Conservation’s veto or capacity to overrule the decision of an Environment Court, I put to the Chamber this scenario. Let us say that we had an application that was heard before the Environment Court. The local iwi come along and say that the application will have an adverse effect on their pipi beds, the Environment Court says that they are right, and it turns down the application. In this scenario let us say that the Minister of Conservation was my good colleague Chris Auchinvole, and he said “No, I’m a keen fisherman and I’m going to overrule the Environment Court. I’m going to let it go ahead.” He would be the very first member to scream foul. I say to the member opposite that that is what the law says.

My challenge to the members on my left is this: why do they not trust the Environment Court? There is no other part of the Resource Management Act where Ministers make decisions on individual consents, and members on this side of the House say that we trust the Environment Court. The sorts of issues that the member has raised should be properly dealt with in that court.

Hon Nanaia Mahuta: I raise a point of order, Mr Chairperson. Will the Minister take a question?

The CHAIRPERSON (Eric Roy): That is not a point of order. You cannot interject like that.

Hon Nanaia Mahuta: I seek leave for the Minister to take a question.

The CHAIRPERSON (Eric Roy): No, you cannot do that. It is a debating point. The member can interject, but if the member who is speaking does not respond then that is the end of asking the member to take a question.

Hon Dr NICK SMITH: I have a very simple question for members of the Labour Party. Why do they not trust the Environment Court? It is a very simple question. We trust the Environment Court in respect of hydro developments, major transmission projects, and huge roading projects, so why would Parliament take a different view and not trust our Environment Court judges to make proper decisions without political interference in the area of the coast?

The second point the member raised was that this bill was all about developers. In fact, Russel Norman went one step further. He said that this bill is an attack on the voluntary and community spirit of communities all over New Zealand. Let me give member a very practical example of why members on this side of the House support this bill. I have a letter here from Mr Peter Grant. He is the treasurer and a life member of the Mercury Bay Tennis Club—one of those rampant developers! Do members know what that awful tennis club wanted to do? It wanted to build a volley wall for its community. To apply for a 2-metre high volley wall at the Mercury Bay Tennis Club—and I have a photo of it that I would be happy to table—it lodged a consent with the Thames-Coromandel District Council, and the council said the club had to have a resource consent. Do members know how long that took? This application was lodged in July last year. How long do members think it took for the Mercury Bay Tennis Club—one of those rampant developers out there—to get consent to build a volley wall for the children of Mercury Bay and Whitianga? The club lodged its application on 11 July, and it finally got consent on 17 February. But there is a byline. Do members know how much it cost the Mercury Bay Tennis Club to get a resource consent for a volley wall in Whitianga? It cost $2,200 to build, but the cost of getting the resource consent was $2,564. Is Mr Norman telling me that that is a voluntary and community group that is being attacked in this bill? I say to that member that that is the sort of bureaucracy that is driving ordinary New Zealanders mad.

Communities and members want to do the right thing. They want to make a positive difference for their communities, and members on this side of the House are saying that it is examples like that that show why we need this bill and why we need to take a practical view of how we deal with resource consents.

JEANETTE FITZSIMONS (Green) : The Greens have put forward a number of Supplementary Order Papers on the notification provisions of the Resource Management (Simplifying and Streamlining) Amendment Bill, and I would like to run through them so that members will be able to support them.

I ask members to turn their attention first to Supplementary Order Paper 43. It removes altogether clause 68, which makes the changes to notification. Basically, these clauses have become a mess. It is confusing. It is not at all clear. We know that it somewhat raises the bar for notification, but it is very unclear how it will be interpreted. It is creating a legal mess. We should go back to the position we had earlier. It was not ideal, but at least we were getting some case law around it, and it was better than what we have now.

That brings me to some comments made by Louise Upston. She talked about people having difficulty getting resource consents to build a garage. Most garages and house extensions need a building consent but they do not need a resource consent. It would have to be an unusual kind of garage—one that shades people’s sunlight, encroaches on the boundary or bulk and location requirements, or whatever—to actually need a resource consent. People certainly would not be notified beyond the immediate neighbours. So it is a very bad example. I give members an example of something of much greater impact that does not get notified, at all: an open-cast coal mine in the Waikato. An open-cast coal mine was regarded as having effects so minor that it did not need notification, at all. I ask members to try that next door!

If Supplementary Order Paper 43 fails, which I am sure will not be the case, we have Supplementary Order Paper 45. It clarifies that in a case of limited notification, where the restrictions on who gets notified are quite narrow, an organisation representing the public interest when there is an impact on that public interest by the development should be regarded as affected persons. Because the definition of “person” under the Resource Management Act makes it clear that organisations are persons under the Act, we would think that an organisation representing the public interest would be a person affected anyway. But some have argued that only natural persons can be affected in the sense of the Act and that, therefore, organisations representing the public interest could be excluded from the limited notification provisions. That is why we have said, for the avoidance of doubt, that these organisations should be regarded as affected persons. If that organisation is the tennis club and water quality is being affected, then it would not qualify. But if the local environment group has done work on water, and water quality will be impacted, then it ought to be notified.

Supplementary Order Paper 45 also omits new section 95D(a)(ii), inserted by clause 68, which has the peculiar effect of saying a person “must disregard any effects on persons who own or occupy—(ii) any land adjacent to that land;”. So people can cause effects on their immediate neighbours, and they do not get notified, but people cannot cause effects further abroad. That seems to be bizarre, and we propose that that new section should be omitted altogether.

Supplementary Order Paper 43 removes clause 131, which is the clause that repeals the right, under section 274 of the Act, to join an appeal brought by another party. I dealt with this issue somewhat in my second reading speech, where I said that the ability to join an appeal brought by somebody else will never be needed by a large developer with full-time lawyers. They will be in there right at the beginning. The people who need section 274 are the people who are holding down jobs and looking after families. They are volunteers, they are part-time, and they just do not see the deadline coming up in time to get into the original case in front of the council. Therefore they lose their right to appeal. As the law stands, section 274 allows them, when someone else appeals, to join that appeal and to bring their information and evidence for the benefit of the court in order to make a better decision. I quote the case of the Cypress mine appeal, where the Buller Conservation Group, under section 274, joined as an interested party the Royal Forest and Bird Protection Society, which had appealed. They were able to fund a lawyer, an ecologist, and a landscape architect, and that helped the environment movement produce a well-rounded case in that appeal.

The Royal Forest and Bird Protection Society, and groups like it, sometimes use that ability to join a case. In this case a national environment group brought an appeal, and then the local group was able to join that appeal and bring its local knowledge. Local knowledge is really important in a case like this. I have already mentioned in my second reading speech the case of the local people who knew that the land on which a mining tailings dam was built was unstable and would slip. Unfortunately they were not listened to, even though they got as far as court, and the land was unstable and slipped, and it cost $20 million. The mining company might wish that it had listened at that stage to the local group. So we believe that section 274 adds a useful provision to the Act and should not be repealed.

If all of this fails, finally we have Supplementary Order Paper 44, which clarifies that even if section 274 is repealed, a person representing some aspect of the public interest that is affected by this case can appeal against the case. I recommend those Supplementary Order Papers to the House.

I will talk about trees. We do not have laws on murder because we think every good citizen of Auckland will go out and murder people. We do not have laws against theft because we think most people are thieves. We have those laws because there are a few who might be. Likewise, we do not need tree protection laws because we cannot trust the householders of Auckland; we need tree protection laws because in Auckland, above all other places, a lot of infill development is going on whereby developers buy a section they have no real connection with, do not intend to live on, and have no attachment to, in order to build as many apartments as they can fit on to it, and the trees are in the way. This is a totally different situation from a person with a beautiful magnolia in his or her front garden, who is unlikely to chop it down. That is not who this rule is for. We are talking here about the areas that have the most intense development pressures. Of course we are not losing trees in Christchurch! Developers are not trying to cram multiple apartments into every tiny corner of Christchurch. It is not growing at quite that rate. We have those pressures in a few parts of the country. Councils can use this tool in the public interest where it is necessary to have some control over trees in those areas that are being densified quite fast.

The Minister for the Environment said there were 5,000 applications per year to trim trees. If the Minister is right, then what he is saying is that all of those 5,000 cases would not have had to happen if he had accepted my amendment, which excluded trimming trees and allowed a blanket protection only for felling, removing, or destroying trees. But the Minister would not accept that amendment, at all, despite the fact that it would have dealt with those 5,000 applications, which he said were about trimming trees. My suspicion is that roughly half of them were about trimming trees and roughly half of them were about felling trees, but in either case it would have dramatically reduced those compliance costs.

In addition, councils could delegate the decision to an officer on site who goes out, visits, and makes an assessment. The officer says yes, signs the piece of paper, and says: “Off you go.” There is no need for the mass of paperwork that goes on at the moment. It could be done very quickly and simply. It is just a matter of having a check. The scheduling will create very much greater compliance costs because every single tree scheduled is open to appeal by people who do not want it scheduled. The council will be tied up in a nightmare of compliance, red tape, cost, and paperwork trying to get its schedule, and most councils simply will not try.

Hon DAVID CUNLIFFE (Labour—New Lynn) : Self-sown or planted, raised and nurtured by the landowner or growing up naturally through the canopy cover above. Growing over dozens of years, sometimes hundreds of years, sometimes thousands of years, they emerge to provide shelter and shade. They provide stability for our soils, they prevent erosion and slipping. They fertilise, they attract rain, they hold moisture, they provide beauty, wilderness, amenity, and view. They refresh our souls as well as our waters. Trees. They are slow to grow, quick to go.

At the heart of the debate lies this paradox. There are two competing views of the ownership of these things called trees. On the one side is a party that believes that ownership is entirely individual and entirely temporal, and therefore every individual should have the ultimate right to cut them down. On this side we have a party that believes that trees are part of our birthright that we give to other generations, and are also something that we own collectively as well as individually. In recognition of that broader view, some communities around New Zealand have joined together to agree rules that everybody in that community should stand by in the way that they either protect, or decide to chop down, a tree. Clause 52 amends section 76 of the Resource Management Act to prohibit any rule in a district plan from providing for the protection of any tree or group of trees in an urban environment. It is an act of prohibition against any community deciding that there is a common interest in maintaining those trees. Clause 151 requires any council to remove rules from the district plan by 1 January 2012, conveniently after the next general election, which probably explains why the Government has brought in a Supplementary Order Paper that at least scores the unrestricted trimming of a tree immediately on the passage of this bill, before the next general election, just in case National does not win it.

Here we come to another fascinating political point. In the life of any Government there are some key moments, moments when in its arrogance it puts its big boot right in the organic matter, and this is one of those moments, just as it was on adult and community education cuts, and just as it was when the public decided that it was revolted by Rodney Hide’s minimalist vision of a local government agenda. On this issue inboxes are clogged with hundreds and hundreds of emails from Aucklanders who say that it is not the Government’s right to override their democratically elected councils that have put in place rules that the majority stand for. Here is the problem. This is an active override by central Government over local democracy, from a party that campaigned against the nanny State! This is the chainsaw State, the bulldozer State, driving its way through local government rules. It is the party of liberty crushing bottom-up democracy—go figure! That is what these tree provisions are really about.

This is a bill that was supposed to streamline and simplify, but whose only solution to the trees issue is to create a mountain of bureaucratic red tape by requiring that every tree or—maybe, just maybe, especially if Lynne Pillay’s amendment goes through—group of trees has to be individually scheduled by the council, creating a trail of paperwork and further consultation. They say the blanket rules are too bureaucratic so we are going to get 100,000 little individual rules for each tree. One of the members opposite raised the subject of Timaru. I grew up not far from there. That is the kind of place where, if people are driving along an empty country road and see another car, they wave because they never know whether it is the last car they will see. It is not hard to protect an individual tree in Timaru; there are not too many of them. But it is a totally different scenario in Waitakere, where I now have the privilege of living. In Waitakere, there are hundreds of thousands of trees. It is completely impractical to do individual scheduling or even small group scheduling of trees, and many properties and many dwellings exist in the bush.

There is a ridiculously inequitable state of affairs in these clauses, because they apply only to urban trees and urban councils. That says that rural people—is that because they vote National more often—must love their trees more or would be more sensible. Is that the hidden agenda here? Why should urban people not have the right to join together through a democratically elected council and protect their native flora? It does not make any sense, it is inequitable, and it is unnecessary because streamlining is an operational matter. It does not need to be a legislative matter. If it is, the Greens have an amendment that quite rightly allows for improved trimming and provides for on-the-spot consenting processes, and we believe that there is a lot of potential there to find a good middle ground. We are not opposed to streamlining, but we believe that these provisions take the Act in the opposite direction.

The legislation is unethical. It manifests an extreme individualism. It says “The tree on my property is mine alone. It doesn’t matter if it took 200 years to grow. It doesn’t matter if I am a blink in the eye of the life of the tree. It doesn’t matter if as well as being on my property it provides shade or stability for the properties beside me, above me, or below me on the hill, and it doesn’t matter if removing it might cause erosion or a slip. That does not matter. It does not matter if it is part of a view. It doesn’t matter if it is part of a line of pōhutukawa along the coast. That does not matter, because it is mine alone.” That is the kind of individualism that ordinary New Zealanders do not buy into.

