Wednesday, 1 March 2006
Madam Speaker took the Chair at 2 p.m.
Amended answers to Oral Questions
Question No. 10 to Minister, 28 February
Hon PETE HODGSON (Minister of Health)
: Yesterday in answer to a supplementary question on question No. 10 I advised the House that the National spokesperson on health had not responded to my letter of 14 February on pandemic preparedness. That is not the case and I apologise. In fact, the National spokesperson on health did respond last week, although I first saw his letter this morning.
Questions to Ministers
GEORGINA BEYER (Labour) on behalf of the
Hon PAUL SWAIN (Labour—Rimutaka) to the
Minister of Finance: Has he received any reports on the aspirations of New Zealanders that the KiwiSaver scheme will address?
Hon Dr MICHAEL CULLEN (Minister of Finance)
: I received a report of a very wide survey showing that homeownership remains the No. 1 dream for most New Zealanders. The KiwiSaver scheme is one of the practicable, affordable ways in which this Government is helping New Zealanders to realise that aspiration.
Georgina Beyer: Did the report reveal a preference for tax cuts over continued investment in strong public services?
Hon Dr MICHAEL CULLEN: No, the report of a survey commissioned by Telecom revealed that the following were the top dreams of New Zealanders: to remain safe and secure for our families, to have the best health system in the world, to own our own home, to continue to stand up for ourselves, and to have the best education system in the world—nearly all of which require Government expenditure. So while some might promote the idea of slashing public services to fund unsustainable tax cuts, this Government stands up for the dreams of the great majority.
Georgina Beyer: What other Government policies support the aspirations recorded in that report?
Hon Dr MICHAEL CULLEN: The report also reveals that New Zealanders are most proud of their beaches and empty spaces, of being nuclear-free, and of the way in which we are often the first to accomplish important things in the world. We are committed to supporting those aspirations, unlike some, who on occasions seem to see nuclear-free New Zealand as a potential bargaining chip.
Social Development and Employment, Minister—Confidence
Dr DON BRASH (Leader of the Opposition) to the
Prime Minister: Why does she still have confidence in her Minister of Social Development and Employment?
Rt Hon HELEN CLARK (Prime Minister)
: Because he is a hard-working and conscientious Minister.
Dr Don Brash: Which David Benson-Pope does she have confidence in—the one who said the allegations against him were a nonsense and that he had never heard of the complaint against him, or the David Benson-Pope who yesterday effectively admitted he knew about the complaint, but changed his story to a denial that he had actually seen the letter of complaint?
Rt Hon HELEN CLARK: Madam Speaker, I would like the response that I am about to give to be heard in silence, and I have a right to request that.
Madam SPEAKER: The Prime Minister has requested silence for her response. I ask the House to respect that.
Rt Hon HELEN CLARK: I accept that to most people, including to me, a letter from a parent raising such issues would be seen as a complaint. It is clear that because the issues raised did not breach school policy, and were not dealt with as a disciplinary issue, Mr Benson-Pope did not see that as a complaint when he made his statement to the House on 12 May. In my view, that was an error of judgment, but I do not consider it sufficient reason to dismiss a Minister. That is my judgment.
Rodney Hide: Does it change the Prime Minister’s view of her Minister that he re-entered the dorms in 1998 on a school camp—after he had been spoken to by the principal and after the school had developed its policy—where there were 14-year-old girls naked and semi-naked?
Rt Hon HELEN CLARK: That is an allegation on a website; I am not aware that it has been raised in any formal sense. It does not appear to have been dealt with as a disciplinary matter.
Dr Don Brash: Does the Prime Minister really expect the House and New Zealanders to agree that it was acceptable for Mr Benson-Pope to enter showers and dormitories where 14-year-old girls were semi-clad, because there was no school policy at that time; if so, just what kind of message does she think she is sending the parents of New Zealand schoolchildren by her failure to act?
Rt Hon HELEN CLARK: There is no evidence whatsoever that Mr Benson-Pope entered showers. If the issues are as serious as the member alleges, they would have been dealt with as a disciplinary matter. The fact is that they were not.
Dr Don Brash: Has the Prime Minister seen the statement made by the Post Primary Teachers Association (PPTA) President, Debbie Te Whaiti, that the PPTA, of which Mr Benson-Pope was a regional chair, had a clear policy in place prohibiting such behaviour well before 1997, and what message does she think her continued defence of Mr Benson-Pope sends to teachers and pupils about acceptable behaviour by members of the teaching profession?
Rt Hon HELEN CLARK: In respect of the PPTA, there are clear procedures in the collective agreement to be followed when complaints are raised about disciplinary matters. It does not appear that it was raised as a disciplinary matter.
Rodney Hide: Could the Prime Minister please tell the country why she continues to defend the Minister, who is demonstrably a pathological bully, liar, and pervert?
Madam SPEAKER: I ask the member to withdraw those comments and I refer him to Standing Order 371.
Rodney Hide: I withdraw. Supplementary—
Madam SPEAKER: No, you will withdraw and apologise for those comments.
Rodney Hide: I withdraw and apologise. Could the Prime Minister explain to the people of New Zealand why she continues to blow her credibility and the credibility of her Government on the Minister, who does not deserve it, rather than dealing with the big problems confronting New Zealand society over this economy?
Rt Hon HELEN CLARK: I have to be guided by such matters as a principal who says that it was not a disciplinary matter and that it did not involve a breach of a code of conduct. Certainly, I would view it somewhat less seriously than being associated with shonky investment seminars in Fiji.
Rt Hon Winston Peters: I raise a point of order, Madam Speaker. I could not hear one part of that answer. If National members wish to ask questions, surely they should entitle the rest of the House to hear what the answer might be—after all, we have not heard one fact from that side of the House yet.
Madam SPEAKER: Except for the last comment, I agree with the member. Although, of course, interjections are permitted, if people cannot hear the reply it does defeat the purpose of question time.
Dr Don Brash: Why is the Prime Minister so determined to defend Mr Benson-Pope, when in the past she has shown absolutely no hesitation in dismissing Dover Samuels, Ruth Dyson, Marian Hobbs, Lianne Dalziel, John Tamihere, and Taito Phillip Field, and can she tell the House what it is about Mr Benson-Pope that makes him so special to her?
Rt Hon HELEN CLARK: There is such a thing as natural justice, and for a man—[Interruption]
Madam SPEAKER: I have just asked the House to keep the level of interjections low, please. I could not hear the answer to the question from here.
Rt Hon HELEN CLARK: For a man to be hounded from a job for matters that were not considered anything like serious enough to be raised as disciplinary matters with a school board, is quite wrong. I can assure members opposite that if I were to react in the same way to every letter of innuendo I get about many of them, this House would never hear the end of scandal.
Dr Don Brash: What credibility does Mr David Benson-Pope have as her Minister for Social Development and Employment, in light of these disturbing allegations; and is it not time the Prime Minister put the interests of the New Zealand public ahead of those of a man for whom there is a file of complaints that is growing every day?
Rt Hon HELEN CLARK: Disturbing allegations would have been dealt with as a matter of discipline; the fact is they were not.
Seed Sterilisation—Government Position
NANDOR TANCZOS (Green) to the
Minister of Foreign Affairs: Does New Zealand support an international ban on the use of seed sterility technology, such as terminator; if not, why not?
Rt Hon WINSTON PETERS (Minister of Foreign Affairs)
: No. There is no international ban on seed sterility technology.
Nandor Tanczos: Is the Minister aware that the Ministry of Foreign Affairs and Trade does not regard genetically engineered terminator technology as either good or bad, even though it is specifically designed to make plants sterile so that farmers cannot replant their seeds; and hence will jeopardise food security for millions of people?
Rt Hon WINSTON PETERS: I am aware of what the Ministry of Foreign Affairs and Trade’s policy is. I am also very much aware that when such conventions or other agreements and treaties apply, and in fact exist—unlike the question’s imputation—then those matters will be decided by domestic policy, at which point I say that the Minister for the Environment and Minister of Agriculture should have been asked the question in the first place.
Nandor Tanczos: I raise a point of order, Madam Speaker. The Minister has implied that the primary question was factually inaccurate. As you, Madam Speaker, and all members know, we have to verify any question put down, so I find it extraordinary that the Minister has made that claim.
Hon Dr Michael Cullen: The member does not have to verify the question; he just has to authenticate it. That may merely be a newspaper clipping, which one would not necessarily regard as a statement of unquestionable fact.
Madam SPEAKER: The Minister is entitled to address the question in the way he did.
Nandor Tanczos: Why did New Zealand support the position that GE terminator technology should be able to be used, in opposition to the vast majority of signatories to the Convention on Biological Diversity, in Spain this January?
Rt Hon WINSTON PETERS: Perhaps the member could best answer that question himself. He knows full well the domestic background to the origin of policy in respect of this matter from when the Greens were in a support arrangement with the Labour Government. He is best able to describe why he supported that; my job is to describe why we are doing what we are doing now.
Rodney Hide: I raise a point of order, Madam Speaker. That cannot possibly be an answer to a question in this House—a situation where a Minister has got up and said that maybe the member asking the question is in the best place to answer that question. Nandor Tanczos is not a Minister; Winston Peters is the Minister, and the question was addressed to him. A question cannot be turned back—
Madam SPEAKER: I understand the point of order. The Minister did address the question. It may not have been to the satisfaction of members, but he referred back to the answer he had given before.
Nandor Tanczos: Will the Minister take into account when agreeing on the position New Zealand will take in Brazil this month the effects of genetically engineered terminator technology on the more than 1.4 billion people around the world who directly rely on seed saving for their own food security, especially in light of our commitment to eradicating poverty and achieving sustainable development around the world?
Rt Hon WINSTON PETERS: As I sought to point out to the questioner, there is no such international convention or treaty. The second answer is that these sorts of policies on the international stage are determined not off the top of one’s head or on the hoof but rather by domestic policy agreed upon at home. That remains the position of this country, and that is why, if the member was seeking those answers, he should have asked the Minister for the Environment or the Minister of Agriculture.
Nandor Tanczos: I raise a point of order, Madam Speaker. The Minister’s answer was a total nonsense. In that question I made no reference to any international ban, which the Minister refutes. I asked quite clearly whether when agreeing on New Zealand’s position in Brazil this month he will take into account the effects I outlined. Is the Minister saying that he has no responsibility for the position New Zealand will take in Brazil this month?
Rt Hon WINSTON PETERS: I am trying to point out to the member, who has been around long enough to know, that if one wants an answer to a certain question relating to a specific portfolio then one should direct it to the right Minister. I was at pains to point out to him that although we might authorise, as a part of foreign policy, the people who are to appear in Brazil this month, nevertheless they are drawn from ministries that are directly concerned with this issue. That is the point he should know.
Nandor Tanczos: The Minister clearly is not in control of his own portfolio. I am asking the Minister whether he will take into account certain information when deciding New Zealand’s position at an international conference. I find it extraordinary that he says that I should ask the Minister for the Environment a question on that matter.
Madam SPEAKER: I think the Minister has addressed the question in his explanation as to how the policy that will lead to that answer being given is made. Of course the member is entitled to put down another question for the Minister for the Environment.
Social Development and Employment, Minister—Allegations
Dr DON BRASH (Leader of the Opposition) to the
Prime Minister: Does she accept the Hon David Benson-Pope’s statement last Saturday that allegations he entered the girls’ shower block and dormitories were “a nonsense”; if so, why?
Rt Hon HELEN CLARK (Prime Minister)
: The Minister was reacting to the
Investigate magazine website, which clearly contained allegations that were sensationalist. I am satisfied that issues were raised with the school that it deemed not to be disciplinary matters, but following which school policy was changed.
Dr Don Brash: Is it the Prime Minister’s position, in continuing to support her Minister, that his statement of 12 May last year was correct because he had no knowledge at all of the complaint against him; if not, what is her position?
Rt Hon HELEN CLARK: In response to an earlier question I made it clear that I considered that the answer was an error of judgment.
Dr Don Brash: Has the Prime Minister asked Mr Benson-Pope why he has stated that the recent complaints, now backed up by a letter and by the former principal, were “a nonsense”; if so, what was Mr Benson-Pope’s response?
Rt Hon HELEN CLARK: As I have said, the allegations on that website were sensationalist. I do not intend to go through them one by one. Anyone reading them can see that they stretch matters far beyond the letter sent by the parent.
Dr Don Brash: Is the Prime Minister telling the House that she is the only person in New Zealand who does not understand that Mr Benson-Pope’s earlier denials in this House and his statements yesterday are totally incompatible, and why does she so resist coming to the conclusion that is blindingly obvious to everybody else?
Rt Hon HELEN CLARK: The member seems determined not to take on board what I have already said today, which is that the answer was an error of judgment but I do not consider that sufficient reason to dismiss a Minister. That is a judgment I have made.
Hon Dr Michael Cullen: Has the Prime Minister received any complaints or material relating to other former teachers in this House, including Mr Gerry Brownlee, some of which lead to serious conclusions; if so, why has she not used that material in the public arena yet?
Madam SPEAKER: I would just remind members that when members ask questions, they are to be heard in silence, and that goes for all sides of the House.
Rt Hon HELEN CLARK: I have indeed seen such material, but have abided by the normal convention that such matters are not suitable for raising in this House. I would observe, for the benefit of Mr Brownlee and other National members, that people in glass houses should not throw stones and overturn the old conventions.
Rt Hon Winston Peters: Could I ask the Prime Minister who, in her experience or opinion, would be the more qualified to determine whether an action warranted dismissal: the headmaster who dealt with the matter at the time, or someone who wants a Titus Oates Star Chamber procedure to be the way we do justice in this country?
Rt Hon HELEN CLARK: Clearly, the principal, who has made it clear again today that he did not consider that the issues raised were disciplinary matters.
Dr Don Brash: Does the Prime Minister stand by her statement that the recent complainants should “put up or shut up” by going to the authorities, and is she concerned that young women may interpret her comments to mean that they can talk about and expose abuse only if they are willing to go to the police?
Rt Hon HELEN CLARK: There was a 6-month investigation during which there was plenty of time to air these matters.
Dr Don Brash: Does the Prime Minister not yet understand that New Zealanders have already reached a judgment about the credibility of the Hon David Benson-Pope, and that the longer she continues defending her Minister, the more questions will be asked about her own credibility?
Rt Hon HELEN CLARK: As I said to the member in the House yesterday, he should not assume that the conclusions he jumps to are shared by others. I have a stack of letters supportive of Mr Benson-Pope.
Hon MARK GOSCHE (Labour—Maungakiekie) to the
Minister of Labour: What recent reports, if any, has she received on the minimum wage?
Hon RUTH DYSON (Minister of Labour)
: I have received a report on a survey of Wellington businesses, which shows that nearly 70 percent of those businesses support the raising of the minimum wage.
Hon Mark Gosche: Has the Minister seen any other reports concerning the minimum wage?
Hon RUTH DYSON: Yes, as a matter of fact, I have. I have seen reports in which the need for a minimum wage at all is dismissed. That indicates how out of touch with New Zealanders and the business sector Dr Brash has become, because his views are quoted in the reports.
Hon Mark Gosche: Has the Minister seen any other reports that are opposed to the idea of the minimum wage?
Hon RUTH DYSON: Yes, I have seen another report that suggests we abandon not only the minimum wage but also minimum holiday entitlements, parental leave, and the moves to close the gender pay and employment gap. Again, those are wishes expressed by Dr Brash.
Sue Bradford: Does the Minister consider the survey results that came out the other day from Wellington businesses to be a more accurate reflection of the views of business around this country about the need for a higher minimum wage than some of the other reports the member has referred to?
Hon RUTH DYSON: I assume that the survey results accurately reflect the opinions of those who were surveyed in the Wellington business area.
Peter Brown: Noting those favourable answers, certainly to the principal question and to the Green member’s question, will the Minister recommend to the Prime Minister that the words “if economic conditions permit” be deleted from the confidence and supply agreement between New Zealand First and the Labour Government so that we can guarantee that there will be a $12 minimum wage by the year 2008?
Hon RUTH DYSON: I think that that would be a total breach of the good faith in which those negotiations were conducted.
Social Development and Employment, Minister—Allegations
JUDITH COLLINS (National—Clevedon) to the
Minister for Social Development and Employment: What credibility can he bring to the position of Minister for Social Development and Employment, given the allegations surrounding his inappropriate actions in charge of young people?
Hon DAVID BENSON-POPE (Minister for Social Development and Employment)
: I do not accept the member’s proposition in that question.
Judith Collins: Does he agree that the numerous humiliating parodies of him, like this one, or this one, are indicative of widespread public opinion that he is deceitful, that he is a bully, that he is a pervert, and that he is not a fit person to be in control of children let alone be in control of an entire ministry charged with the well-being of all—
Madam SPEAKER: The member knows better than that. They are personal reflections. I refer her to Standing Order 371.
Rt Hon Winston Peters: I raise a point of order, Madam Speaker. The member cannot seek to hide behind the ill reporting of someone outside this House as a defence for that sort of behaviour. That member, being a lawyer, should well know that. She should be asked to thoroughly apologise, withdraw, and wash her mouth out. So should those in the media who seek to rush to judgment without one fact to back their story on.
Madam SPEAKER: Could the member please rephrase the question.
Judith Collins: Does the Minister agree that the numerous humiliating parodies of him, like this one, or even this one, are indicative that in the public’s opinion he should not be in control of an entire ministry charged with the well-being of all New Zealand’s young people, and will he now do the decent thing and resign that portfolio?
Hon DAVID BENSON-POPE: No, I think they are indicative of the welcome wit of cartoonists.
Judith Collins: How can he be a credible Minister for Social Development and Employment when nine students attest that he shoved a tennis ball into a student’s mouth, and he says that is “ridiculous”; when at least three women say he walked in on them getting changed, and he says it is “nonsense” and then apologises; and when a former principal—his former boss—says that he notified Mr Benson-Pope of a written complaint regarding his inappropriate behaviour, and the Minister now says he cannot remember it?
Hon DAVID BENSON-POPE: Making allegations is one thing, but for every allegation that has been made I have received many supportive comments from students, parents, and teachers supporting my teaching career.
Rodney Hide: Does he think that, as Minister for Social Development and Employment, he has any credibility when in 1998 on a school camp with fourth-form girls he walked though the dorm while they were getting dressed in the morning, not once but every morning, and when they complained about it his response was that they had nothing to worry about because he had seen it all before?
Hon DAVID BENSON-POPE: I certainly do not accept those propositions. I repeat my invitation to anyone who does have concerns to take them immediately to the appropriate authorities.
Judith Collins: How does he reconcile his statement to the House yesterday that: “… I remain convinced that my conduct as a teacher was not inappropriate.” with the statement of his former principal that his actions at the time were “just not appropriate”, and does he accept that telling stories that are at odds with students, principals, and parents severely compromises this Minister’s credibility?
Hon DAVID BENSON-POPE: I do not accept that statement either, and I am pleased to tell the member that one of the main reasons for that is contained in the document that I will be seeking leave to table when this question is finished.
Rodney Hide: Does the Minister believe that he can carry out his duties when he slapped a young girl pupil on the thigh, when it was against school policy, and he knew that it was—
Rt Hon Winston Peters: I raise a point of order, Madam Speaker. I am beginning to see the pattern of these questions from Rodney Hide. They do not come attached to any evidence whatsoever—
Hon Bill English: That’s not a point of order.
Rt Hon Winston Peters: Yes, it is a point of order and you will shut up while I repeat it.
Madam SPEAKER: Will the member please withdraw that comment.
Rt Hon Winston Peters: Yes, I will. I am entitled to be heard in silence and members are offending the House’s rules.
Madam SPEAKER: Yes, I agree. There is one rule for everyone to be heard in silence on the point of order. The member, however, should not tell another member to shut up in that way.
Rt Hon Winston Peters: I raise a point of order, Madam Speaker. That is not the first time today that I have raised a point of order again to a loud cacophony of sound from National members. It is wrong, and they are not getting away with it in this House as far as I am concerned. My point is that what this member is doing is, not once but on countless occasions, raising an allegation with no future preparedness to table any evidence to back it up. That is wrong, and as a former Speaker’s ruling once said, although he may get away with it once, if he repeats that pattern then someone is entitled to demand that he table the evidence now to back up the assertion, and I am making that demand right now of him. Rather than a whole lot of things that he says he knows, let us see just one of them that we all might know.
Rodney Hide: I thank the Rt Hon. Winston Peters for raising this issue and I make this point. Yes, I have raised questions for this Minister in this House—questions that he has vehemently refuted, said were false, and actually caused me some considerable discomfort. Every one of these questions was demonstrably shown to be true by the very authorities that Helen Clark is saying we should go to. I would like to put my track record for making allegations up against that of the Rt Hon Winston Peters, a man who has never got it right; it is me who has got it right, in respect of that Minister.
Madam SPEAKER: I understand the point of order from both members. I remind all members that this is question time. It is a time to ask questions, not to make allegations. Would the member please rephrase his question as a question to the Minister.
Rodney Hide: What credibility does the Minister think he has as the Minister in charge of social development, the infirm, children, and the elderly, when as a teacher he slapped a young girl on the thigh, which was against the school policy at the time and, indeed, against the law—or will he deny that, as well?
Hon DAVID BENSON-POPE: I am happy for the New Zealand public to make its own judgment about my actions. I completely refute the ridiculous statement that has just been made by Mr Hide.
Rodney Hide: I raise a point of order, Madam Speaker. I think this Minister’s answers are often quite important to subsequent developments in this House. I could not hear whether the Minister denied the allegation.
Madam SPEAKER: I could hear it. There was not the level of barrage there normally has been, so most members obviously heard it, as well.
Rodney Hide: Point or order—
Madam SPEAKER: It will be in
Hansard, as the member knows.
Rodney Hide: I raise a point of order, Madam Speaker. I ask, through you, Madam Speaker, to hear the answer, because you heard the answer and I did not, and I am sorry for that. Did the Minister deny slapping a young woman on the thigh?
Madam SPEAKER: Is this another supplementary question?
Rodney Hide: No, I am asking you, Madam Speaker, because we have to do supplementary questions. I never heard the answer.
Madam SPEAKER: The Minister has given his reply. If we have to interrupt proceedings every time a member did not hear everything, we would not get through question time.
Rodney Hide: Point of order.
Madam SPEAKER: I am sorry. I have ruled on that matter, Mr Hide. If it is a new point of order, you are perfectly entitled to make it, but it had better be a new point of order.
Rodney Hide: Absolutely new.
Madam SPEAKER: I am sorry, what was the last comment you made?
Rodney Hide: Absolutely new.
Madam SPEAKER: Thank you.
Rodney Hide: I raise a point of order, Madam Speaker. We do not get too many questions in the House. It is not my fault that other people call out and barrack so that I cannot hear. I am entitled as a member of Parliament to ask a question and to have—[Interruption] Well, it might be all right for Mr Peters to interrupt during a point of order when he complains about it, but I am entitled as a member of this Parliament to answer a question and to have a reply. I did not hear it. You said that you did, and that it would be in
later. Well, that is good, but it is very, very hard to ask supplementary questions when one does not actually hear the answer. I was asking you, Madam Speaker, particularly from the perspective of a small party—which, sadly, is ACT—to give us a bit of help and say whether he denied it or whether he did not.
Madam SPEAKER: I thank the member. The member gets considerable help from the Speaker, I must say. I would point out to the House that it is not the Minister’s fault that the reply was heard not by the member but by others. So I say to all members that in future it would be wonderful if we could have question time in silence. I do not expect that, and that is not what is required, but I would ask us to move on now.
Judith Collins: Why did the Minister tell John Campbell of TV3 yesterday that he would be available for interviews, and then did not front up; does he not think that that sort of behaviour compromises his credibility as a Minister?
Hon DAVID BENSON-POPE: That is not what I told Mr Campbell. I would note that I was subsequently disappointed that Mr Campbell did not have the integrity to say he was taping me. I said I would make a decision about that matter later in the day.
Judith Collins: Did the Minister ever enter a girls’ changing room after the school policy change in 1997?
Hon DAVID BENSON-POPE: I am not aware of any further allegations in that regard. I am happy to confirm that I do not believe that any of my actions have ever been outside the school policy of the day.
Treaty of Waitangi—Historical Claims
PITA PARAONE (NZ First) to the
Minister in charge of Treaty of Waitangi Negotiations: What initiatives, if any, are under way to ensure that historical Treaty claims are able to be settled expeditiously?
Hon MARK BURTON (Minister in charge of Treaty of Waitangi Negotiations)
: This Government has already implemented a number of initiatives to expedite the Treaty settlement process, such as establishing three additional teams to assist claimants to enter negotiations and to achieve settlements. It is our manifesto commitment that all historical claims be lodged by 1 September 2008, so that we can proceed to settle all claims by 2020.
Pita Paraone: Has the Minister seen the draft report from the Law Commission entitled
Waka Umanga: A Proposed Law for Māori Governance Entities, which contains the recommendation that Māori-specific corporate entities should be established and mandated for iwi groups at the beginning of the settlements process; does he not agree that the adoption of that recommendation would speed up the entire Treaty settlements process?
Hon MARK BURTON: I am indeed aware of the report. I can say to the member that this year officials are working on a series of initiatives to further streamline all aspects of the claims process. The content of that report will certainly be taken into account.
Dave Hereora: What progress have those additional teams made towards just and timely settlements?
Hon MARK BURTON: As to the teams that I referred to in my initial answer, over the last 3 years we have seen six deeds of settlement reached, and 13 groups have entered negotiations—five of those in 2005 alone. Three settlement bills were passed last year, and I expect another three to be introduced this year. Currently, the Government is in negotiations with over 20 groups, covering several hundred Wai claims.
Gerry Brownlee: Can the Minister confirm that the briefing paper to the incoming Minister in 2005 indicated that terms of negotiations have been signed with only 10 outstanding claimant groups, and that at the current pace it would take at least 15 years to conclude those negotiations and settle claims; if so, how can his claim that he is making progress more speedily than before be believed?
Hon MARK BURTON: As I indicated in my answer to the initial question, the pace of settlement, in part because of the initiatives taken by the Government in the last few years, is increasing. In the last 3 years, six deeds of settlement have been reached. Three settlement bills were passed last year, as the member knows, and I anticipate another three being introduced this year. The pace is increasing, and I anticipate that it will continue to do so with the initiatives the Government is taking.
Pita Paraone: Does the Minister agree that the establishment of Māori corporate entities, such as those recommended in the
Waka Umanga report, that have sufficient flexibility to meet the legal demands of accountability and corporate governance, while also embracing Māori cultural realities, is a positive step both for the settlements process and for Māori in general?
Hon MARK BURTON: I agree that the proposals in the report warrant serious consideration, and they certainly will get it.
Social Development and Employment, Minister—Allegations
Hon BILL ENGLISH (National—Clutha-Southland) to the
Minister of Education: Does he agree with the Prime Minister’s statement about the alleged 1997 incident in which, as a teacher, the Hon David Benson-Pope walked into the dormitory and bathroom of 14-year-old girls changing: “that he behaved in accordance with school policy at the time”; if so, what was that policy?
Hon STEVE MAHAREY (Minister of Education)
: I agree with the Prime Minister’s statement. I am also aware that Mr Benson-Pope has stated that his behaviour complied with school policy at the time, which, I understand, was for a staff member—
Hon Member: That makes it all right then, doesn’t it.
Hon STEVE MAHAREY:—does the member want to be quiet, so he can hear it—for a staff member, gender not identified, to give a wake-up or hurry-up call to students.
Hon Bill English: What standard of behaviour does the Minister of Education believe is appropriate for male teachers who are responsible for young teenage girls, many thousands of whom are on school camps right now?
Hon STEVE MAHAREY: Standards that comply with policies set down by their schools.
Hon Phil Goff: Can the Minister confirm that the claims and innuendo made several times now by Mr English and Dr Brash have in fact been contradicted by the statements made by the principal, who made it absolutely clear that: “There is no question about anyone entering the showers,” there was no question about any compromise of privacy, and the hurry-up call was made from the door; and, further, that those statements were in fact supported by the girls who were quoted in the
Herald on Sunday last Sunday?
Hon STEVE MAHAREY: Yes, I am aware that the account given by the principal differs from the account given by people such as Mr Bill English. It is my understanding, of course, that Opposition members have embarked upon using sources such as that from
Investigate as their sources of information. I do not think anyone in his or her right mind should use that journal as a source of information.
Rt Hon Winston Peters: Has the Minister of Education seen any photo, fact—even if it is only one fact—or piece of acceptable evidence from Messrs English, Brash, and Hide, or from Ms Collins, in respect of these allegations; and what will this do for male recruitment into important professions such as the teaching profession, and for the retention of males who are in those professions now, if someone can be scandalised in this House without one fact being produced to back it up?
Hon STEVE MAHAREY: I confirm that I have not seen any evidence from Mr English, from Ms Collins, or from Mr Hide. I imagine that all members in the House would like to see evidence, where it exists, because they, too, could have claims made against them at any time, and they also would want to see evidence.
Hon Bill English: Does the Minister believe that a school should hire a teacher surrounded by the following allegations: stuffed a tennis ball in the mouth of a student; hit a student in the face—accepted as prima facie by the police; slapped a teenage girl on the thigh; kneed a male student in the groin; entered a girls’ changing room while girls were showering; burst in unannounced on girls getting changed after a mud run; accused of bullying other teachers; and made pupils stand outside in the cold in their nighties, as verified by the police; should any school hire a teacher surrounded by that swirl of allegations?
Hon STEVE MAHAREY: I would hope that any school hiring a teacher would ensure that it found out the truth about any allegation surrounding a person, and would not rely on the words of Bill English, who routinely misleads on issues relating to the education sector, as he is doing today.
Hon Bill English: Can the Minister confirm that last week the Government defended Mr Benson-Pope by agreeing with his statement that the allegations were nonsense, that yesterday it defended him by agreeing with his statement that he acted within school policy, and that today it has changed its position again and defended him on the basis of its statement that the principal did not regard the behaviour as serious enough to warrant formal disciplinary proceedings; and will the Government change its mind again tomorrow?
Hon STEVE MAHAREY: The first point raised by Mr English was the one relating to the
Investigate magazine, where Mr Benson-Pope referred to it as nonsense. I regard anything in the
magazine as nonsense, by definition. The school policy at the time, as Mr Benson-Pope has pointed out, was for people to give a wake-up or a hurry-up call. That was the policy, and that is what he acted within, as I understand it. And, thirdly, do we rely on the principal’s statements? Well, he gives a range of statements and we have used those—just as he has—to provide evidence.
Hon Bill English: When will he show some leadership as Minister of Education and stop hiding behind sly half-truths and acknowledge that the behaviour that has been described is not the behaviour of a decent male, let alone a professional teacher?
Hon STEVE MAHAREY: I would regard the behaviour of a decent male to be that of getting up in this House and providing real evidence for the assertions he makes. If Mr English has the courage of his convictions, he might like to try to provide a bit of evidence for a change, and be a real man.
Rodney Hide. In response to the Minister’s answer, I seek the leave of the House to table the police report that shows a prima facie case against the Minister for hitting a pupil on the nose—
Madam SPEAKER: Leave is sought to table that document. Is there any objection?
