[Sitting date: 09 May 2012. Volume:679;Page:2073. Text is incorporated into the Bound Volume.]
Wednesday, 9 May 2012
Mr Speaker took the Chair at 2 p.m.
Questions to Ministers
Income Gap, Parity with Australia—Local Wage Growth
DAVID SHEARER (Leader of the Opposition) to the
Prime Minister: Is it still a fundamental purpose of his Government to narrow the wage gap between New Zealand and Australia, and to grow local wages in New Zealand?
Rt Hon JOHN KEY (Prime Minister)
: Narrowing the wage gap with Australia is certainly something we are aiming for over time, and we have made a good start. Since September 2008 real after-tax wages in New Zealand have increased by 11 percent; in Australia over a similar period they have increased by only 7 percent. So the wage gap has narrowed a bit, but there is still lots to do. In terms of growing local wages, the member should be aware that average earnings rose by 1.2 percent in the last quarter and 3.4 percent in the last year. In real terms that constitutes wage growth of 0.7 percent for the quarter and 1.8 percent for the year, so wages are certainly rising.
David Shearer: Is growth under his Government the worst in 50 years; if so, does that help close the gap with Australia?
Rt Hon JOHN KEY: I do not have that information to hand. But what I can say is that what is interesting is that the member has asked the question about whether a National-led Government facing a global financial crisis and the worst earthquake pretty much in New Zealand’s history—
David Shearer: I raise a point of order, Mr Speaker. That was a pretty straight question.
Mr SPEAKER: It was indeed a straight question. The Prime Minister said he did not have that information on him, and then went on to say what he could tell the honourable member or what he could say, and that is usually an indication that it is not actually part of the answer to the question.
David Shearer: Does he agree with data from Statistics New Zealand that shows that average annual growth in New Zealand since he became Prime Minister was well under 0.5 percent, while in Australia it was 6.5 times higher at more than 2 percent?
Rt Hon JOHN KEY: Firstly, you would have to have a look at all of that data, because it probably includes a period that was under Labour. What the member is saying is that he wants a bigger mining sector, like Australia’s, but every time this Government talks about more mining those members reject it. I might add one final point. Last night the Australians had their Budget, and despite the fact they have got a massive mining sector, this is what the Australians have done in the last 4 years: borrow A$190 billion.
Michael Woodhouse: How—[Interruption]—have wages grown in New Zealand over time?
Rt Hon JOHN KEY: Well, at least he has friends, but anyway. As I said in my primary answer, real after-tax wages in New Zealand have grown 11 percent since September 2008. That is 11 percent more that is going into the pockets of people in New Zealand, even after allowing for inflation, in just 3½ years under a National Government. So let us understand that: in 3½ years of a National Government, in real after-tax terms wages have risen 11 percent. The interesting question is what they went up in the 9 years of the previous Labour Government. The answer is 4 percent.
David Shearer: Has the wage gap closed with Australia since he became Prime Minister, or has it actually grown by $19 a week, even based on his own figures that he tabled in the House?
Rt Hon JOHN KEY: It has narrowed, and that is because—[Interruption]; they do not like the numbers—real after-tax wages have grown 11 percent since we have been in Government. They have grown 7 percent in Australia, so that is less—the gap has narrowed. And they have grown a lot more than they did under a Labour Government.
David Shearer: In light of the Prime Minister’s commitment to stop the exodus of Kiwis to Australia, what is the average number per week of New Zealanders leaving for Australia?
Rt Hon JOHN KEY: I do not have that to hand.
David Shearer: Does he understand that the current migration figures show that 1,000 Kiwis a week are now moving to Australia, the highest ever recorded?
Rt Hon JOHN KEY: I cannot confirm that number, no.
Mr SPEAKER: Order! Now look, I have been fairly tolerant of a reasonable level of interjection. I now call the Rt Hon Winston Peters and I want to hear his supplementary question.
Rt Hon Winston Peters: Given that a scaffolder in Queensland gets about $42 per hour and in New Zealand gets $14 per hour, does he stand by his statement, as reported in
Bay Report on 20 December 2007, that he would “love to see wages drop”; if not, why not?
Rt Hon JOHN KEY: No, I do not stand by that statement, because it was incorrect, and it was withdrawn by the newspaper that had made it.
Rt Hon Winston Peters: This has not been in the ether for some time, so I seek leave to table the
Bay Report of 20 December 2007—
Mr SPEAKER: Could I just check with the right honourable member: is this a newspaper report?