Labour will be vigorously opposing these tree provisions, and we will be moving three amendments to remove or reduce them. Phil Twyford will be moving amendments to strip those offending provisions from the bill because they are wrong and they should go. At the very least, they should be deferred into the second tranche of the Resource Management Act reforms so that the Government has time to properly consult. If National is a party of consultation, then let it be true to its word. I will be moving an amendment to exempt the Waitakere Ranges Heritage Area, established by this Parliament not a year ago after 30 years’ work and supported by 81 percent of Aucklanders, according to Colmar Brunton. That should be akin to a reserve or a conservation management area, and that should be exempted for very, very sensible reasons from the operation of those clauses, if they stand. If the Government rejects both of those two, I call on the Minister to state whether he will support an amendment on behalf of Waitakere City by Lynne Pillay MP. They are technical amendments that hold the Minister to his word that it is not an individual tree but a group of trees that can be scheduled, if scheduling must occur.

I come to the fundamental point that the trees of west Auckland are a community resource as well as an individual resource. There are far too many homes on properties of less than 4,000 square metres that are reticulated that are surrounded by trees. In fact, the only area on some properties that is not treed is the physical area of the house. The rest of it is solid tree cover, and scheduling every tree is a nonsense. At best, it is a bureaucratic nightmare; at worst, it is a deliberate con. That brings me to National’s Auckland MPs. Nikki Kaye goes around the tree groups and says that she will help. Either she knows she is powerless and she is not being frank, or she has an overblown impression of the Minister’s willingness to listen. Either way, it is vacuous; she has delivered nothing. Paula Bennett would not return the phone calls of the Waitakere City Council. She presents herself as a defender of west Auckland, yet she is selling it down the river. Tim Groser could not be bothered because he is overseas. Pita Sharples could not pick up the phone. In his case, I understand there may some family reasons, so we will cut him some slack on that. But I call on Māori Party members to be the kaitiaki of the trees, not just talk about it, and vote with Labour if they can get over themselves and long-past history, and support these amendments.

Hon Dr NICK SMITH (Minister for the Environment) : That was an extraordinary contribution from David Cunliffe. It was wrong in fact, wrong in process, and wrong in philosophy. Let me go through each of the issues. The member opposite said that there is no provision except for individual tree protection. That is wrong. There is absolute capacity for groups of trees to be identified for protection through the proper process. All this bill does is ban blanket protection rules across the district.

The second error I want to mention, which I find extraordinary, concerns amendments. Where are all the amendments that Labour members moved at the select committee when they heard submissions on this bill? I do not think a single amendment was put forward at the select committee. [Interruption] Mr Twyford has said he has strong concerns. He was on the select committee. Was he asleep? Was he not there? Why did Labour members not move a single amendment at the select committee when these detailed provisions concerning trees were being dealt with? They have completely let the side down.

Let us turn to the issue of philosophy. I will explain very simply the philosophy on this side of the Chamber. In an extraordinary backwards flip the member David Cunliffe is saying that somehow the changes we are making are an attack on liberty. Let me very simply explain for the member the principle that applies here. It is perfectly proper for Parliament to define something as simple as a person’s property right. Probably the most important asset that New Zealanders own is their little quarter acre, and it is the proper business of this Parliament to define the limits and the extent of people’s rights around their little quarter acres.

Hon David Cunliffe: No limits under this Minister!

Hon Dr NICK SMITH: The member opposite keeps interjecting and saying that there are no limitations. That is simply untrue, and it is below what I would expect of a front-bench member of the Labour Party.

Members on this side of the Chamber say that is an absolute right—and David Cunliffe gave a speech about a huge tree that has been growing for 200 years—for a community to identify a tree, or group of trees, in its district plan, and there is nothing in this bill to stop anybody from properly recognising those trees.

I say to the member that if the council wants to adopt a rule of that sort, then it should talk to the property owner. Is that not a novel concept? It seems to me that it is a novel concept for members on the Labour benches to say that if people have a tree on their property and the council wants to protect it, the council should talk to them and consult them. Is that a radical notion? Is that something that this Parliament and its members cannot grapple with?

Perhaps I should read, for the benefit of Mr Cunliffe, this contribution from Mr Bill Ralston. He says: “Before Christmas I decided to get rid of an ugly, stunted, exotic box elder tree at the bottom of my garden that was strangling a native nikau and a couple of other palm trees. The guy who does our garden brought around an arborist who told me he could not fell the damn thing without a resource consent. I wrote a cheque and several weeks later a man from the Auckland City Council with a clipboard came around and stared long and hard at the offending tree. Yes, he would recommend we could cut it down. More weeks passed and eventually a long document arrived from the Regulatory Planning Department of Auckland City Environments saying we had been granted consent. The tree feller came, cut it down and removed it in 30 minutes.”

Bill Ralston said he was very pleased that the National Government is going to pass changes to end that sort of nonsense. He went on to say: “I will never again have to apply for a Resource Consent to trim my garden, the council will not have to spend many hours pondering my botanical behaviour, and the ratepayers of Auckland will not be wasting hundreds of dollars every time someone in this city wants to do some gardening”.

I also draw Mr Cunliffe’s attention—

Hon David Cunliffe: How many emails has the member received in favour of whacking down trees?

Hon Dr NICK SMITH: Well, the member Mr Cunliffe asks about emails. That is an interesting question. I never—

Hon David Cunliffe: He has to read his media trainer’s emails.

Hon Dr NICK SMITH: The member should take a big deep breath for a moment. I draw his attention to the New Zealand Herald poll. What did the poll say about this issue this week?

Hon David Cunliffe: How scientific was that?

Hon Dr NICK SMITH: Well, that member, who has just been talking about the number of emails I have received, is not prepared to accept a poll from the New Zealand Herald. I have to tell the member that it is as simple as this: the vast majority of New Zealanders do not believe they should have to get a resource consent to trim their trees.

I look forward to campaigning in 2011 and saying that a vote for Labour is a vote for a nanny State and a vote to go back to the nonsense we have tolerated for 9 years, as has been demonstrated by the poor old citizens like Bill Ralston, who had to go through a 6-week performance to get resource consent to trim a tree.

NICKY WAGNER (National) : I want to refer to Supplementary Order Paper 43 in the name of Dr Russel Norman. Part of this Supplementary Order Paper deals with security for costs. Security for costs is something that concerned many of our submitters, but we believe that a lack of knowledge about the process increased their concern unnecessarily. The Resource Management (Simplifying and Streamlining) Amendment Bill does reinstate security for costs. Many community groups were concerned that this provision may exclude them from participating in environmental decisions. But when the Local Government and Environment Committee reviewed court decisions from the past, we felt that the judges had used their power with discretion and that genuine environmental groups with genuine concerns would not be disadvantaged.

It is important to note that the Environment Court has always had the ability to award costs in appeal proceedings, but the power of the court to require security for costs has varied. Security for costs is the deposit of money or security to meet the possibility that the party will be unable to pay costs that may be ordered by the court should the case be unsuccessful. In the period 1996-2003, although the Environment Court had this power it was rarely used. Database searches could find only eight times when security for costs was required, whereas nearly 1,500 cases went before the court each year. Contrary to common perception among many of the submitters, the practice of requiring security for costs in the Environment Court does not kick in automatically upon the lodgement of an appeal. A party, usually the party whose resource consent decision is being appealed against, first has to apply to the court for an order for security for costs.

When it had the power to require security for costs, the Environment Court exercised its discretion according to a range of factors. The general principles are set out in rule 61 of the District Court Rules 1992, and the interests of both the appellant and the applicant are to be considered. Factors that are considered include the strength or merits of the plaintiff’s case, the conduct of the parties involved, public interest factors, and an assessment of the financial resources that are available. Given that the court already has case law in place and it has been considered to work well, we did not see a need to specify criteria for additional consideration in this legislation. I repeat: we do not think that environmental groups or individuals with a genuine issue need to fear this amendment. It is there to provide a balance at the court’s discretion, and I believe it is needed. During the submission process we did see firsthand evidence of an environmental group that felt it was OK—in fact, it felt it was its right—to dissolve the organisation and walk away from its responsibility when court costs were awarded against it.

We believe that the new bill, in allowing the ability to require security for costs at the court’s discretion, provides a good balance. We hope that as groups get to understand the process and see it in action, they will conclude that they have nothing to fear and everything to gain from participating in environmental decision-making. Therefore, I suggest that we do not support Dr Russel Norman’s Supplementary Order Paper.

Hon GEORGE HAWKINS (Labour—Manurewa) : I will begin by saying that I think the Resource Management Act has been a very good Act. It is very easy to find examples of where things have not gone right. One can always dig those up. The Resource Management (Simplifying and Streamlining) Amendment Bill has to make sure that red tape is cut. However, will it work? I think we have to look at the situation as it is. People came to the select committee hearing and made their submissions with passion. I was disappointed that I was not able to sit on the committee very often because I was on the Auckland Governance Legislation Committee that was sitting at the same time, dealing with Auckland issues.

I want to talk about what is going on in Manurewa in regard to this bill. If someone wants to build one of these things called a bloke’s shed and it happens to be going up against the boundary, that person will run into real conflict. The resource consent cannot be gained very easily. I understand that, and I want to see things change. The reality is that the people who administer the Act at the moment are the same ones who will be in charge of this new Act, once it passes through the House. We have to change those people, and I think that is the real problem. We have to change the way these people see things. When someone asks to have a bloke’s shed built on the back of his or her section, up against the neighbour’s property, these guys see that there is at least 3 months’ work in it for them. Of course, it is not made easy. I hope that these things will change quite considerably. I think the Act itself has been fairly important, in terms of making sure that developers do not run roughshod over the assets of a community. The environment is very, very important.

I want to tell members about a situation in Weymouth. Two macrocarpa trees are growing right on the boundary of someone’s place. They are not beautiful trees, and the next-door neighbour wants to get rid of them because they are blocking the light and making the property damp. But the person who lives about eight houses down the road thinks they look pretty good, and then the debate starts and the council ends up taking sides. I do not want this bill that is before us now to start a chainsaw massacre.

Chris Auchinvole: It won’t, George; it won’t.

Hon GEORGE HAWKINS: I think it very well could, and I think we have to be careful about that. When we see how some people in Auckland will do anything to clear a bit of land to build on, we have to be very careful. Auckland is even better than Christchurch, as far as a city with trees goes. There are some wonderful places in Auckland. But people get passionate. Remember One Tree Hill, when it used to have a tree? People became very emotional when the tree was cut down. Aucklanders love their trees. Of course, we would be remiss if we did not make sure that people cannot go out there and just chop down the tree. We cannot say to people: “Well, that tree has been there for the last 100 years. It’s going to stay.”, and have them reply: “No, it’s not. I’m going to chop it down. It’s my tree.” We most certainly do not want that to happen.

It is interesting that at the moment the chief executive of the local council has more say over the tree than the person who owns the land that the tree is on. However, there are people in our community who are not responsible, who do not care what their neighbours think, and who do not care what the wider community thinks. We do not want to let them get their chainsaws out and hack down every tree, because they do not like them. Councils are notorious for putting so much red tape in the way of people. I have a case in Manurewa at the moment. It took the council 26 years to notify a person that a fence was the wrong size.

Dr RUSSEL NORMAN (Co-Leader—Green) : I will speak briefly about notification issues, because those are some of the issues in the Resource Management (Simplifying and Streamlining) Amendment Bill. I will talk about a particular example of how the notification processes are already far too weak. The example I wish to address is around a piece of bush that used to exist in the South Taranaki ring plain. It was called the Parihaka bush. This is an example of why the current regime around notification is far too weak, and why it is a mistake to weaken it further, as the Government proposes to do with this bill.

Parihaka bush was about 10 hectares of remnant forest and a remnant swamp, or wetland, and it sat in the South Taranaki ring plain. Members who know the South Taranaki ring plain will know that outside the Taranaki park, very little native vegetation is left. According to the ecological assessment done on the area, about 1 percent of the original native vegetation is left in the South Taranaki ring plain. Parihaka bush existed previously; it was about 10 hectares. Tawa, rewarewa, miro, pukatea, rimu, māhoe, pigeonwood, tree ferns, and about 20, 30, or 40 different varieties of ferns, trees, and shrubs existed in this area. It was a very important local piece of vegetation. It also had the Waitotoroa Stream, which had water of reasonable quality in it because of the bush that existed around it.

Parihaka bush was in the middle of a dairy farm—and there is a family story about this. New farmers basically wanted to bowl the bush in order to do a dairy conversion. They wanted to take it out; they wanted to get rid of it. They went to the South Taranaki District Council, which told them they would need a resource consent. The farmers, being of the same mind as the National Party and the ACT Party, thought that that was an outrage. They said something like: “How dare they! It is our land. How dare we have to have a resource consent in order to bowl the last 10 hectares of native bush left in an area where 1 percent of the native vegetation is left? It is our land. How outrageous it is that we should have to have a resource consent in order to bulldoze bush!”. So the farmers started bulldozing it anyway. They said: “Bugger that! We don’t believe in this Resource Management Act stuff. The National Party tells us all the time how bad it is, and we subscribe to that, so we will get the bulldozer out and start bulldozing the bush.” They started on the bulldozing before someone found out and the council sent someone around to assess what was going on.