Rodney Hide: —and for sticking a tennis ball—
Madam SPEAKER: I have understood, as has the House, the nature of the member’s comments. In raising this matter, the member needs only to identify clearly what the document is; it is not to give a speech. The document is the police report. Is there any objection to that report being tabled?
Rt Hon Winston Peters: I raise a point of order, Madam Speaker. I invite Rodney Hide to try to seek leave again, but if he gets up again and describes something as being a prima facie case, then how will the rest of us understand what on earth he is seeking to table?
Madam SPEAKER: My understanding is that what is being tabled is the police report.
Rt Hon Winston Peters: No, he said it had something to do with the police and that it was a prima facie report. With the greatest respect, I am not aware of that sort of document. Perhaps he could describe it to me.
Madam SPEAKER: I think the rest of the House understood that it was the police report. I shall put it. Is there any objection to the police report being tabled? There is no objection.
Hon Bill English: Can the Minister confirm that it is now the Government’s position that there is no evidence for any of the allegations that have been made against David Benson-Pope, that the police report has no merit, that none of the allegations involved serious behaviour, and therefore there is no case to answer whatsoever?
Hon STEVE MAHAREY: The police report is the police report. We have all read it, we all understand what is there, and of course, nothing was proceeded with from that. From the point of view of the Government, of course, we have heard a number of allegations, but we have not heard evidence that supports those. The member can provide that evidence if he would like to, but so far he has not been man enough to do so.
Madam SPEAKER: We are trying to eliminate those little innuendos and side bars. “Real man” has been mentioned several times in the House in different contexts.
Hon STEVE MAHAREY
: Madam Speaker, I would take your own ruling and say that if the member wants to serve it he will have to take it.
Madam SPEAKER: That is the difficulty we have, I must say; we do have responses across the House. So I think we should all note that for the future.
Hon Dr Michael Cullen: In light of one of the previous questions and answers, would the Minister regard it as appropriate for a school to hire as a teacher somebody who was convicted of pushing an elderly man down the stairs, or somebody else who was told point blank by a judge that he did not believe a word of what he had said, as happened to Dr Nick Smith?
Hon STEVE MAHAREY: As I said before, I would hope that all schools would have policies that would allow them to understand the character of the people they were hiring. If they were given evidence of someone who was convicted for pushing someone down the stairs I would hope they would not hire that person. If they were given evidence of someone who misled the court, likewise I would hope that they would not hire that person.
Hon David Benson-Pope: During my question earlier I intimated my intention to ask for leave to table a document I had received, and I now do so. I request leave to table a letter from a parent who attended a 1997 camp at Tautuku in the Catlins discussing the accusations that have been made.
- Document, by leave, laid on the Table of the House.
Rt Hon Winston Peters: I raise a point of order, Madam Speaker. This is in line with a point of order I raised before. I seek the House’s leave for time to be set aside so that Messrs Brash, English, and Hide, and Ms Collins can now table some evidence for the first time.
Madam SPEAKER: That is out of order. The member cannot seek that for somebody else.
Prisons—Health and Safety, Mt Eden
TARIANA TURIA (Co-Leader—Māori Party) to the
Minister of Labour: Will she be taking any action about the health and safety of employees following a Department of Corrections report into Mount Eden Prison which reportedly identified serious non-compliance with building codes and standards, fire, health and safety requirements; and a “medium” risk of sewage flooding into the exercise yards and other unsanitary conditions?
Hon RUTH DYSON (Minister of Labour)
: I am advised that since the Department of Corrections information was compiled in 2004, to which the member referred, all issues identified by the member have been addressed.
Tariana Turia: What workplace health and safety strategy has the Minister considered for Mount Eden Prison, which Department of Corrections officials report as facing a high likelihood of service failure, the consequences of which would be catastrophic; and why has it taken 2 years for the Government to respond?
Hon RUTH DYSON: I will start by first answering the last question that the member posed. It has not taken that length of time, at all. In fact, all the issues that were identified in the report have been addressed in the 12 months since that information was compiled. The Department of Corrections has a responsibility to take all practicable steps to comply with the Health and Safety in Employment Act 1992, and my officials will continue to work with the Department of Corrections officials to continuously achieve that goal.
Simon Power: What action will the Minister take to elicit an explanation from the Minister of Corrections, given documents that show: “The cost of approving the use of Corrections working capital to fund Spring Hill and Otago is that deferred maintenance risks such as Mount Eden will not be able to be met from the department’s existing funding streams.”, and does she consider that a satisfactory response to the ongoing health and safety issues at Mount Eden Prison?
Hon RUTH DYSON: My responsibility is to ensure that the legislation is complied with. How the Department of Corrections uses its finances, and whether it uses that as a negotiating point in budgets, is not my ministerial responsibility.
Darien Fenton: Does the Department of Labour automatically prosecute an employer if health and safety standards are compromised?
Hon RUTH DYSON: No. Prosecution is not the department’s first reaction. The most important reaction is ensuring that the workplace is safe, and that the employer is committed to taking all practicable steps to ensure a healthy and safe workplace environment. In fact, the criteria for prosecution are that it is the only way of achieving compliance, but the employer has avoided compliance to gain a deliberate economic advantage; that there is a careless disregard for the safety of the workforce; and to ensure public accountability. In my view, that is an appropriate threshold.
Dr Pita Sharples:
Kua kite anō ia i te ripoata a Bob Harvey, te Tumuaki o Waitakere, mō te whare herehere o Mt Eden e kī ana: “Kāre e taea e ngā kaihanga atāmira mō te Ariki o ngā Rīngi te hanga atāmira e weriweri ana, e kino ake ana i tērā whare herehere whakarihariha kei te mōhiotia e tātau. He makariri, he mākū. Kāre e taea te whakamahana, te whakatikatika. I hangaia i ngā tau 1880 mō ngā mauhere 120. I tēnei wā, tata atu ki te 360 kei reira. He wāhi aurere, mokemoke hoki. Ki tōku whakaaro ko ngā raiona ahakoa kei roto i te rāwhi whakaaturanga o Tāmaki, ā, mate noa rātau, ka nui atu ake ngā wā e whakakorikori tinana ana, e hākari ana, e paenēne ana i te rā ki ngā mauhere kei Mt Eden.”; nā, āhea ka whakatikatika ai tēnei kāwanatanga i tēnei āhuatanga e whakamā whānui nei i a tātau?
- [An interpretation in English was given to the House.]
Madam SPEAKER: I remind the member that it is question time.
Dr Pita Sharples: I raise a point of order, Madam Speaker. My question—as it will be revealed—contained a quote, in order to preserve accuracy, and that lengthened the question.
Madam SPEAKER: The translation will be included. I accept that, but I still remind members that it is question time.
[Has the Minister read the report from the Mayor of Waitakere City, Bob Harvey, about Mount Eden Prison: “A set maker for
The Lord of the Rings]
Hon RUTH DYSON: No.
Tariana Turia: Given that a former Minister of Corrections, the Hon Matt Robson, believed that Mount Eden Prison should be replaced by the year 2003 because of the condition it was in, what response has the Minister made to the Corrections Association of New Zealand, which warned—after inmates were housed in prison vans last year—that Mount Eden Prison is particularly at risk, because ongoing muster problems have led to an increase in assaults on staff, and riots, and that even the death of a guard could eventuate?
Hon RUTH DYSON: I am not the Minister of Corrections; I am the Minister of Labour, and the responsibility of the Department of Labour is to ensure that the health and safety in employment legislation is complied with by all employers, including the Department of Corrections. My advice is that no complaints have been laid with the Department of Labour, in relation to any activity or concerns around Mount Eden Prison, since the middle of last year. The member raised a number of concerns in her primary question, and I have been advised that all those issues in relation to health and safety have been addressed.
Business Tax Review—Expected Outcome
JOHN KEY (National—Helensville) to the
Minister of Finance: Does he stand by his statement that he envisages some very bold measures emerging from the business tax review currently under way?
Hon Dr MICHAEL CULLEN (Minister of Finance)
John Key: Is the Minister’s business tax review considering a cut to the corporate tax rate, together with the introduction of a payroll tax; if so, what does he consider will be the benefits of that scheme?
Hon Dr MICHAEL CULLEN: A whole range of options are being looked at. Unlike many members opposite, Mr Dunne and I are not afraid to think.
John Key: Can the Minister recall that at his request in 2004 Treasury calculated that to cut the company tax rate to 20 percent, with no loss of revenue to the Crown, would require the introduction of a payroll tax of 5.4 percent; if so, does he find such a concept appealing?
Hon Dr MICHAEL CULLEN: I can recollect those numbers. They would be subject, obviously, to a great deal of recalculation. In both cases they would be significantly lower than the corresponding Australian rates.
John Key: Is an objective of the Minister’s business tax review that proposals be revenue-neutral; if not, how large does he envisage the impact will be on the Crown accounts?
Hon Dr MICHAEL CULLEN: Those matters will be settled as part of the review.
John Key: Did the Minister’s statement to the Finance and Expenditure Committee a few weeks ago that some of the options being considered by the review may prove to be “too big and too bold for a wide variety of stakeholders, including officials” indicate that the payroll tax scheme he is working on is his own idea, and that others will have trouble accepting it?
Hon Dr MICHAEL CULLEN: It indicated that sometimes one can dream, and that other people do not like dreams.
Hon Peter Dunne: Does the Minister also recall seeing a statement that said: “we are not persuaded that reducing this tax”—that is, company tax—“… would have any materially beneficial effect on growth,”; and is he surprised to know that that came from the National Party’s 2004 economic policy position paper?
Hon Dr MICHAEL CULLEN: I remember the quote as if it were yesterday. It came directly from Dr Donald Brash.
Research, Science and Technology—Recent Initiatives
MOANA MACKEY (Labour) to the
Minister of Research, Science and Technology: What recent initiatives will enhance education and science research in New Zealand?
Hon STEVE MAHAREY (Minister of Research, Science and Technology)
: Today I have some outstandingly good news. The Government has committed $43 million over the next 5 years to build the Advanced Network, which is a high-speed advanced communications network. It will link our universities with our Crown research institutes, and link them both to a worldwide network that will significantly enhance their ability to do research in this country. I should note that the $43 million put forward by the Government will be matched by the universities and the Crown research institutes themselves. It is a fantastic development.
Moana Mackey: What other investments is the Government making to accelerate New Zealand’s economic growth through science?
Hon STEVE MAHAREY: There is so much good news that I will restrict myself to the following: the Government is investing around $175 million a year, or 15 percent of the total research and development budget, to support biotechnology research. A report I released this week reinforces the value of that investment, because it tells us that just four biotechnologies alone returned $400 million to New Zealand last year. That has to be put against the fact that 62 percent of all biotechnology is still in a developmental stage. We are clearly watching a rising part of our economy, from which we will get huge returns.
R Doug Woolerton: Why has it taken so long to regain the focus of agricultural science, given that it is now many years ago that Simon Upton initiated the disastrous changes that led to a 40 percent drop in agricultural science, according to Fonterra?
Hon STEVE MAHAREY: Ever since the Labour Government has been in office, of course, that focus has been reversed, and we are now on the right track.
Small Business—Advisory Group Report
KATHERINE RICH (National) to the
Minister for Small Business: Does she stand by her statement to the House on 14 February 2006 that her Government had accepted 18 of the 19 recommendations from the Small Business Advisory Group’s first report “outright”?
Hon LIANNE DALZIEL (Minister for Small Business)
: As I have said publicly, the word “outright” probably does not reflect the sense of immediacy sought by the Small Business Advisory Group in its recommendations, and reflected in its scorecard. That is something I will be discussing with its representatives when I meet with them on 14 March. The member needs to understand that the recommendation and report-back process is ongoing, and I am confident that the next set of scores will be improved.
Katherine Rich: Now that the Minister accepts that the word “outright” was an overstatement, when the Small Business Advisory Group gives her Government a lukewarm rating of five out of 10 for its response to its first report, does she accept that saying the Government had accepted 18 of the 19 recommendations “outright” was at best an exaggeration and at worst a porky?
Hon LIANNE DALZIEL: I would remind that member that it was this Government that set up the Small Business Advisory Group. There was no such thing, and not even a Minister for Small Business, when her party was in Government. The group made 19 recommendations to the Government, only one of which was rejected “outright”—the personal grievance - free period. Not surprisingly, that was the only one that the Small Business Advisory Group scored zero out of 10. Unlike the National Party, the Government does not agree that employers should be able to sack workers without reason.
Hon Dr Michael Cullen: Can the Minister confirm that the statement was made on Valentine’s Day, and that it reflected the love affair between her and the business sector?
Hon LIANNE DALZIEL: I can confirm that it was made on Valentine’s Day.
Katherine Rich: How does the Minister reconcile her claim of outright acceptance of the report’s recommendations with the group’s conclusion that the Government has “been awarded an averaged mark of 5.3/10.” and “done little to transform that response into tangible outcomes for business.”?
Hon LIANNE DALZIEL: As I said to the member, I am meeting with the Small Business Advisory Group on 14 March in order to discuss its response to the Government’s response to its first report. There is an issue in respect of its grading of some of the Government’s responses, because it divided it into two parts: policy and implementation. I want to discuss with the group some of the implementation stuff. We scored very well on the policy—we scored over five on 12 of the recommendations.
Maryan Street: Which of the Government’s responses to the Small Business Advisory Group recommendations were scored by the group in its second report, released on Monday, at 10 out of 10?
Hon LIANNE DALZIEL: Our responses to three of the recommendations got a full 10 out of 10, which I think is fantastic for the first report we have received. These recommendations include the Small Business Advisory Group’s No. 1 recommendation: “That the Government enhance funding to up-skill mentors and mentor co-ordinators in order to provide a superior service to clients and to market their services.” Our responses to the No. 5 and No. 6 recommendations were accepted by the Small Business Advisory Group as also having achieved a 10 out of 10 rating.
Peter Brown: Is the Minister aware that many employers employ people casually because there is no such thing as a grievance-free probationary period, and would she be more kindly disposed to a grievance-free probationary period if some rules governing casual labour were in place?
Hon LIANNE DALZIEL: The core issue here is the employers’ concerns, which have been expressed by the Small Business Advisory Group, about the risk of taking on new staff. The Government is actively addressing this by providing better information about good practice in employing and managing staff through, for example, the new Department of Labour publications
How to Hire Guide for Employers and
Katherine Rich: Is it not pathetic that the Minister skites in the House today about three of the 19 recommendations her Government has accepted, when the Small Business Advisory Group has given her Government an overall rating of five out of 10, and what is the point of meeting, listening, and reporting, if she is going to ignore what the group says?
Hon LIANNE DALZIEL: I think it is a bit rich that those criticisms are directed at the Government by a party that, when in Government, had no Minister for Small Business and no Small Business Advisory Group. The Government’s policy program already addresses 18 of the 19 recommendations that have been made, and more are to come. I remind the member that the Small Business Advisory Group has included in its new set of recommendations only two of the previous recommendations, because it believes me, not her.
Maryan Street: Does the Small Business Advisory Group have any input into Government policy other than through its annual report?
Hon LIANNE DALZIEL: Yes, the advisory group has had significant influence, and is now regularly consulted on tax matters, and on policies and programmes run by the Department of Labour, the Accident Compensation Corporation, New Zealand Trade and Enterprise, and Statistics New Zealand, to name but a few. All of these issues are highly relevant to small to medium sized enterprises, and the Small Business Advisory Group’s advice has been extremely valuable. I am glad we have a Small Business Advisory Group. If I had wanted to hire yes-people who just patted me on the back for everything I did, without giving me the small business lens, then I would want to work for Don Brash—because that is all he wants from his spokespeople.
Debate on Budget Policy Statement
SHANE JONES (Chairperson of the Finance and Expenditure Committee): I move,
That the House take note of the report of the Finance and Expenditure Committee on the Budget Policy Statement 2006. This document is replete with fantastic ideas. It is premised on three key themes. The first theme is economic transformation, the second is families, and the third is identity. The document was dealt with by the very competent—and more than adequately chaired—Finance and Expenditure Committee, and was the subject of a very lucid presentation by the Treasurer. It is offered at a time when the economy is going through a cycle of less than fantastic economic growth. However, this cycle was foreseen, was looked at by Treasury, and comes as no great surprise.
What is the Government doing in this document? In contrast to the Opposition, we have something very rare on that side of the House: ideas. These ideas are focused on growing families and investing in infrastructure. Why is that important? It is important because we need a strong economy. A strong economy will deliver the living standards that our children and our grandchildren expect of us. How well has this economy performed under the fantastic stewardship of the Government and Dr Cullen? Obviously—and it will come as no surprise to the Opposition—it has grown 25 percent over the past 6 years, and nowhere is the growth happening at a greater pace than in those areas where technology looms large. I shall say more on that shortly.
In regard to a very innovative policy that we reflect in this document and in which we have great pride—and I hope all the university students are listening to this very good speech—from 1 April 2006 we will have our interest-free student loan scheme policy. Why is that good? That is good because it will no longer beggar and belabour families who want to see their children go on to tertiary education, and those children will be able to add to the march of people enriching the productivity of the economy.
In addition to that, what else are we doing? Unlike the Opposition, we have not forgotten about families. In fact, we are expanding the Working for Families package. It is a fantastic policy, and people are clapping up and down through the four winds in Aotearoa for it.
In addition to that, the policy reflects the fact that our export sector has not performed as well as exporters would have liked. Why is that? Amongst other reasons is, obviously, a high dollar. That brings us to the point reflected in this Budget Policy Statement: a high dollar cannot coexist with profligate fiscal policy similar to that which has been promoted by various speakers from the Opposition benches. For those reasons, I have no doubt that during the upcoming Budget rounds fiscal discipline and prudence will be a major point of interest. That is because too much loosening feeds inflation, inflation feeds interest rates, and interest rates worsen the prospects for our exporters.
However, let me continue with some of the brilliant policies that are reflected in our document. In the New Zealand superannuation scheme for married couples, there is an adjustment to 66 percent of the average weekly wage. What we have is a seamless approach: the retiree community has been well and truly listened to, the working community has been well and truly catered for through our policy of focusing on families, and the rangatahi—the young people—are well and truly catered for through a student loan scheme. Also through the policies that we will introduce, there will be a focus on childcare. Those policies reflect the seamless approach that this document is overwhelmed with.
I will continue in relation to capital expenditure. An additional $1.9 billion, we have heard, has been allocated for capital expenditure.
Hon Member: Borrow for education.
SHANE JONES: A point has been raised as to why we do not have more borrowing. Well, fortunately, we will not get caught up in failed schemes, such as those we have seen in Australia, where essential infrastructure was handed over to private enterprise. Rather, we will continue to observe the necessary fiscal discipline and, where there is cash-flow operational capacity, it will be put into enriching the capital expenditure needs. Why? Because we lived through a deficit in the 1990s, when unwise decisions were made in the belief that the market would simply deliver. There is no better example of where the market did not deliver in the 1990s than in the debacle of our railway sector.
In addition to that, one of the most visionary policies, which is now acquiesced in by the Opposition is, obviously, our Superannuation Fund. That is forecast to increase in value from 4.3 percent of GDP in June 2005 to 12 percent in June 2010. Operating surpluses are predicted to be sufficient to meet the Government’s contribution to the fund over the forecast period. This indicates the very long-term strategic focus that this document reflects: taking care of business for the future, enabling more young people to educate themselves and not be saddled with unreasonably high levels of debt, and providing for a capital fund that contributes to the costs of an ageing population.
In respect of technology, we need to be able to grow our export sector, given that the entrance of labourers into the labour market is about to drop by 50 percent over the next 15 years. So how ought an economy to deal with that fact? Obviously, it is by productivity and by investing in technology. Therefore, technology—which people will no doubt hear about—will loom large as we continue onwards throughout this particular period of time. I think it is important to bear in mind that people throughout society, including doyens from the business community, have identified how comprehensive, constructive, and visionary this document is. So I tell those members who constantly prattle on and moan that we are being left behind by Australia, that it comes as no surprise that Ralph Waters, one of our better chief executive officers in the construction sector, tells people that things are really good in Aotearoa land.
Now let me continue in relation to those rather negative things that are constantly said about there being indications pointing to a business downturn. I need to quote from Jason Wong from First NZ Capital. What does he say? He says that business confidence is a coincident indicator. The surveys give rise to some consternation, which is exaggerated by members opposite. Those members worsen that consternation because they do not have a string of ideas.
The National Party had an opportunity last year to sell to the New Zealand public and to the electorate a series of ideas that blended social, cultural, and economic ideas. What did National members do with social ideas? They got members of the Exclusive Brethren to write their policy for them. What did they do with cultural ideas? They decided to demonise, stigmatise, and undermine the contribution of the Māori community to society. And what did they do in relation to economic ideas? They fled backwards and promised to shrink the State, which is why we are transformational whereas they are transistors. They would slash spending and try to recreate the failed policies of the 1990s. That did not work then. They have not contributed any ideas other than moaning and diversionary tactics, because deep down this document has captured the imagination and the support of the electorate. And nowhere was that better reflected than in the election result.
So what are we going to see in the upcoming Budget round? Well, that lies at a detailed level with Dr Cullen. However, to recap, there will be ongoing investment in our students. Those students know who their friends are.
Dr DON BRASH (Leader of the Opposition)
: The Budget Policy Statement finally dashes any hope New Zealanders might have had that this Labour Government cares about the gap between living standards in New Zealand and living standards in Australia. It dashes that hope. In 1999 after-tax incomes in Australia were 20 percent higher than after-tax incomes in New Zealand. Today after-tax incomes in Australia are 33 percent higher than those in New Zealand. All the indications are that over the next 2, 3, or 4 years that gap will continue to widen. The Australian Government will be cutting taxes; the New Zealand economy will be growing more slowly.
Equally worrying is the fact that over the last 5 years, growth in output per person, growth in productivity, has been a miserable 0.8 percent per annum in this country—substantially lower than in Australia. Everybody knows, even if Helen Clark and Michael Cullen do not, that we will never overtake Australian living standards unless we narrow that gap in productivity, and right now we are not beginning to do so. So on present trends we are going backwards vis-à-vis Australia, and is it any wonder that we have an increasing outflow of our brightest and best New Zealanders across the Tasman? Over 600 Kiwis are leaving for Australia every week.
It is no wonder, also, that reported just this week was the worst trade deficit in New Zealand’s history since 1976—in 30 years. It is the biggest-ever deficit in absolute terms, and the biggest deficit in terms of the relationship to exports, in 30 years. Over the last 5 years we have seen Government spending and Government hiring growing much faster than the rest of the economy, and, partly as a consequence, we have seen employment in the sectors that are not generating exports grow strongly by 25 percent over the last 5 years. We have seen growth in employment in agriculture, fishing, and manufacturing actually shrink by 1 percent over the last 5 years.
Why is that? In large part it is because Government spending has been growing too fast. While value added has been growing strongly in the domestic parts of the economy—the non-tradable parts of the economy—we have seen that value added in the primary sector has grown by just 1 percent over the 5 years to June 2005. There has been 1 percent real growth in the primary sector. It is simply not true that exports have not been growing because of the volatility of the New Zealand dollar. The New Zealand dollar is not more volatile than other major currencies, and that has been established by the Reserve Bank over many years. The main reason the export sector has been growing too slowly to keep our international trade in balance is that Government spending has been growing too quickly and the non-tradable parts of the economy have been growing too quickly. The Reserve Bank has had to increase interest rates. As a consequence, the exchange rate has been high, and that has put pressure on exports. It is not the volatility of the exchange rate affecting our export sector; it is the speed at which Government spending is growing.
What does the Budget Policy Statement say about the future? It says there will be slower growth, at 2.8 percent, over the 5 years to March 2010 than in the 12 years since 1993—that is what the Budget Policy statement says. There is no sign at all that the Government has any idea how to make that growth faster.
Mr Jones indicated in his speech the major initiatives likely to be in the Budget. What are they? We will have interest-free student loans. Well, that sure as Hanover will not increase growth at all—not at all. It will have no effect on growth. Why? Because the Budget Policy Statement itself says the number of people in tertiary institutions will actually decline slightly. It will be lower in 2010 than it is now. We will be dishing out $1.5 billion in new loans in 2010 with fewer students in 2010. There is nothing there for increasing growth at all.
The second thing the Budget Policy Statement has is a big amount of money being spent on the Working for Families package. There may be some benefit in that for many families—
Jill Pettis: And they will spend it in towns.
Dr DON BRASH:—but it is bought at the cost of significantly higher effective marginal tax rates, which that member may not understand, which will be very high over a very wide range of low and middle incomes. There is nothing at all for growth in that package. It may make Labour voters feel good but it sure as Hanover will not do anything for economic growth.
The third thing Mr Jones talked about was the fact that the Budget will increase the entitlement for New Zealand superannuation from 65 to 66 percent of the average wage for a married couple. That may very well be something that is very constructive for older New Zealanders, but it is not at all relevant to growth.
It is a sad document. I am not even, at the moment, talking about the imminent slow-down of the economy, which is a real challenge to the economy in the short term. Many people will lose their jobs and many businesses will fail, and that is a serious issue. But much more serious is the fact that the trend growth rate of this economy will be slower in the next 5 years than it was in the last 12 years. This Government has absolutely no answer to that at all.
Lindsay Tisch: Devoid of ideas.
Dr DON BRASH: It is devoid of ideas, as my friend Lindsay Tisch points out. This Government has been in office more than 6 years and the forecast growth rate is markedly slower—not just in cyclical terms—for the next 5 years than it has been in the last 12 years. That is the most severe indictment on this Government’s performance. After 6 years in office, growth is forecast to be slower in the next 5 years than it has been in the last 10 or 12 years.
Once upon a time some New Zealanders believed Helen Clark and Michael Cullen when they talked about raising New Zealand living standards into the top half of the OECD. Once upon a time some New Zealanders believed Helen Clark and Michael Cullen when they said they were proposing to close the gap between New Zealand and Australia. Once upon a time some New Zealanders believed Helen Clark and Michael Cullen when they talked about economic transformation and raising productivity. Once upon a time some New Zealanders believed Helen Clark and Michael Cullen when they said they were aiming for growth of at least 4 percent per annum. Once upon a time some New Zealanders believed in the tooth fairy.
Hon CLAYTON COSGROVE (Associate Minister of Finance)
: That was, for those who may not have known it, the leader of the once-great National Party. That was the leader who leads a National Party whose only tactic is not to stand by our country and our economy, not to put up policy or ideas, not to propose, as we do, how to do things better, and not to continue, as we have for the last 6 years, to continually transform and enhance our economy. No, the only tactic and the only idea that that member—the once-great Governor of the Reserve Bank—now has is to run the economy down. The only tactic that the National Party has—and it is interesting that the member is moving about—is to desperately pray for rain and to desperately pray that the economy will fly to pieces, that people will lose their jobs, and that the country will go to hell in a handbasket. I do not call that a tactic based on patriotism. There is another word for it, but we will not go there.
Dr Brash the doom merchant has been criticised by one Ralph Waters. It is very interesting what people out at the coalface, like Mr Waters, the chief executive of Fletcher Building, say. They are out there doing the business, not pontificating from the ivory tower that Dr Brash spent years in. Here is what Ralph Waters said about a speech that Dr Brash made on 31 January this year, in which he poured doom and gloom on the economy and basically said we were heading for the rocks.
Dr Don Brash: No, no, that’s wrong.
Hon CLAYTON COSGROVE: I say to Dr Brash that squawking will get him nowhere—they are the last words from a man on his way out, I would think. Mr Waters said in the
Dominion Post: “I fear the risk for this country is if enough people keep saying there is going to be a recession, it will be a self-fulfilling prophecy and there is no need for such gloom from how we see demand in the marketplace.” Now, that is what the chief executive— There “old chirpy” goes again, squawking away. He had 10 minutes in this House to get up and make a statesmanlike speech, and tell us his vision for the economy and for the country—what he would want to do if we were unlucky enough to have him leading this country.
Hon Member: Not one idea.
Hon CLAYTON COSGROVE: He does not have one idea, my colleague says. He has not one policy, yet he squawks like a sort of strangled chook. Well, Dr Brash will learn, once he has been here a wee while, that his interjections show him up for what he is—and he is light.
I support the Budget Policy Statement because it is about transforming our economy, and looking after our families, young and old, and it is about something called “framing national identity”—something that Dr Brash once hypothesised about. He was asked—I think when he was on an aircraft—what it meant to be a New Zealander, and he could not answer. I think he said that it had something to do with being in first class. I could give him 4.2 million ideas as to what it means to be a New Zealander, but we will not transgress there. But it shows the lack of vision, the lack of ideas, and the lack of depth from the once-great Governor of the Reserve Bank. Others have also criticised Dr Brash.
I ask Dr Brash and the National Party where their policy for families is. We have one, the Working for Families package, and we are implementing it. We have an aim of looking after our families, young and old, and we are doing that. Where is National’s policy in respect of transforming our economy? Where is its KiwiSaver scheme, for instance? I recall Dr Brash, the once-great Governor of the Reserve Bank, saying the key challenge—
Jill Pettis: He wasn’t.
Hon CLAYTON COSGROVE: Oh, he was. He raised everybody’s interest rates. The key challenge facing New Zealanders, he said, was how to increase household savings. He went on to say that he was frankly not sure how this culture of low household-sector savings could be changed. The only option, he hypothesised, was that the interest rates at the time he was Governor of the Reserve Bank were too low to encourage savings and discourage borrowing. I ask him today where his scheme is. Where is the National Party vision and policy to encourage Kiwis to save? The only thing the National Party has, apart from rolling out the doom and gloom, is to drop taxes and cut spending. That is the panacea of National Party members. That is the depth of their economic analysis. They tried it in the 1990s and they imploded our economy. Where have they come from as we enter the 21st century? Is there any new vision from Dr Brash and his team, even though they now have John Key, whose name, I am told, is “National Velvet”?
It is interesting that in the Budget Policy Statement debate the finance spokesman is put in the back shed—I wonder why—and that the leader gets up and hypothesises. I wonder why Mr Key was not given the lead speech.
Where was Dr Brash’s vision on savings? He has said for years that we must encourage savings. He is in the position of Leader of the Opposition, he says that he is a potential Prime Minister, yet he has no idea how to promote a savings scheme or how to change the culture of New Zealanders. We all know that New Zealanders ain’t that great at saving, but Dr Brash hypothesises, and says nothing. Yet he squawks like a headless chook from the back benches opposite.
Where is Dr Brash’s package on student loans? He had a go at our package to assist students. If members ask any grandparents in this country, they will find that their biggest fear before the election, apart from Dr Brash getting in and slashing their superannuation, was that they would not see their grandchildren again because those grandchildren had huge loans and the only way they could pay them back, or maybe not pay them back, was to go offshore. Yet Dr Brash on the stump, and today, said that he wants to encourage these young, bright Kiwis back. But where is his policy to do it? It is not there.
Our policy is to allow those young people to come back, and to knock off the interest as an incentive to do it. Our policy is to retain and look after our young people—to retain them and incentivise them to stay. I used to have a student loan, unlike Dr Brash. I am probably about the only member in this House who has done a degree under both schemes and who knows what it is like to have a student loan and to do it under the old scheme. The member opposite skated through. He would not know, he is not in touch, and he has evidenced that by his speech in this debate today. What is National doing for young people? Nothing. What is National doing for—[Interruption] I say to Mr Tremain that I would be careful if I were he, after what I heard at a select committee today.