Rt Hon Winston Peters: It is from
Bay Report but reported in the Whangarei newspaper—from 2007.
Mr SPEAKER: I think Whangarei is a reasonably major city to—
Rt Hon Winston Peters: But it is 2007. [Interruption] He has forgotten it but I have not.
Mr SPEAKER: Order! To a fellow Northlander, I think the Whangarei newspaper is a major newspaper in this country. We do not table such press clippings.
Economy—May 2012 Financial Stability Report
TODD McCLAY (National—Rotorua) to the
Minister of Finance: What recent reports has he received on the economy?
Hon BILL ENGLISH (Minister of Finance)
Financial Stability Report from the Reserve Bank says that New Zealand remains vulnerable to global financial instability, but that New Zealand’s funding conditions have improved due to increased household saving, limited expansion of credit, and the freeing up of international debt markets. The Reserve Bank has confirmed its intention to strengthen the core funding ratio of New Zealand banks, which will require them to source more of their funding from local deposits and long-term debt—this will increase the stability of the financial system—and it notes that an increase in household savings and labour market resilience has helped to keep financial stress contained.
Todd McClay: What factors does the report identify as important to New Zealand’s financial stability?
Hon BILL ENGLISH: In view of recent global events, financial stability is becoming a competitive advantage for New Zealand. The Reserve Bank remains
supportive of the Government’s intention to get back to surplus. It notes that this will help contain overall national debt and ensure the Government can respond to future downturns. The bank identifies global financial instability as a source of risk to New Zealand. It also identifies New Zealand’s relatively high net external debt as a vulnerability.
Todd McClay: What does the report say about why reducing public debt is important?
Hon BILL ENGLISH: It says the same things as commentators and banks and economists are saying all around the world, which is that lower public debt will ensure that the Crown has the future financial capacity to respond to a significant economic downturn, natural disaster, or other crisis. The bank goes on to say that renewed financial market turbulence could increase the costs of borrowing, and that provides another reason for consolidating our fiscal position while borrowing costs are relatively low.
Todd McClay: What is the Government doing to reduce public debt?
Hon BILL ENGLISH: The most important thing we are doing to reduce the burden of public debt is to work on those longer-term policies that will help lift New Zealand’s growth potential, such as continued investment in infrastructure, encouraging and supporting more young New Zealanders to get better levels of skills, investing in innovation, and improving the management of the public sector. Alongside that, in the shorter term we are working to get back to a surplus.
Hon David Parker: Amongst the reports he has received about the economy, why are there none describing decent economic growth, wage growth, or more jobs; and is it because the only place he would find those reports would be in Australia?
Hon BILL ENGLISH: The member is simply wrong. We have had reports recently from all sorts of sources that New Zealand’s moderate economic growth will still be higher than that of the United States, the United Kingdom, and the whole of Europe, and will be similar to Australia’s. We have also got continued job growth, as reported last week in the quarterly employment survey, and we have continued wage growth, as also reported just last week by New Zealand’s own department of statistics.
Hon David Parker: If the economy is going so well, why are we having a zero Budget and a thousand New Zealanders a week leaving for Australia?
Hon BILL ENGLISH: The member needs to make up his mind. He was just saying it was not going anywhere at all. In fact, there is moderate growth—[Interruption] There is moderate economic growth, moderate employment growth, and, actually, fairly considerable wage growth. Over the next few years it is likely that those will be just as strong, if not stronger, than is the case in Australia, which the member may be interested to know is starting to experience a number of the same economic pressures as New Zealand did 3 years ago, and it will be interesting to see how those play out.
Louise Upston: What steps has the Government taken to balance its books in the past 3 years?
Hon BILL ENGLISH: In the past 3 years one of the significant steps we have taken is simply to commit to less new spending. The last 4 years of the previous Labour Government ran up about $15 billion of new spending. In the last 3 years under this Government we have totalled $750 million of new discretionary spending. So although we have not cut total Government spending, we have slowed down the rate of growth considerably and focused on using all that money to get better results.
Tax Revenue—Comparison of October 2011 Forecast and March 2012 Financial Statements
Hon DAVID PARKER (Labour) to the
Minister of Finance: In dollar terms, what is the shortfall in the tax-take for the nine months to March revealed in yesterday’s Financial Statements compared to October’s pre-election update?
Hon BILL ENGLISH (Minister of Finance)
: In dollar terms it is $1.57 billion lower than forecast. On the other side of the ledger, core Crown spending is $1.75 billion lower than expected. Just to keep it in perspective, the Australian economy, which the member is quoting, last year forecast a deficit of $12 billion, and it ended up with a deficit of $40 billion—some $28 billion astray. We are looking at a $400 million or $500 million difference.