The council intervened and had an ecological assessment done on the bush. It found out that the bush was a 100-year-old piece of bush that was tremendously important in terms of the ecology of the region. One would think that the council, at that point, would have said the farmers could not bulldoze any more of the bush. In fact, one would think that it would fine them for bulldozing the bush without obtaining a resource consent. One would think that would be the logical conclusion. Instead, the council looked at the ecological assessment, which showed the bush was tremendously important, and it obtained a recommendation from council officers, who said the council should not give the landowners a resource consent, because that would only reward them for bad behaviour, and it would be a bad thing to do anyway. The council then said no, it would give the farmers a resource consent. Not only did the council say it would give them consent to bowl the rest of the bush but also it said they did not have to notify the proposal. The council decided not to tell anyone about it. The farmers had a non-notified consent for the bowling of the rest of the 10-hectare bush, but they left some parts of it.

This is the current situation. The Resource Management Act is already so weak and unable to protect the last remnants of natural vegetation from dairy conversions that this clearance of the bush went ahead. In the bill before us the Government proposes to weaken the notification provisions further. This is the reality on the ground in New Zealand today. This is what is going on outside this House. We hear the rhetoric from National and ACT about the evil Resource Management Act and how it does terrible things, but the truth is that we are losing biodiversity rapidly, because the Resource Management Act is too weak. We need provisions to protect biodiversity on private land. That is essential if we are to protect the remnants of biodiversity. There are farmers right across New Zealand who protect biodiversity. They have Queen Elizabeth the Second National Trust covenants put on their land, they protect biodiversity, and they would be appalled by the actions of these farmers in knocking over this important remnant bush. They do not support that. But in this case, the farmers got away with it. They did it and it was not notified, and that is why we have to strengthen the notification provisions, not weaken them.

H V ROSS ROBERTSON (Labour—Manukau East) : In acknowledging the work that has been done at the select committee, let me say to the presiding officer that I acknowledge and recognise the important part he, too, plays in the debate.

This legislation will be dubbed the chainsaw massacre legislation, because it opens the way for people to be able to remove trees that they do not like. Many of us know the importance of a tree. As an electorate member of Parliament I have served Papatoetoe for the previous 22 years, Ōtara for 13 years, and Ōtāhuhu for just under 1 year. I can imagine some of the great trees that exist in Papatoetoe. I can envisage places like Kolmar Road, and also Wallace Road, where we have some wonderful oaks. Some of them overlap, and I can see some overzealous people now using this legislation to be able to remove those trees if they do not like them.

The Government is overreacting. Labour was accused of being a nanny State Government. We can now turn the tables and say this Government is a nanny State Government. This nanny State Government is putting forward this legislation and overreacting, using a sledgehammer to crack a nut. In Auckland, where population pressures are increasing, our small areas of vegetation are under great pressure. Six out of seven Auckland local councils have general tree protection. The Environment Court accepts the approach, declaring in favour in 2002 of an argument that general tree protection rules were necessary to achieve the purposes of the Resource Management Act. Clause 52 of the Resource Management (Simplifying and Streamlining) Amendment Bill will undo that tree protection.

It is not just my Labour colleagues or my Green colleagues who oppose clause 52. If we look at the New Zealand Herald, the headline on 7 September reads: “Tree law change aids ‘sneaky’ choppers”. I will quote from the article: “Homeowners whose trees are illegally chopped down by neighbours will no longer be able to count on council help once a proposed law change likely to become final this week is passed [into law]. The owner of Auckland’s biggest tree consultancy predicts more neighbourhood spats if the law scraps protection for trees of a certain height or size—and councils will no longer be able to step in. Stacy Colyer, whose Greenscene company is often called in to help with disputes, said there would be an increase in court cases over who owns large trees on boundaries.”

Although one can accept the need to simplify and streamline the Resource Management Act, I have found from experience that much of it comes down to the training of individuals in councils. It comes down to staff training, and being able to handle applications for resource consents.

Mr Colyer is concerned about clause 52. He says it means that in urban environments only trees or groups of trees that are specifically identified in a schedule of notable trees to a district plan in a reserve are protected by the Reserves Act. He says, and he believes, that some simple operational modifications could have been implemented to deal with the problem, rather than act in a way with the legislation and with what it is intended to do.

Mr Colyer has a lot to say. Some of what he says I agree with, and I think the Minister should take some notice of what is being said. We know that trees are important for the environment. We know that there is urban sprawl in Auckland. We know that there will be a time when those people who are developers will want to remove the trees. They will use any opportunity they can to ensure that that happens. If we look around at some other countries that have environmental legislation we see the importance of trees and why they are there. In a lot of the countries, vegetation, wildlife, and birds are affected by a lack of trees. As urban centres become more intensified, the challenges facing the Government are greater.

PHIL TWYFORD (Labour) : We have spent a lot of time in this Chamber over the last few months debating the Auckland super-city, and an enormous effort is going into creating governance structures for Auckland. But what do we find? Before the ink is even dry on the second super-city bill, this Government—this nanny State Government—is already intervening in a heavy-handed way to take away the powers that local government uses to govern its own communities. I think it was the Prime Minister who said that local decisions should be made locally. The Associate Minister of Local Government will be able to confirm that comment, because I have heard him repeating the same idea over and over. But what is happening? The Government is coming over the top with its big boots on, and overriding the powers of local government.

I quote Mr Chris Dempsey, who is one of several hundred Aucklanders who has emailed me in the last few days. He says: “Firstly, if the National Party would really like to place such a prohibition on enacting policies within district plans, then I invite the National Party to write the district plans for every TLA. As I pointed out in my submission to the select committee, for central government to interfere, nanny-like, with how TLAs reach decisions and make policies about things that are important to them, then the obligation is on the Government to do the work for the TLAs. The National Party cannot pick and choose. Either the party abides by its beliefs that the local communities know what is best for them, or it doesn’t.” I think Mr Dempsey makes a very good point.

It is worth asking why six out of seven Auckland councils use the general tree protection rules. Why do they? I have some answers. It is because those rules protect trees, and because the alternative—listing and scheduling those trees—is impractical and expensive. It is also because democratically elected councillors going about their work, and implementing district plans after considerable public input, find that those rules are actually the most effective tool open to them for protecting trees. Does that mean anything to National? No, it does not. There has been a lot of debate this afternoon about whether this is a strange Auckland phenomenon. Why should Auckland rely on these rules when the rest of the country does not?

I invite members opposite, and the Minister, to reflect a moment on why it is the case that six out of seven Auckland councils use these rules. Could it be anything to do with the population density in Auckland, where 1.4 million people are crammed into a little isthmus? Could it be anything to do with property prices? Could it be anything to do with the intense development pressures experienced in our country’s biggest city? I invite the Minister to take a drive along the motorway from Fanshawe Street towards the Harbour Bridge, and to look up at the cliffs of St Marys Bay. And members should not worry because the Minister is not driving; he is sitting in the back of his limousine. He will see there that rogue developers in the past have taken a chainsaw and cleared the cliff-tops in order to be able to provide a clear view for their clients. That is the kind of development pressure we face in Auckland; Aucklanders know that.

The existing general tree protection rules have not prevented every mishap of that kind, but they have prevented many of them. Nikki Kaye, the member for Auckland Central, will have to explain to the good people of Herne Bay, Freemans Bay, and St Marys Bay why the cliff-tops will lose their pōhutukawas after the bill is passed. I have news for the Minister. Once the clause is passed there is no safety net. It will all be over; there will be nothing left to protect the trees of Auckland. Councils have made it very clear that they will not be individually listing trees in anything like the volume that is needed and in a way that currently protects those trees. It is a crazy, expensive, impractical, and bureaucratic approach to solving the problem.

When the Minister spoke early in the day he was completely disingenuous in claiming that 5,000 resource consents every year were needed to deal with the trimming of trees. This debate is not about the trimming of trees, but that is what the Minister said. Already in the select committee Labour members and Green members have made it very clear that they are not opposed to lifting some of the restrictions around these provisions, but the Minister has rejected a compromise proposal that would have made tree trimming a non-consented activity.

Hon Dr NICK SMITH (Minister for the Environment) : I want to challenge a number of the quite ridiculous notions that have been put forward again about the issue of tree trimming. Let me just flick through a few of them. Essentially, Labour is arguing that unless councils love trees we will not have trees. It is a bit like arguing that people would not paint their houses unless there was a council law that required them to paint their houses. Actually, people do paint their houses. They paint their houses to look very nice. It makes the community look good. But does that mean that our Parliament and our councils have to have a whole lot of rules, regulations, and Acts of Parliament to ensure that people paint their houses? No, it does not.

Hon David Cunliffe: You’re the one with the mandate override.

Hon Dr NICK SMITH: I say exactly the same to the member who is continuously interjecting. Labour members essentially do not, at heart, trust New Zealanders. That is the heart of the issue. They say to them that we need a nanny State Government and nanny State councils to introduce blanket rules, because nobody is capable of making decisions about their trees unless there is some bureaucrat who is able to give them consent or not.

Then another extraordinary argument was put forward, which was that on 1 October we will see a massacre of trees. I say to any member of the Labour Party that I will bet them the best bottle of Nelson wine that their tree massacre comments are utter rubbish. Will the member Phil Twyford take me on? He is silent. He is absolutely silent. He knows that his claims are ridiculous. Then the member said that this debate is not about having to get—

Hon David Cunliffe: I raise a point of order, Mr Chairperson. The member knows that the implementation date of the bill is 2012. Would it be possible to re-offer the bet—

The CHAIRPERSON (Eric Roy): That is not a point of order. The member knows that it is not a point of order. The member has been here a while. The member is on the front bench. The member has raised a debating point as a point of order in order to interrupt someone’s speech. It is a free-flowing debate. I like it for that reason. People are having a robust debate. Let us continue, please. That is a message to all members.

Hon Dr NICK SMITH: The members opposite say that it is nothing to do with tree trimming. It has everything to do with tree trimming, because for the 9 years that Mr Cunliffe was in the Cabinet room 5,000 New Zealanders each year had to get a resource consent to trim their trees.

Phil Twyford: We support tree trimming.

Hon Dr NICK SMITH: Well, the question I ask members on that side of the Committee is what they did about it. What did they do about the frustrations of the New Zealanders who, for 9 long years during the course of a Labour Government, had to get a resource consent to trim their trees?

The answer is that the nanny State Labour Government ignored the concerns of those New Zealanders and required that they get a resource consent for the purpose of being able to trim their tree.

The other extraordinary point is that those members claim we are overriding the wishes of councils. The Auckland City Council, which is the largest council to be affected by these provisions, has made a submission to the Local Government and Environment Committee and stated that the rules do not work and that it supports the bill and the changes. I ask how it is possible for Labour members to argue that we are overriding councils, when the largest council to be affected by the changes supports the changes.

Another point I would make is to do with the quite pathetic point put forward by Labour that this Parliament has no right to consider what powers councils should or should not have. That is nonsense. It goes to the core of the responsibilities of this Parliament to define which things it is proper for councils to be able to do, and which things it is proper for councils not to be able to do. Government members say that if citizens want to trim their trees, then they should not have to get resource consent, and councils should not be able to require them to. We say further that if the Government wants to limit the powers of councils to be able to put rules in place without consulting with landowners, then it can. I know that land ownership is not a concept that weighs heavily on members of the Labour Party. All we are saying is that if a council wants to protect a tree or a group of trees, there is a very simple provision in this law. It simply says that if councils want to protect a tree or group of trees, then they should talk with the landowner. Is that such a novel, unusual concept? If councils want to pass a rule that directly impacts on a person’s property, then they should talk to that person. They should consult people.

Phil Twyford: The member knows it won’t happen.

Hon Dr NICK SMITH: The member opposite says that cannot occur. Well, I ask Mr Twyford how it is possible that every single council supports this, including Christchurch. Let me go through the list: Palmerston North, Napier, New Plymouth—

Phil Twyford: Christchurch hasn’t added one tree in 10 years.

Hon Dr NICK SMITH: Let us take up that point. The member makes the claim that the Christchurch City Council has not protected a single tree in 10 years.

Phil Twyford: Not one extra; not one extra in 10 years.

Hon Dr NICK SMITH: Oh, well let me tell the member what happens. The Christchurch City Council—and I had lunch today with Mayor Bob Parker—points out that—

Hon Darren Hughes: Who paid?

Hon Dr NICK SMITH: Is that not typical of the senior Labour whip? All he is concerned about is that pathetic point. Here we have Parliament debating an issue that is costing millions of dollars, and the great intellectual contribution from Darren Hughes is to ask who paid for the lunch. Well, if that is as good as Labour members’ debate gets on this bill, then I can be assured that people will not be voting for a change of Government for a very long time.

I want to deal with the issue of the trees in Christchurch, because the truth is this.