The ASSISTANT SPEAKER (H V Ross Robertson): Order!
Hon CLAYTON COSGROVE: What is Don Brash’s policy on our older folks? His only policy, of course, was to wobble around on superannuation. We still do not know what his policy is today, just like we do not know what his nuclear policy is. Our policy is clear. Our policy is to look after our elderly folk. The National Party’s usual tactic is to never let the facts get in the way of a good story, and that is a tactic the Opposition uses in a number of theatres.
In conjunction with my remarks on the Budget Policy Statement I will just say that we heard a lot in the House today during question time. I put this comment to the House—it is about the atmosphere in this place—and I ask senior members to consider it very carefully: the protocols have been broken by the new Joe McCarthy of the House, Mr Hide. We all know where Joe ended up—a drunk, disavowed by his President, disavowed by his party, and disavowed by his mates. That is how Joe McCarthy died. People ought to reflect on the nature of their conduct in the House. We are approaching what I think is a new form of McCarthyism, and McCarthyism was predicated on the fact that silence said a person was guilty. McCarthyism was predicated on the principle of finishing people with slimy innuendo—a little salacious titbit here, and a little salacious titbit there. Mr Hide—“Joe McCarthy”—is a master. People’s lives were destroyed and people’s reputations were sullied.
I know, and it is interesting, that there are people on National’s side of the House who have been in the education profession and know what it was like to be an educator back in the 1960s and 1970s. Yet we do not hear a lot from them. We could draw some conclusions, but I caution the House. This is an honourable place. I am hugely honoured to be a member of this Parliament and hugely honoured to be a member of the executive. Children and adults come into this place and are in awe—possibly not of the personalities in here, but certainly of the institution that is Parliament. If we are not very, very careful there will be no rules and there will be no protocols for anyone—even for those who sit next to you, Mr Assistant Speaker—and a new form of McCarthyism will be alive and well, and shame on this Chamber for it.
Dr DON BRASH (Leader of the Opposition)
: I raise a point of order, Mr Speaker. I invite Mr Cosgrove to table any evidence he has at all suggesting that Ralph Waters criticised me in his speech in early February.
The ASSISTANT SPEAKER (H V Ross Robertson): It is up to the member whether he tables anything. It is only official documents—
Hon Paul Swain: Read the Standing Orders, Don.
The ASSISTANT SPEAKER (H V Ross Robertson): Order!
Hon Clayton Cosgrove: Point of order—
The ASSISTANT SPEAKER (H V Ross Robertson): The member will sit down, please. Points of order are heard in silence, and there is a reason for that.
Hon CLAYTON COSGROVE (Associate Minister of Finance)
: I raise a point of order, Mr Speaker. I am quite happy to assist the House. Perhaps Dr Brash misunderstood the point I was going to make. I am quite happy to table Mr Waters’ quote from the
Dominion Post of 16 February 2006, which states: “I fear the risk for this country is if enough people keep saying there is going to be a recession, it will be a self-fulfilling prophecy”, and I point out that that is exactly what Dr Brash has been doing for years.
The ASSISTANT SPEAKER (H V Ross Robertson): That is not an official document.
LINDSAY TISCH (National—Piako)
: I raise a point of order, Mr Speaker. I thought you might have interrupted the member. He was making a speech. That was not a point of order. Dr Brash asked specifically for a document to be tabled that supported the position he took. It is either in order or out of order. For the member to then stand up and take a couple of minutes to make a speech and to quote from a document is completely out of order, and he should have been pulled up for it at the time.
Hon MARK BURTON (Minister of Justice)
: I raise a point of order, Mr Speaker. The problem for the senior whip opposite was the so-called point of order from Dr Brash. Clearly, Dr Brash was aware that Mr Cosgrove had referred to the
Dominion Post article. He was clearly aware that it was not an official document, and therefore his point of order was not one.
The ASSISTANT SPEAKER (H V Ross Robertson): I just say to members that it is one all, and I would like to move on.
JOHN KEY (National—Helensville)
: In case anyone is confused, we are actually here to talk about the economy and the Budget Policy Statement. That was a classic speech by the honourable member for Waimakariri. It is no wonder that Mr Cosgrove did not say anything about the economy, because he does not know anything about the economy. He is just sent down here to act like the loveable bulldog that he is. Poor old Clayton—
The ASSISTANT SPEAKER (H V Ross Robertson): Order!
JOHN KEY: Poor old Clayton Cosgrove has spent his life being desperate to get into Cabinet. He did everything he could to get into Cabinet. He bought himself a nice new tie to take to Cabinet. Now that he is in Cabinet, he has worked out that the benchmark is David Benson-Pope. That is what it takes in order to get into the Labour Cabinet. Well, I have news for Labour members: they will all have a chance to get into that category. It is no wonder that Labour chose to put Mr Cosgrove down to debate the economy—he knows nothing about it. He should go back to worrying about noisy cars, and leave the economy to some people on the Opposition side of the House who know exactly what they are talking about in that regard.
It will be interesting, when the Budget does roll around—the Minister of Finance told the Finance and Expenditure Committee today that 18 May is the Budget date. What will surprise most New Zealanders will not be what is actually in the Budget, because we know that the Government was in free fall when it decided it was a great idea to write off the interest on student loans for all New Zealanders. The Government’s only problem was that it had a document from Treasury that told it that the policy would have a colossal effect on borrowing in New Zealand. It had a document from Treasury that told it that the policy would cost billions of dollars a year to run. The Government had not actually worked out that that policy would cost us $1.5 billion—that is the write-off from that policy alone on the balance sheet—and that that is what will flow through the Government accounts, through into the Budget Policy Statement, and ultimately through into the Budget, when the Minister gets up to read it on 18 May. So New Zealanders will not be surprised to see that cost in there.
New Zealanders also will not be surprised to see the Government’s “Welfare for Families” package in the Budget. But they may be surprised to learn that New Zealanders who earn $142,000 a year will be eligible for Working for Families. That is above the level where even the top personal tax rate cuts in, in Australia; that rate is set at around $125,000 a year for the moment. New Zealanders will not really be surprised to see KiwiSaver in the Budget either, even though the Minister of Finance knows it is very unlikely to be successful. So New Zealanders will not be surprised to see those things there, and they will not be surprised to see the little trinkets that came about from the various coalition and support arrangements that the Minister of Finance and the Prime Minister had to sign up to, as they cobbled together one of the poorer Governments we have seen in New Zealand’s history. All of those things will come as no surprise to New Zealanders when they see the Budget on 18 May.
What may surprise New Zealanders slightly, in fact, is not what is in the Budget but what is not in it. They will see one of the largest surpluses in New Zealand’s history, and they will be surprised that no tax cuts are in there, at all—not even a hint of a tax cut, to encourage New Zealanders. What is very interesting about Michael Cullen is that he gets up in the House and tells New Zealanders that they will respond to incentives when it comes to saving. KiwiSaver is such an incentive, and New Zealanders will be given $1,000 if they put money into KiwiSaver. So New Zealanders apparently respond really well to incentives, according to Michael Cullen, when it comes to savings, but when comes to—
Dr the Hon Lockwood Smith: What about tax?
JOHN KEY: When it comes to tax, he does not want a bar of incentives. We should know who to look to when we look for personal tax cuts, as my good friend Dr the Hon Lockwood Smith will know. Lo and behold, today when Dr Smith asked the Minister of Finance about the contradictory statements made by the Minister of Revenue, Mr Dunne, and Michael Cullen, and asked who should be believed, Dr Michael Cullen, in a very sincere way, looked across at the microphone and said Dr Smith should believe the buck stops with Dr Cullen. He said members should not worry about Peter Dunne, even though he signed the coalition arrangement. Michael Cullen said the buck stops with him, and if he says there are no tax cuts, then there will be no tax cuts.
Interestingly enough, I raised with Dr Cullen today what I thought what was a very simple question. In 2000, when Labour came into office, Government revenue was 38 percent of GDP, and today Government revenue is 45 percent of GDP—7 percent higher. That increased percentage equates to $10 billion. I said one would think that if a Government had $10 billion more, annually, than it had thought it would have, it could afford to give New Zealanders a tax cut.
When the Government has $10 billion more in any 1 year, can it afford a tax cut? Well, the Minister of Finance, 2 weeks ago, told the Finance and Expenditure Committee that any New Zealander who thinks there should be a tax cut on the back of the massive surpluses should be quietly taken out and drowned. I hate to tell the Minister of Finance that he is obviously condemning many, many New Zealanders—in fact, the majority, because the majority voted for parties that supported tax cuts at the election—to a watery grave at the hand of the State. I am sure that is probably not what he intended—but maybe it was, after all.
It is also very interesting that Treasury officials, who call things the way they are, today told the Finance and Expenditure Committee that growth would be much weaker than they had anticipated. Although they could not quantify what that weakness would mean, we asked them about growth in the September quarter, which we know was 0.2 percent. I asked the Secretary to the Treasury, Mr Whitehead, to tell us what he thought growth would be in the December quarter, the report on which comes out at the end of March. He said he did not know. I asked him whether he thought it was possible that the growth number would be negative. He said he could not quite put it in those words, but that if it was not negative, it could be zero.
For 6 months, the New Zealand economy has not grown.
Dr the Hon Lockwood Smith: Just stood still.
JOHN KEY: Well, it is wandering around in the wilderness, while every other economy is becoming more competitive and more productive, and is carving out a greater slice in the world. We are left with Michael Cullen and his ideology. I will give an indication of why we are wandering around in the wilderness, while other countries are getting on with it. On Monday Peter Costello, the Australian Treasurer, made what I thought was a pretty interesting move: he appointed two very pro-business people to a committee to look at taxation. The Australian Treasurer said to those two pro-business people that he wants them to report back to him, within 5 weeks, with some positive things Australia can do to stimulate its economy and some productive things it can do around its taxation system. The Australian Treasurer wants to implement those things by May of this year. We have heard from Michael Cullen that he will look at the business tax review—and I will get on to that in a moment—but that we will not see anything from that until 2008.
Well, it will take until beyond 2008 to convince people that Michael Cullen’s latest and greatest idea—a payroll tax—is a very good idea. Dr Cullen is a very smart guy, and I am sure he has thought it through that many of New Zealand’s export industries rely very heavily on staff, and that it would be quite difficult for those industries, were staff to go away. Labour, which, we are meant to believe, is the party of the workers, wants to put an impost on the employment of people. Its strategy is to roll out a payroll tax that will see a drop in the company tax rate. Some companies will pay less tax—I accept that—and a whole lot more of them will pay a payroll tax for every employee they have, at a time when unemployment is rising in New Zealand and is likely to rise more.
My leader, Dr Brash, talks quite a bit about this Government’s lack of ambition to get New Zealand into the top half of the OECD. I can assure the public of New Zealand that they will not need to read the Budget, or hear it read, to know that absolutely nothing in that document will raise New Zealand higher in the OECD rankings. In fact, we know that it would take 10 years of double the per capita growth we have had to get there, and that will not happen under this Budget. New Zealanders need to understand—in just the same way that Treasury tells our select committee what is going on—the facts. We are not in the first division of OECD countries nor in the second division of OECD countries. We are in the third division of OECD countries. When we look at countries that are not in the OECD and take a global perspective on the world, we see that we are 40th on a per capita income basis. The Falkland Islands are 36th, and the Faroe Islands are 42nd. Many, many small nations are doing very much better than us.
For 6 years we on the Opposition side of the House have sat back and waited for the Labour Government to do something. The previous National Government delivered to the Labour Government the strongest economy that any Government has inherited, and in 6 years Michael Cullen has done one thing, and one thing alone. He has ratcheted up spending, claimed that he is a prudent manager of the economy, and put more and more things into the economy that make us less competitive, less productive, and less likely to achieve the sorts of returns we need. Very soon Michael Cullen will read his seventh Budget, and it will be just like the other six: a very, very great disappointment to our country.
Hon BRIAN DONNELLY (NZ First)
: Yet again, National leaders are proclaiming that our economy is in a tailspin and that depression is just around the corner. In fact, the reality is that the economy has grown—that is indisputable—by around 25 percent in the last 6 years, compared with the OECD average of 16 percent. Admittedly, it was off a low growth base, but who was in Government during the previous 9 years? In reality, if it had not been for the astute handling of the Asian crisis by the then Treasurer, the Rt Hon Winston Peters, the growth rate would have been at an even lower base 6 years ago.
It is also indisputable that we have historically low unemployment rates—at 3.4 percent, the lowest rate in the OECD. It is debatable as to what degree those economic statistics can be attributed to the Government of the last 6 years. What, however, is not debatable is that gross sovereign-issued debt as a percentage of GDP has fallen and is predicted to drop further to, or lower than, 19.3 percent by June 2010. Dropping the level of debt has to be seen in terms of future-proofing the economy against future shocks. I refer to National’s policy, which would increase debt to fund tax cuts. That would hardly future-proof us.
New Zealand First supported Labour’s introduction of the Cullen fund. New Zealand First differs from the current administration, not over whether there should be compulsory savings—anyone who ignores the need for decisions to be made now condemns our elderly population to disaster in 30 to 40 years’ time—but we believe that such savings should be held in individual accounts to future-proof those savings against the rapaciousness of certain parties that may, God forbid, win the Treasury benches in the future and raid the Cullen fund.
However, for us to assess the economic performance of a Government purely and simply in terms of economic indicators such as growth and surpluses is simplistic. It gives no indication of how decisions relating to economics impact upon people’s lives. I was fascinated to hear Don Brash say that the Working for Families package may make Labour voters feel good but it does nothing for growth. I say to Dr Brash that I am happy I grew up in a period of time—and it was totally under National Governments, with the exception of the 3 years of the Nash Government—when Governments were committed to a redistribution of wealth to families, and particularly to families with children. I am really glad I grew up under that sort of regime.
When Jenny Shipley and her National - ACT - Mauri Pacific - Alamein Kopu Government reduced the floor of superannuation payments to married couples to 60 percent of the net average wage, it probably assisted the traditional economic indicators. However, not captured in the figures was the suffering of superannuitants. Therefore, the reference in the Budget Policy Statement that next April’s annual adjustment to the rate of New Zealand superannuation will lift the married couple rate to 66 percent is in fact joy to the ears of those of us in New Zealand First. A large number of superannuitants have told us how wonderful that $10 per week in their pocket will be to them. For many it will mean that they will be able to interact with their grandchildren—surely a fundamental expectation in our society—by simple things like buying them birthday and Christmas presents.
New Zealand First is also proud of the role it has played in creating the statement that more resources are to be applied to the justice sector, including the boosting of police staff numbers. I commend the Minister of Police, who happens to be here, who ensured that what we thought was in the agreement was reflected in reality—that they are to be front-line police. What is the point, for example, of having the best economy in the world if people feel insecure in their homes and scared on their streets? National would have given tax cuts so that the rich could hire their own security guards, while at the same time it would have slashed police numbers and left the ordinary citizen with no protection from rape, burglary, assault, and all those other sorts of violations.
I also take note of the statement on page 81 of the
Half Year Economic and Fiscal Update 2005: “The Government is in the process of developing options for a new immigration service delivery strategy that would allow better management of the risk surrounding immigration decision-making.” I might state that, for the last 3 years of the previous Parliament, the Labour-led administration denied that there was any risk. But, in the end, the strength of New Zealand First’s argument has prevailed. Out of this strategy will come a strong immigration policy, based on meeting the needs of the country rather than on aiming at creating a population of 10 million, which is the policy that the previous National administration had on a policy that satisfied a feel-good factor for those of Green persuasion.
I also note that on page 85 there is a reference to a new taxation regime for the racing industry. This is under way and will have a major impact on rescuing this very important sector of the economy from incipient collapse. We note with satisfaction reference to a review of arrangements for the payment of superannuation to New Zealanders residing overseas, and the treatment of overseas pensions paid to recipients of New Zealand pensions and welfare benefits.
The reason I mention these references is that they all derive from the confidence and supply agreement between New Zealand First and Labour following the last election. I ask one question: what impact has National had on this Budget Policy Statement? The report raises questions about the quality of Government expenditure. This must always be a concern of Parliament, and there will always be debate about that quality, regardless of which party is in power. New Zealand First, for example, would consider that interest-free loans for students is poor expenditure. The interest rate should, at least, be set at consumer price index in order that students repay the true value of what they borrowed, and possibly even higher to encourage payback.
Finally, the report notes the commitments to the development of infrastructure, including transport infrastructure. I want to make the point that the National Opposition is being extremely disingenuous over the funding of transport infrastructure. It has long been a New Zealand First policy that all roading taxes should be directed to transport infrastructure. During the 1990s National strongly opposed New Zealand First’s position. It voted down a New Zealand First member’s bill. Even when we were in coalition with National from 1996 to 1998, in preparation for the 1998 Budget, we wanted an extra 4.2c per litre to go into transport infrastructure from roading tax. Bill Birch, with the support of the then Minister of Transport—the Hon Maurice Williamson, I might add—totally opposed that initiative. In the end, a compromise was reached so that the Budget allowed for an additional 2.1c to go into the transport fund from the consolidated account, where it was being siphoned off to. Then, to get up to 4.2c, an increase of 2.1c per litre was required. In other words, National insisted on a tax increase. National is now saying that we should be putting all the funding back into roading. We believe that that is disingenuous, given its record over the 1990s. It should say, purely and simply, that it has flogged yet another policy from New Zealand First.
We cannot deny—and I do not think that the present administration is denying—that over the next few years the economy will not be as rosy as it has been over the last 6 years. As I said, we have to ask questions about whether the positive growth that has occurred has been totally allowed for by Government policy. As a result, we need to recognise that huge demands for additional expenditure will not be made over and above what has already been agreed to. If the public and members of various different lobby groups think that that is going to be true, then I think they should think again. Nevertheless, it is the responsibility of the present administration to ensure that it manages the economy as well as it possibly can over the next few years. Certainly, the commentators are saying that it is not going to be anywhere near as bad as the leaders of the National Party, Don Brash and John Key, are predicting. The pessimism that those people are putting out into the market place can be nothing more than for political purposes, being potentially destructive of any advantage that the New Zealand economy may have. We should ask that they consider whether the national interests are being best served by the pessimism they are promoting for political purposes.
SUE BRADFORD (Green)
: This debate over the 2006 Budget Policy Statement gives us a useful opportunity to consider the recent economic history of New Zealand, and to look forward to the next financial year and beyond. We are told in this statement that the economy has grown by 25 percent over the last 4 years. But what is this growth all about? Has our economy become more sustainable? Can we call that 25 percent increase a success if it does not translate into greater human well-being or environmental sustainability? Rivers are still being polluted, basic health problems among so many of our children continue to increase, too many workers are still in insecure jobs with wages too low to sustain either themselves or their families, and so much more. We need measures of economic, social, and environmental success other than a mere growth in GDP. Unless this happens, we may well find that we have sacrificed our environment, our workforce, and our children in order to get up the OECD GDP league table. Moving up the table does not automatically deliver to the environment and to those who are most vulnerable in our society.
We are still heavily dependent on oil, which is driving our negative balance on trade in the current account deficit. Although George Bush himself has acknowledged that the US is addicted to oil, in Aotearoa New Zealand we seem to be oblivious to the short-term and long-term effect that oil dependency will have on our country. The year to January has seen the largest trade deficit ever. Nearly half the increase in imports lies in the cost of oil, yet we still have no standards for fuel efficiency in vehicles. We are building big new roads faster than ever before in history, with cries to build them even faster and with only very modest funds for public transport, cycleways, or traffic-demand management. We are doing all this despite the real question that we should be facing: how we will afford the fuel to drive in the future at the rate that we drive today.
The Budget Policy Statement sets policy targets for innovation and productivity, but only productivity of labour seems to be considered. What about the productivity of energy, which will be less available than labour in the future? We have failed to meet the targets in the National Energy Efficiency and Conservation Strategy, but there are no Budget measures to address this.
The biggest risk to our agricultural economy is climate change. It is also a big fiscal risk, as we are now liable for the cost of our carbon debts in 2012. Yet there are no policies to deal with this. The climate change policy is a shambles. The carbon tax has been abandoned and we will have to wait a year to see what will be put in its place, if anything.
Rod Oram’s reflections on the second Australia - New Zealand Climate Change and Business Conference in the
Sunday Star-Times of 26 February was very instructive. Mr Oram’s article begins with the paragraph: “The debate over climate change and the response to it have advanced dramatically over the past year in the rest of the world. In New Zealand, they have taken a great leap backwards.” He goes on to say how Governments, scientists, businesses, and environmental lobbyists around the world are making great strides in dealing with climate change and carbon tax issues, while New Zealand delegates at the conference had a sorry story to tell.
We are still waiting for the Minister to tell us how the funding shortfall left by the carbon tax will be met. Will expenditure be cut? If so, on what? Will other taxes be raised? If so, which ones, and how? Today renewable energy is a smaller proportion of total energy than 6 years ago, so we are actually going backwards on sustainability.
Most of the room to move in the forthcoming Budget has already been taken up by the student loan zero-interest package. Of course we support this, even though the Government’s policy in this area lags a long way behind our commitment to get rid of the student loan scheme altogether and to allow borrowers to pay off existing loans every year that they work in New Zealand following graduation.
We also support the Government’s move to extend the Working for Families package tomiddle and high income families. However, we have consistently opposed, and will continue to condemn, the continuation of its policy that denies the same support to the most vulnerable of all families—those on unemployment, sickness, domestic purposes, and other benefits. It is an absolute travesty that those New Zealanders and their children are punished because they are unable to work. We again ask the Government to reconsider its policy in that area and end the systemic discrimination against beneficiaries.
I also call on Government members to seriously reconsider the Minister for Social Development and Employment’s apparent commitment to going ahead with the abolition of the special benefit, and its replacement with the temporary additional support benefit. I doubt that many Labour MPs have seriously come to terms with the fact that once the temporary additional support benefit is implemented and the special benefit no longer exists, many people coming on to benefits will be deprived of badly needed income. The temporary additional support benefit removes discretion and is time limited, unlike the special benefit, which means that in the future tens of thousands of beneficiaries will end up with even less money on which to survive than they have now. That is an outright and drastic benefit cut, and I believe that if Labour MPs really understood what those changes will mean they would be urging the Hon David Benson-Pope to take urgent action to reverse his decisions in that area.
There are, however, some areas of the Budget that we are looking forward to. Those are the matters addressed in the Labour - Green Party cooperation agreement that was signed as part of the new Government formation process last year. The two key areas the Green Party is expecting Budget support for are the enhanced energy efficiency programme and the Buy Kiwi Made programme. We are also hoping that over this term of Parliament the Government will support building increased capacity for public passenger transport; increasing the number of students eligible for student allowances by increasing parent or income thresholds; further reducing levels of child poverty; increasing overseas development assistance; raising the minimum wage to at least $12 an hour, if not more; improving the nutritional environment, especially among children; enhancing organics advisory services; improving environmental education; doing more about endangered species conservation; and taking measures to further support the development of the community and voluntary sector.
I am responsible within the Green Party for the Buy Kiwi Made programme. We are working closely with the Minister for Economic Development’s office and the Ministry of Economic Development itself on this project. I have already met with a number of interested and potential stakeholder groups for the project. There is a great support coming through from businesses, trade unions, economists, and individual firms.
The main opposition we have encountered so far has been in the pages of last week’s
National Business Review that paraded three sirens for neo-liberalism to attack the programme. Can I assure the
and its doomsayers that the Buy Kiwi Made programme will not founder on its anti-interventionist rocks, but will become a major programme to celebrate the quality, tenacity, and courage of New Zealand companies and workers to support and promote what is made by, in, and for New Zealand.
Buy Kiwi Made has a number of goals. They are: creating awareness of the employment, economic, environmental, and social benefits of buying locally made products and services; building brand loyalty for New Zealand - made products; reducing imports, especially of consumption goods; helping to reduce New Zealand’s trade deficit; helping to increase New Zealand’s manufacturing capability; helping to create jobs; and helping to reduce fuel consumption.
Although in the scheme of things the Buy Kiwi Made project will be a modest exercise, the latest balance of payment figures show that it must be all hands to the pump to ensure that this country does not spend more than it earns. Reducing imports is just as important as increasing exports, and, in the end, much more sustainable. Yet, for too long, import substitution has been a dirty phrase in this country.
Economists sometimes tell us that to understand a national economy we have to think of it as a household. Well, let us do that. What would we think of a household where the parents concrete over half the vege garden, grass over the other half and put a cow on it, throw away the sewing machine, the workshop tools, and all the repair kits, and then give the kids credit cards with unlimited spending. Yet that is exactly how our economy is being run. No matter how hard the parents work, and how much they earn, the children continue to run up debt. The household continues to run up deficit after deficit. Then when the parents try to take the credit cards away from the kids, they are sued by the World Children Organisation for breaking its rules. Can the Government explain how that makes sense? Can National’s Mr Groser, who has helped write some of the World Trade Organisation rules, explain the sanity of the situation?
I look forward to the success of the Buy Kiwi Made project, but, even more important, to it being joined by other Government-Green initiatives that can tackle the rising trade deficit and help us develop the truly sustainable Aotearoa that we will need if we are to survive the environmental and economic crises of the next decade.
HONE HARAWIRA (Māori Party—Te Tai Tokerau)
: Before I came to Parliament, cost cutting, penny-pinching, keeping the freezer full, and making do were just part of the challenge of raising a whānau up north. After having spent some mind-numbing months on the Finance and Expenditure Committee I realised that the same principles are supposed to apply to Parliament and the national statement of accounts. Folks, I have to say that the accounts down here in Wellington just do not add up. One example is this. The Government is planning to spend an extra $13 billion over the next 4 years, but for some reason it cannot find the money to help the 250,000 poorest kids in Aotearoa. That is a damning indictment on this Government, reflected in the view of the Public Health Association, which challenged us that the health of children must not suffer because of Government policies. Quite frankly, we should not be patting ourselves on the back about how good the accounts look when our kids are going hungry.
In terms of income and growth we note that the country has a 3.8 percent growth rate, but that 60 percent of Māoridom still has an annual income of less than $20,000. In fact, at the time of the election the average income for Tai Tokerau Māori was less than $13,000. Again, the national accounts may look OK, but they sure do not stack up for Māori. Then at the other end of our population we note that the Government is expecting to have nearly $10 billion in a superannuation fund by 30 June, but for some reason there is still a massive difference in life expectancy between Māori and Pākehā. So although every Māori taxpayer, like everybody else, will be expected to contribute to that super fund, very few Māori actually get to receive the benefits of it. Again, the glitter of the accounts does not measure up to the reality of those most in need. We need to take a harder look at the way in which we present our national accounts, and consider a more realistic and more honest measure of the state of our nation, because our well-being, our health, and our future as a nation depends on the prosperity of our total environment, not just on what is in the wallet.
The Minister of Finance spoke to us last week and painted a pleasant picture with words like “modest or mild slow-down” and “retail numbers coming off a bit”, and gave us the reassurance that the present track is within the Government’s comfort range. I also need to inject some reality into that comfort range. That reality includes the race relations report released this week that noted that indicators of well-being remain relatively poor for Māori and Pacific peoples in a number of areas, particularly health, economic standard of living, and education. It also includes the big difference between Pākehā and Polynesian in health problems like diabetes, heart disease, cancer, obesity, and smoking-related illnesses.
That brings me to just one of those areas—smoking. During the select committee process the anti-smoking lobby argued for a massive increase in the tax on tobacco. The reality in my electorate suggests that tax increases do not work well. When people are addicted to smoking, when the price is put up, what happens is that smokers get pissed off, they stop buying cigarettes, and they buy roll-your-owns instead. The health problems get worse more quickly and the country starts to pay out more for smoking-related health-care. I am a reformed smoker and, some would say, a bit of a pious and pompous prick about it as well, but I am also a politician and a proud member of the Māori Party, which is mounting a strong attack against the tobacco companies.
Nelson Mandela said that if one was a politician one had to be prepared to suffer for one’s principles, and the Māori Party is prepared for that. He also said that a political movement must keep in touch with reality and the prevailing conditions. While some might think that our position is a little wacky, the truth is that it is not hard to understand. The reality is that tobacco kills 600 Māori people every year and jeopardises the lives of all those around us who are smokers as well—family, friends, and workmates. Kids are particularly vulnerable, and the prevailing conditions of poverty and low wages are also part of that reality. So when I see people light up I think about things like the fact that 25 percent of those who die from smoking die 22 years earlier than non-smokers; that, like me, my co-leader Dr Pita Sharples stopped smoking, because it is all about whānau, and, like me, he also wants to live to enjoy his mokopuna; and that, for all of their best efforts, the “Just Say No” campaigns are barely working.
Yesterday the Australians said that, based on an inquiry into the effects of passive smoking on passengers, particularly children, they were considering legislation banning people from smoking in their own cars. I can hear all those smokers shouting out already: “How can they? This is my car; I can smoke in it if I want to!”. Well, remember when the bikies kicked up a fuss about wearing helmets? Now they all wear them and nobody blinks an eye. Remember what a fuss there was about us having to wear seatbelts? Now the first thing we do when we get into a car is put one on. And remember how we thought that kids’ car seats were dumb? Now every parents’ car has one. Sometimes we have to put personal choice aside for the greater good. Banning the production and sale of tobacco is one of those times.
When we look at the health of the economy, we must also look at the health of the people and the health of the nation. We must find a way of achieving genuine progress for Aotearoa. The Māori Party has adopted what is known as the genuine progress index, which measures progress based on positive contribution and negative activity. Smoking, for example, is a negative, because it takes $1.2 billion out of our pockets and add millions more dollars to the bill through health care—and for what? There are no positives about smoking.
I remind the House that smoking kills, and the tobacco companies keep smiling about it. Last year the number of cigarettes smoked increased to 2,436 million—that is 590 for every baby, every child, every daughter, every son, every mother, every father, every grandparent—every single person in Aotearoa. That is criminal. It is a good opportunity to remind ourselves that the GDP that the Government uses is nothing more than a measure of economic scale. The genuine progress index is the true measure of the health of our nation.
I know that only too well from our experience with Ngāwhā prison. The Department of Corrections did not tell us when it was building the prison that it would cost too much to build and that it would be just another 360-bed regional comprehensive prison, using the same obsolete practices that do not rehabilitate people, or that it would have to be repaired all the time because it has already started sinking into the geothermal landscape. The enormous financial and social costs of our record prison populations are a negative on the genuine progress index, and ones that we need to balance out with rational and forward-thinking debate on criminal and penal policies that encourage whānau to take responsibility for their own, that introduce alternatives to prison, and that can help victims, communities, and offenders.
The Māori Party well knows the risk of raising issues of principle like tobacco—gee, here I go again—and controlling crime, and the shots that people will take at us for daring to raise them. But if we want to achieve, then we must also be prepared to take the risks. In 25 years the population of the country will be more Polynesian, more Asian, better educated, and more multilingual. We need to consider Māori knowledge as an asset to the nation, and we must look at how we can harness the talents, values, and philosophies of our Pacific and Asian brothers and sisters. Treasury has no structured mechanism for recognising and dealing with the browning of our society. But a brown Aotearoa is like Pantene—it may not happen overnight, but it will happen—and we must factor that into our plans.