Hon David Parker: What made the greater contribution to the shortfall: his inflated pre-election claims about the rate at which National would be able to grow the economy, or his failure to deliver the actual growth itself?
Hon BILL ENGLISH: As the member ought to know, the pre-election forecasts are done by Treasury, not the incumbent Government.
Hon Annette King: Blame Treasury.
Hon BILL ENGLISH: Well, that is a matter of fact, and as the member may well know by now, the second half of last year was softer than most people expected. However, we are confident of moderate growth that will be higher than in the US, the UK, and the whole of Europe, and probably as high as in Australia.
Hon David Parker: Rather than blaming Treasury, would he agree that tax revenue would be higher if the economy was growing faster; if so, does he accept responsibility for his failure to grow the economy faster?
Hon BILL ENGLISH: Well, of course, if there is lower growth, there will be lower revenue. The Government, of course, has set out to assist the growth of the economy by, for instance, getting a convention centre in Auckland, expanding our mineral and resource programme, and supporting our agricultural industries to grow. The Labour Party is against all those things, so how does it think it could grow the economy?
Hon David Parker: Did the Pre-election Economic and Fiscal Update state that every percentage drop in GDP growth result in half a billion dollars less in tax revenue, and therefore does his $1.5 billion less tax revenue announced yesterday mean the economy is going even worse than the worst-case scenario in the Pre-election Economic and Fiscal Update?
Hon BILL ENGLISH: No, it does not.
Louise Upston: What is the impact to the Crown’s finances of the Government’s tax changes since the 2008 election?
Hon BILL ENGLISH: Of course, the main reason for the tax changes have been to improve the incentives in the economy, so we incentivise less borrowing too much and speculating on housing, and incentivise more exporting and saving. Of course, that change is under way in the New Zealand economy. The total effect of the very sensible tax changes we have taken to close loopholes, reduce personal and company tax rates, and increase the taxation on consumption and on property has been, actually, a net gain in tax revenue compared with the policies we inherited.
Hon David Parker: I raise a point of order, Mr Speaker. I would invite the Minister to table an official document if he is quoting from it.
Mr SPEAKER: Can I check with the Minister—was he quoting from an official document? He was not.
Earthquakes, Canterbury and Christchurch—Measures to Meet Fiscal Cost
Dr RUSSEL NORMAN (Co-Leader—Green) to the
Minister of Finance: How much has been raised to date by the Earthquake Kiwi Bonds and, at this rate, how many
years will it take to cover the Government’s estimated $5.5 billion liability resulting from the Canterbury earthquakes?
Hon BILL ENGLISH (Minister of Finance)
: To date, $26.4 million has been raised by Earthquake Kiwi Bonds, but I point out to the member that it was never the Government’s intention to rely only on Earthquake Kiwi Bonds to pay for our share of the earthquake costs. The Government borrows, as is required as part of its broader borrowing programme, to meet the commitments it has already made of $5.5 billion to the rebuild of Christchurch. We are not going to have difficulty financing that commitment.
Dr Russel Norman: Can he confirm that, given that his earthquake bonds scheme has raised $26 million in about a year, at this rate it would take about 200 years to raise sufficient funds to pay for the rebuilding of Christchurch?
Hon BILL ENGLISH: I probably could confirm that if it is mathematically correct; it is just that it is irrelevant to financing our commitment to Canterbury. The Government has made a very firm commitment of $5.5 billion plus its obligations under the Earthquake Commission. We have the capacity to finance that as and when required. The hold-ups and challenges in Christchurch are not to do with finance; they are actually to do with the complexity of resolving insurance issues.
Dr Russel Norman: Would it not make more sense to strike an earthquake levy, which would have raised about $1 billion so far in the first year of operation, which would pay for the total Government share of $5.5 billion in 5 to 6 years?
Hon BILL ENGLISH: The answer to that is no. We did treble the Earthquake Commission levy to channel some of the extra costs of insurance through to homeowners, so they understand that that is what is going to happen. But we decided, as discussed at the time, that incorporating the funding of the Canterbury earthquake in our general borrowing programme was the right thing to do at a time when the economy was struggling to get on its feet and we did not want to hit it with more taxes and levies.
Dr Russel Norman: In light of his earlier discussion about the importance of protecting the fiscal position of the Government, does he acknowledge that a temporary earthquake levy, raising about a billion dollars a year, would mean that the Government’s fiscal position would be much healthier than it is currently?