Phil Twyford: There are fewer of them.

Hon Dr NICK SMITH: No, hundreds of trees have been protected in Christchurch, and I will tell members how. Again, this is an area where Labour members are ignorant of the law. Every time a resource consent is applied for, as a condition of that resource consent, many councils properly require the protection of trees. That is—

Hon David Cunliffe: Why is this member the only one talking from the National side?

Hon Dr NICK SMITH: Are the members of the Labour Party not truly pathetic? When I do not take calls they complain, when I do take calls they complain, and they try to interject to the point that I cannot answer the questions from the member. I will come back to the issue. The Christchurch City Council has protected hundreds of trees in the last 10 years. The member is incorrect.

Hon David Cunliffe: He hasn’t scheduled a single one.

Hon Dr NICK SMITH: Well, Mr Cunliffe asks whether the council has put them on the schedule. I am not sure that the public actually cares whether they are protected as a consequence of a condition of a resource consent or whether they are scheduled. From the public’s point of view, their concern is whether the tree has been protected.

The last point I would make is that Labour members have claimed—and we have just heard this from one of them—that a neighbour would not be consulted about the removal of a tree. Well, I will give those members some news: under the current provisions the neighbour is not consulted either. In all those 5,000 resource consents per year in Auckland to either trim or remove a tree there is not a single case where the neighbour is required to be consulted. What is more, in 97.6 percent of the cases the consent is granted.

LYNNE PILLAY (Labour) : The Minister in the chair, the Hon Dr Nick Smith, is clearly not listening to what this argument is all about. This clause is being held up by the Government as some sort of trophy for cutting red tape and bureaucracy, and also as a promotion of individual and property rights. I see the Minister is looking attentive. I ask whether he can explain to the Committee how the requirement of councils to identify trees in groups or individually throughout the whole of the Greater Auckland region is not bureaucracy. The task would be hugely time-consuming, expensive, and complex, and it would be impossible to carry out effectively and efficiently.

Now the Minister is saying that he wants a progress report from councils every 6 months. Under the new one city, we will have Len Brown as the mayor, and after a few months he will ask what is going on, as his budget will have been absolutely blown-out on identifying and protecting trees. The hard-working council workers—those who have kept their jobs—will say that they are going out to meet all the property owners and have a nice cup of tea with them and a jolly good chat, but that there are thousands and thousands of them. The council workers will say that they have not got through them all or identified all the trees, but that they are talking to them. That is where the expense is. When the Minister next takes a call, I would like him to explain that point very clearly, because I think that he talked about having a cup of tea with property owners—

Hon Dr Nick Smith: I’ve never said that in my life.

LYNNE PILLAY: —or having a good chat with them.

Hon Dr Nick Smith: I never said it.

LYNNE PILLAY: If the Minister goes to Waitakere, I am sure that the property owners there will ask him whether he would like a cup of tea, and they will ask the council workers that. But the reality is that the process will take huge, huge amounts of time.

So many Aucklanders from right across the region, from every city in the Auckland region, have sent piles and piles of emails. They have held meetings, they have written to MPs, and they have telephoned MPs. I am proud of my west Auckland colleagues and my Greater Auckland colleagues who have listened to the people and are running the argument here. I have to say that not one National MP from Waitakere has answered those people’s calls or listened to them. My colleagues are the people who are there to represent westies. The people who have contacted me and my colleagues have not just been critical. They have offered sensible solutions and proposals, such as expanding the exemption list to include exotic trees, increasing the list of notable trees, and removing tree protection from areas that are low in character. All of those suggestions fell on absolutely deaf ears and were completely disregarded by this Government, which is a Government that talks about central government not being nanny State. Yeah, right!

The irony of it is that the councils and community groups throughout Waitakere are working really hard at the moment and are putting considerable resources into identifying the cause of the disease that is killing many, many kauri in the ranges. Why bother? I ask why they are bothering to go to all that trouble when any individual under his or her individual property rights can cut down the tree anyway. Why are they putting in that time and resources? When the Waitakere Ranges Heritage Area Bill was in its early stages, and it was supported by the vast majority of westies, Nick Smith rode into town, and did he ever whip up a storm! “Confiscation by stealth” is what he said. The minority of people who believed him were so inspired that they got signs made that said “confiscation by stealth”. Just like his leader—

Hon Dr Nick Smith: Stop making it up.

LYNNE PILLAY: The Minister says that he did not say it. Is the Minister saying that he never said that?

Hon Dr Nick Smith: That’s correct, I’m saying you should stop making it up.

LYNNE PILLAY: The Minister said he never said it.

Hon Dr Nick Smith: You should stop making it up.

LYNNE PILLAY: OK—just as his leader said “socialism by stealth”. Did anyone in Waitakere have their land confiscated by the enactment of the Waitakere Ranges Heritage Area Act? Absolutely not.

I hope that my amendment will not be necessary, because of the Green Party’s amendment and the amendments of my colleagues—my very good colleagues, who have put great amendments on the table. I hope the Government will support those amendments. In the event of that not happening, my amendment—and this amendment was requested by the Waitakere City Council—seeks to enable councils to identify trees in a more achievable, less bureaucratic, and less red-tape sort of way. If that can happen by way of a map, then it will not be easy, but it will certainly make the provisions in section 52 more achievable. I hope that my amendment is not necessary, because I hope the amendments that give more protection to trees will be carried through the Committee.

It is ludicrous to hear not only the Minister but many MPs compare Timaru with the pressures of Auckland development. I have been to Timaru; it is a fabulous place, but we can in no way compare the development and the population pressures in the Auckland region with that of Timaru. A third of the country’s population is in Auckland. The pressures of development are astronomical. One of this Government’s many slogans has been about allowing local people to make local decisions.

Hon Tau Henare: That’s right, we’re going to make a local decision.

LYNNE PILLAY: That is right!

Hon Tau Henare: If I want to chop my tree down, I’ll chop my tree down.

LYNNE PILLAY: I say to that member to speak out again. Yet central Government is taking that right away from—

Hon Tau Henare: If I want to prune my trees, I’ll prune my trees.

LYNNE PILLAY: I say to that member, Tau Henare, to speak out again. Central Government is taking that right away from locally elected councils and citizens who want to ensure that trees and our environment are protected. We all know that trees reduce urban pollution, stabilise soil, give shade and privacy, and are integral to the well-being of our communities. The reintroduction of many species of native birds, and the well-being of tūī and wood pigeons, happens because we protect trees in our environment. In Waitakere the trees on private land are vital—

Hon Tau Henare: What wood pigeons? You killed them all 100 years ago!

LYNNE PILLAY: They may not have them in Te Atatū. The trees are on private land and they are vital to ensure a buffer between an urban area and the regional park. Any schoolkid in New Zealand can tell this Government why tree protection is so important in urban areas. Those same students had got their heads around climate change, and were doing meaningful projects and tackling climate change when this Government was still a climate-change denier. My property in Titirangi—[Interruption] It is the weaving of the tree roots that stabilises the soil on the bank that it stands on. If the council did not have the time and resources to get around to my place and put it on the list—because thousands of properties, as we all know, need to be done—and if I had decided that it was my individual right to cut those trees down, what would be at risk? At risk would be beautiful trees that are hundreds of years old, and the erosion of not only my property but also my neighbour’s property. There would be very serious problems, including landslides and potential flooding, to say nothing about the risk to birds or the ghastly blot on the landscape.

Before the Waitakere Ranges Heritage Area Act, the Waitakere Ranges were being really cut away at. The Parliamentary Commissioner for the Environment referred to the axing of those trees as “death by a thousand cuts”. The implications of clause 52 being enacted would lead to just that, but it would be across the whole Auckland region—“death by a thousand cuts”. I urge the Government and the Minister to take heed of the speeches, and to support the amendments that are before the Committee.

Hon Dr NICK SMITH (Minister for the Environment) : That was such an extraordinary contribution from Lynne Pillay that I just have to respond. First up, she claimed that kauri in the Waitakere Ranges are at risk. What total garbage! Not one tree in the public areas of the Waitakere Ranges is affected one iota by the Resource Management (Simplifying and Streamlining) Amendment Bill, which is before the Committee.

The second point I make to the member is to ask why, if Labour is so opposed to clause 52, every Labour member of the Local Government and Environment Committee voted for it. If the bill will bring about the end of the world as we know it—

Hon Member: Death by a thousand cuts.

Hon Dr NICK SMITH: —and “death by a thousand cuts”, as Lynne Pillay has said, why did every member of the Labour team on the select committee vote for it?

Thirdly, Lynne Pillay wants me to respond quite specifically to her amendment. It is truly “Einsteinian” and truly intellectual. It will really stretch the limits. She wants to change the wording in the bill so that councils can schedule or provide for trees in plans and can use maps. That is a good one! I have to advise the member that I am legally advised that her amendment will have absolutely zip effect, and that it is perfectly possible within district plans—

Lynne Pillay: Then pass it—support it.

Hon Dr NICK SMITH: The member says we should pass her amendment. She says we should pass an amendment that will do absolutely nothing. I do not know whether she has noticed, but if we look at any one of our district plans what do we see?

Hon Members: Maps.

Hon Dr NICK SMITH: Maps. So I am not sure whether the Government will be choosing to include an amendment that provides for maps, although I reassure the member that councils will continue to be allowed to have maps in their district plans.

A further point I will make, which is about something that seems to have focused the mind of the member, is about how councils will be able to make provision for the protection of trees in the process that is used by 90 percent of councils. Let me make it very plain for her. With great relief, on 1 October Aucklanders will no longer have to apply for resource consents to trim their trees. As a consequence, I am advised that the work of about a dozen staff and about $2 million of resource will no longer need to be applied to that meaningless function. The staff will no longer have to do that work. I think everybody—homeowners and others—will be relieved about that change.

I simply ask that rather than those council staff members doing that meaningless task they do a worthwhile job—that is, get round their suburbs, their beautiful areas of Auckland, and whip around with a very simple device, a locator, and find out from the council plans where those significant trees are that we really should be protecting. I have confidence that they will get on and do that.

The last point I will make is that Lynne Pillay and others have quoted a number of arborist businesses that are desperately opposed to this provision. Well, of course they are. When people are required to get an arborist’s report to be able to trim or remove a tree, the average cost for them is over $1,000. I am advised that those businesses at the moment are earning over $5 million a year from the current requirement of the law. Are we as a Parliament surprised that those businesses would like the law to remain the same? I am not. Of course they want that to be the case, but the decision for this Parliament is not about the interests of those arborist businesses. They are not of concern to me; what concerns me is—

Phil Twyford: What about all the citizens?

Hon Dr NICK SMITH: —exactly—the ordinary citizens we are empowering through this provision. But where I think Mr Twyford and I differ is that he says that citizens will protect their trees only if there is a busybody bureaucrat from a local council telling them that they have to look after their trees; members on this side of the Chamber say that the vast bulk of Aucklanders value and want to protect their trees and do not need a nanny State Labour Party or a busybody bureaucrat telling them to do so.

Dr KENNEDY GRAHAM (Green) : This is the first time that I have intervened in this debate. I will address some general issues in the first instance pertaining to environmental protection and sustainable management as they are involved with the Resource Management (Simplifying and Streamlining) Amendment Bill. I may address some specific issues later pertaining to ministerial powers of coastal protection.

The stated purpose of this amendment bill is to simplify and streamline. “Simplify” means to make something less complicated and easier to understand, reflecting a characteristic belief on the part of this Government that New Zealanders are inherently unable to comprehend anything that may approach a complicated level. “Streamline” means to shape something so that it can move as effectively as possible through liquid or gas. The purpose did not say anything about red tape. The Minister for the Environment, in sponsoring the bill, noted in his first reading speech: “Over the nearly 18 years since the Resource Management Act became law, there has been growing criticism across all sectors about the slow and costly plan preparation and consenting processes.” He warned: “Decision-making processes … must become more efficient.” The bill, he exalted, would provide a timely support to measures to stimulate the economy. He concluded that “stronger tools for managing anti-competitive behaviours and new consent pathways,” were required.

My main contention is that the bill represents the Government’s rather distorted view of reality. The Government, since its election in November, has essentially conveyed two mantras into this House. One mantra is that we need to balance economic opportunity with environmental responsibility. The second mantra is that we have to remove the nanny State. Those two mantras inform this Government’s approach to pretty much everything. It brings the mantras with the claim that it has an electoral mandate to articulate them. It sees the Resource Management Act as a central strut of this Government’s implementation of that philosophical orientation.

That approach suffers from several mistakes, both of logic and of political judgment. The logical mistake is the following: the economy and the environment are not separate and discrete entities that can be balanced. There is only one thing; there is only the environment. That is the reality. The economy is simply human activity within the environment. If humans display such hubris that they can pretend to live and grow outside the environment, they will perish. If humans display even a lesser amount of hubris, and think that they can engage in economic activity and then tend to the environment separately and subsequently, they will suffer. To use the jargon that even the erstwhile Association of Consumers and Taxpayers can understand, the economy is a subset—that is to say, it is a wholly owned subsidiary of the environment.