We must look at why it costs $2,000 per Polynesian child in hospital costs, and plan to insulate all homes to reduce the likelihood of asthma, which comes about because 30 percent of our homes simply are not insulated. We must look at new approaches in order to manage our natural resources better to cope with the peak oil challenge. Finally, a Brazilian, Paulo Freire, reminds us that we make the road by walking. If we want policy statements that bring about positive social change, we need to start doing it, to think outside the square, and to open the debate to others—to indeed make the road by walking. Happy are those who dream dreams and are prepared to pay the price to make those dreams come true.
GORDON COPELAND (United Future)
: The debate on the Budget Policy Statement takes place at a critical time for New Zealand. Growth in the New Zealand economy has slowed appreciably. Business confidence is low, and continues to decline. The merchandise trade deficit hit $7.1 billion for the year ended January 2006, which was the highest amount on record. That deficit represented 23 percent of the total value of all our exports, which is the largest figure in 30 years. The people of New Zealand are more indebted than ever before, with at least $158 billion now owed to overseas creditors.
The only thing in all of that that is stronger than ever is the Government’s balance sheet. I must say that the Government has exercised a degree of prudence during the last 6 years of strong economic growth, although I would argue that it has been somewhat tight, rather than prudent. But it is certainly true that the Government’s coffers are now overflowing with riches, and that its balance sheet is in tremendous shape.
It is against that background that Treasury, in its briefing to the incoming Government last year, stated that although it believed that New Zealand is currently well placed in a fiscal sense, the rate of spending increases in recent years will need to slow significantly to ensure long-term fiscal sustainability. But the Government’s Budget Policy Statement indicates that it intends to do just the opposite. Not only does it intend to ignore the recent advice of Treasury on that point but, in fact, it intends to go in the opposite direction. I will give some figures to back up the statement I have just made.
For the year ended June 2001—the first full year after this Government took office—core Government expenditure was 31.3 percent of GDP. That figure reduced slightly to 30.6 percent of GDP for the year ended 30 June 2005, which is the date of the latest Government balance sheet that we have. However, in spite of Treasury’s advice, the Budget Policy Statement forecasts core expenditure to rise to 32.6 percent by 2008. That is 2 percent of GDP more than for last year. The total core Government expenditure in 2008 will be a whopping $55.4 billion. That is $9.2 billion, or 20 percent, higher than it was for last year. So in the next 3 years expenditure will increase, as a percentage of GDP, by 2 percent, or, in dollar terms, by $9.2 billion.
That is against the background whereby growth in the New Zealand economy has slowed from 4.7 percent per annum in 2003 to a forecast figure of less than 1.7 percent in 2007. So we have the contradictory situation that although the New Zealand economy is slowing—and slowing significantly—the Government is intent on going on a spending spree. Growth is down by 3 percent per annum, but Government expenditure, as a percentage of GDP, is up by 2 percent per annum. So there we have it, very simply: growth is slowing, the New Zealand economy is struggling, and the Government is intending to boost expenditure to that extent.
I believe that that is fundamentally wrong. The Government must not imagine that it can spend the country to prosperity. That is an impossibility. It is like a man trying to swim to the surface with a great weight tied around both his hands and his legs. He will not make it, and we will not make it either as a country if we go down the pretence pathway that somehow we can spend our way to prosperity.
It is also something that is fundamentally unfair and inequitable in terms of its impact on the New Zealand people. Whilst businesses have lost confidence, and are retrenching and struggling to maintain profitability, which has an effect in terms of their ability to pay increased wages and salaries or to take on extra people—we know we are now beginning to see lay-offs in many companies—those who happen to be paid from the public purse will be insulated from all that. They will be put into a privileged position where they are fine and dandy, whilst those in the rest of the country, which is actually the productive sector, are struggling, and struggling greatly. We want the productive sector of the New Zealand economy to grow—not the Government bureaucracy—and that message needs to be formally taken on board by the Government. It is better by far that businesses are allowed to swim than that the Government weigh them down.
That is why the business tax review, as part of the Government’s confidence and supply agreement with United Future—it is happening only because we asked and negotiated for it—coupled with a decrease in Government expenditure, is so important. I put this proposition also to Dr Michael Cullen, whose fingerprints, of course, are all over the Budget Policy Statement. I make the point that if he is prepared to spend $9.2 billion in extra money, then he can alternatively use part of that for tax reductions for businesses. There is scope to do it, and it would be a far better and more effective thing to do. The submissions to the Finance and Expenditure Committee from Federated Farmers, Business New Zealand, the Business Roundtable, and many others, all made this central point: it is time for the Government to rein in its bureaucracy and expenditure, and to allow more of the hard-earned prosperity of this country stay in the pockets of businesses, so that they can grow, provide employment, and increase the productivity rate, and so that we can lift the living standards of all New Zealanders.
I again say to the Government that it should be listening to that advice. There is actually no point in the Government having Treasury do the significant analysis that goes into the Budget Policy Statement if, on such a central plank as that, the Government continues to ignore Treasury. Dr Cullen told the Finance and Expenditure Committee today that, in a sense, he sees the boost in Government expenditure as stabilising the negative growth, but I do not think it is the Government’s job to do that—that should be left to the businesses of this country.
In addition, as the Business Roundtable set out on its submissions on the Budget Policy Statement, the Government should use its strong balance sheet to speed up investment in infrastructure. When I look at the statements of the Crown for the year ended 30 June 2005, and look down to net core Crown debt as a percentage of GDP, do members know what I find? I find 0 percent. In net terms the Crown, on its own balance sheet, has no debt. I say to the House that if I were working as the chief executive of a large corporation, and I had business opportunities for growth ahead of me but no debt on the balance sheet, I would be sacked. That would be the reality, because it is important that we go ahead and make investment in order to decongest transport in Auckland, Wellington, Tauranga, and other places. It is extremely important that we upgrade the electricity grid, so that we can get electricity to people at a reasonable cost. The Government should be using the strength of its balance sheet to get those sorts of things moving, and moving fast.
United Future favours borrowing for those projects, with repayments spread over 30 years or so, so that we can get ahead and do those kinds of things. Those are the sorts of investments that have the potential to grow the economy, to grow our prosperity, and to ensure that all New Zealanders are better off. That is not revenue spending; revenue spending is of dubious quality. It is actually good investment in the future of our country. It is the way in which we can boost productivity and support business, and it is the path towards prosperity for our nation.
RODNEY HIDE (Leader—ACT)
: It is always a great pleasure, in relation to the Finance and Expenditure Committee, to follow Mr Gordon Copeland and, indeed, Mr Hone Harawira. I enjoyed both contributions to this debate. I listened most attentively to both speeches, and I agree with everything that Gordon Copeland said. We certainly have a problem in this country with the economy going down, and with the Government over the next 3 years expanding its expenditure and effectively squeezing out the private sector. Of course, that is what is driving up interest rates, through the inflationary impact.
I was staggered to be reminded by Mr Copeland that the increase in Government expenditure over the next 3 years is a whopping $9.2 billion. We often sit on the Finance and Expenditure Committee and talk about a billion dollars. It just rolls off one’s tongue, but it is a very hard figure to get one’s head around. It is a thousand million dollars.
Mr Copeland talked about an increase in expenditure of $9.2 billion, and he said that core Government expenditure would rise to $55.4 billion. To give members a feel for what that is, I want to paint a picture of what it would look like. Most people in this House or listening to the radio can at least imagine a $100 bill. I want members to imagine a $100 bill, and to then imagine a bundle of $100 bills worth $10,000 and standing just so high. We can imagine those bundles being stacked up on a table. We would put one bundle, another bundle, and a third bundle—and there is $30,000, which is a lot of money, but just so high. That is what Jonathan Hunt spent on his taxi chits in 1 year.
Then we go a bit higher to $40,000, $50,000, $60,000, $70,000, and $80,000—and ask how high $1 billion would stretch. Well, it would not be just to the ceiling here; it would be way beyond that. It would stretch for a kilometre. So bundles of $100 bills stacked up to equal $1 billion would be a kilometre high. Of course, $1 million is just a metre high.
So that gives us a comparison of $1 million with $1 billion, and when we look at what Dr Cullen is spending in the year 2008, we see that it is $55.4 billion. That is money taken from hard-working New Zealanders, which would stretch 55.4 kilometres high. The increase alone in expenditure would be 9.2 kilometres high and, quite frankly, I would not let Dr Cullen spend $100 of my own money and think that he could do a better job than I could.
Hon Chris Carter: No one would want to give you any money. It’s like Fiji; tell us about Fiji.
RODNEY HIDE: Well, I know that Chris Carter would not know what money was, but I believe it is shocking to think that Government expenditure over the next 3 years will expand by that amount. So I agree with everything that Mr Copeland said.
I want to pick up on a point that my colleague Hone Harawira made. Of course, he is quite right: smoking is a terrible, terrible thing. It is a terrible thing for the health of New Zealanders, and what makes it particularly tragic is that those who are most addicted to smoking are oftentimes those who can least afford it. It is such a tragedy amongst young Māori, still, to see them taking up the habit of smoking, despite the best efforts of people and the knowledge we now have about what it will mean. I just find it so sad when we see those beautiful young people with nice skin and healthy bodies, but they are having a smoke and, unfortunately, we know how they will end up looking in 50 years, how it will affect their health, and how with even their best endeavours they may not be able to quit easily.
But I want to quibble a wee bit with Mr Harawira’s suggestion that we ban tobacco, as the solution—
Tariana Turia: Ban the sale.
RODNEY HIDE:—that we ban the sale of tobacco. I want to explore that, if I may, and ask Mr Harawira to consider what it would mean. The difficulty would be that people would not stop smoking. People would still smoke, and the first thing we would have to do would be to increase the resources of the police enormously, so they could go around and catch people who were illegally growing tobacco, manufacturing tobacco products, and possibly smoking tobacco.
I know that Tariana Turia said that we will pull them up just for selling it, but it is the same business. If we catch those smoking tobacco we have to find out whether they have bought it from somewhere. So there would be a huge increase in the State’s resourcing of the police, to police the smoking of tobacco in this country of ours.
Prohibition would also make criminals of those who bought and sold tobacco, and presumably we would need some penalty against them. Do they go to jail, do they get fined—what do we do to people who buy and sell tobacco? Also, of course, nothing would help the criminal gangs in New Zealand more than the prohibition of tobacco, because that would make the growing and the sale of tobacco a huge underground industry. I do not think we would necessarily see less tobacco being smoked in the end than we do now.
So I caution about the use of prohibition. Yes, I would love to live in a country where no one smoked and people did not buy cigarettes, and where young people in particular did not take up the habit. But I urge caution about the idea that somehow through prohibition we can wave a magic wand and remove a drug such as tobacco. And my comments apply with equal force to other drugs and whether we are going about controlling them in the best way.
The Government talks about economic transformation, and there has been a transformation under this Government. The transformation has been the transfer of money from the pockets of working people and business people to the Government. That is the transformation that has occurred: everyone is feeling a bit poorer because everyone is paying a bit more tax. While the Government crows over the fact that it has a positive balance sheet, the economy turns turtle.
I know that Michael Cullen likes to heap scorn on Adam Smith, but Adam Smith’s point was, in part, to explain that a country got rich not by having a king who had a lot of gold but through the sum total of the wealth that was created by its citizens through trade, and that measuring a country’s wealth by its Government’s treasury was a complete mistake. Michael Cullen, who thinks he is so clever about economics, does not understand even the most basic point made by arguably the very first economist—that is, that the wealth of a country is not measured by how much money the Government has.
Day after day we are subjected to Dr Michael Cullen suggesting that, because the Government has taken a lot of money from working people and businesses and put that money into its own Treasury, the country is in good shape, when actually it can mean the reverse. We heard that from Dr Michael Cullen in the Finance and Expenditure Committee today. The committee also heard what Michael Cullen had to say about the economic cycle. I found that very interesting—and Mr Copeland can confirm that I asked him what he thought had caused it. It is very interesting. According to Michael Cullen, when the economic cycle is on the up it is his good work, but when it is on the down it is everyone else’s fault and has nothing whatsoever to do with Michael Cullen.
We can go right back to Adam Smith and every economist since; we know the conditions for growing an economy. They are free trade, the maintenance of law and order, the maintenance of the basic utilities needed to run an economy—
Gordon Copeland: A stable currency.
RODNEY HIDE: —a stable currency, and a Government that keeps taxes low and spends wisely. Of course, with this Government we have the exact opposite: a Government that taxes hard and spends unwisely, and it, therefore, destroys wealth. Indeed, this Government does not allow people in business to go about their business, but hinders them every which way.
I do believe that we face some very serious issues in our economy. We face some very serious issues on the social welfare front, in health, and in education, and we face some very serious problems—to which there are no easy answers—in law and order and the maintenance of public safety. I do not see this Government, or, indeed, this Parliament, addressing those issues. That is the tragedy of the Budget Policy Statement. Where is the vision from Helen Clark or Michael Cullen as to where this country could be in the next 10 years? That is what we are lacking. That is why we need a better Government.
Hon PAUL SWAIN (Labour—Rimutaka)
: For those who did not know, that was Rodney Hide, the leader of the ACT party. The first part of his speech sounded to me very like the kind of gobbledygook recipe he dished up to the people in Fiji. Many of the people who went and listened to him in Fiji came away losing millions of dollars.
Hon Chris Carter: Poorer.
Hon PAUL SWAIN: They were the poorer for it. That is the kind of gobbledygook nonsense that that member constantly dishes up in this House, and he then has the cheek to lecture Michael Cullen and the Labour-led Government, which has turned round economic growth from very low figures to an average of around 4 percent for the last 6 years, which is well ahead of the OECD average. Rodney Hide used to believe in “values, not politics”. Do members remember that? Roger Douglas did some good things and some not so good things, but I do think he was a principled person. When he was starting the ACT party he talked about “values, not politics”. What he was trying to say was that people were interested in hearing about the big issues; they were not interested in the sleaze and the character assassination with which Rodney Hide has made his mark.
Hon Chris Carter: It’s his trademark.
Hon PAUL SWAIN: That is right—it is his trademark. He thinks that that is the way to build the party. That is why the party’s support is down, that is why it now has only two members, and that is why its coffers have dried up—because it has nothing to do with values; it is all to do with sleaze. Rodney Hide thinks that that is the way to build a party, and, of course, he is wrong. That is basically why he is inconsequential to the proceedings of this House.
The Budget Policy Statement sets out—
Rodney Hide: Tell us about David Benson-Pope! Why won’t Benson-Pope take an interview?
Hon PAUL SWAIN: The point about that comment, of course, is that the member realises that during the entire 10 minutes he had to speak he made not one policy statement on behalf of ACT—not one new idea, not one new thought, and not one constructive suggestion. That is why the ACT party and Rodney Hide are irrelevant to this debate.
The Budget Policy Statement sets out the broad strategic priorities that the Government is guided by in preparing the Budget. The three broad themes the Government is pursuing are economic transformation, families—young and old—and the importance of national identity. There is not sufficient time to go into all the huge measures the Government either has begun or wants to proceed with over the next 3 years, but I will mention a few.
The growth in employment figures is an outstanding, spectacular success, with growth rates that have been the envy of the OECD. Unemployment is the lowest it has been for decades, but the job is not finished. We recognise that growth will soften—there is no question about that—as we go into this phase of the economic cycle, but we are pursuing a number of measures. One is the Superannuation Fund, which is now such a huge success. National members opposed that at one stage, until they realised they had to jump horse very quickly or they would be in trouble.
Another success is in the area of skills training. The Government has resurrected the apprenticeship system that was killed off by Bill Birch in the 1990s. The tax changes for small business, which have just gone through the Finance and Expenditure Committee, are very, very positive for small-business development. We have also worked on productivity, which the Budget Policy Statement says will improve.
The second theme is the whole issue of families, with the Working for Families package and the announcements made prior to the election. The Government is now well on track to expand those measures, giving more opportunities to families.
The third theme is the issue of national identity, which this Government has taken really seriously—led, of course, by the Minister for Arts, Culture and Heritage, who happens to be the Prime Minister, who has put a real focus on arts, fashion, design, film, and all of those things New Zealanders do well. And, of course, we are having some huge successes in sport, including the magnificent performance of the Hurricanes. I have a feeling that this will be their season.
I want to compare that with the National Party. It is hard to get a single policy out of National at the moment. We have had a huge number of flip-flops. I do not want to flog the nuclear policy any more, because everybody knows that the National Party does not know what it stands for or what its policy is on that issue. So I will not even bother with that; that would be like flogging a dead horse. Then we had the flip-flop on superannuation.
Those members have also fallen into the trap of focusing on personal attacks and character assassination, and it is really sad. I have been in this place about 16 years and I have never known Parliament to stoop to the low levels it has been stooping to lately. I am sad about that because the situation will become worse. The real point is that we have always been able to keep away from that sort of thing, but it will become worse, and members opposite will have to start thinking about the things they have done in their past that may well come forward in this House. So I think a few of them will be sweating. The problem is that people who live by the sword, by and large, die by it.
I think that the problem with National Party members talking about, or even trying to reflect on, what their policy might be is that they are sounding like a stuck old seventy-eight. It is the same old policy: they want tax cuts—huge tax cuts—at a time when the economy is starting to slow, and they want to spend more. All National members of Parliament want to spend more. I have one such member close to my electorate. John Hayes, the member for Wairarapa, wants to build a tunnel through the Rimutakas. Of course, he has no idea how to fund it or what other projects might go by the wayside. National members just want to do whatever they like, say whatever they like, and borrow more. We heard this morning that the National Party is quite happy to give up on the debt target this Government has set. Those members would have tax cuts of huge amounts, borrow heaps, and spend more—and that is why no one takes them seriously.
Don Brash in his speech lamented the fact of the income gap between Australia and New Zealand. He forgot to point out, of course, that the labour market in Australia is much more regulated than New Zealand’s, and that workers there have been able to take a bigger dividend from the growth that has come about. What the leader of the National Party wants to be able to do, of course, is say that we should deregulate the labour market more. National thinks that somehow that will solve the problem. Of course, it will not. The National Party still believes that 4 weeks’ leave is an outrage, even though Australia has had it for about 30 years. That is one of the reasons why this Labour-led Government has introduced it.
But I think the problem with National Party members is that they are still obsessed with the leadership race, and I am obliged to tell those punters where things are at since last week.
Hon Chris Carter: Give us some tips.
Hon PAUL SWAIN: Well, I think that Don Brash has slipped back a bit. He has gone from $1.30 to $1.40, because he has become involved in sleaze and because of his inability to recall the deal with the Exclusive Brethren. With John Key, there is no change; he is on $1.50. Bill English has gone from $1.80 to $2, because he has become involved in sleaze. He knows that that is not the way to do it, so he has slipped backwards. Money is coming off him at the moment, so people are watching him closely to see whether he will keep on with that. If he keeps away from doing that, I reckon his odds will shorten again, and he will be back to more like $1.70. Gerry Brownlee has gone out to $8.
Hon Chris Carter: $8?
Hon PAUL SWAIN: Yes—$8. I think he has gone way out to that. But, of course, he has been handicapped by his past, and we do not want to talk about that. But he is carrying quite a lot of weight in that department, and I would say he is out to $8. Simon Power is on $3.50, I would say. That is where he is. I think that some of the money that is on him will probably go to one of the other contenders—probably to John Key towards the end. But there is still that big tussle going on at the moment at the TAB between Key, English, and Brash, with Brash, to be fair, with his nose out in front. Then, of course, there is Tim Groser. If one had a hundred bucks, one would put it on Tim Groser. He is paying $100. That would be a great return; that would be a real roughie. It would be a great return at $100-odd. If I had a hundred bucks, I would slip it on there, because we never know what will happen before they get to the finish line.
So the National Party is concerned about leadership. What the Labour Government is concerned about is economic transformation, families young and old, and national identity, and that is what the people of New Zealand want to hear about.
Hon BILL ENGLISH (National—Clutha-Southland)
: The Hon Paul Swain betrays, I think, Labour’s lack of judgment over the issues that are swirling around David Benson-Pope. If Paul Swain and the Prime Minister think that that issue will go away because they have started throwing some muck at some other MPs, then they have completely misjudged where public opinion is and where the opinion of this House is. Mr Swain should understand that the long list of problems now attached to David Benson-Pope and the seriousness of the actions and behaviour he has been involved in mean that he is the issue, not the National Party or Rodney Hide—and that is certainly how the public sees it. One teacher was quoted in the
New Zealand Herald
today as saying that this issue is “blowing teachers’ minds out there”. The very idea that a Government could tolerate, as a senior member of its own ranks, someone who has behaved in the way that he did is unacceptable.
Rodney Hide: They excuse him.
Hon BILL ENGLISH: Well, the Government has actually gone further than that at times by saying it never happened. So Mr Swain would do well to take the issue a good deal more seriously than to treat it as playground tit for tat, because it does not matter what he says about Gerry Brownlee. What has been said about David Benson-Pope by over a dozen young people who have been willing to come forward and say it publicly is what is in the public mind, and that is the issue that Helen Clark must deal with and, so far, she has chosen not to. In a way I would like to say that that is to the benefit of her political opponents, such as myself, but I think that a more serious problem arises from her inability to deal with the issue—that is, the erosion of the sense of respect for the authority of teachers and for the Government stewardship of public education.
But that is not the only issue where Labour is suffering from a credibility gap. The other one would have to be economic transformation. One imagines that when someone uses a word like “transformation”, something significant, something energetic, and maybe something new would be happening to the economy. Well, that has not been the case, at all. Economic transformation appeared as Helen Clark’s slogan early in the tenure of this Government, in around 2000 or 2001. It was Labour’s label for the idea that it had something to say and something to do with the burst of economic growth that this country has had. As has been debated in this Chamber many times, that growth has had very little to do with the actions and activities of the Labour Government.
However, this Government has spawned a major industry of bureaucracies, plans, strategies, and people monitoring each other, measuring, counting, and speculating—at a cost of hundreds of millions of dollars to the taxpayer. It has made no difference to the economy, and Dr Cullen has not set out to try to show that his last 6 years of economic management have made any difference to the economy.
I just want to pick up two or three areas where the Government needs to get down out of the clouds and get to grips with the realities of microeconomic reform, because, fundamentally, that is what will drive our economy forward. The Labour Government in New Zealand has been untypical. In most other similar countries—Australia, Canada to a lesser extent, and the UK—Governments have persisted with a constant process of reform to make their economies more competitive. If they are left-wing Governments, they have embarked on other programmes like expanding public expenditure, growing the numbers of civil servants, and having more middle-class welfare. But no Government has given up on the programme of microeconomic reform in the way that this Government has. This Government has fooled itself into thinking that more money will fix every problem.
Members can take as an example the roading infrastructure. We have seen a complete debacle from rising star—what is his name?
Dr the Hon Lockwood Smith: David Parker.
Hon BILL ENGLISH: We have seen a complete debacle from “Rising Star Parker” in the last couple of weeks. A politicised Transit board puts out a plan, and the Government realises it is an embarrassment and disowns it but has no alternative proposals about how it will fund a plan it says it is totally committed to. We know, because of the environment the Government has created in local government and around Transit, that that money will not be spent efficiently. In a sense it does not matter how much it commits to; a significant proportion is bound to be wasted because of the processes that have become so complicated, the delays that have become so long, and the increasing amount of Government compliance that those who will be building this infrastructure have to deal with.
Another example is the Department of Corrections. We have seen in the last 2 or 3 months a great deal of public attention to what is going on in our prisons. It is quite clear now that the Labour Government has been totally held hostage to Mr Phil Goff’s rhetoric. Labour has embarked on a programme of sentencing and “lock ‘em up” kind of politics in order to shore up its own constituency, but it has had no proper programme for how to deal with the consequences. Then, when it has started building the prisons, the costs have doubled in a matter of 2 or 3 years. My electorate will be one of the beneficiaries of that. The prison in Milburn will be set up at 300 beds, it is bound to end up at 600 beds, and at the current rate the Government will spend over half a billion dollars building that prison at Milburn. That will be terrific for the local economy but very bad news for the taxpayer.
I want to refer also to the issue of education. This is yet another area where the Government is creating a swamp of complexity, incompetence, and failure while it swans around the country talking about economic transformation. Well, we have had transformation in education. The Government has taken an orderly and well-run tertiary sector and turned it into a train wreck of incompetence and public waste. It has taken an adventure in secondary school qualifications and turned it into a dripping sore of lack of public credibility. Dr Cullen has taken on the job of tertiary education Minister. I wish him well. In a sense I feel sorry for him, because his significant career as a Minister of Finance is going to fizzle out as he wades into the mess that Steve Maharey left for him, and it will take him all the rest of his term in office to fix it.
Dr the Hon Lockwood Smith: As Steve Maharey makes more mess.
Hon BILL ENGLISH: Yes, as Steve Maharey makes more mess in TVNZ. He is going to mess up early childhood education. He left a mess in his other portfolio of science and research, and certainly in tertiary education. Why is it that everything this man touches crumbles? It is like a reverse Midas touch.
Dr Cullen has written a Budget Policy Statement with speculative ideas, such as KiwiSaver, which is minor. The minor ideas take up a bit of media space, but the real problem is that the Government has lost its desire, its will, and its capability to do the fundamental jobs of Government properly, and those are to provide public education in a way that is effective for students and cost-effective for the taxpayer; to make sure there is long-run and efficient investment in infrastructure; and to deal properly with the consequences of policies that it has followed for political benefit, like the problem that has arisen with prisons. All of these problems will fall in the lap of the Minister of Finance, and over the next 2 or 3 years he is going to feel like the roost to which all the chickens have come home. All the built-up problems of overspending, micro-management, and politicised processes are adding up to the need for him to cut expenditure. They are adding up to public dissatisfaction with services. They are adding up to a credibility problem for the Government in areas that have traditionally been regarded as Labour’s core competence—in particular, education. The man who will have to fix it all is Dr Cullen, who is tired, cranky, and worn out with shovelling all the extra bits that Helen Clark and her Ministers leave for him. This Government’s credibility will stand or fall on whether he can do a job that no Minister in Cabinet is capable of doing.
Dr the Hon LOCKWOOD SMITH (National—Rodney)
: On 15 February the Finance and Expenditure Committee heard evidence from the public on the Budget Policy Statement. Among members of the public were groups from the business world, including the Business Roundtable, Business New Zealand, and Federated Farmers. The Business Roundtable, admittedly, does not have a huge number of members, but it has very significant members. Many of our major corporates are members of the Business Roundtable. Business New Zealand has among its members a huge cross-section of New Zealand business. Federated Farmers represents a large chunk of the primary sector. I guess that with those three organisations we had a large chunk of New Zealand’s productive sector making submissions to the select committee.
Their submissions were almost identical. They all pointed out to the select committee that the Government sector has been growing too rapidly at the expense of the private sector. They pointed out that if that continues, there is no way the objectives in the Government’s Budget Policy Statement can be achieved. There is no way that productivity in this economy will be lifted to match that of other countries in the developed world, such as Australia, that we have to compete with. There is no way we will see an economic transformation in this country if the growth in Government spending carries on in the way it has been going.
One of those submitters pointed out that if we look at employment in agriculture, fisheries, and manufacturing—again, a significant chunk of our productive sector—we see that employment in that part of our economy over the last 5 years has actually fallen by 5 percent, while employment over the same time period in the Government sector, the State sector, has grown by 17.5 percent. How does one expect the economy to be transformed into a highly productive, dynamic economy when employment in the productive sector is going down and employment in the State sector is mushrooming?
But, of course, Dr Cullen knows better. A large chunk of the productive sector of this economy is saying to him: “This is all wrong, and you won’t get the productivity growth you’re seeking while this goes on.”, but Dr Cullen and this Labour Government know better. They know better than most of the businesses in New Zealand. That shows the arrogance of this Labour Government now, after 6 years in office. It is the arrogance that sees Dr Cullen telling the business world: “You guys don’t know what the hell you’re talking about. I know far better than you do.” Dr Cullen is saying that the Government should carry on and increase the size of the Government sector—which is what the Budget Policy Statement shows will happen—and shrink the private sector.
That is the same kind of arrogance we are seeing from the Prime Minister. Today she said it was acceptable for one of her Ministers, David Benson-Pope, to have used his power—and I use that word advisedly—as a teacher. There is a huge imbalance of power between a teacher in his position and a student in a classroom, a dormitory, or a shower. For a teacher to abuse that position of power in the way David Benson-Pope did over some years in that school he taught at, and for Helen Clark to think it was acceptable for a teacher to abuse that difference in power between a teacher and a student in the way David Benson-Pope did—to think that his judgment in abusing that power was all OK—shows the arrogance of this Government and how that arrogance has seeped right through it.
Helen Clark thinks that is OK. Dr Michael Cullen thinks he knows better than the entire business sector in this country. That is why this Government is starting to get the odour of decay around it. Its judgment is being shown to be falling to bits.
Let us look at what is happening now that this Government has increased its expenditure so much in the last 5 years. Government revenue as a percentage of this economy has climbed in that period from just under 38 percent to 45 percent of GDP—that is, almost half our economy is now represented by Government revenue. Part of the reason, although not all of it, is that this Government is allowing New Zealanders to pay more and more tax. As New Zealanders’ incomes go up—which happens over time with inflation, plus increases in pay—they go into higher tax brackets and pay more and more tax. That is one of the reasons why the average after-tax income of New Zealanders has not gone up or even stayed the same relative to the average after-tax income of Australians. Their average after-tax income has climbed much more than that, and the gap between the two has gone from 20 percent 5 years ago to 33 percent now—partly because this Labour Government is allowing New Zealanders to pay more and more tax.
We know that New Zealand First and United Future want to change that. We know that Peter Dunne wants to have tax thresholds indexed so that that does not happen, and so that over time New Zealanders can keep more of their pay and not pay more and more tax as they go into higher and higher tax brackets. We heard Gordon Copeland talk about that today. But I have to tell this House that at the select committee today I asked Michael Cullen point-blank who the public should believe in terms of adjusting the tax brackets—him, or Peter Dunne. Dr Cullen said that they should listen to him. He said: “The buck stops with me; I make the decisions.” All I can say to Peter Dunne is that I am sorry about that. It will not be him making the decisions over those tax thresholds. Peter Dunne told Parliament on 22 February that he was working on the legislation for that, but I have news for him. Michael Cullen is deciding whether that legislation is going ahead; that is what he told the select committee today.
It is important, because the migration statistics of New Zealanders over the last 3 years show a massive net outflow of New Zealanders leaving New Zealand on a permanent basis. Just 3 years ago, 11,200 New Zealanders net left New Zealand on a long-term basis. The year after that, 2 years ago, that figure had jumped 7,000 in a year to 18,100. Last year, the figure jumped another 7,000 to 25,000 New Zealanders. The number of New Zealanders leaving New Zealand on a permanent basis and going overseas has more than doubled in 3 years.