Hon BILL ENGLISH: Of course that was an option, but we have struck, I think, the right balance, in terms of getting back to surplus, between reorganising our tax system so that it does yield more revenue by plugging loopholes and improving incentives, on the one hand, and containing expenditure, on the other hand. You can solve any fiscal problem just by pushing taxes up, but when you are trying to get the economy growing to provide jobs and higher incomes, we decided that putting more taxes on it was the wrong thing to do.
Dr Russel Norman: Well, given the fiscal trouble that the Government now finds itself in, will he re-examine the quality of some of the Government’s spending, in particular the $14 billion on new motorways that it is proposing to spend, the $2.3 billion on subsidies for emissions trading scheme polluters, the $400 million on subsidies for irrigation, and the $1.1 billion—and counting—from the 2010 tax cuts, largely going to upper-income earners?
Hon BILL ENGLISH: The member is wrong about the tax cuts, so we will not be re-examining that. Secondly, I am pleased he has drawn attention to our extensive infrastructure investment programme in roads. In fact, it is a feature of this Government’s management, which is almost unique—that is, despite the recession, we have carried on with the infrastructure investment required to support a growing economy and that somewhat significant number of New Zealanders who still drive cars.
Dr Russel Norman: Is he aware that the Christchurch City Council is under pressure to sell the city’s assets to pay for the rebuilding of Christchurch, and does he think it is fair to ask a city that has been recently devastated by two earthquakes to sell its assets, rather than the Government raising a national temporary earthquake levy?
Hon BILL ENGLISH: That is really a matter for the city council. It has got financial obligations it needs to meet and choices about how to do it. I might say that New Zealand, as a whole, is in this situation, where meeting the cost of, among other things, the earthquake means that we are trying to avoid high levels of debt. We are actually looking at partial sales of some Government assets, which would help us through a difficult situation.
Dr Russel Norman: Is the Minister confident he has made the right fiscal decision, given that his Earthquake Kiwi Bonds have raised $26 million in the first year, whereas an earthquake levy would have raised $1 billion, and does he acknowledge that that one decision has added significantly to the amount that the Government has to borrow?
Hon BILL ENGLISH: Yes, and yes. We think those decisions strike the right balance between dealing with the large demands on our expenditure caused by the earthquakes, at a time when the economy was in recession and hitting it with more taxes would have made it more difficult to get the new jobs, investment, and growth that we are all looking for.
Budget 2012—Welfare Reforms Targeting Young People
Hon TAU HENARE (National)
: Mr Speaker—
Rt Hon Winston Peters: Good boy, Tau!
Hon TAU HENARE: What’s that?
Mr SPEAKER: Order! Would the member just please ask his question.
Hon TAU HENARE: Well, I would if they would be quiet.
Mr SPEAKER: Order!
Hon TAU HENARE: To the Minister for Social Development. How will Budget 2012—[Interruption] I will just give it to him!
Mr SPEAKER: Order! The member needs to be careful. I might just go on to the next question. Question No. 5, the Hon Tau Henare.
Hon TAU HENARE: OK, let us start again.
Mr SPEAKER: Let us get on with it.
Hon TAU HENARE (National) to the
Minister for Social Development: How will Budget 2012 provide greater support for young people most at risk of long-term welfare dependency?
Hon PAULA BENNETT (Minister for Social Development)
: Brilliant question! Changes in Budget 2012 will support those young people most at risk: teen parents and those 16 and 17-year-olds who are either on benefit or not in education, employment, or training. We have allocated $148.8 million over 4 years to ensure these young people are in education, training, or work-based learning. This includes putting a youth provider alongside each individual to wrap around support. We will expect providers to ensure those people attend classes, receive budgeting advice, and attend parenting courses.
Hon Tau Henare: What reports has she received to indicate public support for these measures?
Hon PAULA BENNETT: Quite extensive for those measures, and also for the call to remove some of the barriers to beneficiaries being able to access contraception. From some of the polls that I have seen—and I have seen three of them—on Stuff 85 percent thought it is a great idea—
Grant Robertson: Oh yes, Stuff—that well-known scientific poll!
Hon PAULA BENNETT: Well, I say to that member that nearly 20,000 people responded to that poll, which is actually more than respond to the household labour force survey. The
New Zealand Herald
itself had an 85 percent favourable response to that one, and
Campbell Live last night had 82 percent in favour.
Hon Tau Henare: What new measures are there that will support young teenagers on benefits to make better choices?