The second mistake is a political mistake: the belief that the nanny State is the central threat to the New Zealand people. What arrant nonsense! It is true that Labour developed a reputation for being a nanny State, and I think it indeed befitted the assertive leadership of 9 years of the previous Government. It got a belly laugh in the course of 2008, and a negative vote in the November election. What about the rest of us? How are we best described using similar imagery? The erstwhile Association of Consumers and Taxpayers is best described as the robber baron State: those who wish for unbridled freedom to make excessive personal wealth. National is best described as the cowboy State: those who wish for freedom to desecrate, then modestly pretend to clean up the environment afterwards.

RAHUI KATENE (Māori Party—Te Tai Tonga) : I stand to speak to Supplementary Order Paper 47 in the name of my colleague Te Ururoa Flavell, which inserts new clauses 5A and 5B into the Resource Management (Simplifying and Streamlining) Amendment Bill. These amendments are critical to strengthening requirements for all persons to uphold the Treaty of Waitangi in the implementation and administration of the Resource Management Act. We will be putting forward these Supplementary Order Papers; I will speak to them now.

The House will no doubt recall the advice of Sir Robin Cooke in 1990 on the occasion of the 150th anniversary of the signing of Te Tiriti o Waitangi. He said of the Treaty: “no matter precisely how it should be categorised in law, it has taken on in fact a vitality and a potency of its own … it has become part of the essence of national life … it is a foundation document. It is simply the most important document in New Zealand’s history.” The amendments we hope the Committee will support today are in essence the commitment to uphold the Treaty as simply the most important document in the land. The amendments address the concerns of whānau, hapū, and iwi that resource management appropriately reflects obligations under the Treaty of Waitangi.

Currently, section 8 of the Resource Management Act 1991 requires that the exercise of functions and powers under the Act take into account the Treaty principles. These three words—“take into account”—are part of a suite of concepts and phrases that constitute the menu of Treaty clauses in legislation. Other legislation includes phrases such as “to give effect to the principles of the Treaty of Waitangi”, as in section 4 of the Conservation Act 1987; “to give particular recognition to the principles of the Treaty of Waitangi”, as in section 10(o) of the Royal New Zealand Foundation of the Blind Act 2002; “have regard to the principles of the Treaty of Waitangi”, as in section 4 of the Crown Minerals Act 1991; and “Ensure … full and balanced account is taken of—(iii) The principles of the Treaty of Waitangi;” as in the preamble to the Environment Act 1986.

The Government has a responsibility to uphold the Treaty relationship and tangata whenua rights. Throughout the select committee process there was a very strong theme in the submissions from Māori that the Crown guaranteed to protect the special relationship between tangata whenua and their landscapes and natural environments through te Tiriti. The Government has agreed that the Treaty of Waitangi is the basis of resource management law and practice. The Māori Party was extremely pleased to be able to safeguard the Treaty provisions earlier on in the process of the bill.

We propose these changes now in light of feedback from the select committee stage, in order to strengthen the provisions. We propose a new clause 5A to the effect that this Act now binds the Crown in respect of “The Treaty of Waitangi relationship between hapū and iwi Māori, and the Crown.” We also propose to add new clause 5B, which repeals section 8 and substitutes the following: “In achieving the purpose of this Act, all persons exercising functions and powers under it, in relation to managing the use, development, and protection of natural and physical resources, shall give effect to the Treaty of Waitangi (Te Tiriti o Waitangi).” We look forward to the debate as we introduce these provisions to strengthen and uphold the Treaty of Waitangi.

DAVID SHEARER (Labour—Mt Albert) : I rise to support my colleagues in calling for the removal of clauses 52 and 151 of the Resource Management (Simplifying and Streamlining) Amendment Bill. Labour has always opposed those clauses. It did not vote on the clauses; it voted on the bill as it went through, part by part. I also rise in support of the hundreds, if not thousands, of people who have written in and have been in contact with us to oppose clauses 52 and 151. I spoke at a meeting last week in Grey Lynn, in the heart of the Auckland Central electorate, and my colleagues David Cunliffe, Russel Norman, and Phil Twyford were also present. People were opposed to, angry at, and very saddened by the fact that many of the trees in their area were going to be removed.

Phil Twyford: Were there any National MPs there?

DAVID SHEARER: My colleague asks, interestingly, whether any National MPs were there, and the answer is no, there were none, unfortunately. People were disappointed that National MPs were not there, because they wanted to tell them what they felt about clauses 52 and 151—that they did not want them. Essentially, those clauses remove the council’s right to put on a blanket ban to protect trees.

The question, and it is a fundamental one, is why central government is telling councils what they should and should not do. What is wrong with councils being able to respond to their own communities and put in tree protection legislation that fits their local communities? Six out of seven Auckland councils currently have blanket tree protection. Rodney District Council removed it in 2000, but put it back in 2007. Why? Because popular opinion said that it was the best way to protect trees. Now, either the councils are stupid, or they do not understand good tree protection—or are they doing what works best for them? We have to ask ourselves that question.

Auckland is different from much of the rest of the country, and my colleague Phil Twyford mentioned some of those differences. Auckland contains one-third of New Zealand’s population. It is a high-density population, and the demand for development is more acute than in any other place in the country. There are development pressures. The extra value placed on a property that has a view after the removal of trees is way above what we would find in any other place in the country. Auckland has a high rainfall and young soils. It is hilly, and those hills are very susceptible to erosion. That is why its councils prefer to have blanket protection for trees. Trees protect the environment that is so precious to Auckland.

Hon Dr Nick Smith: Why does Auckland City Council oppose it?

DAVID SHEARER: Auckland City Council could change it, if it wanted to. Manukau City Council is for it, North Shore City Council is for it, and in 2007 Rodney District Council voted it back in. Why is this Government talking about removing it? I do not understand it.

Phil Twyford: Nanny State.

DAVID SHEARER: It is not a nanny State; it is a “ninny State”. It does not make any sense. The alternative is to schedule individual trees. Members should think about the bureaucracy that is involved with individual trees, or even groups of trees, as suggested. Members should think of the bureaucracy it will take in order to be able to do that for each of those trees, or groups of trees. It is time consuming, it is bureaucratic, and it is costly. Members should think of the litigation that will be involved when somebody arrives at somebody’s property and demands that their tree be scheduled. What will their reaction be? They may not want it to be scheduled; they will appeal it. There will be an enormous amount of litigation, which councils will have to fund. As my colleagues have said, it is a sledgehammer to crack a nut.

Hon CHRIS CARTER (Labour—Te Atatū) : I am not going to talk about trees, although, as members of this Committee know, I am a passionate believer in trees—particularly endemic species of trees—being saved.

I want to talk about the very serious matter of the removal of the Minister of Conservation’s decision-making powers in respect of coastal consents for restricted coastal activities. I stand in support of the two Supplementary Order Papers that have been put up by my colleague David Parker and Rahui Katene from the Māori Party. They have both said, and rightly so, that it is very important that the Minister of Conservation, in representing the public interest—the Crown ownership of our coastal space—has the ability to exercise that judgment on behalf of the people of New Zealand.

I feel well qualified to speak on this matter. For 3 years, from 2002 to 2005, I was privileged to be Minister of Local Government. Indeed, the current Local Government Act stands in my name. I was also Minister of Conservation between 2002 and 2007. During that time, as Minister of Conservation, I signed offmany significant coastal activities. Some of them I declined—for example, at Whangamata. It is very important. I know that the Minister in the chair, the Hon Nick Smith, who is responsible for this legislation, has also served as Minister of Conservation and will have exercised the responsibility of judging what impact a significant coastal development would have on the unique landscapes, the biodiversity, and the coastline itself.

One of the things that defines us as New Zealanders is the coast. Ask any Kiwis what they love about our country and they will inevitably mention the landscape, and almost always the seascapes. No part of our country is more than 90 kilometres from the ocean, so the beach and the coastline are very important to New Zealanders. The coastline, as many members know, is under increasing developmental pressures. It is under pressure from residential and commercial development, aquaculture, and intensification of population. All of those are impacting on the decision making of local government. I think that retaining the ability of the Minister of Conservation to give guidance to local government in the consent process is absolutely critical.

The New Zealand Coastal Policy Statement is the only planning document local government has to guide it in its decision-making process. When I became Minister I asked for that policy to be updated. We have gone through a long process. Dr Jo Rosier, a planning lecturer at Massey University, updated the Coastal Policy Statement. We then set up a team of four experts to look at her recommendations. Interestingly enough, the current Minister of Conservation has postponed the report of that committee. The report of that group of experts guides the Minister of Conservation in giving guidance to local government. It is about protecting our unique coastline. It is about giving guidance to local authorities. That has all gone in this change in the legislation before us.

I think it is amazing that Nick Smith is the Minister responsible for this legislation. He has spoken to me personally about his pride during the time he was Minister of Conservation and his love of the environment. He is weakening the protection of our coastal areas. For the New Zealanders of the future, that could be an enormous liability. One of the things I regarded with great pride about being Minister of Conservation was the legacy that we leave for future generations, whether it is in biodiversity protection; whether, in my case, it is the 360,000 hectares we added to the conservation estate; or whether it is the 17 marine reserves I created as Minister with the support of my colleagues. That sort of stuff lives on for future generations. Protecting our seascapes from inappropriate development is an absolutely critical thing to do in Government. It is a responsibility for future generations. Nick Smith is weakening that ability by removing from the legislation—

Dr Russel Norman: Mining! Don’t forget the mining.

Hon CHRIS CARTER: The Green Party co-leader brings up mining.

Hon Dr NICK SMITH (Minister for the Environment) : I am truly gobsmacked that Labour would put Chris Carter on his feet to defend the ministerial veto on coastal consents after the way in which he abused his powers in the previous Parliament as Minister of Conservation. In one foul act he destroyed confidence in the law and actually created the constituency in which this bill occurred.

Let us just go through the history of what occurred with Whangamata. Environment Waikato dealt with the resource consent on that marina. It received hundreds of submissions, and it heard submissions. The decision was appealed to the Environment Court, the Environment Court heard evidence for 6 weeks, and then the Environment Court judges made their decision. Then what happened was that a few of Chris Carter’s Labour mates, particularly Bob Harvey—

Hon David Cunliffe: Why is this relevant?

Hon Dr NICK SMITH: I will tell him why this is relevant. It is because we are removing the ministerial veto on coastal consents over decisions of the Environment Court because of the way that Chris Carter abused the law. Is that what I said? No, it was what the High Court of New Zealand said in overturning his abuse of the law. You see, the High Court found out that a few of Bob Harvey’s mates went around the back door and sent him some quite appalling emails. They were people who had not bothered to submit before the council committee. They were people who could not be bothered with going to the Environment Court but thought they could get around it and with subterfuge affect the process by being able to overturn the decision.

What was even more interesting was that the Environment Court considered the matter for 6 weeks. How long did Mr Carter take to overrule the decision of 6 weeks of consideration in the court? It took less than a few hours. I simply ask Mr Carter and other Labour members why they do not trust the Environment Court. Why does Mr Carter not trust the Environment Court? You see, what members on my side of the Chamber are saying is that we have faith in the Environment Court, and we do not think we should retain the power to overturn decisions of that court. Effectively, Labour members are arguing that they do not trust the Environment Court and that they want politicians to be able to veto those decisions. I think that is appalling. I make a simple point to Mr Carter. I wonder what the attitude of Labour members would be if a coastal consent, an application for a marina, a marine farm, or a big port, went all the way through a resource consent hearing, and went to an Environment Court hearing, and a National Minister said that even though the Environment Court said no to the consent, National says yes. I will tell members what would happen. Labour members would be crying foul from the rooftops. I bet every member of the House—and, frankly, every member of the House knows it in his or her heart—that that is exactly what would occur.

That is why we ask, from quite a principled point of view, why Ministers should overturn decisions of the Environment Court. We say they should not. We say that when Chris Carter vetoed the decisions of the Environment Court he actually brought both politicians and the judicial process into disrepute. That is why that provision should come out of the law.

Hon DAVID PARKER (Labour) : I will respond to the point the Hon Nick Smith made. We are not saying that Ministers should reverse the decision of the Environment Court—

Hon Tau Henare: Yes, you are.

Hon DAVID PARKER: No, we are not. The Minister’s decision to veto is a different decision. It is not the same decision as the Environment Court’s; it is a different decision. The Environment Court’s decision, as the Minister in the chair, the Hon Nick Smith, has already acknowledged, is severely constrained as to its breadth. The Minister’s decision is not the same decision as the decision of the Environment Court. But there are some situations in which the Crown, through the relevant Minister, in this case the Minister of Conservation, should have the right to veto developments in coastal space.

Hon Dr Nick Smith: Veto the court?

Hon DAVID PARKER: No, not veto the court; veto the right to develop coastal space. It is a different thing. Lots of things are permissible on my land under the Resource Management Act that I, as an owner, none the less say I do not want and will veto. That is the same position the Minister of Conservation is in, within a limited jurisdiction—

Hon Dr Nick Smith: That is not correct.