One of the reasons—not the only reason—is that of course in New Zealand they have no hope. They cannot get ahead; as their pay goes up and as they get more and more senior positions in their work, they go to higher tax brackets and pay more tax to this rapacious Labour Government that believes it knows best. It is fascinating to look at a recent report out of Ohio University in America on the impact of taxes on the migration of people between states in the United States of America. It is fascinating to see that in recent years—between 2000 and 2004—1.3 million Americans left states with high income tax levels to go to states with low income tax levels. In fact, a commentator on the Ohio University research stated: “It’s a stealth migration, and it’s one of the biggest, most significant yet least recognized movements of the population in American history … People are voting with their feet to say that taxes do matter.”
How high are our taxes here in New Zealand? People would be shocked to learn what most families face. Ninety percent of New Zealand families are now involved with the Working for Families package. Once that package, which this Budget Policy Statement will put in place, is rolled out, 90 percent of New Zealand families with dependent children will be involved. Tax research shows that marginal tax rates affect people most, because those rates affect the tax they pay on their next dollar. For hard-working families in New Zealand who try to get off benefits and move up into self reliance, the marginal tax rates they face are appalling. The Government’s own Inland Revenue Department data shows that once a family with three children earns $10,000 a year trying to get off the domestic purposes benefit, on the next dollar that family earns it will pay 92 percent tax. It does not get better. As that family with three children gets up to $50,000 in income it will pay over half its next dollar in tax, and so it goes on. That family does not get below paying 59 percent tax on its next dollar until it is earning $100,000 of income. Then it gets down to paying 39 percent tax. No wonder people are leaving New Zealand in droves under this Labour Government.
A party vote was called for on the question,
That the House take note of the report of the Finance and Expenditure Committee on the Budget Policy Statement 2006.
||New Zealand Labour 50; New Zealand First 7; United Future 3; Progressive 1.
||New Zealand National 48; ACT New Zealand 2.
||Green Party 6; Māori Party 4.
|Motion agreed to.
Employment Relations Amendment Bill
- Debate resumed from 23 February.
DARIEN FENTON (Labour)
: This bill is not about preventing contracting-out or undermining competitive tendering. It is about ensuring that workers have the right to transfer, while, at the same time, the new employer has the right to make business decisions in relation to the workforce once the transfer is complete. So let us not get into overstating or hyping up what is a simple protection that takes New Zealand workers only one small, long-overdue step towards the kinds of protections workers overseas have had for many years.
I emphasise again that this bill is about fixing a problem that occurred because of the Crest Commercial Cleaning decision. It is about ensuring that the original intent of the Government and this Parliament is met. If we do nothing, the only workers in New Zealand who are left without any kind of protection will be those workers whom the original Act specifically sought to protect—that is, cleaners, food service workers, caretakers, laundry workers, and so on who have already been contracted out.
The bill does not encourage poor performance and acceptance of incompetence, as some have claimed. Those are management issues that can be dealt with at any stage of a restructuring process, either before or after. The bill does not give jobs for life. It provides protections for workers only at the point of transfer. After that, the employer is free to carry out normal business operations subject, of course, to existing employment law.
Let us be honest, even before the enactment of the Employment Relations Amendment Act (No 2) 2004, many employers had carried out the requirements of the law in relation to transfer, and even with the Crest Commercial Cleaning decision, those employers had made a decision to continue to apply the requirements as intended by Part 6A of the Employment Relations Act. Has the world fallen apart? It does not look like it.
Cleaning, catering, orderly, and laundry workers have waited a long time for this protection in legislation. Unfortunately, they have had to wait a little bit longer because of the Crest Commercial Cleaning decision. This is a complex area of law, and I know that Opposition members do not understand it, but the workers who are affected by it do. They have had to live and breathe the unfairness of this situation for years and years. I look forward to sharing experiences at the select committee as to how this legislation can work positively for both business and employers, and to the protections that were originally envisaged by this Government being enacted speedily.
PAULA BENNETT (National)
: First of all I would like to address the vulnerable workers. The premise I heard last week from members on the other side of the House was that National did not support those workers. What a myth that is. No one supports people in work more than the National Party, and no one actually acknowledges the job workers are doing more than the National Party. In fact, the National Party would like to see more money being put back into workers’ pockets. In many respects I personally feel that the people to whom the bill refers—our cleaners, our food service workers, etc.—are doing perhaps the hardest job in our community and in our society. Those people deserve to be respected for that, and they certainly deserve to have more money in their pockets.
I also want to talk a little about skills shortages, because if we listened to the Government we would be under the impression that skills shortages are about the shortage of engineers, machine workers, and those sorts of people, included in the Immigration Service list. As a matter of fact, we have a skills shortage across the board. We have as much of a skills shortage within the area of cleaners as we do anywhere else. There is a shortage in that area; as a matter of fact, it is not difficult to get a job in that area—and rightly so. A good cleaner will get a job in just about any town in New Zealand, because he or she is available. It is as simple as that. The Employment Relations Amendment Bill is not necessary.
I want to pick up on what Darien Fenton was saying, which was that cleaners who do an unsatisfactory job will not be taken on, because that is a performance issue. In the Dunedin Kindergarten Association situation the contract had finished. It is not that the contract was being rolled over. The contract had been terminated. The association then looked around, because it felt that the job that had been done had not been done to a satisfactory level. In fact, in the opinion of many parents and teachers the kindergartens were unsanitary and not suitable for children. So it is nuts to think that the very people who were not cleaning to a satisfactory level would then be passed on to the next cleaning company. Is this what we really want, as parents, for our kids—that we no longer have the right to say that an unsatisfactory job is being done and we do not wish to continue with that company, and to employ another one, because if we do we will find that we are working with the same people? It just does not make sense.
If we are really serious about supporting our most vulnerable people, or about supporting those who really need to be given a go and protected, the best thing we can do with them under employment relations in this country right now is to offer a 90-day probation period. The reality is that people want to prove themselves. They want to stand up, they want to be counted, and they want to be given a go. A 90-day trial period will work best for the most vulnerable in our society. It will work for the immigrants who are new to New Zealand, and are saying: “Let me stand up and prove my worth. Give me a foot in the door. Let me show you what I can do. Let me prove that my experience from overseas will actually stand up against anyone else’s. Let me in that door.” The 90-day period will equally stand up for people who have a criminal record, or who perhaps have not had the most favourable employment history, up to that date. Those people will be able to stand up and say “Give me a go.”, and a 90-day trial period is the way to do so.
From my experience within the employment sector, more employees bowed out of the employment arrangement in the first 3 months than were asked to leave or were performance-managed. It actually works to the employees’ favour that they too can trial the employment arrangement and give it a go. We do not know the fit. We do not always know whether a company will work for us. By having a 90-day trial period we get to step in and give it a go, and we can walk away with no penalties and no stigma involved. If we are serious about protecting those workers who need a go in our society, then a 90-day trial period is seriously the way to do it.
I want to talk a bit about a couple of scenarios that could happen under the bill. They are ones that cause me immense concern. Let us presume I own a relatively small business with a couple of cleaning contracts. One of them I lose and on the other one I am just making ends meet—I am struggling. I am struggling to keep my business alive, and I am struggling to continue to employ the people who are working for me. I have immense respect for the people who are working for me. I am giving them every opportunity and I am paying them above the minimum wage—I am doing everything I can. But I am barely holding on. I see a contract come up. I think I am going to get this contract, and I am going to compete for it to the nth, because I want to keep these employees going, and I wish to have a successful company. I cut my margins. I do everything I can to get that contract. I put in a very competitive tender and, lo and behold, I win. That is a win-win situation. I get to keep the employees I have had for such a long time—well, no, actually I do not get to keep those employees. I will have to put them off, because I have to take the other employees from the company that lost the tender. So I am going to have to make redundant those guys who are working for me and whom I have had a long-term, loyal arrangement with, because I cannot keep on both them and the new employees that, under this amendment bill, I would have to keep. So it is goodbye to those employees, because I would have to make them redundant at the end of the day. They are then without a job, but I have taken on others who have come from the previous contract.
Let us also think about a small to medium sized business that perhaps is not quite as ethical or astute, and is not running its business quite as smartly.
David Bennett: It could be a Labour Party member’s.
PAULA BENNETT: It could be a Labour Party member’s business.
The owners of the business are working away. Their cleaning contract is coming up for renewal in 6 months, and there is a good chance that they might lose it.. They have had a few complaints from the company that they have the contract with. They know the company is not overly pleased with the service they are giving, and there is a good chance that they will actually lose the contract. But they have an idea about what they might do to get rid of the competition—they might double the salary of the people who are currently working for them. They want to do it; it works in their favour and the employees are absolutely rapt, because they are getting double the money. The owners know that when they lose that contract and it goes to their competition, the competition will have to pay its employees the doubled salary. The competition will have to stand up and address all of this, because the bill does state, in new section 69A, inserted by clause 4, that employees have the right: “(a) to elect to transfer to the other person as employees on the same terms and conditions of employment;”. The owners could quite easily do that if they knew that they were going to lose a contract, if they wanted to affect their competition, and if they wanted to see the competition’s business go under. At the end of the day those employees would be without jobs—those very vulnerable workers whom Labour is trying to support. They would not have a job, because that company would not be there any more. Their original employees could make their conditions so good and so top of the range that their competitors could not possibly run a competitive business while paying their employees that much.
There are many scenarios in which the amendments in the bill would not work. I think we have to identify the fact that companies have the right to decide who they will contract their cleaning and their services to. They have a right to decide what is best for their business and, in the case of the Dunedin Kindergarten Association, what indeed is best for their children. This amendment bill is utter nonsense. It does not support our workers, who need the best protection. The best way to get people out there to have opportunities and to step up is to introduce a 90-day trial period, and that is certainly what the National Party stands for.
A party vote was called for on the question,
That the Employment Relations Amendment Bill be now read a first time.
||New Zealand Labour 50; Green Party 6; Māori Party 4; Progressive 1.
||New Zealand National 48; New Zealand First 7; United Future 3; ACT New Zealand 2.
|Motion agreed to.
Hon MITA RIRINUI (Minister of State)
: I move,
That the Employment Relations Amendment Bill be
referred to the Transport and Industrial Relations Committee.referred to Transport and Industrial Relations Committee.
Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill
Hon PHIL GOFF (Minister of Trade)
: I move,
That the Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill be now read a first time. I intend to move that the bill will be considered by the Foreign Affairs, Defence and Trade Committee, with an instruction to the committee to present its report to the House on, or before, 13 March 2006. I also intend to move that the committee have the authority to meet at any time while the House is sitting except during oral questions, during any evening on a day in which there has been a sitting of the House, on Friday in a week in which there has been a sitting of the House, and outside the Wellington region on a day the House is sitting, despite Standing Orders 192, 194(a), and 195(1)(b) and (c).
The Trans-Pacific Strategic Economic Partnership Agreement is a four-way agreement to liberalise trade between Brunei, Chile, New Zealand, and Singapore. In fact, it is the first trade agreement that spans four countries across Asia and the Pacific, and it offers strategic and economic opportunities for New Zealand. Together the four countries, which are all member economies of the APEC organisation, have a combined GDP of some NZ$400 billion, and trade flows amongst the four countries are worth over NZ$2.5 billion per year. The agreement not only reinforces the desire of New Zealand and Chile to deliver trade and economic relations with Asia but also serves as a building block to wider trade liberalisation within the APEC region as a whole.
The bill amends New Zealand’s domestic legislation in order to bring it in line with the Trans-Pacific Strategic Economic Partnership Agreement. This bill in fact allows the agreement to come into force. That entails an amendment to the Tariff Act 1988, to enable the preferential tariffs conferred by the agreement to be applied to the parties to the agreement. The tariffs conferred by the agreement are included in the preferential tariff column of the New Zealand tariff. The actual rates of duty, as spelled out in the agreement, will be added to the tariff by a subsequent Order in Council.
The tariff reductions under the agreement will make New Zealand’s exports more competitive, and will bring small but useful immediate benefits to our exporters. On entry into force of the agreement, tariffs on 89 percent of New Zealand’s current exports to Chile will be immediately eliminated. All remaining tariffs will be phased out by 2017. That will bring savings to New Zealand exporters of around $2.2 million in import duties—the amount incurred in the year ended June 2004. In that way the agreement will immediately deliver benefits to New Zealand exporters, including exporters of products such as coal and a wide range of agricultural technology products where New Zealand’s exports are currently growing, such as seeds, animal genetic material, and veterinary vaccines. New Zealand exported only a small quantity of goods, worth $3.55 million, to Brunei Darussalam in 2004, incurring duties estimated at $52,000. Brunei will bind at zero tariffs, covering 92 percent of New Zealand’s exports to Brunei. It will eliminate all remaining tariffs by 2015. Tariffs between New Zealand and Singapore are already zero, under the existing New Zealand - Singapore closer economic partnership agreement.
This agreement, however, is about much more than just tariffs. It has a clear strategic focus beyond the direct tariff benefits that will accrue to the parties. The agreement will provide more opportunities, and greater certainty and transparency, for New Zealand businesses that wish to operate in Chile, Singapore, and, eventually, Brunei Darussalam, across a whole new range of services and sectors. New Zealand companies will be able to bid for Government procurement on the same footing as domestic suppliers. The partnership provides a framework for resolving issues concerning technical barriers to trade, and concerning sanitary and phytosanitary measures. Some barriers identified by New Zealand exporters have been included in the immediate work programme of the Committee on Technical Barriers to Trade, which has been set up.
The agreement also establishes a framework for closer economic, scientific, technological, educational, cultural, and primary industry cooperation. The objective is to build on existing cooperative relationships, with a focus on innovation, research, and development, creating new opportunities for all parties. Cooperation programmes to support sustainable development will also be established under the Environment Cooperation Agreement and the Memorandum of Understanding on Labour Cooperation, which were concluded as part of the overall package of the agreement.
This is New Zealand’s first trade agreement with a Latin American country. It will put New Zealand’s relationship with Chile—one of our closest Latin American partners—on a new level. As relatively small agricultural traders with comparable productive structures, the agreement provides the basis to foster a closer sense of partnership between Chile and New Zealand, opening the way to working collaboratively in third markets. Chile has established itself as a business platform for South America, in a similar way to the way in which Singapore acts as a hub in South-east Asia. The partnership will raise New Zealand’s profile in Latin America and will make it easier for businesses to use Chile as a launch pad. Since the signing of the agreement, there has already been increased interest among businesses and Crown research institutes in the opportunities that Chile presents. The membership of Singapore and Brunei, as ASEAN countries, is also an important part of the strategic rationale of the agreement, and adds significantly to the combined GDP of the member countries.
The Foreign Affairs, Defence and Trade Committee has considered this agreement, under the international treaty examination process. Its report to the House notes that the agreement serves New Zealand’s objective of broadening relations with Latin America and Asia, as well as promoting New Zealand’s wider trade policy interests in APEC and multilaterally.
To conclude, the agreement represents a significant economic and strategic opportunity for New Zealand. It enjoys strong support from the business community and others, including educational institutions with an interest in strengthening relations between New Zealand and the Latin American and Asian regions. The Government would wish to see the bill enacted by 23 March, in order to allow adoption by Order in Council of relevant regulations within the time frame in which the parties hope to ratify the agreement.
I commend this bill to the House.
Hon MURRAY McCULLY (National—East Coast Bays)
: I will not detain the House for long in relation to this matter. The Minister has drawn our attention to the significance of the bill, and I want to say a few words about that. Also, I want to comment on the rather unusual process by which the House will be invited to support the motion that the Minister has given notice he intends to move.
I will speak briefly on the bill, because my two most learned colleagues—former Ministry of Foreign Affairs and Trade officials, Mr Groser and Mr Hayes—will no doubt speak at great length and with great eloquence in relation to the trade policy issues that sit behind the legislation. As the Minister pointed out, the measure is an important one. It cements some important trade relationships in place and provides the opportunity for us to see reduced tariffs between New Zealand and some important trading partners—and that, as I think the Minister indicated to the House, will see substantial reductions in tariffs in respect of some of those relationships, and quite quickly. So, for that reason, and because of some of the other facilitation measures that will flow—as the Minister has also pointed out—the National Party is unambiguously in support of this bill.
However, I want to make it clear that the process by which it is to be passed is a somewhat unusual one, and I want to reflect on the timetable that now lies ahead of the House in relation to the measure. According to the note I have here, I understand that this measure needs to be passed into law by the end of March and come into effect by 1 May 2006. It is not every day that the Government comes to the House and asks the other parties to facilitate a measure in quite such a short time frame. Indeed, as the Minister has already told us, the Foreign Affairs, Defence and Trade Committee will be asked to meet virtually any hour that is available, and the time that it will be given in which to report back is about as tight as one could possibly have while still having a select committee process.
I want to explain to the House why the National Party is being so soft and accommodating as to agree to those conditions. First and foremost, I say to the Minister that the National Party is very keen to cooperate with the Government on matters of trade. We want to send a clear and unambiguous signal to the other countries with which we do business. Also, we want to send a clear and unambiguous signal to the business community that it can look to the major political parties in New Zealand to cooperate on such matters and that any element of petty politics is removed from the proceedings. Just in that context, I say to the Minister that we would like a slightly more generous time frame, generally, in relation to legislation he brings to the House. I acknowledge that because of the election in the latter part of last year and some no doubt difficult machinery matters that the officials have to deal with, regrettably we have a somewhat less generous amount of time available to us than would normally be the case. However, I am satisfied that no one’s interests will be compromised by that process. As the Minister has already told the House, this treaty has already been before the select committee, and it has hardly been kept a secret from those in the business community or from those who otherwise might be affected by it. I am therefore quite satisfied that the highly truncated select committee process this bill will go through will not prejudice the interests of any party, in the way that would normally be the case with a timetable of the sort being recommended to the House today.
Having said that, we want to send a clear and unambiguous signal that the National Party will cooperate on these matters and therefore will do its best to cooperate with the select committee. I say to the chair of the committee, Dianne Yates, who is in the Chamber at the moment, that I trust that the Government will reciprocate the generous spirit that is being demonstrated from this side of the House by ensuring that the very lax resolution we are to agree to is not taken advantage of in any shape or form. We genuinely want to cooperate and we ask that the provisions that are being granted here will be reciprocated.
The Minister knows that in matters relating to trade New Zealand is too small a country, is in too remote a part of the globe, and has too great a dependence upon international trade as its lifeblood for us to play petty politics in any shape or form. So we will send this measure to the select committee, we will support it through that process, and we will make sure that all of those who do business with New Zealand feel that at least the major players are doing their bit. I am pleased to hear that the New Zealand First Party intends to support the bill to the select committee. I know that the bill will perhaps present some issues for its members, but I encourage them to approach the process with an open mind. The more that political parties in this country can send a signal that we stand together on these issues the better it is for all of us, particularly in relation to the position of the Minister of Foreign Affairs. I hope that those members do not make his life unduly difficult, or complicate the nature of the relationships or future discussions that need to be held, by putting him in a position where his own party is seen to be taking an unduly negative—an unhelpful—view in relation to a bill of this sort.
I join the Minister in welcoming the bill into the House and pledge the cooperation of the National Party during the select committee process and the bill’s subsequent stages. I say to those who stand to benefit from this measure that I trust they will take full advantage of the negotiations that have been held in bringing this treaty together and in the expeditious progress of the bill through the House, as I am sure we will see.
DIANNE YATES (Labour)
: I thank the Hon Murray McCully for his comments on this bill. I might point out that it is a very small bill, comprising only two pages, so it will not take the Foreign Affairs, Defence and Trade Committee a great deal of time to process.
The general policy statement in the explanatory note states: “The Bill amends the Tariff Act 1988 to enable the Trans-Pacific Strategic Economic Partnership Agreement (TPA) to be brought into force. The TPA has been signed by Brunei Darussalam, Chile, New Zealand, and Singapore. The agreement obliges each party to phase out duties on goods imported from the other parties. As goods imported into New Zealand from Singapore are already exempt under the New Zealand/Singapore Closer Economic Partnership Act 2000, the preferential tariffs provided for by the Bill will apply to goods originating from Brunei Darussalam and Chile.”
So this bill is actually a small technical bill to allow the treaty to continue and to become part of our law. This measure is not being hurried. The negotiations for the Trans-Pacific Strategic Economic Partnership Agreement started in 2002 with the New Zealand Government, the Prime Minister of Singapore, and the President of Chile. The agreement was originally known as the “P3” agreement, because it involved three countries: New Zealand, Singapore, and Chile. It was then extended to include Brunei Darussalam. So the bill will not take a great deal of time.
Also, the bill has gone through the treaty procedure, which means that the select committee has already looked at the national interest analysis and reported back on it to the House. During that stage we had public consultation and brought people in to the committee to give us their opinion, so we are now really only going through another step in the process.
The national interest analysis lists about five pages of people who were consulted in the process. Individual businesses were written to, and meetings took place with the Council of Trade Unions, Local Government New Zealand, the Federation of Māori Authorities, at least 51 companies, the New Zealand universities, and non-governmental organisations. Chambers of commerce have held workshops on the whole issue. So I do not think it is quite right to say that the matter is being rushed through. A great deal of consultation has taken place in relation to the bill.
I want to point out a couple of matters. One is about cultural effect, and there was some discussion when we looked at the national interest analysis. We have been assured that the Trans-Pacific Strategic Economic Partnership Agreement contains safeguards to ensure that there are no adverse effects on New Zealand cultural values, including Māori interests. One part of the analysis states: “Provided such measures are not used for trade protectionist purposes, the Trans-Pacific SEP also gives successive New Zealand governments the right to adopt measures they deem necessary in relation to Māori, including in fulfilment of Treaty of Waitangi obligations. Furthermore, interpretation of the Treaty of Waitangi is not subject to any dispute settlement provisions under the Trans-Pacific SEP.”
The analysis also has information on the full communication programme. For those people who are interested and listening to the radio, if they can access the national interest analysis, then that would give them far more detail on the Trans-Pacific Strategic Economic Partnership Agreement, the “P4 treaty”. I refer members also to the initial booklet that came out about that, and to the statement Jim Sutton made at the time. This is the first trade agreement to involve several Pacific Rim countries, and the Trans-Pacific Strategic Economic Partnership Agreement—also known as the “P4”—has a strong strategic dimension and will serve to deepen the economic relationships between New Zealand, Brunei Darussalam, Chile, and Singapore.
The Trans-Pacific Strategic Economic Partnership Agreement is a high-quality trade agreement. It establishes a free-trade area and liberalises trade between New Zealand, Brunei Darussalam, Chile, and Singapore in both goods and services. The Hon Jim Sutton went on to state: “It achieves a benchmark reached by few bilateral trade agreements in having a commitment by the four countries to eliminate tariffs on all traded goods, and at the same time adopts a high-quality approach to trade in services. The shared vision is to stimulate more open trade within the Asia-Pacific region, and New Zealand is keen to see the membership of the Trans-Pacific SEP expand as other Asia-Pacific nations look to take part. For New Zealand the economic benefits of the Trans-Pacific SEP will be seen from the day it enters into force.”
From that day, as the Minister of Trade, Phil Goff, has told us, 90 percent of New Zealand’s exports to Chile will enter duty-free, as will 92 percent of New Zealand’s exports to Brunei Darussalam. Tariffs between New Zealand and Singapore are already zero, as we have said, under the existing New Zealand - Singapore closer economic partnership. These tariff reductions will open up new market opportunities and restore level playing fields for our exporters with competitors from those countries like the United States that already have trade agreements with Chile and Singapore.
The Trans-Pacific Strategic Economic Partnership Agreement is a model of free-trade agreements, which further establishes New Zealand’s credentials as a progressive trading partner. With the potential for more countries to join the Trans-Pacific Strategic Economic Partnership Agreement, now is the time—and we are keen that this legislation will progress—for Government and business to work together to maximise the benefits and opportunities it offers to enhance trade and economic links.
I am pleased that we have the support of the other side of the House. I thank those members opposite who were previously involved in some of those negotiations who are now members of the House. In fact, they will probably find it very interesting, after their having worked on the original negotiations, to be able to follow the bill’s process through the House and to see this agreement signed. I certainly know that the Prime Minister is looking forward to the signing of this agreement. Once again, along with the Minister, I commend this legislation to the House and look forward to its speedy process.
TIM GROSER (National)
: When the chief whip asked me to fill the speaking slot—and I see now that it is only 7 minutes to 6—Mr McCully, a man I hold in enormous respect, expressed some doubt as to whether, given my background and the nature of the subject, I could express my views in anything under 3 hours. The second surprise was that I know he is expecting me to launch into a deep, geopolitical analysis of this agreement in the 7 minutes before we go to get something to eat. However, Mr McCully was so cooperative, so diplomatic, and so reasonable in his approach that I am afraid Mr Hayes and I have just had a quick consultation and we feel the need to slightly rebalance the equation. So before I get into the geopolitics of this subject—which I will address probably in 15 seconds, because basically Mr Goff the Minister has analysed it in correct and orthodox terms—I just want to make a few reflections on the issue of trade and foreign policy.
It is quite interesting to ask ourselves why we are in the situation that Mr McCully summed up in the way in which he approached this. Why is it that we are in this bipartisan space? When I first became involved in trade policy in the 1970s when working in the New Zealand Treasury, I can assure members, and I am sure members can recall, that it was anything but a bipartisan policy. In fact, we faced a bitterly divided country on those issues, for two reasons. Firstly, it was because we had the developed world’s highest form of import protection around our border for fear of being swamped by competition and, secondly, because on the other side of the equation the General Agreement on Tariffs and Trade, the premier institution of the international trading system, was seen as completely unfair and biased against us. It had its rules on industrial products, an area where we feared we lacked all chance of ever becoming competitive, yet when it came to agriculture there was no sign of balance, whatsoever. So this is not a policy that has been all sweetness and light historically, as this debate indicates. We have moved strategically into this situation.
Like many New Zealanders, I have a view on MMP that I do not think is in any way original, and it would be summed up as follows. I think that when New Zealanders voted for it, they were voting not just for a change in the electoral system. I think what they wanted was a change in style, as well. I think they wanted a more cooperative approach, of which this trade policy is a very good example. I know that the Prime Minister finds it difficult to issue two sentences in a row without the word “inclusive” in them, but I do not see, apart from a few exceptions such as this agreement, a great deal of evidence of a new approach. I see instead that a largely partisan, “take no prisoners” approach to politics is still prevailing.
But there is another model, and if the Government had had the decency to listen to what Dr Brash was saying at the beginning of this session, it would know that we are prepared as a party to look case by case at other issues—exactly as we have done successfully in this country. We put forward the issue of climate change, but the Government would not even listen. But there is that other model, and as we sit down here in the comfort of that nice cooperative approach it is worth reflecting on the fact that it has served this country well. It is a model to use, if the Government can escape from the partisan model it is following in just about all other areas.
Now, let us have a little think about trade policy in the context of what it is. The Minister of Foreign Affairs, Mr Peters, gave a very nice speech a week or two ago, followed by Mr McCully. It was a standard Ministry of Foreign Affairs speech given to a new Minister. It is the seamless-web theory of foreign policy. Let me explain what that theory is really all about. It is a correct view, in my strong personal opinion, about how foreign policy actually works. It is not a matter of just putting foreign policy in one box and domestic policy in another—and that applies even more strongly to trade policy; they are closely interlinked
But of course we have a problem, and I shall not comment at large on it. We all know what the problem is and we saw it demonstrated today when the Green Party asked the Minister a series of questions. All he could do was act as a postbox, and in fact he was absolutely correct, in my opinion, in taking that approach. But when he is overseas there is no postbox beside him, and he will have to defend the Government’s position. I do hope that when my former colleagues in the Ministry of Foreign Affairs gave him their standard, seamless-web theory of foreign policy they did not use those words “seamless web” because, my goodness gracious me, that would be an unfortunate metaphor with regard to Mr Peters. What it brings to mind, of course, is the ancient child’s fable,
The Spider and the Fly. Many of those children’s fables contain great wisdom that one should absorb by the age of 6.
Whether Mr Peters absorbed the wisdom of that fable is a question that we might examine in the moments we have left. Members will recall the original parable:
Will you walk into my coalition? said the spider to the fly.
’Tis the prettiest little coalition that you ever did espy.
The way into my coalition is up a winding stair,
And I have many curious baubles to show you when you’re there.
The problem is that Mr Peters clearly thinks he still has his exit strategy. However, the member for Tauranga—and I would refer to him by his name “Bob the Builder” if it were not a technical breach of the Standing Orders—has rather closed that option off. So we will find in due course what happens to the spider and the fly. We know who the fly is. I do not want to be too crude and suggest who the spider is in this case, except we know that she likes fast cars, provided she is not driving personally, of course. We will find out, I think, that this ends rather stickily for the fly—in this case, New Zealand First.
Nevertheless, the point about the seamless web theory is essentially correct. In terms of trade policy it is really important to understand that the real agenda for New Zealand, in terms of its domestic agenda, has moved on.
- Sitting suspended from 6 p.m. to 7.30 p.m.
TIM GROSER: The dinner break was a very disturbing development for a new parliamentarian—I mean, I went to the wall, and then there was a break. The whole country and the future of the Government were hanging on my words, and then we stopped for an hour and a half. But I will try to get over it, and I will be very brief—well, I have only 2 minutes anyway, so I do not have much of a choice.
I want to make three fundamental points. First of all, to be more serious, the agreement is a good agreement. National has a small difference over the way in which our cultural industries might be treated. We went through that in the select committee; it is not a life and death issue, at all. I think Government negotiators can look to a lighter touch in the future, which is really related to a view that our cultural industries—and I have my hat on here as much as Opposition spokesperson on arts, culture and heritage as on the trade side of the equation—are clearly moving from a situation of being secondary industries in New Zealand over the last 30 years, and very much a defensive concern, to being very efficient and very export-oriented. There will always need to be a degree of subsidisation underneath the industry—but it is neither the right time nor place to go into the reasons for that—and there are different ways of offering that other than by the broad exception used in this particular case. But I think my first point has been made—that the agreement stands as a very good agreement, and that National is fully behind it.
The second point I make is a fundamental point about all trade agreements of this nature. At the end of the day, they are only opportunities. What New Zealanders make of those opportunities—or Zimbabweans, or Australians, or Chileans, or people of any country; they all have those opportunities—is very much dependent upon the initiative of the people concerned and the policy frameworks that are there to support them. We know that New Zealanders have a high degree of initiative. So it comes back, once again, to the linkages back into domestic policy structures, and that is why I introduced, albeit with a certain light touch, the theory of the seamless web of foreign policy. When negotiators are out there developing new opportunities, it is very, very important that at the same time they are backed up by the right type of domestic policy frameworks.
My third point is that the long-term significance of this agreement is a little difficult to tell at this stage, as is often the case. When I was a senior official working in the area, I often said to Ministers that trade policy is not an area for those who require instantaneous gratification; the seed time is very long. So if this agreement works well, and if international progress in the Doha round works well, the agreement may not turn out to be of major importance. But if things turn sour, then the opportunities that New Zealand has, like this agreement, will become strategically very important.
BARBARA STEWART (NZ First)
: I rise on behalf of New Zealand First to speak to the Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill. I advise the last speaker, Tim Groser, that the fly has landed in a positive place for all New Zealanders, which is far preferable to being Little Bo Peep who is valiantly trying to keep all of her sheep in order, as the National Party is doing at present. We know too that the dags of those sheep were in such a bad condition that the flies were not tempted, at all.