Hon PAULA BENNETT: We have introduced money management using redirections and a payment card to ensure these young people learn how to manage their costs. I make no apologies for this kind of hands-on approach. The previous Government’s hands-off one simply has not worked. We have also introduced incentive payments. We will pay a young person on a benefit an extra $10 per week for each of these if, for 6 months, they have been in education, training, or work-based learning; they have completed a budgeting programme; or, for young parents, they have completed a parenting programme, have enrolled with a primary health organisation, and have up-to-date well child checks for their children.
Jacinda Ardern: Why, under her new reforms, would a woman on an income of $288 a week pay $480 for long-term contraception like Mirena, while a woman receiving the same amount per week but through the benefit system will pay nothing?
Hon PAULA BENNETT: Because we have targeted it at those who are on a benefit.
Jacinda Ardern: I raise a point of order, Mr Speaker. I think the answer that the Minister gave was implied in the question. That obviously was not what I was asking. [Interruption]
Mr SPEAKER: Order! I am on my feet. With respect, the answer seemed perfectly clear to me—that the Minister’s objective was to target beneficiaries. That is the difference.
Rt Hon Winston Peters: Given the questioner’s wraparound support for the Minister and his peerless support for the National Government, did the Minister receive any representations from the questioner about how aghast he was at the attack the Minister received yesterday from her Associate Minister Tariana Turia on this issue?
Hon PAULA BENNETT: I am sorry; my Associate Minister may have opinions, but she is actually not bound to agree with everything that I do.
State-owned Energy Companies, Sales—Crown Shareholdings
Hon CLAYTON COSGROVE (Labour) to the
Minister for State Owned Enterprises: Does he stand by the Prime Minister’s statement regarding asset sales that “We are not going to do anything tricky there”?
Hon TONY RYALL (Minister for State Owned Enterprises)
: Yes, I agree with the Prime Minister’s statement. This Government campaigned up front on the policy of the mixed-ownership model, which includes the pledge that the Government will maintain majority ownership of these companies. This promise stands, despite the unlikely theoretical scenario some members opposite keep raising.
Hon Clayton Cosgrove: Why, then, does the Mixed Ownership Model Bill specifically allow him to “do something tricky” and sell off the vast majority of the affected companies through the issue of non-voting shares?
Hon TONY RYALL: Well, first of all, there is nothing tricky in any of this, because there is a bill and the Government has been completely up front about it. The fact is the member is creating what I think can only be described as an uncommercial fantasy in respect of the issue of these shares. It may theoretically technically be possible if you are looking at a textbook that that could happen, but we have looked back at the New Zealand stock exchange and not one company has issued shares in the form that that member is suggesting.
Hon Clayton Cosgrove: If the Minister truly does intend to retain 51 percent ownership of the equity and company dividends, why is there no written guarantee in the bill, which instead allows him to dilute the Crown’s equity and dividend rights to essentially zero through non-voting shares and other loopholes; and if he believes it is a technicality, why does he not rule it out and amend the bill?
Hon TONY RYALL: Because it is simply not necessary for that to happen. The fact is that we have done quite a lot of research, which shows there is no company on the New Zealand Exchange that has issued shares in that format. We do believe that these companies will provide real benefits for New Zealand as part of the mixed-ownership model, as part of helping us deal with debt in this country.
Hon Clayton Cosgrove: Given that the bill does not require the Crown to retain 51 percent of shareholding, but only 51 percent of voting rights, does it meet the promise made in the agreement with United Future, which calls for the Government to “Introduce statutory limits on the sale of public assets to no more than 49 percent of shareholding”?
Hon TONY RYALL: It is completely consistent. What New Zealanders want to know is that this Government will maintain 51 percent of the control of these companies, and that is what is in the legislation, and that is what will be in the companies’ constitutions. Over the next 3 years, debt in this country is going to grow from $50 billion today, to $72 billion. It is imperative that this country takes action to control its debt.
Rheumatic Fever—Throat Swabbing Programme in Schools
Dr JIAN YANG (National) to the
Associate Minister of Health: How is the Government expanding its programme to reduce rheumatic fever in vulnerable communities?
Hon TARIANA TURIA (Associate Minister of Health)
: As part of the relationship accord between the Māori Party and the National Party, this Government is tackling rheumatic fever head-on. Today we announced that as part of Budget 2012 we are doubling the spending, from $12 million to $24 million, over the next 4 years to reduce rheumatic fever in vulnerable communities. We currently have 101 schools engaged in the rheumatic fever campaign, targeting 35,000 children in seven regions. This new funding will allow more schools and more children to be targeted in this preventive programme. Around 70 percent of children who get this Third World disease will suffer some heart damage, but with proper treatment that risk is dramatically reduced.