Hon DAVID PARKER: It is. It is a limited but real power of the Minister of Conservation to sometimes say “No, I don’t think this is in the public interest.” That is the responsibility of Government, but this Government is saying “No, that’s all too hard. We never wanted to be involved in those decisions. We don’t think there is ever a case for the Crown, as the guardian of these areas, to say no.” The Government is going to devolve that decision to someone else and not have to take responsibility for it. That is what the Minister is doing; he is abrogating his responsibilities.

I will turn to another issue. We have a 45-page Supplementary Order Paper here for the Resource Management (Simplifying and Streamlining) Amendment Bill, and we are not really sure what some of it means. A 45-page Supplementary Order Paper was dumped on us, with no tracked version to show the effect of it on either the Act or the bill. We have had substantial criticisms about the legislation—not from people whom the Minister might like to criticise as being lightweight but people like former judge Peter Skelton. I did a lot of work in the environmental field in the 1980s. I can say that Judge Skelton, who is now retired, was the best judge I ever appeared before. He is widely respected. He is now—or was until recently—an adjunct professor of planning law, so he went on to a distinguished academic career.

Peter Skelton turned up to the Local Government and Environment Committee and said that the bill was poorly drafted. I do not totally blame the Minister for its poor drafting because I think there are some institutional problems that lie behind it, which also vexed the previous Government and are yet to be sorted. Peter Skelton criticised the drafting of the bill and said that it did not achieve its policy purpose because it was so complex, so otiose, and so poorly drafted that even things that it was supposed to achieve are sometimes not being achieved.

He was not alone in that view; a few other people were of that view too. Through the intervention that was led, in part, by Shane Jones, one of my colleagues, the select committee, with the approval of the Government—and I thank Government members for that—agreed that it should harness the efforts of a group of experts, including retired judge Peter Skelton, to try to sort out some of those problems. They did sort out some of those problems, but they have not had a chance, any more than we have, to have a look at these 45 pages of new drafting. So how can we have any confidence, as we deal with the bill under urgency, that we are not actually making things more complex and creating more problems rather than fewer?

I will give one particular example. We have had the very important change of wording in the notification provisions brought to the Chamber just today in a Supplementary Order Paper. There is a fundamental change of onus from consent authorities stating that there may be environmental effects as a result of an activity, to environmental effects having to be proven to exist or to be likely. The effects have to be probable rather than possible. That is a big change in the legal test. We have not had any advice from the group of experts as to whether the Supplementary Order Paper is properly drafted, even if that is the policy intent.

I will mention another thing. New section 95D, as inserted by clause 68 of the bill, states that when assessing whether the adverse effects are minor, one “must disregard any effects on persons who own or occupy the land in, on, or over which the activity will occur; or any land adjacent to that land;”. I spoke to my colleague Jeanette Fitzsimons, who is very learned in these matters—and I do not think I am a complete prat on these matters. I cannot find in the legislation the other provision that is meant to go with that one and that deals separately with the effects on the land itself and the adjacent land. I am told by Jeanette Fitzsimons that she thinks that somewhere there is an alternative provision that deals exactly with that point and that deals with the effects on the land on which the activity will occur or the adjacent land.

The difficulty we have in the Opposition is not just the difficulty of finding our way through this complex amendment bill; we now have 45 pages of amendments, including amendments to this particular clause, which is fundamental to notification and therefore fundamental to whether people learn through notification about an application that might affect them or the environment, and we do not know whether they have a right to participate in the process.

The test to be applied by the councils is being changed, and there is a lack of clarity as to what happens if one is an owner of land adjacent to where there is activity. If a person is an owner of more distant land, it is clear what the test is now. We might not agree with the test, and we might think it has been forced upon us late in the process through a Supplementary Order Paper under urgency, but in respect of adjacent land we are less clear. So I ask the Minister to clarify that situation. He may well be able to do so with advice from officials. The provision may be unaltered from the original Act. That may well be the answer, but it is very difficult for us to know, and I think it is unreasonable for us to have to deal with these matters on the floor of the Chamber when the 45-page list of amendments ought to be referred back to the select committee so that the select committee, including members of the Opposition, can get the benefit of hearing from advisory experts like retired judge Peter Skelton and so we can make sure we are getting the legislation right.

The Resource Management Act is the cornerstone of environmental legislation in New Zealand, and we ought not to be amending it on a wing and a prayer. We know from the Minister that he is driven by the promise he made to have this legislation in the House within 100 days and passed within 6 months. I say to the Minister that we will forgive his not meeting that deadline. It is more important to get the legislation right than it is to preserve the Minister’s dignity about the promise he made for it to be passed within 6 months.

I remind the Minister of the comments he made in respect of the emissions trading legislation. He put exactly the same accusations to the previous Labour Government—and we were not proceeding under urgency, the Supplementary Order Paper was smaller, and we had provided tracked changes to the bill in order to show the effects on it of the amendments. None of those protections is available to this Parliament today, and I think it is an abuse of our processes that the Minister is proceeding in this way.

Hon DAVID CUNLIFFE (Labour—New Lynn) : During the Committee stage there is often a point where it is useful to start to gather together some of the rebuttal that comes across the Chamber. The Minister said earlier that he was gobsmacked. I might observe that if he were my child I would be tempted to change my vote in the referendum. He was using several porkies that, I think, he knows were never true. He has accused the Labour Opposition of opposing tree trimming. That is just ridiculous. Labour supported it in the select committee, and we support it now. We have said two things. We said, firstly, that it would be useful to have a definition of “trim” and a definition of “fell”, because I would not trust that Minister not to cut something from 50 metres to down to 2 metres and call it a trim. So some guidelines would be helpful. He said that the Labour Party supported clause 52 in the votes at the select committee, which was ridiculous, because it was a part by part vote. We were never given the opportunity to vote for or against the clause. What we did do in the select committee’s report was clearly reserve on the point and clearly show that we disagreed with that matter.

Hon Dr Nick Smith: No.

Hon DAVID CUNLIFFE: That is absolutely true. But the Minister’s furphies go on and on. He has used the argument that very few tree consents are declined, and, therefore, substantial expense is incurred for little benefit. What he has failed to tell the Committee is that, as an overall percentage, a higher rate of general planning consents are passed than tree consents. So by the logic of his argument we would not have any planning processes at all because it is all a waste of time when most are granted. The second point is that the Minister has omitted to tell us that many of the ones that were passed were modified and passed in modified form, and that, therefore, the process is not only real but valuable. He said that no tree rules exist in 90 percent of councils, so there is no need to have them all. There are two problems with that.

Hon Dr Nick Smith: No—no blanket rules.

Hon DAVID CUNLIFFE: Yes—no blanket rules. The first problem with it is that all areas are not the same. The reason the district councils surrounding Waitakere wanted Parliament to pass the Waitakere Ranges Heritage Area Bill was that the pressures of development on the boundary of the bush were uniquely strong and acute in that area, and that is why this House only last year, by majority, voted that bill into law. Having put that bill into a correct format with the Resource Management Act, it is an abomination that this House would now reverse its own decision of not even a year ago and gut the provisions that allow it to be implemented.

I remind the Minister that, in respect of the trees provisions, 81 percent of Aucklanders and 77 percent of Waitakere residents in an independent Colmar Brunton poll said they supported the Waitakere Ranges Heritage Area Act, and they wanted greater protection for the trees in them thar hills. That is exactly why I am putting forward an amendment that treats the Waitakere Ranges in the same way that the Minister is proposing to treat conservation management areas and reserves, which is simply to say that it is a special case, and the general prohibition on blanket tree provisions should not apply because it is impracticable to schedule every tree. I welcome the Minister to come up to Titirangi and go around and schedule every tree—we can barely see the ground for the canopy cover. The only clearances are where there are actual dwellings amongst the forest, and it is ridiculous to suggest that it is a streamlining measure to schedule all of the trees there. It may be physically possible in the extreme, but it will cost the Waitakere City Council an arm and a leg in time, money, and attention. It will cost the residents of my city a huge amount of bother at a time when Rodney Hide is running a minimalist agenda and saying that councils have no place in environmental protection at all.

Does the Government not talk to itself? How can it be that Rodney Hide says in his Cabinet paper that councils have no role in environmental protection, yet this Minister says councils have to schedule every individual tree?

Hon Dr Nick Smith: No, I don’t.

Hon DAVID CUNLIFFE: Oh, well—or group of trees. But if he is going to use the group line, why will he not accept Lynne Pillay’s amendment, which removes the word “specific” and makes clear, for the avoidance of doubt, that groups of trees can be scheduled together? It does no more than that. The Minister tried to make a crude joke by saying “Ha, ha, ha! District plans already have maps in them, so there’s no need to have an amendment that allows them to schedule using a map.” Well, that is simply childish. Of course it is helpful to use a map. It is absolutely essential. If the Minister’s word is to be taken—and he is an honourable member—then it is essential to be able to use groups, and maps are part of that. I ask the Minister to confirm for the Committee whether he will consider this again.

The bottom line with this—and there are many, many hundreds of emails that I dare say we will want to table before this is over; many hundreds of emails make the point—is that this Minister has got it wrong and this Government has got it wrong, and they will pay the price. The last bastion of hope for Aucklanders is the fact that the felling provisions do not take effect until 2012, and there is a little event near the end of 2011, which will give Aucklanders the opportunity to make sure that clause 52 is never operative. When Labour wins the election in 2011, with our colleagues in the Green Party—and no doubt the Māori Party will change horses by then—we will suspend the implementation of that provision and have a new review so that Aucklanders can have a say in their own future. So I say to ladies and gentlemen out there in listener land that if they do not like clause 52, and if this jackbooted Minister tries to steamroll it through Parliament without further consultation, and refuses to put it in the second tranche, they have one chance to stop it in 2011.

Hon Dr NICK SMITH (Minister for the Environment) : I raise a point of order, Mr Chairperson. It is about the member’s language. He talks about jackbooting legislation. This legislation was introduced in February. Members opposite had an opportunity at the select committee—

The CHAIRPERSON (Eric Roy): I say to the member—

Hon Dr Nick Smith: It’s a point of order.

The CHAIRPERSON (Eric Roy): Well, I want to rule on it, and I have 15 seconds, so I will. There is quite a distinction between referring to legislation and referring to the Minister. In my interpretation of what the member did, he did cross the line. So I rule that comment out of order.

• Sitting suspended from 6 p.m. to 7 p.m.

RAHUI KATENE (Māori Party—Te Tai Tonga) : I stand to speak to the Māori Party’s amendments to clauses 20, 83, 83A, and 133, which relate to the removal of security for costs and the reinstatement of ministerial veto for coastal permits. I will, firstly, talk to the detail around the removal of security for costs. This amendment reinstates the provisions of the principal Act whereby the Environment Court does not have the power to order a party to give security for costs. As a member of the Local Government and Environment Committee I recall that many submitters were opposed to the repeal of the provisions preventing security for costs. It was their view that the repeal of the provisions may limit public participation in resource management decision-making to those able to raise security.

The provisions in the current Act reinstated the powers for the court to require security for costs from appellants. The idea was that this move would limit the number of vexatious and frivolous objections to applications for development. What it means in practice is that before a group can take a case against a company, the group would need to put up whatever money the company determines the court proceedings will cost it in lost time, production, etc., as security for costs. Claimants then have to sign that they are able to put up the money, before the case can go to court.

I recall that for my auntie Eva Rickard, in the case she brought against Tainui in 1995, the security for costs that Tainui named was $1 million. That is a classic case of environmental injustice. We all know there are already significant costs for whānau, hapū, and communities in taking cases before the Environment Court. I recall a case brought against the Exide Technologies battery recycling factory in Pētone by the local community, which cost approximately $35,000 before it even got to court.

In many respects, security for costs is a way of restricting and preventing people’s right to challenge development. It is yet another way of shutting up the public and marginalising the poor. Corporations that fund developments have the financial means to fight through the Environment Court for years, whereas hapū and communities may not be able to afford even to get to court. The other key issue is that a judge can already throw out a case and order costs if the judge thinks the case is vexatious. So the Māori Party’s amendments will reinstate the provisions of the principal Act whereby the Environment Court will not have the power to order a party to give security for costs.

The second issue dealt with under these amendments relates to the decision-making powers of the Minister of Conservation in respect of coastal permits. The amendments reinstate the decision-making powers of the Minister of Conservation in relation to coastal permits for restricted coastal activities. The bill before the Committee amends the Resource Management Act 1991 in respect of restricted coastal activities by repealing the section that allows the Minister of Conservation to make the final decision on the issuing of coastal permits, after receiving a recommendation from the Environment Court.

Clause 83A substitutes a new section 119A, which stipulates that the court’s recommendation is the final decision and that the coastal permit commences on the date of the decision or on such later date as the court determines. Members will recall the fracas that erupted over this issue in respect of the Whangamata marina. Well, if the bill goes through unamended, it could all be on again. The amendment put forward in the bill will have a retrospective effect, which means that the court’s recommendation made on 26 October 2005, in respect of the Whangamata marina, operates as a legal coastal permit, regardless of the actions of the Minister of Conservation in declining to grant the coastal permit for it. It is important to remind ourselves that the Government has a responsibility to uphold the Treaty relationship and tangata whenua rights, which were upheld in respect of the Whangamata marina. As we know, Hauraki iwi were not listened to by the judicial process but were listened to by the Minister.