This legislation basically amends the Tariff Act to allow the Tariff (Trans-Pacific Strategic Economic Partnership) Agreement to come into force. With that comes the obligation on each partner—New Zealand, Chile, Singapore, and Brunei—to phase out duties. Singapore, of course, is already the subject of an agreement, so in reality we are talking about Chile and Brunei. New Zealand First will support the bill going to a select committee to enable members’ scrutiny and public submissions, and to acknowledge the strategic potential of an agreement that involves both Asia and South America—two areas of great importance to our future.
The agreement comes out of negotiations that began at APEC in 2002, and the national interest analysis was tabled in the House last year. It is New Zealand’s first agreement with a Latin American country. Tariff reduction will be phased in, with the longest protection—relating to textiles, clothing, footwear, and carpet—lasting until 2015. New Zealand First has long advocated that policy makers should give priority to New Zealand industries and communities when setting any programmes on tariff. In this instance, the value of the agreement is clearly strategic rather than financial. New Zealand goods going to Chile have been incurring a little over $2 million in import duties, and only $50,000 to $60,000 for our exports to Brunei. Those are not earth-shattering figures, but for a party that has succeeded in gaining an agreement that 2007 will be an export year, and for a party that has long advocated that we need to win the export and employment stakes, not some artificial tariff-removal race, the opportunity to open doors in South America and Asia is not lost on us. Around 99 percent of imports from Brunei, and around two-thirds of those from Chile, already enter New Zealand duty-free.
Although New Zealand First is absolutely not committed to a global liberalisation agenda, it is not inclined to oppose the measure on ideological grounds, when it has such strategic potential for our exporters, with little real threat to local producers. Let us consider the costs and benefits of the agreement, both in light of our trade and foreign relations objectives and against the background of a global liberalisation programme that clearly requires serious review. The place to do that, and to allow the public to have its say, is at the select committee. So New Zealand First supports the bill going to the Foreign Affairs, Defence and Trade Committee.
KEITH LOCKE (Green)
: The Green Party will be opposing the legislation, because we oppose the Trans-Pacific Strategic Economic Partnership Agreement, which this legislation is implementing. It is not that we are against trade agreements, but we are against this particular agreement. On an ideological basis, it is an agreement that just reduces tariffs everywhere, without demonstrating practical, positive effects for New Zealand.
If one looks at the tariff reductions in the bill, one must ask how they will overcome the huge trade deficit that we currently face, which was at the record level to the year ended January of about $7 billion. There has not been any working through of that issue. In one respect, the removal of the tariffs in the other three countries in the agreement, and the lowering of barriers there, will allow some of our exporters to export more into those economies. But that does not necessarily mean that there will be a net benefit, and it does not necessarily mean that we will get more for our existing exports. Phil Goff talked about companies saving $2.2 million in Chile in the duties they currently pay. Well, it is not necessarily a saving, because if those duties are built into the price that exporters get in Chile, when those duties are removed, the retail price drops down proportionately. It may not result in any savings for the New Zealand exporting companies. It is true that when we have knocked off duties in New Zealand, the prices have often gone down, and it has not necessarily meant an increase for the overseas companies exporting into New Zealand.
It is true that, as the previous speaker said, this is not a major agreement, in the sense that it does not change an existing situation dramatically, but it could lead in the direction of losing export capacity if the removal of tariffs in New Zealand made it more difficult for New Zealand manufacturers who might then have gone on to export. It could reduce our exporting capacity because we are competing with a lower-wage economy in the case of Chile, and with an economy that is not a level playing field in the case of Singapore. The Singapore Government plays a big role in many of its industries and can undercut New Zealand in its exports and bids for services—as it has already done. It is true that the existing free-trade agreement with Singapore has not demonstrably benefited New Zealand in terms of the balance of trade. It has tended to go more in Singapore’s favour, although there are arguments about what the current situation is. Some argue there has been a bit of an upturn in our favour if we consider the last few months, but over the last 4 years a benefit cannot really be demonstrated for New Zealand.
As Phil Goff, Murray McCully, and Tim Groser have all indicated, this agreement is not to be viewed on its own but as part of a larger strategic plan for free-trade agreements in Asia and in our whole region. It is a stalking horse for free-trade agreements with China—a much bigger economy—and with Malaysia, etc. If we look at these issues more broadly, towards a free-trade agreement with China, we are looking at the serious problem of losing more of our manufacturing industry, particularly in the textile, clothing, and footwear areas that are already hard hit and finding it difficult to compete. We want to retain some infrastructure in that area, and these agreements, and moves in this direction, are making that more difficult.
They take us in the opposite direction to what the Government, in cooperation with the Greens, is rightly doing—that is, promoting a Buy New Zealand Made campaign—whereas this agreement says there shall be absolutely no preference for New Zealand products over those from Chile, Singapore, or Brunei, and equal treatment has to be given to all exporters from those countries. That applies, for example, to the area of Government procurement, but if we are to have a successful Buy New Zealand Made campaign, the Government will have to take the lead and encourage local bodies to procure locally, too.
However, this agreement says that we cannot give any preference to New Zealand products over products from those other countries, or services from them in terms of procurement. If we were worried about unfair competition, about bad labour standards in Singapore, Chile, or Brunei, or about bad environmental practices there, all of which were undercutting our ability to trade and which were not leading to good situations in those countries, then there is a provision in this agreement—not in the bill itself but in the agreement—to have discussions about those problems. But there is no implementation enforcement procedure in the agreement. So I think that if we look at that, we will see that this agreement will have a detrimental effect, as a whole.
We should not look just at the balance of trade; we should look more broadly than that to the whole balance of payments, which is pretty dire in New Zealand at the present time and going very much against New Zealand, with billions of dollars worth of dividends going out of the country each year because so much of our economy has been taken over by foreign investors. There is roughly about $80 billion of foreign investment in New Zealand, and about only $20 billion of outgoing investment. There is a huge imbalance there, and it is getting worse all the time.
Unfortunately, this agreement helps to lock in an approach that will lead to even more foreign control of our economy. The Green Party believes that the existing excessively high threshold of $100 million, under which approvals are not needed for foreign investors coming into the country, is locked into this agreement with Singapore, Brunei, and Chile, and a future Government will not be able to change it, because there is a ratchet provision there saying that once we have agreed we cannot then push the threshold down, in the case of the investment side of the agreement. Even though this is not an investment agreement as such, New Zealand has committed itself under that agreement to locking in that $100 million threshold in a way that cannot be changed by a future Government. That undermines the sovereign power of any future Government that wants to change things, and of this Parliament itself.
The Minister of Trade indicated in his speech that services are also covered in this agreement, and the Greens have a particular concern there. The Minister said that educational institutions are quite keen on this agreement; unfortunately, it is the private educational institutions that are the most interested. The New Zealand Government is very involved in promoting those private educational institutions abroad, particularly through the World Trade Organization’s General Agreement on Trade in Services (GATS) round. It is true that some New Zealand providers might get a certain advantage out of those practices, but it works the other way, too, with private providers from overseas coming in and potentially gaining a big foothold in control in our own education system. Under those arrangements, and under this one, foreign providers have to be given equal treatment and equal Government subsidies—if Government subsidies are to be provided to private education services.
There is a new approach in this agreement to service commitments, which is different from the normal GATS approach, whereby the four countries are to provide what is called a negative list of services—that is, things they want kept out of the agreement in terms of provision of services, but with a free rein on everything else. So if this Government forgets to put certain things in that negative list, then for all time the other things—and they may be the result of further technological development—stay outside of the commitment and it is a free-for-all between those four countries in terms of the provision of those services. There is also ambiguity in the list of services that are excluded from free competition, which is provided in the treaty, as to exactly how they apply, and the determination of how they apply is not made by New Zealand—not the sovereign Government or Parliament of New Zealand—but by international arbitration. When we talk about the agreement protecting public education, and a lot of education services are, in reality, mixed public/private, who is to determine what is protected?
TE URUROA FLAVELL (Māori Party—Waiariki)
: The Māori Party’s contribution to this debate tonight is based on a Māori history of negotiation and alliances, in which our people have always looked at the potential for strategic and economic opportunities for Aotearoa. It is a history we know well, and it guides our decision making in all international trade agreements. As this nation entered the second half of the 19th century, the Māori partner to Te Tiriti o Waitangi was the dominant force in a vibrant, growing, and prosperous economy. For examples of that, we need just to look up State Highway 1 to Ngāti Toa and the rohe of Ngāti Toa Rangatira.
Two years ago, in the closing submissions of counsel for Ngāti Toa Rangatira to the Waitangi Tribunal, Matiu Rei, Te Waari Carkeek, and Professor Richard Boast, among others, gave evidence of the trading empire developed by Ngāti Toa with Pākehā/Europeans. They described the harvesting of flax, the use of European vessels and technology, and the full-scale involvement in the whale trade. Evidence was given by Professor Alan Ward and Dr Ann Parsonson of the reputation Ngāti Toa had as a maritime trading empire, controlling trade, the use of the coast, and access across both sides of Cook Strait. The significance of the coast and trade routes for Ngāti Toa, and its history of relation-building—of alliances, marriages, negotiations, and resource sharing—provided a solid base for an agreement to develop trade and benefit from multilateral cooperation. The concept of nation-to-nation strategic economic partnership agreements is therefore very familiar to tangata whenua.
Yet despite the glowing reputation of Ngāti Toa as an aggressive and energetic entrepreneurial group, its fortunes just as rapidly deteriorated. Submissions to the tribunal included the following: “… Ngati Toa, one of the most powerful tribes in Te Tau Ihu as at 1840, ideally situated, equipped with outstanding resources and exceptional leadership, a signatory to the Treaty and keen to benefit from the ‘benefits’ of European settlement, found itself by the turn of the century marginalized. Impoverished and reduced to virtually no land base, with its leadership scattered and decimated, its traditional tribal relationships and customary land tenure in a state of disarray …”.
So something happened, and I suppose that is where the Māori Party comes in. Our party is here to declare that we want to defend the rights and uphold the aspirations of the indigenous peoples of the world. In considering this legislation, I must think about the indigenous communities in Brunei—communities like the Malay, the Tutong people, the Bisaya people, the Dusun people, and many others. What happens when local and regional sovereignty interacts with multinational and international identity? It usually involves the loss of local identity and local and ethnic practices, which become subsumed under flows of global trade, colonialism, and assumptions of universalism. How will the indigenous communities of Brunei benefit from the Trans-Pacific Strategic Economic Partnership Agreement?
The bill proposes that Singapore will act as a hub in South-east Asia, and that Chile will become a similar launch pad for South America. But still some questions concern us. How will the indigenous communities fare in this four-way trade agreement that opens the door to wider trade liberalisation within the APEC region? Have those communities experienced the same reversal of fortune that saw Ngāti Toa—or, for that matter, any hapū or iwi—decline? Have similar steps been taken to destroy the mana and rangatiratanga—the power base—of indigenous communities implicated in this trans-Pacific agreement? Our knowledge of indigenous communities is that across the globe, traditional ways of life and homelands are being destroyed by overpopulation, growth, and industrial development, all in the name of progress—but to whose advantage? It is generally not to the advantage of tangata whenua.
Since the Spanish conquest, indigenous peoples have been used as labourers—poorly paid and lacking political representation. Although those conditions of semi-servitude are changing slowly, just 4 months ago the indigenous people of Chile gathered in Santiago for the First Forum of Indigenous Peoples on Poverty Eradication. They gave some indication of their plight. Their letter to the Presidents of Latin America and the Caribbean makes for interesting reading, as we consider the place of this bill today. It states: “In spite of the call by the international community with regards to decisively improving the human rights situation of Indigenous Peoples, the State of Chile persistently refuses to acknowledge Indigenous Peoples and their rights in the constitution … This legal lack of protection in terms of collective rights places Indigenous Peoples at a disadvantage before the rest of the Chilean society … In Particular, for Indigenous Peoples like the Aymara, Quechuas, and Likanantay, a real commitment to overcome poverty implies the acknowledgment and enjoyment of our rights to superficial and subterranean water sources, the acknowledgment of our rights over mining fields existing in our ancestral land and the right to have a share in profits resulting from their exploitation.”
I ask this House to seriously consider this whole bill and how we can sign up to a four-way trade agreement linking Latin America, the Pacific, and Asia, when we have such gaps at home with regard to indigenous people—Māori. One would hope that this nation, understanding the strategic and constitutional significance of Te Tiriti o Waitangi, would ensure that Treaty responsiveness in any international trade and tariff agreement is given considered thought by any Government entering into such an agreement. The Māori Party therefore looks for a guaranteed involvement of Māori as Treaty partners in the negotiation of, or enforcement of process under, such agreements. The national interest analysis, however, is guarded in its application of Te Tiriti o Waitangi. It states that the trans-Pacific agreement contains: “safeguards which will ensure that there are no adverse effects on New Zealand cultural values, including Māori interests”, which earlier speakers talked about. It is hardly a full endorsement of pride in tangata whenua achievements, is it?
This could have been an excellent opportunity for the New Zealand Government to recognise the unique contribution that Māori offer to the domestic New Zealand economy. Instead, the strongest position put forward is that there is nothing in the agreement that will prevent the Government from fulfilling any obligations under Te Tiriti o Waitangi. It is no wonder that there is general scepticism on the part of tangata whenua that those acknowledgments amount to any more than a paper promise. Commitments are avoided, and any real benefits are geared to the Crown, not to Māori or any other indigenous parties implicated in this relationship.
The relationships envisaged for tangata whenua communities as Treaty signatories should entitle us to enjoy the rights as a Treaty partner that attach to these international agreements. The commitments articulated in Te Tiriti o Waitangi should translate into international trade agreements such as the Trans-Pacific Strategic Economic Partnership Agreement. Promises made should be promises upheld. There is certainly space for greater collaboration between Māori and other indigenous communities about how international agreements like the Treaty could work in practice at international and domestic levels in contemporary times, but our treaties should be used as affirmations of, or a source of, political rights and status. They should be used to provide power as a vehicle for revitalisation.
The Māori Party will not stand by and allow, or turn a blind eye to, the situation that tangata whenua in other places—our brothers and sisters overseas—find themselves facing, and to the gross injustices and inequalities outlined by the indigenous communities implicated by this treaty. Our decision to oppose this bill is influenced finally by an ancient Incan prophecy from the Mapuche people of Chile and Argentina: “One day the great sacred birds of the North and the South will fly together. When the eagle of the North and the Condor of the South fly together, the Earth will awaken. The eagles of the North cannot be free without the condors of the South. Now it is happening. Now is the time.” Indeed, now is the time for the Māori Party to defend the rights, and uphold the aspirations, of indigenous communities across the globe. In doing so, we honour the inherent entrepreneurial capacity of tangata whenua and will do our very best to protect it for future generations.
Hon PETER DUNNE (Leader—United Future)
: In a roundabout way the previous speaker, when he talked at the commencement of his speech about the people of Ngāti Toa—not far from here—and their history as traders, encapsulated New Zealand’s history and the rationale behind this bill. He went on to move some distance from that point. But the starting point has to be that New Zealand is a small country, at the end of most of the world’s major trading routes, that historically has lived by its capacity to trade. We have significant natural advantages, but proximity to markets is not one of them. We have capacity in terms of attractive products that we produce, but we need willing markets into which to sell those products.
In today’s global environment where—notwithstanding delays in completing the Doha round or other international agreements—more and more multilateral agreements are being entered into between countries that believe they share a common interest, it is only rational that New Zealand looks to maximise its opportunity in this regard. That is why United Future supports the Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill.
I was momentarily encouraged when the Green speaker said that the Green Party was not opposed to trade. Then I reflected on all the trade agreements that we have discussed in this House over the last few years, and I could not think of one that the Green Party had actually supported. I also recalled his leader making a comment at one stage, in 1999, that New Zealand’s biggest export was soil—windblown by erosion—and that if we stopped international trade, we could cut international air travel in half, because all those trade negotiators would not be flying back and forth and, therefore, the polluting effects of aviation fuel in the upper atmosphere would be minimised. So I thought for a moment that we might have been seeing a change of heart, but it was not to be.
I listened to both the previous speakers, and one of the points that came through—which is one that is always raised when these types of agreements are being debated—was the question of what essentially is in it for the various partners. When we look at this agreement, we might ask: “New Zealand, Chile, Singapore, Brunei Darussalam—what is in it for New Zealand?”. There is the opportunity for us to have access into markets that we might not have access into in the same way at the moment, but the downside risk is argued to be that we have to accept products, services, and all sorts of things coming the other way.
About 18 months ago, in the Legislative Council Chamber next door, I hosted a three-way discussion between the ambassadors for the United States and Mexico and the High Commissioner for Canada to commemorate 10 years of the signing of the North American Free Trade Agreement. One of the key messages relevant to this bill that came forward at that meeting was the mutuality of benefits to all three countries over that 10-year period. Each country had benefited from the agreement, perhaps in different ways, but no country could report that it was worse off as a result of having concluded that agreement.
I think that is the lesson here. We know the advantages we have achieved from some of our bilateral trade agreements, going right back to the Closer Economic Relations agreement with Australia, which is the obvious one. But this is the first multilateral agreement of its type that we are seeking to conclude, and it recognises the common interests we have already with Singapore, the various ties we have with Brunei, and the fact—as the previous Chilean ambassador to New Zealand, Mr Appelgren, was so fond of reminding us of—that Chile is our nearest neighbour to the east. This is about bringing together a large regional agreement between countries that already have some interests in common and countries that have a willingness to expand those trade and political partnerships.
The format of the bill is exactly the same as with other trade agreements. The amendments it makes are to the Tariff Act, and that is entirely as it should be. They have come after the consideration by the Foreign Affairs, Defence and Trade Committee of a national interest analysis, and in some cases, the draft treaty. The bill will go back to the committee for some period for the consideration of submissions, and I wager that, in this particular situation, we will hear many of the arguments, from the same sorts of groups, that have been rehearsed in respect of every previous trade agreement, and not a great deal of light will be shed on events as a consequence.
I also make the point that in the last Parliament, the Foreign Affairs, Defence and Trade Committee carried out an inquiry into New Zealand’s relationship with the countries of Latin America. The Government response to that report, which was tabled in the House just recently, acknowledged the importance of New Zealand’s developing trade relations with all of those countries, and with Chile in particular, because of the opportunities that are there for us in terms of countries of similar latitude and geography, and countries where the markets that we might be seeking to promote are likely to be favourably viewed. This agreement, bringing Chile into the fold, as it were, as far as New Zealand is concerned, is, in my view, extremely welcome.
The way of the future will be these types of agreement. New Zealand is already negotiating with China, we have agreements with Thailand, Singapore, and Australia, and there is talk of more and more regional cooperation. We cannot pretend, particularly as a country of our type and size, that we can somehow stay outside that set of new environments. We live by trade. We will perish if we are unable to trade effectively in the future. I say to those people who criticise this legislation as implying a loss of sovereignty, or a surrender to the evil power of the multinationals, to look at what is happening elsewhere. Last night a group of us had dinner with the delegation from the European Parliament.
One of the issues I raised in discussion with a number of people—from new Europeans, such as the Poles, through to some of the more traditional members of the European Union—was how, in this new European environment, is national identity preserved? How can people who have spent the best part of the last couple of hundred years fighting each other come together in a political and economic union that is sustainable and viable? And the answer I received from those people, from Britain, Poland, Austria, and other countries, who were at our table was that culture and language is the distinctive thing. The Germans are no less German because they are in the European Union. The British, despite people like Margaret Thatcher, are no less British because of the European Union. The national culture preserves that identity. I say to those, therefore, who worry that somehow we are surrendering culture and identity through these agreements that, if anything, we are providing the opportunity to strengthen those links.
So we welcome this bill. We will certainly be supporting it. We are confident in the advantages it will bring to the New Zealand economy, and we look forward to the bill being passed and the relevant agreements coming into effect as soon as possible.
JOHN HAYES (National—Wairarapa)
: I was interested in the platitudes of the previous speaker, who clearly has not done very much homework. He would know, for example, if he had done some, that we do not have an agreement with China, and if he reads today’s copy of the
Independent, he might find the reasons why we might not get one.
Hon Maurice Williamson: Poorly informed.
JOHN HAYES: He is absolutely poorly informed—that is dead right. I would also like to comment on my Green colleague, that well-known supporter of Pol Pot. He talked about ideology. He was born into it; his parents were great supporters of Stalin. He was talking, as members will recall, about bilateral trade balances.
Sue Bradford: I raise a point of order, Mr Speaker. I think you may be aware, but this member may not be, that it has been ruled out of order for those kinds of references to be made about my colleague Keith Locke.
Mr DEPUTY SPEAKER: The member is quite right. We will desist from that. I thank the member for raising it.
JOHN HAYES: I want to come back to the point about bilateral trade balances and the nonsense he was talking about how these things had to be in balance. I used to get this a lot when I was the ambassador in Iran. I would get hauled across by the Iranian Treasury people, who would say that our trade balance was out of order and that we had to buy more products from Iran—until I pointed out to them that every New Zealander spent about 50c per capita on Iranian products and every Iranian spent about 7c per capita on New Zealand products, and that just drove a bus through their arguments.
This is an agreement involving Brunei, Chile, Singapore, and New Zealand—four countries with tiny populations, tiny economies, and, in some cases, very few resources. Its gestation, for those of us who can remember, began as a P5 agreement. Originally it was proposed that this agreement would include Australia and America. Well, this Government has not done much about delivering that. This Government has brought in a trade agreement that has actually cost more to negotiate than it will ever deliver to the people of New Zealand. What else, I wonder, would Ministry of Foreign Affairs and Trade officials have been doing if they had not been spending their time negotiating this agreement? They would probably be spending more time at the United Nations, helping the Government with its social engineering agenda.
I support this agreement and National supports it for reasons of philosophy, but it will not make the slightest bit of difference to anybody—and it will make no practical difference whatsoever to people in my electorate. But it is a good idea. I would like to draw on the words of the late Robert Kennedy to illustrate why we support it. He said: “Each time a man stands up for an ideal, or acts to improve the lot of others, or strikes out against injustice, he sends forth a tiny ripple of hope, and crossing each other from a million different centers of energy and daring, those ripples build a current that can sweep down the mightiest walls of oppression and resistance.” I commend people to think about this agreement in those terms, because this is a tiny step and the people of our country will need to change this Government if we are to take bigger steps in the trade area.
I congratulate Phil Goff, who is not in the House tonight. Interestingly enough, we do not have the Minister of Foreign Affairs here, we do not have the Minister of Trade here, and we do not have the chair of the Foreign Affairs, Defence and Trade Committee here.
Hon Chris Carter: I raise a point of order, Mr Speaker. First of all, Mr Deputy Speaker, I am on my feet and the member is standing. I appreciate that he is a new member, but he has now made reference to two individual MPs whom he says are not in the House. The member, under the Standing Orders, must not refer to members who are absent.
Mr DEPUTY SPEAKER: I was just about to raise that point. Thank you, Mr Carter for raising that. The member must not comment on the absence or otherwise of any members of this House.
JOHN HAYES: The people of the Wairarapa will certainly be furious with me for this mistake, because like me they want to see an open economy, and particularly in a small country like ours, we want to be open to international trade in goods and services. It is a primary requirement that we have this for economic success. The dismantling of “fortress New Zealand” over the past 25 years has been a key element in the reform programme that has produced today’s more efficient economy. Tariffs and other barriers to trade are now low, and New Zealand is likely to reach free trade, zero tariffs within a decade.
I also want to draw attention to the comments of our New Zealand First colleague who was, it seemed to me, despite the lead-up to the election, saying: “We will not support free-trade agreements.”, and was actually positioning her party and her leader to do just that. The people in my electorate are looking for returns from the activities of our Ministry of Foreign Affairs and Trade, and it is not happening. I wonder why. It seems to me that there are people in this House who believe that Helen Clark and her Labour Government will retain power for the next millennium. Certainly Winston Peters appears to be in this camp. He was desperate to align himself with Helen Clark even though he is now in the unusual position of being our most important Minister, but outside Cabinet.
The governing party must have self-confidence. It must want power, and it must believe that its exercising of that power can send our country in the right direction. This agreement will not do that. But the Government also needs to keep in mind that on any projection of its political past its power will come to an end. Winston Peters should keep that long in mind, as, I think, should Ron Mark. Mr Mark has a huge wealth of experience to contribute and really deserves a Cabinet post, but he has spent 10 years in this House and has not got to Cabinet yet. That has been at least 7 years too long, and the way things are going he is not going to get there.
The test of Winston Peters’ statesmanship, in the context of our history, will not be how many trees he pulls out by the roots but how he fits our foreign policy into a continual process of adaptation in which he combines leadership of our foreign policy with our national mood. This is not necessarily a recipe for inaction or the avoidance of controversy. Some of the most bitterly contentious measures—for example, the Civil Union Bill or issues around immigration—will, I think, for New Zealand First become inviolate. They will not be undone, because of the cost of too much damage to the Labour – New Zealand First relationship.
I would never ever say that the Labour Government is the most rapacious, doctrinaire, and unpatriotic Government this side of the equator—quite the reverse—but I would like to point out, from today’s copy of the
Independent, the words of Chris Trotter. He talks about the recent speeches made by Murray McCully and by our Minister of Foreign Affairs. He points out that we are a weak and relatively vulnerable nation, and that we should be making every effort to deal with trouble before it arrives. He talks about what is going to happen, and what is very likely to happen in Iran, which is a confrontation between Iran and the United States. As a consequence of that, he says there is a need for the five fingers of the Anglo-Saxon fist—the USA, the UK, Canada, Australia, and New Zealand—to act in concert. He argues that Helen Clark will come under intense diplomatic pressure to stand shoulder to shoulder with her very, very good friends.
If there is to be a strike against Iran, that will cause a lot of difficulty for us. If we abandon our current multilateral stance and support the United States’ plan to, as Chris Trotter says, detach the Iranian energy nozzle from China’s petrol tank, then we should abandon all hope of the possibility of a mutually rewarding free-trade agreement with the People’s Republic of China. On the other hand, if we decide to stand aloof and condemn the actions of our Anglo-Saxon allies, New Zealand exporters may well find themselves shut out of their hard-won markets. Having grasped that very unpalatable situation, I think people should refer to the speech made by my colleague Murray McCully because he provides some answers.
I warn the people in my electorate and the people of New Zealand that we are on a difficult and dangerous path. We do not have the trade relationships in place with our major partners to generate the sort of income we need as a country. Why do we need that income? Let me tell members. We need income to train and provide doctors, general practitioners, in Dannevirke, for example. I warn that we do not have the trade agreements in place to generate income to pay for the cost of kids’ operations in my electorate. For example, children are waiting for 4 years to get a glue ear operation.
I warn the people of this country that we do not have enough decent trade agreements in place to generate income to stave off poverty in the Pacific region, for which we are responsible. Let me tell members on the other side of the House that they have squandered $12 million of taxpayers’ money in the Solomon Islands by giving school books that have never left the wharf. Twelve million dollars of taxpayers’ money—which includes money from the people in my electorate—has been totally squandered. I warn members that as long as we tax petrol and do not spend that tax on the roads, we will not have enough money because we do not have the trade agreements in place to pay for decent roading systems. We do not have enough money coming from our trade agreements to get enough police to man the police station in Carterton, despite the Mayor of Carterton, Gary McPhee, having been to Parliament this week to talk to the Minister of Police to try to sort it out.
I support this bill, but we are a small, vulnerable country. We need to work out where our future lies, and we need to stop wasting our taxes on agreements such as this that are of no consequence. We need to focus our resources on agreements that matter.
KEITH LOCKE (Green)
: I raise a point of order, Mr Speaker. During that speech John Hayes made accusations against me, and previously in this Parliament members have been forced to withdraw and apologise for saying that I supported Pol Pot. I never supported Pol Pot in his crimes, and that member should be asked to withdraw and apologise.
Mr DEPUTY SPEAKER: You are quite right, Mr Locke. But the issue was raised and—
KEITH LOCKE: But the member did not withdraw and apologise.
Mr DEPUTY SPEAKER: That matter, Mr Hayes, should not have been raised in the way it was. I ask you to withdraw the reference to Mr Locke being a supporter of Pol Pot.
John Hayes: I withdraw. [Interruption]
KEITH LOCKE (Green)
: I raise a point of order, Mr Speaker. The member over there said: “But not to Stalin.” He is implying I supported Stalin. I never supported Stalin.
Hon Maurice Williamson: I didn’t say that at all.
Mr DEPUTY SPEAKER: What is wrong with saying “Stalin”? Who—
KEITH LOCKE: It was Maurice Williamson.
Mr DEPUTY SPEAKER: No, that is a debatable point. But thank you for raising it.
TAITO PHILLIP FIELD (Labour—Mangere)
: I raise a point of order, Mr Speaker. I distinctly recall John Hayes including in his accusation reference to Mr Locke supporting not only Pol Pot but Stalin, as well.
Hon Maurice Williamson: No. He didn’t accuse Keith Locke of being a supporter of Stalin.
Mr DEPUTY SPEAKER: He has withdrawn the main one, so I think we will leave it at that. But I thank you for raising that, Mr Locke.
Hon CHRIS CARTER (Minister of Conservation) on behalf of the Minister of Trade: I move,
That the Tariff (Trans-Pacific Strategic Economic Partnership) Amendment Bill be
referred to the Foreign Affairs, Defence and Trade Committee
New Zealand Superannuation and Veterans’ Pensions (Entitlements of Spouses and Partners of People in Long-term Residential Care and Remedial Matters) Bill
Hon DAVID BENSON-POPE (Minister for Social Development and Employment)
: I move,
That the New Zealand Superannuation and Veterans’ Pensions (Entitlements of Spouses and Partners of People in Long-term Residential Care and Remedial Matters) Bill be now read a first time. At the appropriate time I intend to move that the bill be referred to the Social Services Committee for consideration, and that the committee report the bill back to the House on or before 22 May 2006.
The main aim of the bill is to extend the eligibility for the single rates of New Zealand superannuation or veterans pensions to all superannuitants and veterans pensioners who have spouses or partners in long-term residential care in a hospital or rest home. The single rates are higher than the rates payable to persons who are married or in a civil union. This amendment will apply from 1 July this year. It was recommended by the Social Services Committee in a report that the committee presented to Parliament in May last year. The committee report was prepared in response to concerns outlined in a public petition. The Government accepted the recommendation in the committee’s report.
Currently, a person with a spouse or partner in long-term residential care is eligible for the higher single rates in only two narrowly defined circumstances: firstly, if the spouse or partner is receiving the residential care subsidy, which is means-tested; or, secondly, if the spouse or partner is suffering the effects of a stroke or dementia and is thereby unable to recognise the spouse or partner and affirm marriage vows. There are two main issues with the current approach. First, the current linking of access to the higher single rates to the residential care subsidy is inconsistent with the general non - means-tested approach to eligibility for New Zealand superannuation and veterans pensions. Second, the exception that relates to a spouse or partner suffering a stroke or dementia has proved difficult to administer. In particular, it requires officials to ask intrusive questions and make complex decisions regarding sensitive issues.