Dr Jian Yang: What particular steps are being taken to reduce rheumatic fever in the Porirua region?
Hon TARIANA TURIA: Today, along with the Prime Minister and Minister Hekia Parata, we launched a new throat-swabbing programme in Porirua at the Holy Family School. Porirua City has the highest rate for 5 to 15-year-olds of all territorial local authorities in New Zealand. The new funding in Budget 2012 to support tackling rheumatic fever will allow at-risk schoolchildren up to year 10 in east Porirua to be part of the throat-swabbing programme and follow-up antibiotic treatment. This covers 19 schools and colleges, and 10 new schools will be enrolled in the programme.
Te Ururoa Flavell: Kia ora tātou. Can she share with the House some signals that might indicate how rheumatic fever is being prevented?
Hon TARIANA TURIA: To reduce the annual rate of rheumatic fever amongst Māori and Pasifika people and to contribute to the reduction of rheumatic fever occurrence in New Zealand, ultimately our desire is to see the eradication of this disease. There is no place in New Zealand for a Third World disease that is preventable.
Mr SPEAKER: Question No. 8, the Hon Annette King. [Interruption] Order! I have called the Hon Annette King. [Interruption] Order! Will the cross benches please come to order. I have called the Hon Annette King for question No. 8.
Housing New Zealand Corporation—Minister’s Statements
Hon ANNETTE KING (Labour—Rongotai) to the
Minister of Housing: Does he stand by all his comments regarding housing?
Hon PHIL HEATLEY (Minister of Housing)
: Yes, as long at they have been taken in context.
Hon Annette King: Does he stand by his answer on 7 March that “Clients are now getting a much better service.”; if so, why are people now waiting at least 25 minutes on the 0800 line before a real person answers their call, and could it be that Housing New Zealand Corporation is capable of answering only 10,000 calls a week, not the 20,000-plus he claimed in Parliament?
Hon PHIL HEATLEY: It is smart to have a number to call and sort out simple issues like “I need my window fixed.” or “How much rent is owed?”. However, the transition has not been without its challenges and that is why next Monday a further dozen staff will be employed; the following week another group of staff, the following week another group of staff will be employed, and the following week another group of staff will be employed.
Hon Annette King: I take from that answer that it is not a better service, so have his colleagues, particularly those representing Glen Innes and Onehunga, raised their growing concerns about the massive increase in Housing New Zealand Corporation problems arriving in their offices since Housing New Zealand Corporation closed its offices and people cannot get through on the 0800 number; and, if so, what action has he taken?
Hon PHIL HEATLEY: No, the member can take from that that it is a good service that is getting better week after week after week after week.
Hon Annette King: Why has it taken almost 2 years before Housing New Zealand Corporation has got around to seeking expressions of interest to undertake a minor housing redevelopment programme in Christchurch, which will not be completed until 3½ years after the first earthquake, and when there is a real housing problem already existing in that city?
Hon PHIL HEATLEY: It has taken some time in Christchurch due to the earthquake, but Housing New Zealand Corporation has lifted its game. Under the previous Government it took 7 years to do nothing in Hobsonville and 5 years to do nothing in Tāmaki. So I am delighted with the way that Housing New Zealand Corporation has lifted its game, particularly in difficult circumstances such as the Canterbury earthquake.
Hon Annette King: Does he think he is in touch with the magnitude of the housing crisis in Christchurch, considering he told this House that most Housing New Zealand Corporation houses in Christchurch were in the red zone, when in fact two-thirds of them are not in the red zone; and why did it take the Minister for Canterbury Earthquake Recovery to demand action for Housing New Zealand Corporation to start repairing the State houses, so what is he paid to do?
Hon PHIL HEATLEY: There are over 6,000 houses in Canterbury; I do not think I said that most of the 6,000 were in the red zone.
Transport Planning—Funding and Expenditure
JULIE ANNE GENTER (Green) to the
Minister of Transport: What is the plan to pay for the Government’s transport expenditure given that the Ministry of
Briefing to the Incoming Minister warns of a funding shortfall of $4.9 billion if high oil prices and low GDP growth continue?
Hon GERRY BROWNLEE (Minister of Transport)
: The shortfall referred to by the questioner could occur in the years between 2021 and 2030. It was included in the briefing to the incoming Minister to indicate that if those conditions persisted, it might exist. We are not making plans now for what might happen in 2021, but I do acknowledge the member’s commitment to this Government dealing with these problems in 2021 through to 2030.