The Māori Party believes that it is not appropriate for the Environment Court to make final decisions on resource management. It has no responsibility to uphold or recognise a Treaty relationship and tangata whenua rights. Judges cannot be held accountable in the same way as a Minister. Again, as a member of the Local Government and Environment Committee I can say that many submitters, including Māori, were opposed to this amendment. It was their view, a view we share, that a ministerial power of veto remains important to properly protect the coastal environment. So our amendments to clauses 20, 83, and 83A reinstate the ministerial veto for coastal permits.

Dr KENNEDY GRAHAM (Green) : Before the dinner break I offered a broader, philosophical view of the Resource Management (Simplifying and Streamlining) Amendment Bill, and I was disposed to describe the different philosophical orientations of our parties using the imagery offered to us by National over the last several years in criticising the Labour Government for developing the nanny State. I am wont to extend that imagery to characterise the rest of us, and I do so with a view to throw light on where we differ at a basic philosophical level and where, in practical terms, it comes to mean different decisions at the margin of political judgment. I recalled that the Association of Consumers and Taxpayers is best described as the robber baron State, while National, which makes up the Government, is best described as the cowboy State as it wishes to assert ultimate freedom to desecrate, if necessary, in the name of economic growth, with scarcely, at most, a modest concern to clean up the environment. I believe that mistake will be recognised within the first 3-year term of this Government. Cowboys riding high in the chaotic rodeo of New Zealand polls do get thrown, sooner or later—and I think sooner rather than later.

If we turn the same spotlight of imagery upon ourselves in the Green Party, how are we best described? I can think of no better description than that we embrace the concept of a holistic State; we wish for a holistic inclusion of all human activity in harmony with the environment. That is the philosophical difference that motivates us, as opposed to National, and it prompts us to oppose this amendment bill in its current form. To us the environment is paramount and it must be protected. This central assertion does not, in any way, preclude the development of a healthy and vigorous economy, a vigorous economy based on innovation, productivity, and, yes, efficiency. But it does preclude strip mining the proper protection of the environment, which we believe this bill runs the danger of doing.

All parties agree that there needs to be a Resource Management Act that reflects the recognition of the need to protect the environment. In practical politics we differ at the margin between economic growth and environmental protection. At the margin is where our fundamental differences in philosophy are displayed. If in doubt, National and ACT would engage in economic growth, even where the environment is in danger of damage. So, I believe, would Labour when tempted. If in doubt, the Greens would desist from a proposed economic project on the basis of the precautionary principle strictly applied. That is why the Greens oppose this bill. These differences strike at the overarching issue of our times—that of sustainability. We believe that our approach results in a sustainable planet and a sustainable nation. We believe that the National and Labour approach—the Nat-Lab—results in a planet that is sliding dangerously to irrevocable depletion, climate instability, and potential political strain.

I now ask where, in all of this, are the Bluegreens.

Hon Clayton Cosgrove: Who?

Dr KENNEDY GRAHAM: That is a good question. Where are the Bluegreens? Let me offer a series of statements from National’s Bluegreens. The first statement states: “clean air, clean water … ought to be achievable in New Zealand within one generation.” Who got us into this mess? National prides itself on having had the reins of power for the majority of the last 50 years. Who got us into this mess in the first place? The second statement states that New Zealand “rivers, lakes and streams [should be] swimmable, fishable and in good ecological health … groundwaters [should be] drinkable.” I ask members who got us here. Who got us into this mess? The third statement states: “Attractive, liveable cities that are easy to get around are hugely important both for quality of life”—correct phraseology—“and [for] economic competitiveness.” Well, that must explain the extraordinary roading expenditure that we are now facing.

PHIL TWYFORD (Labour) : The Committee has probably gathered by now that Labour members are against clause 52 of the Resource Management (Simplifying and Streamlining) Amendment Bill.

Hon Member: But it is worth repeating.

PHIL TWYFORD: It is worth repeating. So disgusted are we by this expedient, tatty clause that this evening I will propose an amendment by way of Supplementary Order Paper 40, which has been tabled. I shall mention briefly that there are two parts to the amendment. One is to omit clause 52, and the other is to omit clause 151. The effect of the amendment would be to delete the prohibition on the use of general tree protection rules. The intention is that this change would allow the Government time to meaningfully engage with Aucklanders and local communities on appropriate modification of the tree protection rules.

I want to comment on the many interventions that we have had from the Minister for the Environment this evening. I think disingenuous is probably the best description I can find for the comments of the Hon Dr Nick Smith. That is his name is it not, the Hon Dr Nick Smith? Is that the correctly pronounced name? [Interruption] Yeah. He repeatedly and insistently characterised Labour’s position on this provision as being against the trimming of trees. We have made it clear throughout the select committee process and during today’s debate that we are not against the trimming of trees. We have made it very clear that we support the expected Green Party amendment that would make the trimming or pruning of trees a consent-free zone, and that remains our position.

The Minister, in fact, rejected out of hand the Green Party’s compromise proposal, which would have seen trimming removed from the rules, and would have introduced a quicker, easier, and simpler procedure for homeowners who wanted to obtain consent for the removal of trees. The Minister rejected it, yet he came to the Chamber this afternoon, all puffed up, and repeatedly said that the intention of the Government, against our opposition, was to deal with tree trimming.

There are a couple of points that the Minister has returned to over and over again through the afternoon and evening. The first one is property rights. He clearly is of the view that this issue is about an assertion of the property rights of landowners. I will read an email from Sue Roff, who describes herself as a National Party supporter: “It has come to my attention that many believe in property rights. I know I do, and I agree with the right of a person to do what they want with their land, but large trees are a resource that affect everyone. Consider if I want to put in a septic tank. Why do I need a consent? Do I not have property rights then? Because the contents of the tank could leach into the groundwater, and this would affect everybody. Well, the value of large trees are the same. They affect everyone: our birdlife, groundwater, drainage, physical well-being—the list goes on. I have trusted the National Party all my life, and now trust they will do what is right.” Well, I say good luck, Sue.

Another email will be of particular interest to the member for North Shore. It comes from Roger Donnell, who is fearful that the Government will “throw the baby out with the bathwater.” He has an interest in this matter because he lives in Wilcox Bush on Beach Road. He tells the story about the intention of a developer to subdivide the next-door section. He writes: “We were originally approached for approval of the subdivision concept, but did not approve it because of the possibility of damage or destruction of the trees on the property, which include a 400-year-old puriri. Since then the Government has changed and all has gone quiet. We suspect it is simply to wait for this bill to be passed so that the bulldozers and chainsaws can move in and destroy the existing bush.” The member for North Shore might like to get back to Roger Donnell, because I think he deserves an explanation if clause 52 is passed this evening—and I suspect it will be, unfortunately.

That last letter conveys the accurate sense that if this ban on general tree protection rules is implemented, there is nothing standing between Aucklanders and the destruction of some of our most treasured trees around the city. If that happens, the National MPs on the other side of the Chamber will have to do some explaining. They will have nowhere to hide, including Ms Nikki Kaye.

Hon Dr WAYNE MAPP (Minister of Defence) : I want to deal with the issue that has been raised by Mr Phil Twyford and with the misinformation he is spreading. He is spreading simple propaganda. I say that because he quoted an example—and I was listening carefully—of a 400-year-old puriri. The concern was that the tree would not be protected. Well, I suggest to Mr Twyford that he read the bill carefully and think of the obligations that rest upon the various councils up until next year and upon the Auckland Council thereafter.

It is inconceivable, I suggest, that a 400-year-old puriri would not be designated by a council, because that will effectively be the obligation of councils from hereafter. Certainly, there are blanket rules at the moment, but there will be new rules following the passage of the Resource Management (Simplifying and Streamlining) Amendment Bill. We on this side of the Chamber have a reasonable expectation, and I know that the Minister of Conservation will be writing to councils and setting out the expectations of the Government in terms of the responsibilities of councils to designate, firstly, individual trees of special importance—and a 400-year-old puriri clearly fits into that category—and, secondly, groups of trees.

I will deal with the second issue as well, because I think it gets to the heart of the concerns of the people who have written to me and, indeed, of other members of the Committee. As I understand it, from both reading the report of the Local Government and Environment Committee and talking to the Minister, councils will have the power to designate discrete areas, particularly on the coastal fringes, which are common throughout much of Auckland, particularly around the North Shore, where there are pōhutukawa, puriri, karaka, and other native trees.

Without question, the coastal fringe is hugely valuable to our community, and much of it is in private hands. The groups of trees will be able to be designated by councils. That is actually what landowners in those areas will expect to be the case. They will, of course, also expect to be able to appropriately prune and trim those trees. So I suggest to the Opposition members that their scaremongering has been fundamentally misleading, because there are ample powers on the part of the seven councils currently, and the single council that will exist from September next year, to designate the important trees and, significantly, the groups of trees that represent ecosystems.

I have taken a particular interest in this issue because I am the member for North Shore and because I happen to live on the coastal fringe. I understand the significance of these issues, and I know the feelings of the communities. I suggest to members of the Committee, and, indeed, more broadly to the community, that there are ample powers in legislation for councils to act responsibly and to ensure the protection of unique heritage trees, which are usually native trees, and, more significantly, ecosystem areas that are covered by the concept of “groups of trees”.

It is also important to recollect that we are talking about privately owned land, so reserves, council-owned lands, and land owned by the Department of Conservation are all fully protected. That is not the issue in question, yet many people are of the contrary view. It is my view that councils, acting constructively, using the powers of this legislation, and with the encouragement of the Minister of Conservation, will, over the next 2 years before the provision comes fully into effect—because that is the final point—ensure that they take up the responsibility to protect the heritage that we in Auckland expect to be protected.

CAROL BEAUMONT (Labour) : I rise as an Auckland MP to speak against clause 52 of the Resource Management (Simplifying and Streamlining) Amendment Bill, and to speak in support of my colleague Phil Twyford’s Supplementary Order Paper 40 on this matter. I think it is really important for particularly the Auckland MPs across the Chamber to think very, very carefully about what they are doing here. An overwhelming number of the people in the city in which we live oppose clause 52, and they do so not because they are silly and are subject to scaremongering; they oppose it because they have very genuine concerns that the removal of the blanket protection will see the removal of large numbers of trees from Auckland.

In the area in which I live, if one climbs up Maungakiekie and looks out, one sees a large number of trees. It is a very green and beautiful part of Auckland. That has not always been the case. Recently I was in the Onehunga Community House, where there are some old photos of that suburb. There was a period of time in the 1930s, 1940s, 1950s, and even the 1960s when it did not look like that. More recently, we have added trees back into our urban environments, and that makes a very real difference to all of us. It makes a difference in terms of what our environment looks like, and it makes a difference in terms of the quality of our standard of living. There are native birds back in our cities. That may sound corny, but I know that in the street I live in there are now many tūīs that were not there 15 years ago, or even 10 years ago.

Large numbers of trees could be removed. That is the risk the Government is taking. The Government is trying to assure us that it will not happen, but it is very interesting to note that the New Zealand Herald environment reporter yesterday talked about what might happen to protect trees. Her view is that Auckland City is clearly saying that it will not go through a complicated process of listing all of the large trees that are currently protected, and that it will be up to individual landowners. The property on which I live has many large trees, and, as it happens, I would want to protect them, but not everybody will have that attitude. It could be that we sold our property and that the next people who came there felt that they should cut those trees down. Are we prepared to take those risks? I think the Auckland members of Parliament opposite need to think about this very, very seriously, because if that is the result, they will be blamed.

As I said before, the people who are saying these things are not scaremongering. They are not fools. I will quote members another North Shore example. Adrienne Grace says that many trees will be cut down as soon as this bill becomes law. The reason she says that is she knows, as do many Aucklanders, that there is very real pressure from developers. Developers will be able to clear-fell a site and they will not have to replace any lost trees through replanting. If my own property were bought by developers, they would want to knock down the trees so that they could put more buildings on it. Adrienne Grace says that the development pressure is so great in the Auckland region that there will be increasing numbers of sites with little or no tree cover for shade, screening, or visual amenity. Any trees planted will be of a size that it will take decades for them to provide the functions provided by the trees we have now. As a result, New Zealand risks losing the international clean, green image it has worked so hard to promote, and tourism could be negatively affected.

As Adrienne Grace said, and as the New Zealand Herald environment reporter said yesterday, listing or scheduling trees in the district plan, which is the only permissible means of protecting trees, is costly, time consuming, very limited, and insufficient. Along with many Aucklanders, she is very apprehensive about this. What that says is that the Government is pushing this measure through without listening to the people of Auckland. The current provision has worked well. The fact is that six out of the seven local authorities are quite happy with it. It is clear that some things could be fixed. A very real compromise has been put on the table by Jeanette Fitzsimons. That is what we should be looking at, so that the people of Auckland have some assurance that we are not going to see the wholesale destruction of trees.