This amendment will ensure fairer treatment for many superannuitants and veterans pensioners living in the community with spouses and partners in residential care. Approximately 2,000 older New Zealanders in that situation will benefit from this change. I should like to take this opportunity to thank the petitioners who first brought this issue to the attention of the House, particularly petitioner Mrs Barbara White, who was supported by Lianne Dalziel.
The bill also makes other changes to eligibility criteria for New Zealand superannuation and veterans pensions. From 1 July 2006 the bill will remove the sharing expenses rule, which has prevented some superannuitants and veterans pensioners from receiving the living alone payment. The living alone payment represents the difference between the single sharing rate and the higher single living alone rate of New Zealand superannuation and veterans pensions. This difference is currently just under $20 a week net of tax. Current legislation limits eligibility for the living alone payment to superannuitants and veterans pensioners who are single, living alone in their principal place of residence, and not sharing their household expenses—including accommodation expenses—with any other person.
The sharing expenses rule operates as a somewhat strict and arbitrary form of income testing for the living alone payment. It is strict in that any contribution to household expenses denies eligibility completely. It is arbitrary in that only a particular form of income—namely, contributions to household or accommodation expenses—is counted. In some cases, superannuitants and veterans pensioners have been denied eligibility for the living alone payment because they received modest contributions to their household expenses from others, such as family members. The amendment will mean that eligibility for the living alone payment is based solely on actual living arrangements. It will, therefore, ensure fairer treatment for all superannuitants and veterans pensioners who are living alone.
The third amendment contained in this bill will enable a person to be paid New Zealand superannuation or a veterans pension for up to 156 weeks, if that person is overseas and undertaking voluntary work for a recognised aid agency such as Volunteer Service Abroad. Currently, the maximum payment period is 52 weeks. However, Volunteer Service Abroad’s standard assignment period is 2 years. The extension of the payment period to 156 weeks that is provided by this bill will allow for a typical 2-year assignment plus potential extension of the assignment for up to a further year. This will, therefore, remove the financial disincentives that inhibit older volunteers from making a longer contribution to Volunteer Service Abroad.
The final amendment contained in the bill changes the War Pensions Act to enable all rates of veterans pensions to be increased by Order in Council. This change will align the legislative provisions for the adjustment of rates of veterans pensions with those of New Zealand superannuation under the Social Security Act. As required under section 73 of the New Zealand Superannuation and Retirement Income Act, the Minister of Finance has provided a statement regarding the consultation process followed in the development of the amendments to that Act that are contained in the bill. The statement also covers the outcome of this consultation. The statement is included in the bill’s explanatory note and was also tabled in the House when the bill was introduced.
The amendments contained in this bill address several anomalies in the current treatment of superannuitants and veterans pensioners. I am confident they will ensure fairer and more equitable treatment for many older New Zealanders. In summary, the bill is further evidence of the commitment of this Government to ensure that superannuitants and veterans pensioners are able to live in dignity and participate fully in our society. I am pleased to commend this bill to the House.
JUDITH COLLINS (National—Clevedon)
: It is with pleasure that the National Party supports this bill. It is a very good provision, and it actually looks to recognise the situation that has been highlighted by my colleague the Hon Nick Smith. He took up the issue of a Nelson couple. Mrs Page had to go to a rest home. She and her husband have been married for 70 years, and Mr Page applied to Work and Income for the living alone payment—because he was, of course, living alone—but he was declined under the previous Labour Government because his wife still recognised him.
So the situation was that because Mr and Mrs Page could recognise each other and were not divorced, they were told by Work and Income that if Mr Page wanted to get the living alone allowance he would have to divorce his wife. That is the sort of callous situation that we found people in.
I was on the select committee that looked at the petition the Minister referred to, and it was certainly one that we took very seriously and, I recall, looked at very favourably, because it actually addresses a very cruel situation for people who in this day and age have to be separated at such a time in their lives. I note that the bill was in fact introduced on 21 February this year, 1 week after my colleague the Hon Nick Smith, who was very frustrated with the lack of work the Government had put into this area, lodged a complaint with the Human Rights Commission on behalf of Mr Page, who is now aged 91. I am very pleased to see that the Government has finally moved on it. We have to wonder why it took so long. With all the talk about petitions and everything else, the Government knew about this problem. The Government has been in power for over 6 years, and it could very easily have fixed this issue very quickly.
When we look at the bill itself, we see that it is a matter of only a couple of pages. So given that there was pretty much across-the-board and cross-party support for the bill, one would have thought that a bill of six pages might have been introduced with somewhat more speed once this problem had been recognised. However, we should be very grateful that despite the mad situation we have had, and still have in law at the moment, we are finally getting some action, because if this couple, Mr and Mrs Page, aged 91 and 88 respectively, had been either a de facto couple or a gay couple, or if Mrs Page had dementia or was in prison, then Mr Page would have been able to get the extra money.
Finally we are getting some action, and, really, only after my colleague the Hon Dr Nick Smith took a complaint to the Human Rights Commission. Frankly, the Ministers involved should be wondering why they could not have brought the matter to the House earlier. So we are very pleased to be able to support the bill. We do not want to be too nasty about that fact that it has taken so long, because finally something is happening. We are very pleased to be able to say that the Government has finally got itself together, found some legislation to bring to the House, and can finally get a bill passed—even if it had to get a hurry-up from Nick Smith. So we are very pleased to support the bill, and we are delighted to see that something will finally be done for Mr and Mrs Page and for couples like them.
GEORGINA BEYER (Labour)
: I am very pleased to participate in the first reading of the New Zealand Superannuation and Veterans’ Pensions (Entitlements of Spouses and Partners of People in Long-term Residential Care and Remedial Matters) Bill. I thought it was a little churlish for the member who has just resumed her seat, Judith Collins, to carry on about Mr Nick Smith, who obviously had little influence in terms of finding a real solution to the problem, as opposed to what the Government has been able to do.
I would like to reiterate the words of the Minister for Social Development and Employment, David Benson-Pope, when he congratulated Mrs Barbara White, the lead petitioner who brought the matter to the attention of the House via a petition and, of course, her excellent advocate in that matter, the Hon Lianne Dalziel, who was with her every step of the way. Not many petitions make it right through to this particular instance of having legislation created directly from them. So I congratulate Mrs White on achieving that outcome, if she happens to be listening to the debate this evening, and I hope she is pleased the bill has come to this point.
This is another example of Labour delivering its election promises. The bill extends the eligibility for the single living alone rate, from 1 July 2006, to married superannuitants who have a partner in long-term residential care. That was a key election commitment, and this bill will do it. That change will mean that nearly $20 extra per week will go to approximately 2,000 qualifying older New Zealanders. It is further evidence of the Government’s commitment to ensuring that superannuitants, veterans, and pensioners are able to live in dignity and to participate fully in society. This is the Year of the Veteran, and what better timing could there be for such a bill?
In conclusion, I look forward to the House sending the bill to the Social Services Committee. We were very pleased to consider the petition of Mrs White, which prompted this legislation. I commend the bill to the House.
JOHN KEY (National—Helensville)
: I am pleased to rise on behalf of the National Party in support of the New Zealand Superannuation and Veterans’ Pensions (Entitlements of Spouses and Partners of People in Long-term Residential Care and Remedial Matters) Bill. Since Georgina Beyer mentioned that this is the Year of the Veteran, I point out that I have made an application to the Minister of Veterans’ Affairs, Rick Barker, in relation to a special statue and a memorial celebration to take place in the Auckland Domain for the bombers, who have not had any memorial there and do not have a statue. I understand it would cost about $60,000. Millions of dollars are floating around—the Minister of Finance has about $6 billion worth of surplus available to him. I know that this matter is a bit outside the topic of the bill, but I am very hopeful that the bombers will get their just recognition.
It is interesting that we are in a House that is a war memorial—and it was certainly a war zone today—and that we should be looking to do something for poor veterans and New Zealand superannuitants, who have been forced by this Labour Government, under a crazy scenario, to divorce their partners of often up to 70 years so that they can get the single living alone allowance. What a disgrace it is that the Government has had 6 years to fix that up, but it has sat on its hands and has done very little—other than to count the cash. Michael Cullen sits on a pile of cash that he likes to count, night after night, while the poor veterans and the New Zealand superannuitants are out there, struggling to make ends meet. It has taken the Government 7 years to bring this legislation to the House.
It has taken the good work of the member for Nelson, Nick Smith, to bring the bill forward. This is a proud day for Nick Smith and a proud day for the National Party, because we are forcing the agenda once again, just as we are forcing the tax agenda. Michael Cullen spoke today on the issue of payroll tax. It took the National Party to expose that Michael Cullen is, by stealth, about to introduce a payroll tax to many New Zealanders—fortunately not the New Zealanders who will be eligible for assistance under the provisions of this bill, because they have moved outside the workforce. But I thank Nick Smith for his contribution of caring beyond the extent that many members of Parliament do, by ensuring that the 2,000 eligible New Zealanders will live with some dignity, because it is a crazy scenario that a couple who have been married for 70 years could be forced to get a divorce.
I can add that I have been married to my wife for 21 years. I do not like to admit that, because I am greying slightly. I am 44. I know I am not very good with numbers, but if we add to that another 21 years, we will find that I will have been married for 42 years by the time I am 65. I do not anticipate going gaga any time soon, but should I go gaga at 80, then that would add up to 57 years of marriage at that time. I do not think my lovely wife, after 57 years, should have to divorce me, because she loves me as she does no other human being. She cares about me. She should not have to go through a divorce after 57 years of marriage, so that we can get the single living alone allowance. It is a disgrace that my wife of 57 years—when I am 80 and gaga—should have to go through such a despicable display, and I am surprised that that was not something the Government tackled earlier.
I am surprised that Nick Smith, the very hard-working member for Nelson, had to drive the agenda, and I am amazed that Georgina Beyer tried to rain on Nick Smith’s parade. That is disgraceful, when Nick Smith had undertaken all that work on behalf of the party, had listed all of those things, and had driven the agenda. That is typical of the Labour Government: it is late to do absolutely everything, but is all too quick to put its hand up and claim the credit. The Labour members in the House are barracking, even as late as this point. They should just take it sitting down and accept that Nick Smith drove the agenda, Nick Smith put the issue on the map, and Nick Smith is the person whom thousands of New Zealanders will have the opportunity to reward.
I say to Nick Smith that he has done a wonderful service for the people of New Zealand, and a wonderful service for those veterans. What a tremendous job and what a tremendous effort he has made, given that Michael Cullen is too busy dreaming up payroll taxes, and Georgina Beyer was not sure whether she would stand in Wairarapa. In the end it did not matter, because National romped home in that seat with Chester Borrows. It would not have really mattered whether Georgina Beyer or anyone else had stood in that seat, because the people of Wairarapa knew a disgrace when they saw one. They knew that a person who has been married for 57 years should not have to get divorced in order to get the single living alone allowance. They knew that that was wrong. They knew not to ring 0800 Georgina Beyer, they knew not to ring 0800 Labour, and they knew not to trust a credit card that was paid for by the taxpayers of New Zealand—and while we are on the subject of that, we want the money back, thank you very much.
Instead of doing that, people rang “Nick for Nelson”. When they rang “Nick for Nelson” the phone was on the hook, unlike the Labour Party’s phone. Nick did what Nick always does: he stood up for the people of Nelson, he stood up for the people of New Zealand, and he went the extra mile. It was a tremendous effort by Nick Smith, and I say to Georgina that I was absolutely shocked by what she said. I thought she would have risen above that, and I thought she would have given the credit to the member for Nelson that he deserved. All I can say is that National is proud to support the bill, because National led the agenda. Once again the people of New Zealand can look to the National Party for security, for dependence, for leadership—for all the things that one would expect from a party like ours. The people of New Zealand will be very happy.
I make just one final point in relation to voluntary service abroad, and the ability of New Zealanders to work abroad and still receive their New Zealand superannuation for 156 weeks, not for 52. What a good idea that was, as well. I do not know whether Nick Smith recommended that, but I am pretty sure he would have done that as well, because he has a heart. In Nelson, where Nick works, volunteer work is a critical part of the community. Nick knows the value of volunteer work, and he knows that people who are working as volunteers overseas deserve to receive New Zealand superannuation. They deserve to receive the benefit of all those things.
How proud Nick and the other National members who have driven the agenda on this New Zealand superannuation and veterans pensions bill can feel as New Zealanders head overseas for 156 weeks, knowing that they can receive their New Zealand superannuation as they do their good work—as they work in the tsunami-affected areas, and as they work in Pakistan in areas affected by earthquakes and landslides. As they work in other parts of the world that are challenged, they can look to the National Party of New Zealand and know that it cares about them—not like the Labour members, who sat there for 7 years not caring about that issue, and who were too busy looking at student loans and things they could do to make their way back to victory. National cared enough to make this matter a big issue; National, through Nick Smith, cared enough to make that happen.
I finish by simply saying that I am disappointed with Labour, but, frankly, after 4 years, I have come to learn how easy it is to be disappointed with Labour, which is sitting around, doing very little, and leaving our economy to wander in the wilderness as other countries go past us. Only on Monday, Peter Costello was very happy to set up a taxation review, and very happy to make the Australian economy more efficient and more effective, to drive home the real advantage for Australians. Our Minister of Finance sits in the House tonight, twiddling his thumbs. He will probably get up at some stage, take a call, and claim that Nick Smith’s effort was not fantastic. Well, I say to him that it does not matter what comes from people who have taken 7 years to put this issue on the agenda. National is the one to thank; Nick Smith is the one to thank. It makes one proud to be a member of the National Party.
PETER BROWN (Deputy Leader—NZ First)
: I do not know whether it is good news or bad news for Mr Key’s wife, but after listening to that speech I have to tell the good member’s wife that she will not have to wait 57 years for John Key to become gaga—I think he is well on the way. As for Nick Smith standing up for the people of Nelson, if my memory serves me correctly, within a fortnight of being made deputy leader he could not stand up for anybody. He was carried out of here—and I think he was actually carried back in.
There is an old saying—at least I think it is an old saying; if nobody has said it before me I will say it now—that we should judge people not by what they say but by what they do. What did that crowd on the National benches do when it was last in Government? It scaled back superannuation to 60 percent of the net average wage, and it wanted to means test superannuation and raise the age of entitlement to 70! And now National is trying to say it is the party of compassion. The only compassion National members have is that they feel sorry for themselves, and they will spend a long time sitting there feeling even sorrier.
Taito Phillip Field: Three years.
PETER BROWN: Three years? They will be there for a long time if they try to fool the people of New Zealand with the sort of carry-on that John Key has just indulged in. His contribution was really more about wishful thinking than anything with substance.
New Zealand First members welcome the New Zealand Superannuation and Veterans’ Pensions (Entitlements of Spouses and Partners of People in Long-term Residential Care and Remedial Matters) Bill. We are absolutely delighted with it. We do question why it has taken so long, but now it is here, and we hope it will be fast tracked through Parliament. It is very, very sad for some New Zealanders whose husband, or wife, or partner has lost the ability to communicate, for one reason or another, and ends up in a rest home. The sound member of the partnership is left to cope as best as he or she can on less than adequate funding. The bill will address that problem; it will make it fairer. Those people are living single people’s lives with added responsibility, and it is about time we delivered on the issue. It is about time we looked at the issue for war veterans as well, and the bill will tidy that up. New Zealand First is pleased also that the period of pension entitlement will be increased from 52 weeks to 156 weeks for mature people who work overseas and give their time and effort for very, very good causes. New Zealand First thinks that is a very important issue, also.
But there is much to be done. This is but the start. To quote Winston Churchill—and this quote, I think, applies to this issue as well as it applied to the one about which he spoke—“This is not the end. It is not even the beginning of the end. It is, perhaps, the end of the beginning.” That is the case as far as elderly people in this country are concerned. We are at the end of the beginning of addressing their needs. New Zealand First will start a golden age card in this term, and that will give—
David Bennett: Oh!
PETER BROWN: Oh, the member rubbishes the idea! The member sits there and groans and thinks it is an uncaring idea. Well, let me just tell the member that the golden age card will come, and it will come in this term of Government—thanks to New Zealand First and, in particular, thanks to Winston Peters, who will steer it through and lead the way on producing a golden age card for New Zealanders. Additionally—and this will happen before the bill comes back—the 65 percent of the net average wage that married couples are currently entitled to will increase in April to 66 percent, and it will go up progressively thereafter. It is my understanding that that can be done by regulation for a superannuitant now, but that it cannot be done by regulation for a person on a war veterans pension. The bill will tidy that up. The war veterans will receive the automatic increase that superannuitants receive.
The bill has been a long time in coming. I will not give one iota of credit to any member of the National Party. I am encouraged that National members will support it, but when it comes to addressing the problems of the elderly and the aged of this country, they have been totally and absolutely remiss—so much so that they should be hanging their heads in shame. When they had the opportunity to address some of the concerns that face elderly folk in this country, they walked away, they turned their back, and they said they would not help at all. In fact, they did worse than that: they hindered things, and tried to scale back superannuation, as I said earlier on.
We have an ageing population. The aged sector is about 12 percent of the population right now, and by the year 2051 it will be closer to 25 percent. It is a sector of our society that we must help. This is the start, but it is not the end. New Zealand First will ensure that the concerns of elderly people are uppermost in everybody’s mind in the House. John Key might like to speak light-heartedly in this particular debate, but I can assure members that by the end of this session he will be taking it very seriously indeed.
Hon Tau Henare: Bring back the leader, whoever that is!
PETER BROWN: There is no hope for Tau Henare—no hope whatsoever. But for John Key there might be a glimmer of hope. I can see he is taking what I say seriously, and maybe the next time he speaks he will not be so frivolous when he talks about the concerns of the elderly.
New Zealand First is 100 percent behind the bill, and we hope to see it fast tracked through Parliament, through the select committee process, and back in the House with unanimous support—and genuine support, not the rather flippant and frivolous support that the two National members presented. New Zealand First is 100 percent behind the passage of the bill.
SUE BRADFORD (Green)
: On behalf of the Green Party, I take a brief call to say that we also are totally behind this bill. It is long overdue, and, once again, characterises just one aspect of the huge mess that our income support and welfare system is in. However, at least this little piece of it is being sorted out.
I would like to endorse the words of Peter Brown, who just now said that it has been a bit disappointing to hear such frivolity from Mr Key on this topic. This is actually about fixing up a situation for people in absolutely desperate straits at the end of their lives, where one partner of a couple has been in long-term residential care, and the other partner, who has been left out in the real world, has been stuck on the married rate of the pension or veterans’ benefit, to his or her disadvantage. That is actually really serious when one is counting every dollar and every cent, and it is not something that should be the subject of a whole lot of laughter.
I would also like to acknowledge the role that Lianne Dalziel of the Labour Party played. An elderly petitioner came to the Social Services Committee, as did Lianne Dalziel, to tell the committee about this situation. I would like to acknowledge the courage, in coming to speak to the committee, of the elderly lady who led the petition. She has had long-term support from Lianne Dalziel in trying to get this legislation through Parliament. I would like to acknowledge both her and her colleagues for bringing it through—quite quickly, now that I know something about the legislative processes here. It has been quite a quick process since we heard the petition at the committee, not a long one. It is good to see that the Government does not just accept the decisions of the Social Security Appeal Authority. I just wish we had a mechanism whereby we could look at a lot more of them, rather than just this one.
The Green Party is totally behind this measure. We will be pleased to see the day come very soon when this anomaly is ended, as it affects thousands of people. I understand that the select committee process will be quick, which is excellent—as long as people have a chance to make submissions. If people have problems with it, let us hear from them, but I doubt that they will.
On the other matter of the Volunteer Service Abroad, I say that I think it is fantastic that the Government has seen fit to extend the period for which people can get superannuation or the veterans’ pension while they do volunteer work abroad. It is being extended from 1 year to 3 years. It is a wonderful thing to see our older generation giving their time and experience in this way, and I know that increasing numbers of them are doing this once they leave our regular workforce. It is a great contribution that this country can make, particularly to our neighbours in the Pacific and Asia.
From what I understand, this is very unusual: we are seeing unanimity across the House in support of a piece of welfare legislation. That is great. Let us just get there as fast as we can.
TARIANA TURIA (Co-Leader—Māori Party)
: Rākau papa pangā, ka hei ki te marae. A weapon discarded can be an ornament on the marae. In the context of this bill, that whakataukī advises us that an older person who has followed a career of certain skill but is no longer agile enough or strong enough can teach younger persons the same skill. In its essence this describes the unique relationship of reciprocity, of manaakitanga, inherent in our valuing of our kaumātuatanga—of recognising that the elders, the wise ones, are the repositories of whānau stories and family histories; that they are the bridge to a world not lived by the young.
It is these characteristics that instruct us in supporting the proposed changes to amend the New Zealand superannuation and veterans pension provisions. We must ensure that the adjustments provide for an equitable standard of living, pay for essentials, and enable the continued participation by older people in community life—participation, which is about the best opportunities for all, that will close the gaps between rich and poor, Māori and non-Māori, and older and younger.
This House will recall the New Zealand report from Professor Rodolfo Stavenhagen last year. The special rapporteur identified significant disparities between Māori and Pākehā in regard to social and human development indicators in his visit to Aotearoa. A key concern for the special rapporteur was the lack of significant disaggregated statistical data that identified ethnicity. If one does not have the right data, one cannot really target social policy. The information we do have in Aotearoa is as a result of a 2002 report published by Professor Mason Durie.
The Living Standards of Older Māori report shows a relatively high rate of material disadvantage amongst older Māori, and clear disparities between the living standards of older Māori and non-Māori. One in five older Māori face severe difficulties.
It is data such as this that must inform the subsequent drafting of new legislation to broaden eligibility criteria and to ensure that Māori are able to maximise their take-up from superannuation and the veterans pension. It is never too soon to plan ahead to help boost Māori material well-being and to ensure that all superannuitants and veterans pensioners living in the community are able to benefit from simplified rules, clear entitlements, and income support appropriate to assist actual living arrangements. If we are to hold our heads up high on an international stage, we need to know how to respond to what Professor Stavenhagen observed is a surprising differential of 10 years in life expectancy between Māori and Pākehā.
The urgency of this crisis is also influenced by the demographic changes, as the Māori population will age at a faster rate but at a later time than the non-Māori population. In March 1996 there were 14,200 Māori aged 65 and over. By the year 2011 the number of Māori in this age group is expected to have increased by 84 percent to reach 26,100, when Māori will comprise 5 percent of the population aged 65 years and over. By 2031, the expected number of older Māori will be 59,000—more than four times its current size—and they will account for 9 percent of the total Māori population. In the space of one generation we can expect significant population pressures that this new legislation must take into account.
It is our moral, economic, and cultural responsibility to take care of our older people. Such care is critical for the survival of mana ā-hapū, and we must not short-change another generation. If we can live up to this expectation, the benefits will accrue for the nation as we nurture the leaders and wise advisers of our growing communities. It is all about respect and taking appropriate care of our elderly. The broadening of eligibility criteria means that our elderly are able to continue to play an active role in our communities. The provision to extend the period of time a person can continue to receive superannuation or the veterans pension while overseas working voluntarily for an aid agency is a particularly commendable move.
No one should leave this House tonight without acknowledging the fact that this is the Year of the Veteran. This is our chance to thank all New Zealand veterans of all ages—tangata whenua, Pasifika, and tauiwi alike. This is our time to honour their enormous sacrifices. It is an opportunity to recognise the inherent value of their service to our nation. The Māori Party will continue to call for justice for New Zealand’s veterans who served in the Viet Nam War in order to ensure that their significant contribution to shaping our nation is also recognised.
In light of the year being distinguished as the Year of the Veteran, we could not believe it when we were first approached by Viet Nam War veterans throughout the country, who were incensed at the decision by the joint working-group on the concerns of Viet Nam War veterans to refuse to meet on marae for their hearings. We received emails and phone calls, including a letter from one vet currently living in Sydney, who called the working-group’s decision to boycott the Ngāti Kahu marae in Tauranga a “cultural insult, disrespectful, and a slap in the face for Māori Viet Nam War veterans.” We had to ask how hard it is to hold a meeting on a marae in order to respect the wishes of tangata whenua to honour their request. Many of the veterans never received any support or counselling following their return to Aotearoa. Many experienced serious trauma and turned to alcohol to help them to cope. So where were the hearings held? They were held at the good old watering-hole, the RSA—far more suitable than the marae, or so the working-group decided.
One would think that the long-term care and restoration of all our veterans, including those who served in Viet Nam, would be that they could be rehabilitated with as little trauma as possible. It seems to us to be simple good sense that those who were wounded in mind or body would be adequately cared for and compensated for their injuries.
The well-being of veterans’ families is of critical importance. Our veterans and their whānau have waited for 30 years for the report released by the Health Committee, which confirms that Viet Nam War veterans were exposed to a toxic environment. In honouring the dedication of our own forces, we must never forget the innocent victims of war—the villagers, people and families of Viet Nam—who were also sprayed with the defoliant—the innocent non-combatants whose voices here in New Zealand we do not hear.
It is time now for the Government to act. The Government must honour its responsibility to respond to the devastating trauma experienced by Viet Nam War veterans and the ongoing intergenerational impact on their children in light of their exposure to Agent Orange and defoliant chemicals during their war service, and it must do it now. The Māori Party believes there is no better way of honouring the Year of the Veteran this year than to recognise the genetic damage and the serious health problems caused by the impact of Agent Orange on Viet Nam War veterans. Taking action on Agent Orange, agreeing to hold meetings on the marae, and introducing amendments to the New Zealand Superannuation and Retirement Income Act and the War Pensions Act are all ways of commemorating and paying tribute to the services so many of the people of this land gifted to future generations.
We as a society must ensure that what nature has decreed should not generate undue insecurity, as Nelson Mandela, aged 77 at the time, said. He went further and said that he wanted to be able to sleep until eternity with a broad smile on his face, knowing that the youth opinion-makers and everybody are stretched across the divide trying to unite the nation. We will support this bill as a mark of respect and for the principle of honouring our elderly, our pakeke, and our veterans, the sons and daughters of Tūmatauenga, many of whom as rangatahi sacrificed their youth in serving so that we may sleep with smiles on our faces.
GORDON COPELAND (United Future)
: I rise on behalf of United Future to take a brief call on the New Zealand Superannuation and Veterans’ Pensions (Entitlements of Spouses and Partners of People in Long-term Residential Care and Remedial Matters) Bill. I must say that it is a pleasure in this House sometimes to follow members of the Māori Party, and the previous speech given by the honourable Tariana Turia was one example of a very thoughtful, well-constructed, and very good contribution to the debate on this bill. When she talked about the importance of ethnicity in terms of the statistical—and if one likes, the genetic—characteristics of ethnicity, I was reminded of the little campaign that seems to be run by some members of the National Party at the moment that seeks to confuse New Zealanders about the difference between ethnicity and nationality. For example, this morning at the Finance and Expenditure Committee the member Craig Foss wanted to ask the Secretary to the Treasury why he did not just regard all the people working for Treasury as New Zealanders, rather than worry about their ethnic origins.
It is important to say that ethnicity talks about a person’s DNA and gene pool origin. In my case that happens to be Caucasian, and within Caucasian is the subset of Scottish, English, and Irish. It is a completely different question from nationality. The other difference between the two is that we are born with our ethnicity. It is not something we choose and it is not something we can change, whereas our nationality is something we can change. Everybody who is born in this country is a New Zealander; everybody who has a New Zealand passport is a New Zealander, but I could choose tomorrow to go and live in Australia and I could start to call myself an Australian. Or people could come, as many have, from places like Taiwan to live in New Zealand, and they now consider themselves to be New Zealanders. So that is just a little aside for those in the National Party who have confused minds about the difference between the two terms.
I come to the bill. United Future supports very strongly the provisions of this bill. We believe that it is entirely fair and reasonable when a spouse or a partner goes into full-time residential care, that the rate for the partner who continues to live in the community should then become the single person’s rate. That is eminently fair and it addresses a situation that has probably been blatantly unfair for quite some time. We also support the provision of the bill that simplifies the rules for living alone payments, so that it is based on a person’s actual living arrangements. Again, we are a common-sense party and this is a common-sense provision, when one thinks about it. There is a difference in the rates for single and married couples, because of the difference in living costs. The old saying that two can live together cheaper than one is true when it comes to sharing all kinds of things, from cars to packets of Weet-Bix. One can achieve some economy if one is part of a married couple or a couple living in a partnership, as compared with a person who is on his or her own. That is exactly what the scheme does and that is the distinction we should ensure is made. I know, from correspondence I have had from people, that there has been some confusion around that point and it is good to see it clarified.
We strongly support the extension of the voluntary work provisions for people who are doing voluntary work overseas, from 52 weeks to 156 weeks. I am constantly amazed at the number of New Zealanders who in their retirement years choose to undertake fantastic voluntary work overseas. I would like to ask the select committee that will consider this bill to look carefully at the way in which that work is defined. In my view it should be defined in a way that includes, in an unambiguous manner, people who take short 1 to 3-year terms overseas as missionaries. Some people like to argue that they are in the business of simply—if one likes—winning converts to their particular faith, be it Christian, Muslim, Hindu, or whatever. But speaking for the many, many missionary organisations that I know about, the reality is that day in, day out they give considerable humanitarian support to people, particularly in Third World countries, in every range of charity one could imagine. By the way, the word “charity” happens to mean love for one’s fellow man They express that through medical help, educational help, translation help—the list goes on and on. All of that is part of the day-by-day work done by many of those people in missionary organisations. It is true that their motivation is based on faith, but that should not obscure the reality of the good that they do in those countries. I think that if an objective account were ever taken of New Zealand’s history, it would be true to say that the early missionaries in this country also made a significant contribution—sometimes controversial, but overall extremely positive.
It is also right that we align the veterans pension with the adjustments we are making to New Zealand superannuation. United Future strongly supports the confidence and supply agreement between Labour and New Zealand First, that New Zealand superannuation will move to 66 percent of the ordinary-time weekly earnings as from 1 April 2006. Indeed, our own party’s policy would have been a bit more generous than that. We wanted to move the data to a prospective base rather than a retrospective base. At the moment those calculations are done on 1 April, but are based on the figures for the previous 31 December. When one works that through the next 12 months one finds that superannuitants are always 9 months behind the eight ball, because this new rate applies from 1 April until 31 March in the next year but is still based on 31 December in the year before. I have done the sums and that is the way it works out on average. One is always 9 months behind. Under our formula we would have gone to more than 66 percent, but this at least is a good step in the right direction. I am happy to signal our strong support for this bill on that basis.
Hon Dr MICHAEL CULLEN (Deputy Prime Minister)
: I begin by thanking all members of the House for, so far, their support for the bill. Some clearly are more enthusiastically and genuinely supportive than others.
I would just say to my friend Gordon Copeland that everybody is actually about a year behind everybody else, in terms of pay increases, once he or she has had his or her last pay increase, and that is no different for superannuitants than for anybody else. The formula in that respect, in terms of the fixing, has not changed in that instance since 1976, when New Zealand superannuation was first introduced under the National Government. It has always been related to wage relativity at the point that it occurs, not at some point further down the track.
I would have to say I was a bit surprised by his call for further increases in Government spending, as this morning he was urging me at the Finance and Expenditure Committee to cut Government spending as a proportion of GDP. He appears on occasion to share the strange belief of members opposite that one can increase every item of Government spending but reduce the total in some way or another. It is a very interesting prospect, I have to say.