Julie Anne Genter: Is he saying that he is not concerned that his Government’s expensive State highway programme will cost New Zealanders billions, as long as the funding shortfall is well beyond his term?
Hon GERRY BROWNLEE: I think my answer is yes, because the roads will cost what they cost, and until we get to 2021, or to some time in that 10-year block out to 2030, we do not know whether there will be a shortfall.
Julie Anne Genter: Given that the Ministry of Transport officials have consistently warned that there will be a funding gap between revenue raised from road users and planned expenditure, even in this decade, how does he propose to make up the funding shortfall? Will he raise taxes on fuel and road users, will he borrow more, or will he cut some projects?
Hon GERRY BROWNLEE: I think the advice that the member has referred to as coming from the Ministry of Transport lacks the ambition that this Government has for growth in the New Zealand economy.
Julie Anne Genter: I seek leave to table this document from the Ministry of Transport—the Government policy statement 2012 draft Cabinet paper and engagement document—which states that there will be a deficit of about $1.5 billion between forecast revenue and target Government policy statement expenditure before 2020.
Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is no objection.
- Document, by leave, laid on the Table of the House.
Julie Anne Genter: Does the recently published IMF paper
The Future of Oil, which shows real oil prices doubling in the coming decade, sending petrol prices here to $5 a litre, cause him to reconsider the economic rationale for the so-called roads of national significance; and if not, why not?
Hon GERRY BROWNLEE: I am the Minister of Transport, not an oil speculator for the futures market; therefore, I have no comment on that.
Julie Anne Genter: I would just like to seek leave to table this working paper from the IMF, which shows real oil prices doubling in the next decade.
Mr SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.
Julie Anne Genter: I seek leave to table the Government policy statement, which shows that in 2022, 85 percent—
Mr SPEAKER: Order! This is the Government’s Budget Policy Statement?
Julie Anne Genter: Yes. It shows that in—
Mr SPEAKER: No, we do not table documents available to all members.
Dr Russel Norman: I seek leave to table a document that explains to the Government that “IMF” stands for International Monetary Fund, because it does not seem to realise that.
Mr SPEAKER: The source of the document?
Dr Russel Norman: It is my own annotations.
Mr SPEAKER: No, we do not do that.
Government Procurement Policy—Mobile Phone Voice and Data Services
MARK MITCHELL (National—Rodney) to the
Minister for Economic Development: How is the Government improving value for money in its procurement of services for the public sector?
Hon STEVEN JOYCE (Minister for Economic Development)
: I am pleased to announce that the Government is expected to save around $60 million over the next 5 years after signing all-of-Government procurement contracts for mobile voice and data services. The new contracts are part of our ongoing procurement reform programme, which is making Government buying as efficient as possible and reducing cost. These mobile voice and data contracts have been awarded to 2degrees, Gen-I, and Vodafone. They include all voice minutes and data used on mobile phones held by Government employees. Mobile voice and data services are a very significant cost for Government, so these new contracts are a great result.
Mark Mitchell: How much will the Government save through these public procurement contracts?
Hon STEVEN JOYCE: The seven contracts signed so far are on track to achieve a total saving to the Government and taxpayers of $350 million. Each dollar saved can be reinvested in improving public services and essential infrastructure in order to help grow the economy. We are continuing to show the substantial negotiating power of Government when procuring all-of-Government services. Agencies are now spending considerably less on items such as computers, and the uptake by agencies is increasing as their existing contracts expire. Agencies and suppliers are also saving on resource costs due to having preferred suppliers.
Chris Hipkins: Will his plans extend to the procurement of a new coalition partner for the Government by replacing Mark Mitchell with Colin Craig in Rodney; if so, should Colin Craig separate his campaign contributions into amounts of $25,000 or less?
Mr SPEAKER: Order! In so far as the Minister has any ministerial responsibility, he may answer.
Hon STEVEN JOYCE: Tee-hee, tee-hee!
Employment Relations—Collective Bargaining
DARIEN FENTON (Labour) to the
Minister of Labour: Does she stand by her statement that “I do not want to see unnecessary change for change’s sake. Rather I am looking to put in place pragmatic solutions as we implement our manifesto commitments and let employers, employees and business focus on what they do best.”?
Hon KATE WILKINSON (Minister of Labour)
: Absolutely, and I stand by my next comments that these initiatives are part of our Government’s plan to give businesses the confidence they need to invest, grow, and create higher-paying jobs.