CATHERINE DELAHUNTY (Green) : Tēnā koe, Mr Chairperson. Tēnā koutou. Much as I love urban trees, people seem to have got quite obsessed about that issue. I think there is a big picture here, which includes urban trees, that we need to reassess. It is about the actual future of the sustainability of the entire nation. In 1991 my colleagues and I came down to Wellington from Hauraki-Coromandel to participate in a round-table discussion on the resource management law reform process. We did our best at that time to fight for the protection of our natural resources and heritage. We were very worried that section 5 in Part 2 was too weak in its so-called balancing of the environment versus the economy, because the entire Western World—and more—was obsessed with protecting the economy from any real environmental accountability. So we lost the so-called balancing act on water, soil, and air, and these fundamental sources of life are so much more polluted now than they were in 1991.

The Resource Management Act, far from being a major brake on pollution, has been fairly weak and at times downright facilitative of inappropriate development, but it is way better than nothing the way it is and it does not need some of these changes, especially in terms of community participation and decision making around resources. This so-called streamlining of the Act has done nothing to rebalance the power inequities between paid lawyers and experts versus volunteers from hapū and community groups. As a former environmental mediator under the Resource Management Act, I have every sympathy for people struggling to get consent to build a garage, but that is not what this bill is about, or even what the problems are. If we want to improve the Resource Management Act then we should train the councils and the consenting authorities to work with alacrity and respect for communities. We should not pretend that a large, wordy, and unwieldy proposed reform of the Resource Management Act is fixing that issue. The Resource Management Act as it stands barely holds the line on natural resources, and I totally endorse the comments of Dr Russel Norman and Jeanette Fitzsimons that the degradation of the environment means the degradation of the economy. I also add that the issues of citizen participation are vital and that this bill seriously undermines those rights through increased costs even to participate in hearings.

My own experience with the Resource Management Act includes 15 years as a lay advocate in the Environment Court, and 5 years as a Resource Management Act mediator. I have also had some very interesting days on the Local Government and Environment Committee in its consideration of this bill. At the select committee hearings there were so many submitters who reminded me of my own experience. They came to our committee very well prepared, with heartfelt submissions about the need for expanded notification, not a reduction in notification. As a new member of Parliament and a very inexperienced member of a select committee, I was astonished by the fact that hardly anybody asked them any questions, except me, because I have literally been those people. I have spent my life trying to communicate about resource management matters with people with power who can hardly be bothered asking any questions. What is more, no one else on the select committee when I was there seemed to have actually spent a lot of time being a submitter. These members had never experienced being intimidated by judges and hearings panels, let alone having costs awarded against them or their group, unlike many members of the Green Party, who have lived the resource management issues. Members can call us masochists, if they like, or public-spirited citizens, but we are better equipped to critique the Resource Management Act than many people who have limited experience of being on the submitters’ side of the table. It is a shame that so many submitters were not actually listened to, even if they were heard.

I also rise to express support for a number of Supplementary Order Papers from the Māori Party, particularly those of Te Ururoa Flavell in which he talks about the need to change section 8 and strengthen the recognition of tangata whenua rights under Te Tiriti o Waitangi. I also want to support the Supplementary Order Papers that refer to the security of cost issue and the role of the Minister of Conservation, and many other members have spoken eloquently in the Chamber today about the importance of those issues. Time after time I have been at hearings where people have been at a disadvantage, and this law puts them at a greater disadvantage. I cannot understand how we will serve environmental decision-making and resource management decision-making if people are at a greater disadvantage because of the threat of costs. At the select committee a number of people said that very few judges will implement those provisions. That is not the point. The point is that small community groups considering whether to go to the Environment Court do not want to be intimidated by the fact that they could be awarded security for costs. As a member of an organisation that was awarded more than $22,000, I know that threat is real.

Hon CLAYTON COSGROVE (Labour—Waimakariri) : This is one of those interesting occasions—in fact, we had one in the last bill that was passed under urgency—when there is general support for a bill but the parties are divided on a number of issues. Being a Cantabrian I cannot speak on the issues that will affect Auckland by the Resource Management (Simplifying and Streamlining) Amendment Bill with the authority of Mr Twyford, who is an Aucklander, but some of those issues on which the parties are divided are heritage and the nature and environment we live in.

I note with interest that the former Minister in the chair, the Minister of Defence, Wayne Mapp, was good enough in the previous bill to also take the chair. It was a finance bill, and National rolled up the Minister of Defence, whose name is “Paris Hilton”, I think. We call him that from time to time—affectionately, I must say. For the Resource Management (Simplifying and Streamlining) Amendment Bill, we got the 25-pound howitzer out, and the Minister of Defence again took the chair. He has now become what we call the Sonny Bolstad, for those of us who are old enough to remember him, of the New Zealand Parliament. Members may ask who Sonny Bolstad is. He was the New Zealand axe champion for many, many years. He pre-dated me. I have not picked up an axe. Occasionally, in politics one has to.

Chopper Mapp came out. He is an Auckland member, and his solution as a supporter of the big end of town is to just mow down the trees, Operation Desert Storm style. He is the Minister of Defence, after all.

Hon Dr Nick Smith: Give us a break.

Hon CLAYTON COSGROVE: The Minister in the chair, Dr Smith, says “Give us a break.” Well, if anybody needs a break and a wee lie-down, it is him. We know that for a variety of reasons. We know that Dr Mapp has the developers’ interests at heart. If National gets its way, through the force and tyranny of the majority, it will be possible for developers to come in, mow down all the trees, build 20 or 30 boxes, and vote for Dr Wayne Mapp, the Sonny Bolstad of Parliament.

We have proposed a compromise in Supplementary Order Paper 40, as I understand it, to allow people to do some surgical tree doctoring and a bit of trimming of their trees. If they want to go further than that, they can get an expedited consent from the council and away they go. National wants to push through its Draconian measures. National is the party that said it was against red tape and against bureaucracy and that it wanted to cut cost. We know that given that there will be massive opposition to the wholesale flattening of the natural environment within Auckland, if Wayne Mapp has his way, that opposition, in itself, will create further bureaucracy.

I will quote from the New Zealand Herald, which states: “Each tree must be assessed, mapped and described, a consultation process carried out, and a possible court appeal defended at the end.” Those who are in favour of the other option—or, in fairness, perhaps even an extreme option the other way—should use their constitutional rights to try to hold back the tide. Dr Smith, who has said he is the champion of mowing through the bureaucracy and cutting down the red tape, ought to take a breath and have a wee think about this situation. I think there is a moment in Parliament when we can promote a compromise. A logical compromise has been put up. I think we all agree that the status quo was a wee bit over the top, but Labour has put up a compromise that I think is relatively balanced.

I say in this short call that we have again an illustration of the extremes in politics: those who are prepared to promote a compromise and find a balance between development interest in the big end of town and protecting the natural environment, and those like Dr Mapp who would be out there with the axe and the grindstone, sharpening it up and mowing down trees. He has the flat-earth philosophy—

Hon Shane Jones: Rhinestone cowboy.

Hon CLAYTON COSGROVE: My colleague says Dr Mapp is a rhinestone cowboy. Rhinestone? I do not know. Cowboy? He may be. Being an Auckland member, Dr Mapp has a simplistic view of the world if he thinks that that sort of flat-earth philosophy should run. It is not just about the big end of town and about those who provide big dollars doing big developments; it is all about those people who actually want to protect their environment and have a balance in life.

I ask National in a bipartisan way whether perhaps now that Dr Smith is in the chair and Wayne Mapp is on the benches it might consider our proposition.

Hon Dr NICK SMITH (Minister for the Environment) : It is extraordinary that we get this flamboyant rhetoric about the mowing down of trees and Draconian measures from Mr Clayton Cosgrove. I invite Mr Clayton Cosgrove, an MP from Christchurch, to reflect on whether he thinks Christchurch is a Draconian city. The truth is that Christchurch, a city that prides itself on being called the Garden City, does not have any of these rules.

I want to point out to Mr Cosgrove an interesting thing around the issue of development. I suspect that he knows absolutely nothing about this area of law. A number of Labour members have made the extraordinary claim that if somebody applies for a resource consent, this means that he or she will be able to bowl the trees away. Let me tell members exactly what happens in Christchurch. People apply for resource consents involving blocks of land with trees on them, and every year the council provides protection under those resource consents for hundreds and hundreds of those trees—that is what it does. That works perfectly well, and anybody who thinks there will be a chainsaw massacre—

Brendon Burns: Different quality of people there.

Hon Dr NICK SMITH: I ask my colleague Brendon Burns from Christchurch whether there is a great chainsaw massacre, as the evil people of Christchurch try to take advantage of a law that Labour does not want to be imposed on other parts of New Zealand. Of course there is not. The provisions of the Resource Management (Simplifying and Streamlining) Amendment Bill are not Draconian. There will not be any wholesale flattening of trees; there will be a bit of common sense applied.

The situation is as simple as this. From 1 October, one will not need resource consent in Auckland to trim a tree.

Grant Robertson: Nikki Kaye’s not cheering!

Hon Dr NICK SMITH: Absolutely, National members are cheering. The second thing is that over the next 2 and a bit years, the council will be able to put the bureaucratic effort that is going into processing a whole lot of resource consents for tree trimming into identifying the really significant trees in Auckland that deserve protection. Members on the Labour benches have said that this means the council will have to individually catalogue every tree and apply through the system for it to be scheduled. What total nonsense that is! Every council around New Zealand that has gone through this process—and I note the member for Palmerston North is having a chuckle—does it through its plan, and it does a large number of trees in a group, by neighbourhood. That is how councils should do it under this legislation. I really think this is a case—I ask members to excuse the pun—of Labour not seeing the wood for the trees.

I have found it extraordinary in this debate that there are huge changes set out in this bill to the way in which we consent to major pieces of infrastructure, so that we can get on and build the electricity, water, and transport infrastructure for New Zealand, and we have not heard a squeak from Labour about that, albeit those reforms are very significant. I simply say the Labour members should put their money where their mouths are, and to make my day by promising that they will reverse these changes. I tell those members that that will guarantee this Government a further term. If there was a reason that Labour was rejected by voters, it was that New Zealanders were sick of the nanny State laws whereby ordinary Kiwis had to spend hundreds of dollars on getting a resource consent to trim their trees.

RAHUI KATENE (Māori Party—Te Tai Tonga) : I rise to speak to Supplementary Order Papers 48 and 50. Supplementary Order Paper 48 proposes to insert new clause 21A into the Resource Management (Simplifying and Streamlining) Amendment Bill. This amendment focuses on the transfer of powers from councils to hapū and iwi authorities. At present, hapū and iwi authorities are not empowered to initiate the consideration of a transfer of powers. Our amendment will allow hapū and iwi authorities to request a transfer of powers for them to manage their lands, water sites, wāhi tapu, and other taonga when they determine that they are better able to meet the purposes of the Resource Management Act. Local authorities are required to give full consideration to the matter, including completing a comprehensive evaluation of the request for transfer. They are required to report on the evaluation, and to make the report publicly available. We would hope that whānau, hapū, and iwi would include section 33 of the Resource Management Act, the provision pertaining to the transfer of powers, in their iwi management plans, and promote it to their respective councils.

The context of this amendment is simply that regional councils have shown an absolute inability to protect harbours from pollution, foreshores from coastal erosion, and seabeds from marina developments. I give the example of Waikawa Marina in the Marlborough Sounds, which is powering ahead with its development proposal, regardless of the adverse impacts on the local hapū, the local community, the biodiversity, and the wishes of the many people affected. We absolutely believe that whānau, hapū, and iwi could do a much better job in respecting and protecting their lands, water sites, wāhi tapu, and other taonga.

I draw the attention of the House to the current Regional Policy Statement for the Wellington Region as a good case study to substantiate our position on the transfer of powers. The policy statement explicitly facilitates a transfer of powers with the added commitment of providing assistance to the transition, as long as there is a formal request to trigger it by the iwi. The provisions were written into the policy 3 years ago and provide us with a very strong basis for this amendment. Chapter 4 of the statement, entitled “The Iwi Environmental Management System”, states: “The Wellington Regional Council, in consultation and partnership with tangata whenua, will investigate opportunities for iwi management of resources and opportunities for joint management, where appropriate.” It goes further in subsequent sections, to state that it will “support tangata whenua to administer transferred powers, functions or duties, where appropriate.” It will also “support iwi to prepare iwi management plans, where appropriate, and where iwi wish to do so.” These are great initiatives that “focus on improving opportunities for iwi management of resources and on formal recognition of the role of kaitiaki. These methods are consistent with a partnership approach to resource management, as required by the Treaty of Waitangi, and the transfers of powers provisions of the Act.” These initiatives provide us with an excellent context within which we put forward these amendments, which we are proud to present to the House today, and which we hope will be supported, including those to clause 91 relating to the projects of national significance, boards of inquiry, and appeals to the High Court.

Our Supplementary Order Paper 50 introduces a number of amendments to new Part 6AA, which deals with proposals of national significance. As a result of this amendment, boards of inquiry will be required to include a representative appointed by mana whenua. They will also be required to seek the adv