I want particularly to thank Mrs Barbara White, who was the person who really brought this matter to Parliament’s attention, and my colleague Lianne Dalziel, who is the MP who was most supportive.
I must say I was very amused by the enthusiastic, over-the-top speech in support of Dr Nick Smith by Mr John Key. I am surprised that he had heard of Dr Smith, because he thought the member for Wairarapa was Chester Borrows. He said so in his speech. If he is ever going to get the numbers to do Dr Brash, he has to learn that Mr Hayes is the MP for Wairarapa and Mr Borrows is the MP for Wanganui. But, never mind, that is the trouble when one thinks about financial markets rather than one’s colleagues. I gently say to Mr Key that in a few weeks’ time he may want to read that
Hansard and perhaps dissociate himself rather more from Dr Smith than he was doing this evening. I gently suggest to him that he might care to start distancing himself from one or two of his colleagues on the front bench reasonably early in the process. I am sure he will do that over the next few weeks, at some point.  I say to Mr Henare that what goes around, comes around. That is an old rule in this place, and the National Party will learn about that old rule some time in the next few weeks. I will now come to the other extraordinary thing about Mr Key.  Oh yes, and it is a lot better too, some of it.
Let me now come to another aspect of Mr Key. When one has been overseas for so many years, speculating on the foreign exchange markets, one tends to become out of date with what is happening in New Zealand. I just need to bring him up to date very briefly about what has happened with superannuation in the last 15 or so years. Firstly, the single living alone allowance was introduced by the last Labour Government. I was the Minister who introduced the single living alone allowance. Secondly, the last National Government, in 3 out of its 9 years, froze New Zealand superannuation and had no annual increase, at all. In its last year in Government it legislated to cut the relativity from 65 percent to 60 percent. It had proposed 55 percent, but to get Mr Henare’s support, and that of one or two others, it had to raise it to 60 percent. And there is no question that Dr Brash—because I think he might have said it in detail—actually wanted to go to a relativity of 50 percent of the average wage. National, as a whole, wanted to go to 55 percent. What was the first thing the incoming Labour Government did? It restored the relativity up to 65 percent, and, in the end, to 67 percent of the average wage.
Bob Clarkson: Thanks very much!
Hon Dr MICHAEL CULLEN: I know that Mr Clarkson gets all his jokes from old films. He also got most of his money from a Labour Government at some time or another.
Some of the younger puppies opposite want to start trying to bark and bleat about New Zealand superannuation, but they need to know the awful history of their own National Government in that respect. In 3 out of 9 years, there was no increase for any superannuitant in the country, and the relativity of New Zealand superannuation was cut. The National Government abolished the surcharge only because New Zealand First forced it to. We know that Dr Brash wants to raise again the age of eligibility for New Zealand superannuation. He has given speech after speech saying that the New Zealand superannuation age of eligibility should be raised. Of course, that did not stop him from collecting it the moment he turned 65. So dedicated was he to reducing Government spending that instead of simply not collecting the pension, he decided to collect it then release a press statement saying he was going to give it to charity. Well, he could have saved the taxpayers the money in the first place by simply not collecting the pension. It is not compulsory to take New Zealand superannuation when one turns 65. It is not a legal requirement.
But let me say again to Mr Key that I advise him very strongly—especially when he is talking about Dr Nick Smith being on the telephone—to be very careful before he associates himself and his future too closely with that of Dr Nick Smith.
Dr JACKIE BLUE (National)
: I stand to support the New Zealand Superannuation and Veterans’ Pensions (Entitlements of Spouses and Partners of People in Long-term Residential Care and Remedial Matters) Bill. It has been a long time in the making, and we have to thank the Hon Dr Nick Smith, member for Nelson, for getting this going. It is a pity that we had to wait so long.
I am pleased that the bill will make changes to the New Zealand Superannuation Retirement Income Act 1954, and that it will enhance the lives of superannuitants and veterans who have spouses in long-term residential care in a hospital or rest home. Superannuitants and veterans are a section of our society that needs to be acknowledged. They have all contributed to our society; it is a pity that they have had to wait so long to get this recognition.
Veterans are a specific group within New Zealand, and this amendment bill in part acknowledges the role that veterans have played, and continue to play, in the development of New Zealand as a nation. The decline in the number of veterans of World War II in our population means that veterans are a dwindling population. It is difficult to estimate the numbers of veterans in New Zealand, but it is probably best done by counting the numbers in receipt of the war disablement pension. Approximately 16,000 veterans are in receipt of that particular pension. This bill targets those veterans who have spouses in long-term residential care in a hospital or rest home. In respect of the veteran population, we are dealing with a small, but diminishing, population. Having a loved one in a long-term care facility is an added emotional and physical burden to this group.
I am pleased that the bill will go some way to help both the veterans and the superannuitants. When a spouse or partner is critically ill in long-term residential care in a hospital or rest home facility, there is the inevitable additional financial cost of travelling to and from the facility, and the other extra costs of caring for a loved one who is in care. Quite simply, it is more expensive to live alone. This bill removes the sharing expenses rule for the living alone payment, so that entitlement to the living alone payment for New Zealand superannuitants and veteran pensioners is based solely on actual living arrangements.
I am pleased that the sharing expenses rule has been addressed, as it has been the cause of a lot of negative public comment. It operates as a strict and arbitrary form of income testing for the living alone payment. Any outside contribution to the household expenses denies completely a person’s eligibility for the payment. It is arbitrary in that only a particular form of income, namely that directly related to household or accommodation expenses, is counted. In some cases, New Zealand superannuitants and veteran pensioners who are living alone are denied eligibility because they receive modest contributions to their household expenses from others, such as family members. Clearly, that is wrong.
Chris Auchinvole: It is wrong!
Dr JACKIE BLUE: It is very wrong. I am pleased that the sharing expenses rule has been removed; it is a pity that it has taken such a long time. We have to thank Dr Smith for that. It is a fair and just amendment. In real terms, this bill means that those veterans and superannuitants who have a spouse or partner in long-term residential care in a hospital or rest home facility will be better off by $24 per week, or about $100 per month. That will go some way to ease the financial burden of those veterans and superannuitants.
The bill also increases the period of time a person can continue to receive New Zealand superannuation or the veterans pension while overseas and working voluntarily for an aid agency, such as Volunteer Service Abroad, from 52 weeks to 156 weeks. I would be lost even to begin to estimate how many superannuitants or veterans are working overseas voluntarily, and suspect that it would be quite a small group. But, nonetheless, it is an important group, however small, and those people should not be disadvantaged, as they are doing selfless work in Third World countries. They need to be acknowledged, saluted, and supported, and this amendment will go some way towards that.
However, I suspect that many superannuitants and veterans want to travel overseas on extended visits to their children and grandchildren who are settled in other countries because they do not see a future in New Zealand. Those children and grandchildren are part of a growing exodus of people who are leaving our shores in search of a better life. Those superannuitants and veterans should not also be disadvantaged, simply because they want to spend some time with their relatives overseas. I am pleased that the bill acknowledges those circumstances.
Under the current legislation, a person with a spouse or partner in long-term residential care can receive only a single or single living alone rate of New Zealand’s superannuation or veterans pension in two narrowly defined circumstances. The first circumstance is if a person’s spouse or partner is receiving a residential care subsidy, which is means-tested. The second circumstance is if a spouse or partner is suffering the effects of a stroke and/or dementia and, as a result, is no longer able to affirm his or her marriage or civil union. We have the petition of Barbara White and 1,500 or so others, which has been mentioned by previous speakers, to thank for the broadening of the eligibility criteria introduced into the bill. It was considered by the Social Services Committee and was recommended in a report that was presented to Parliament on 12 May last year.
National MP the Hon Dr Nick Smith will be very gratified by the introduction of the bill. In February last year, he sent out a press release entitled “Super living alone policy stupid and unfair.”
Paula Bennett: Did Nick put out a press release?
Dr JACKIE BLUE: Yes. He will be very pleased that something is finally happening. It was actually on behalf of an elderly man in his electorate, who was denied the living alone payment under Government policy, because his wife was in a rest home and still recognised him. The Hon Nick Smith said in his press release that “The policy is stupid and unfair. It should make no difference to eligibility whether the husband or the wife was in rest home care because of physical or mental disability.”
He went on to say: “It is insulting that WINZ is advising people that to get the living alone payment they would need to divorce lifelong partners who required resthome care.” He further said: “It is bizarre that if this couple were de facto or gay, or if Mrs Page had dementia or was in prison, he would be eligible. These factors should be irrelevant to eligibility for the Living Alone Payment that is intended to recognise that it is more expensive for superannuitants living alone.” He went on to say: “There will be hundreds of New Zealand superannuitants whose wife or husband has gone into care and who are affected by that iniquitous policy. The Government should recognize that their new policy is blatantly unfair and change it. If not, the Human Rights Commission should declare the discrimination unlawful.” It is very gratifying to see that the legislation is finally coming home to be passed.
Before I conclude, as an associate health spokesperson I would like to make some remarks on the care of our elderly. I would like to quote my colleague Jo Goodhew, who is the member for Aoraki and also an associate health spokesperson. In a recent media release she said there was widespread concern that district health boards are still not passing on funding or funding increases to providers of aged-care residential facilities. Mrs Goodhew discovered at a recent Health Committee that figures show that some district health boards are passing on the funding, and others are not. Mrs Goodhew was very concerned, and did not receive a satisfactory explanation of why that was happening. She said that questions had been asked about why that increased funding had not flowed through to providers, but those questions are yet to be answered adequately by the Ministry of Health. It seems that $71 million is, in fact, to allow the sector only to tread water, not to meet increased costs.
That is simply not good enough. We are an ageing population, and to ensure that the health system works effectively we must ensure that we have residential facilities and hospitals for our sick elderly population, and we must ensure that those facilities are adequately funded.
Hon LIANNE DALZIEL (Minister of Commerce)
: As the MP who met with Barbara White to discuss with her what we would do in order to address what was a serious issue, I am very pleased to be able to speak in the first reading debate on a bill that addresses the second limb of the two-limbed issue she brought to my attention. When we drafted the wording of the petition, we wrote: “That the House of Representatives recommend that the Government review the rules of eligibility for the living alone payment when one of a superannuitant couple is in long-stay or permanent residential care and for practical purposes they are no longer able to live together as a couple.”
We made a mistake, Barbara White and I, because we did not realise when we wrote the wording of the petition that the issue of the living alone payment was not the primary issue. For her to qualify for the living alone payment, she first had to qualify for the single rate of superannuation. A person cannot get the single rate of superannuation if he or she is married, and that was the issue she faced. So we discovered, after we had presented the petition, that there were two separate issues. One was the appropriate rate of superannuation—that is, the single rate as opposed to half the married rate—and the second issue related to the living alone payment, which appeared to be subject to different considerations, not simply whether the person was living alone.
So I did some research, and I found out that the ministerial directive that related to the living alone payment dated back to 1999. It was a National Minister who signed the ministerial directive that set the way the living alone payment was to be paid. So I had then to find out why she was not entitled to the single rate of superannuation, because she was entitled only to half of the married rate of superannuation. I discovered, when I went back, that a previous National Minister had been given costings on fixing that problem nearly 10 years ago, but National had said that it was too expensive and had decided to leave it like that—precisely like that. [Interruption] I am really interested that National members want to try to yell over the top of me. The point I want to make to the House—
The ASSISTANT SPEAKER (Ann Hartley): Interjection is obviously OK, but not barraging, and not repetitive barraging in the way it is going on now. Would members please keep it down a bit.
Hon LIANNE DALZIEL: I think it is important for the House to recognise that National was presented with this problem, in Government, about a decade ago, and National said it was too costly to fix. This problem—
John Key: It was weeks before the election. What was the actual date? Come on, name the date.
Hon LIANNE DALZIEL: It was in 1996 or 1997 that National costed the fixing of this problem. I think it is important for members to know why that happened, but I know that National members are not interested in knowing why that happened. The reason was that National finally delivered on a commitment it had given in 1990, which was to remove the surcharge on superannuation. It removed the surcharge, and when it did that it created this anomaly. National members do not remember that, because they cannot recall how that happened. But I know that Peter Gresham was the Minister of Social Welfare who called for the costing on this matter, and he said that it was too expensive to fix. So it—
John Key: You should be ashamed that it’s taken 7 years to sort this out.
Hon LIANNE DALZIEL: It has not taken 7 years to fix, because it was brought to my attention by Barbara White 2 years ago, and within 2 years this Government has fixed the problem. That is because Barbara White came to me, unlike the constituents in Nelson who went to their constituency MP and got nothing. They got a letter sent to the Human Rights Commission; we got a change in the law.
I think it is important for people to realise that it was not any Government, neither Labour nor National, that brought in that dreadful exemption, which I call the “dementia exception”. It was actually a decision of the Social Security Appeal Authority, which stated: “where a married couple are living apart, due to one partner suffering the effects of a stroke or dementia, and he or she has ceased to recognise his or her spouse, and as a result is incapable of positively affirming their marriage vows for the limited purpose of determining what rate of superannuation the spouse living at home should receive, the chief executive should regard that spouse as living apart from the marriage partner and therefore unmarried.” Nick Smith said in his letter, as was quoted in the House, that the policy is stupid and unfair—that is true. That is why the Social Security Appeal Authority tried to work its way around it. It was a National policy that the authority was trying to work its way around. The Social Security Appeal Authority had to determine that a couple was essentially unmarried in order that the spouse at home could qualify for the higher rate of superannuation. This bill fixes that issue.
But there was a second issue. By the time Barbara White brought her petition to Parliament, and had her hearing—very respectfully, I might add, in front of the Social Services Committee, whose members on all sides of the House treated her with great respect, and she was very grateful to be treated that way—she had been determined as eligible for the single rate of superannuation. But she did not qualify for the living alone payment, because it was considered by the department that her husband was still contributing financially to the household through their joint assets. This bill fixes the second limb of the problem. So both parts of this problem are now addressed for everyone—not just for Barbara White but for the other people who signed the petition.
I met the man who signed the petition second. He was in exactly the same situation as the individual referred to by the previous National Party speaker. He did not qualify for the exception because his wife did not have dementia—she did recognise him. He did not qualify for the exception that had been created by the Social Security Appeal Authority to get around the stupid and unfair policy that had been created by National. This legislation will fix that for him. So I think that this is a very proud day. We should be celebrating the fact that the parliamentary system has worked. An individual came to a member of Parliament and said that the situation was unfair. The member of Parliament agreed that it was not fair and undertook to try to fix it. So that member of Parliament, instead of rushing off to the Human Rights Commission, informed the Minister’s office that a petition would be brought in and asked the Minister to work with the petitioners. We worked with the select committee, Barbara White brought her petition to Parliament, and, with the Minister’s office, we were able to achieve this very great result.
I know that Barbara White is proud of the New Zealand Parliament today because Parliament has set aside some of the political differences that affect the way we operate from time to time to do the right thing—the right thing for her, for the other 1,500 people who signed her petition, and for those who did not put their names on the petition but want to have this matter addressed. This is an example of the system working well—somebody brought an issue to Parliament, and Parliament set aside all personal interests to look at the issue and find a solution.
I think that this could not have happened except under a Labour-led Government prepared to listen to the real concerns of the people and finally to address the problem. I am afraid some National Party members will be very embarrassed when they find out that one of their own previous social security Ministers actually costed fixing this problem a decade ago and decided that it would cost the country too much. All the hollow words that we have heard tonight will return to reflect on those who said that they cared about this issue. Barbara White is a tremendous New Zealander who has done a great thing by bringing this matter to the attention of a Government that is prepared to act and make a difference.
Hon DAVID BENSON-POPE (Minister for Social Development and Employment)
: I move,
That the New Zealand Superannuation and Veterans' Pensions (Entitlements of Spouses and Partners of People in Long-term Residential Care and Remedial Matters) Bill be
referred to the Social Services Committeereferred to Social Services Committee
Education Amendment Bill
- Debate resumed from 21 February.
ALLAN PEACHEY (National—Tamaki)
: I rise to speak in opposition to the Education Amendment Bill. In doing so, I wish to focus on the new regulatory regime for the early childhood education sector. That is another example of the way in which the Labour Party thinks that by making a bureaucracy it can solve the problems of children. When will the Government learn that no child ever learnt to read in a bureaucrat’s office in Wellington?
I take on board the advice of the New Zealand Institute of Economic Research and the Early Childhood Council, both of which have expressed concern that the children who currently miss out on early childhood education will gain nothing from this bill. Yet it is those children who would benefit most from access to early childhood education. From among those children will come the silent catastrophe of New Zealand life—the 150,000 New Zealand boys and girls who will pass through our school system not learning to read, write, or do mathematics. This bill will do nothing for those children. We know that children who have good early childhood education are more adaptable when they start school, and more likely to pass through the school system and go on to tertiary education, than those who do not get that opportunity. So why does the Labour Government continue to ignore the children who most need opportunity—who most need help?
I reflect on the irony of this situation. If this were a National Party bill, people like me would be burnt in effigy on the forecourt of Parliament House by members of the New Zealand Educational Institute. Instead, kindergarten teachers are ringing and asking me to go and see them, or asking to come and see me. They are begging members to do something to protect their work practices and their work, because they know that this bill is the end of kindergartens as we know them in New Zealand.
I want to take a moment to reflect on what kindergartens have meant to New Zealanders—to think about what going to kindergarten meant to my four children, and to think about the opportunities that being involved in a kindergarten gave me to meet the parents of the children my children would go through school and grow up with. That went right to the very fabric of what made decent, caring communities. We got involved in volunteer efforts. I remember well painting the kindergarten roof, and two or three guys putting up a new shed there. Those were the days, of course, when a couple of volunteers could put up a new shed for a kindergarten—not like today. Those were the days when on a Saturday we would go and dig the sandpit or help clean the building. Our involvement would then carry on through the school and the PTA to the children’s sports clubs and that sort of thing. That is what we will destroy if we let the kindergarten system collapse—yet that is what we are doing.
I say thank you to the kindergarten teachers of New Zealand for the years of service they have given to children like mine, and to hundreds of thousands of others. I ask them to reflect on where the leadership from their union is—or is it just the fact that because this is a Labour Party bill it is OK? How many of those teachers forewent the opportunity of a decent tax cut to vote for Labour, and now what will Labour do to them?
This bill will be the end of kindergartens as we know them. We know that children who have the opportunity of decent early childhood education will be more successful at school, will not become the criminals of tomorrow, and will not be amongst the youngsters who will not learn to read, write, or do mathematics—150,000 of them, the silent catastrophe of New Zealand. This bill does nothing to give those children a start in life. The Government will spend $100 million, yet the children who most need access to early childhood education, and who most often do not get access to it, will miss out again.
What is it about socialism that says that it is legitimate to leave 20 percent of one’s population stranded—stranded in poorly performing schools, stranded in lousy State-funded housing, and stranded in crime-riddled streets—but not to lift a finger to deal with that silent catastrophe. In fact, we are introducing into this House legislation that will perpetuate that situation.
Hon Member: It’s just poor workmanship; that’s all.
Hon Brian Donnelly: He would have seen the figures that came out, just after you guys got out.
ALLAN PEACHEY: I would like to thank Mr Donnelly, the chairman of the Education and Science Committee, for the committee’s contribution. He does a fine job chairing that committee. I know that he must appreciate the disappointment of missing out on the baubles of office. I say to him that his leader owed him better than that.
So where is the New Zealand Educational Institute? Where is the voice of kindergarten teachers? And where is the voice of those parents who want a kindergarten education for their children—who do not want to drop their children off at 8 o’clock in the morning and pick them up at 5 o’clock, but who like the idea that their children can go to kindergarten for 3 hours in the morning, then spend the afternoon at home with their parents? Where is the consideration for those parents?
Let us not lose sight of one thing: the best upbringing a child can have is from that child’s parents. The more time a child spends with his or her parents, the better it is for that child, and we do not want to be in a situation of encouraging the State to take over the upbringing of our children. It is far better to put our resources and our effort into those children who are currently missing out. That is where our efforts should go, because that way we can finally start to break that chain of silent catastrophe. We can finally start to reduce the number of our children who are not learning to read, to write, or to do maths, and who will, therefore, have no place to contribute positively through our economy. That is what we should be concerned with—not with creating another bureaucracy that gives jobs to bureaucrats. And, please, will this Government understand: no child was ever educated in a bureaucrat’s office in Wellington.
Hon BRIAN DONNELLY (NZ First)
: I could use up the whole of my 10 minutes picking holes in the previous contribution from the National education associate spokesperson, but I will not, and I will tell members why. I think that member has a lot to contribute to the debate and discourse on education, and to what the Education and Science Committee has to do. He has, without a doubt, a great passion for education. I do have to mention that I did spend some time with an education spokesperson from the ACT party who had a great passion for education, and she happens to be in jail now—but that is neither here nor there.
I am very pleased to be speaking in this debate. I am the fifth speaker in this debate, but I am the first speaker who actually knows anything about what this legislation is about, the first speaker who has actually sat and listened to the debate, and the first speaker who has had any involvement in making contributions to the changes made to the original bill. I would like to work through that process in a sensible way.
I want first of all to pay due tribute to the members of the Education and Science Committee in the last Parliament. In particular, I pay tribute to the two members of that committee who are no longer in the House, for a variety of reasons: Bernie Ogilvy and Deborah Coddington. Although much of this bill was motherhood and apple pie, and the report is a unanimous one—and I would like to point that out to members of the Opposition; there was no opposition, and there is no minority statement in the report back—we worked our way through the issues, and made a number of changes. The members of the Opposition parties on the select committee at that particular time contributed to those changes in a very positive way. I want to acknowledge that. The report was a unanimous one, but, as I said, there were a number of changes. The need for those changes was identified as a result of the careful work undertaken by the committee.
It was identified, for example, that certain clauses of the original bill—the bill as it was presented to us—had the unintended effect of preventing a teacher whose registration had expired from undertaking relieving teaching. I can tell members now that my registration has expired. It has been expired for quite some time.
Hon Tau Henare: And all the kids are clapping their hands.
Hon BRIAN DONNELLY: And on election night I was really glad we had made that change. I was really happy. It was a bit like 1999, I might add for Mr Henare. I had to really reconsider my registration process then! The bill contains a number of other provisions that improve the teacher registration process.
There are also a number of issues relating to the composition of the disciplinary tribunals. We recommended, for example, changes that would ensure that at least one member of a disciplinary tribunal—a disciplinary tribunal for teachers—must be a member of the Teachers Council, and that one may not be teacher, which allows for the appointment of someone with specialist knowledge, such as a lawyer with expertise in employment law. However, even with those changes, the way the original bill was drawn up meant that the disciplinary tribunals could have been composed of members, none of whom was a teacher. That seemed to the committee to be contrary to the objectives of the legislation that had established the Teachers Council. Those objectives were intended to professionalise teachers. I think it was the Education Standards Bill, which was in the name of the National member Alec Neill. One of the classic criteria of a profession is that it controls its own membership, including disciplinary action. Yet this legislation was going to take that away. The committee therefore insisted that any disciplinary tribunal must be composed of members the majority of whom are registered teachers. We believe that is right.
Hon Tau Henare: Why?
Hon BRIAN DONNELLY: Because of the professional process. That does not mean to say that other people cannot be brought into it, but if teaching is to be a profession, it must control the entry and exit of its own members.
The bill in its original form extended the prohibition in the principal Act that makes it an offence to abuse, insult, or intimidate teachers in front of children, to early childhood education and care services. It also increased the penalty from $40 to $1,000. The committee explored in detail the issue of the abuse or intimidation of staff, because it had come to our attention that many teachers, largely female teachers, in small and isolated rural schools were operating in fear and trepidation because of the current P epidemic. I take the opportunity to put on record that this is an issue the Government needs to address. However, the provision in the Education Act is specifically about abuse or intimidation of staff in front of students. What the bill intended to do was to extend that to early childhood education providers. What came about as the result of our extensive exploration of this legislation was that we found that under the present Act a student who abuses a teacher in front of his or her fellow students could be liable to a fine of, at present, $40, and maybe, in the future, $1,000. So the select committee put in a clause to make it clear that this provision did not apply to students, as we believed that such behaviour should be dealt with through the ordinary school disciplinary process or through the general law.
The bill also allows for people who renege on bonded scholarship contracts to be required to repay outstanding amounts through student loan scheme processes. That was unanimously agreed to by members, and it was good to have that position endorsed by members of the students association of Christchurch teachers college when I met with them on Monday.
Surprisingly, there was no objection from any party representative to the provision in the bill to extend the use of national student numbers to the early childhood sector and the compulsory sector. New Zealand First is extremely supportive of this move. Our particular concerns are issues of truancy and transiency. One of the real downsides of the Tomorrow’s Schools reforms was that large numbers of students fell through the cracks. They fell through the cracks during the transition process from one schooling level to another, and they also fell through the cracks when parents shifted homes, particularly from one location to another. This move, in fact, will enable systems to be developed that better track some of our most at-risk and vulnerable students.
However, notwithstanding the careful scrutiny by the select committee, a part of this bill is still of genuine concern, and I wish to focus upon this area of concern and bring it to the attention of National’s early childhood spokesperson. It lies in new section 317, in clause 43 of the bill—specifically, subsection (2)(b). The member who might have railed against regulations happened to have sat in Cabinet when the last set of regulations—Desirable Objectives and Practices—were put through in 1998. But this bill is actually trying to put through a different framework, and the Desirable Objectives and Practices will be collapsed into it. New section 317 allows for a process of putting regulations in place. That is fine and I do not think any one would disagree with it. But subsection (2)(b) states: “authorise the Secretary, after consultation with those organisations that appear to the Secretary to be representative of persons likely to be substantially affected by these regulations, to prescribe criteria to be used by the Secretary to assess compliance with the minimum standards imposed by these regulations:”. I want members to focus their attention on that. What it actually means is that, potentially, ministry officials could have the power—and Parliament could be giving them the power, without any review by the Regulations Review Committee—to determine exactly what every early childhood centre has to do, down to the colour it has to use—
Hon Tau Henare: And you like that.
Hon BRIAN DONNELLY: No, we disagree with that. We think that power is far beyond what was ever intended by the legislation, and if that is what the legislation is actually doing, we believe that in the Committee stage we need to draw back on it. We are signalling at this particular stage that we have a concern. We are in discussion both with members of the Opposition and with members of the Government itself to ask what exactly it means and what powers it gives. It was never drawn to the attention of the select committee, but it has been drawn to our attention since then. We want to ensure that the intentions were to set the regulations, then to allow some examples to be given for early childhood centres to draw on, rather than to provide that power.
Later on in that provision, section 317(2)(i) talks about: “prescribe offences punishable on summary conviction by a fine not exceeding $500 in respect of the contravention of or non-compliance with the regulations.” In other words, if a sleeping room is not coloured the colour that the ministry has determined is the right colour for children, one could be up for a fine of $500. That is completely the converse of the whole notion of keeping the diversity that is the very strength of early childhood education.
So I signal here and now to the House that we will be proceeding to explore this issue, and to try to resolve it—
Hon Tau Henare: Explore or resolve it?
Hon BRIAN DONNELLY: —to resolve it in a sensible way, to ensure that what it may be saying is not true.
Hon Tau Henare: Are you going to bring it up in a Supplementary Order Paper?
Hon BRIAN DONNELLY: We will bring it up and amend it at the Committee stage if that is necessary, yes.
METIRIA TUREI (Green)
: I was very pleased to be able to sit on the Education and Science Committee for at least part of the consideration of this bill, and I did hear some of the submissions, but I was not able to be there for the last part. We will support the second reading of this bill, but we will not make a final decision until after the Committee stage because we still have some real concerns about it.
On the plus side, this bill makes some important and necessary changes. We are pleased to see changes to clarify and simplify the prohibition of corporal punishment in early childhood services. It is an important principle that children should not be subjected to violence, and we look forward to this House taking a similarly principled approach to my colleague Sue Bradford’s section 59 abolition member’s bill when it comes before the House for consideration. Some years ago the decision was made to prohibit corporal punishment in schools, and we, as a community and a Parliament, need to make sure we are consistent in our condemnation of violence against children, regardless of whether it is done by teachers or by other adults.
We are pleased to see that a new section makes the intimidation of staff at schools and early childhood services—where that is happening in front of children—unlawful, and that the fines have increased, because violence and abuse have no place in a child’s life, anywhere. We, as legislators, should do everything we can to make sure that the community knows that such behaviour is unacceptable and will be punished. We are also pleased to see that those provisions do not apply to children, and that more child-appropriate services and systems are in place to deal with their behaviour.
We are very pleased to see that a parent’s right to enter the premises of the early childhood service that his or her child attends is retained. I was very surprised when some privately owned centres asked to be able to exclude parents from entering their premises as they saw fit. That struck me at the time as being a terribly unsafe policy for an early childhood centre to have, and I certainly never would have sent my children to a service that barred me from entering its premises to check on their welfare.
The exemptions to this provision in the bill are generally sound, but I would like to see some tightening of the new section 319A(e), proposed to be inserted in the Education Act 1989 by clause 43 of the bill. This paragraph gives the operator a right to bar a person whom the operator considers is “exhibiting behaviour that is … disruptive to the effective operation of the centre …”. I think that it is not the operation of the centre that is the main concern, but the physical and psychological welfare of the children. Under this wording, an operator could bar a parent who wanted to come in, say, to feed or care for a child in some way, because that would disrupt the centre’s schedule. That is not a good enough reason to bar parents from checking on their children in those centres.
Our real concern about the bill, which was expressed by my colleague Rod Donald at the first reading, relates to the extension of the student number system from the secondary into the primary and early childhood sectors. Currently, those numbers are used for the secondary and tertiary sectors to collect and combine data for policy and analysis purposes—largely for the New Zealand Qualifications Authority and tertiary providers to use to verify the identity of enrolling students.
On the face of it, the network management system that has operated those numbers is used for fairly benign purposes, but the Greens have always been concerned that those unique personal identifiers could be readily misused. The only other existing national ID number is the national health index number, which is an identification number given to all children at birth. So we are already trapped for our entire lives, in some form.
The Greens are not yet convinced that those numbers will not be misused or that there are sufficient checks on their use in the bill. We are particularly concerned about the privacy of the children and the families concerned. There is no doubt that the numbers are useful for the better sharing of information between schools when children enrolled at those schools move, and for the better identification and management of truant children—and certainly the Office of the Children’s Commissioner supports the use of those numbers.
But there still remains a high possibility that a breach of those children’s privacy may occur. Just because they are children does not mean they have any less entitlement to the protection of their privacy. In fact, we should put in extra measures to protect their rights and interests, because they have even less power to make any changes or to hold people to account should that information be misused.
We are concerned that the information could be used to access children for advertising—even by the education sector itself. What is worse is that it could be used to trace and punish already struggling parents and families, who, for a variety of reasons over which they may have very little control, are already engaged in a cycle of transience and difficulties.
So we would like to see some better protection mechanisms placed in the bill and to see whether some amendments can be made to tighten up the rules. We look forward to seeing what happens at the Committee stage, but the Greens will support the bill through to its second reading.
- The House adjourned at 10 p.m.