Darien Fenton: What is pragmatic about her proposed changes to multi-employer collective bargaining, which her officials have advised will reduce worker choice, lead to fewer multi-employer collective agreements, and could expose New Zealand to critical international scrutiny, including a costly investigation by the
International Labour Organization for breach of core labour standards?
Hon KATE WILKINSON: It is more pragmatic to enable, for example, a plumber in Invercargill to negotiate their own terms, as compared with a plumber in Auckland, rather than put them on a multi-employer collective agreement on the same terms.
Darien Fenton: What is pragmatic about her proposal to remove the 30-day rule, which her officials have advised will enable employers to offer less pay and conditions than exist for other workers in a collective agreement in the same workplace, or does pragmatism, in her book, mean employers being able to pay less?
Hon KATE WILKINSON: That is just as pragmatic as the Hon Margaret Wilson suggested in the Cabinet paper dating back to 2003.
Darien Fenton: What is pragmatic about her proposal to remove the requirement to conclude collective bargaining, which her officials have advised will encourage surface bargaining, encourage litigation, result in higher staff turnover, and see fewer collective agreements concluded, and how would this help the locked out Talley’s workers get a fair outcome, when their employer could just walk away from negotiations?
Hon KATE WILKINSON: I am not going to comment on individual employment matters, nor am I going to make comments like the honourable member Andrew Little, when he called employers “parasites”.
Mr SPEAKER: Order! I say to National members that it may have escaped their notice but I am on my feet and I am not that short. The last part of that answer was unnecessary and uncalled for.
Social Development, Ministers—Confidence
Rt Hon WINSTON PETERS (Leader—NZ First) to the
Prime Minister: Does he still have confidence in the Minister for Social Development and the Associate Ministers for Social Development; if so, why?
Rt Hon JOHN KEY (Prime Minister)
: Yes; because they are hard-working New Zealanders delivering a brighter future for the country.
Rt Hon Winston Peters: How can he possibly have confidence in Associate Minister Tariana Turia, after she publicly attacked and embarrassed in all media yesterday the Minister for Social Development and all of his Cabinet colleagues when she said, amongst other things, that “I think it’s insulting to tell anybody about how many tamariki they should have.”?
Rt Hon JOHN KEY: The member should look very closely at the confidence and supply agreement between the National Party and the Māori Party, which says quite clearly that the Māori Party is bound on confidence and supply only where it has a delegation. In the case of the Associate Minister, she does not have a delegation in this area; therefore she is quite free to speak out. From memory, that was pretty much the same relationship and the same rules that Winston Peters had when he led New Zealand First in a very similar relationship with the Labour Party.
Rt Hon Winston Peters: Given that he has just said that Mrs Turia is hard-working and engaged in building a brighter future—[Interruption]
Mr SPEAKER: Order! I apologise—[Interruption] I am about to assist the right honourable gentleman. He does not need to add to that. The National backbenchers do not need to do that. How can I hear the supplementary question when that is going on?
Rt Hon Winston Peters: Could I just restart, because the member got me derailed there—
Mr SPEAKER: The member may restart.
Rt Hon Winston Peters: —by the breaking out of an eruption of applause.
Mr SPEAKER: Order!
Rt Hon Winston Peters: Given that he has just said Mrs Turia is hard-working and engaged in building a brighter future—in other words, a person of integrity—and following yesterday’s attack, where she said that the answer to that policy, which requires a vote, is no, has he sought any assurance from Mrs Turia that neither she nor her two colleagues will renege on her party’s confidence and supply agreement by voting against the Budget, on which these figures are predicated, presumably; if not, why not?
Rt Hon JOHN KEY: No; because I do not need to do that because I can rely on their word.
Rt Hon Winston Peters: Am I to understand that the Prime Minister has got an understanding with the Māori Party whereby its members can go out in front of the media and say no on such an incredible policy, but then they will do the Government’s bidding when it comes to the vote; and does it concern him as a defender of whānau ora, the brainchild of the Minister Tariana Turia, that $5 million of Vote Social Development towards whānau ora, including money on wasteful family reunions, has seen these contracts cancelled by the Ministry of Social Development; if not, why not?
Rt Hon JOHN KEY: I have got to be honest. I am struggling to understand the question, but I will try to navigate through it. If he is asking the question of whether I am concerned that the Minister for Social Development has taken the step of expecting value for money when it comes to taxpayer spending irrespective of which programme it goes on under her portfolio, no, I am actually quite relieved that she is such a guardian of taxpayers’ spending. That is what I expect from every Minister.