[Sitting date: 02 May 2012. Volume:679;Page:1851. Text is incorporated into the Bound Volume.]
Wednesday, 2 May 2012
Mr Speaker took the Chair at 2 p.m.
Amended Answers to Oral Questions
Question No. 2 to Minister, 1 May
Rt Hon JOHN KEY (Prime Minister)
: I seek leave to make a personal explanation in order to correct an answer I gave to a supplementary oral question asked by David Shearer in the House yesterday.
Mr SPEAKER: Leave is sought for that purpose. Is there any objection? There is no objection.
Rt Hon JOHN KEY: Last night David Shearer came to the House to correct the record in relation to a supplementary question he had asked during question time yesterday afternoon. He admitted that he had wrongly attributed a statement to me, when in fact it had been made by another person. It was not my intention to mislead the House when I said I stood by that statement. I assumed that Mr Shearer had his facts right when he asked me whether I stood by a particular statement. I apologise to the House for making that assumption. I will not make that assumption again. [Interruption]
Mr SPEAKER: Order! I just want to make it very clear, because I do not want that to happen again, that when the House gives a member leave to make a personal explanation, the House is extending a courtesy to the member in allowing that. In making a personal explanation, no member may make any remark about another member. So I caution the Prime Minister that that was unacceptable. I do not want to see it happen again, from any member. I make that very clear to all members in the House. It is a courtesy when leave is granted to make a personal explanation, and such a personal explanation must make no comment about any other member, at all.
Questions to Ministers
Hon John Banks—Compliance with
DAVID SHEARER (Leader of the Opposition) to the
Prime Minister: Does he believe that Hon John Banks has behaved in a manner that “upholds, and is seen to uphold the highest ethical standards” as required by the Cabinet Manual?
Rt Hon JOHN KEY (Prime Minister)
David Shearer: Does he find it acceptable for a Minister to act unethically, as long as they comply with the law?
Rt Hon JOHN KEY: For a start-off, the member is making an assumption, or an assertion, should I say, and, secondly, I would point out to the member that the issue of ethical standards applies to Ministers when they are holding their warrants.
David Shearer: Does he believe that John Banks acted ethically and gave an honest answer when he claimed that he “hardly knew” Kim Dotcom, in light of reports that he flew in Dotcom’s helicopter to his mansion for a 2½-hour meeting and dinner, attended Dotcom’s birthday party and proposed a toast in his honour, and attended a fireworks display with Mr Dotcom?
Rt Hon JOHN KEY: I have no ministerial responsibility for that.
David Shearer: I raise a point of order, Mr Speaker. Mr Banks gave this assertion when he was in his position as a Minister, as a statement.
Mr SPEAKER: The point the honourable member is making is that his question asked whether a statement made by a certain Minister while he was a Minister, in
relation to matters that occurred perhaps before he was a Minister, upheld whatever it was—ethical standards; forgive me, I cannot recollect exactly the last part of the question. I believe that there is ministerial responsibility for a statement made by the Minister while he was a Minister, and I think to that extent the question should be answered more than that, because the Prime Minister does have responsibility for the ethical standards or otherwise of statements made by Ministers while they are Ministers.
Rt Hon JOHN KEY: I think the Minister would have answered it as honestly as he could, subject to his memory of things that had happened 2 years ago. But I have no capacity nor knowledge of being able to understand the veracity of that argument, because I have no ministerial responsibility for it.
David Shearer: Does he believe John Banks when he says he cannot remember asking Kim Dotcom for the donation to be split into two $25,000 cheques to disguise its origins?
Rt Hon JOHN KEY: I have no reason to doubt it.
David Shearer: Given the questions around the donations from Dotcom and Skycity, has he or his office sought assurances about the legitimacy of the 42 other anonymous donations, totalling $648,000, given to Mr Banks?
Rt Hon JOHN KEY: What my office has sought is an assurance that the Minister acted in compliance with the Local Electoral Act. He has given that assurance categorically, and I will not be sacking a Minister for complying with the law.
David Shearer: Did he or his office ask John Banks whether he had lied to journalists late last week in relation to the level of his involvement with Kim Dotcom?
Rt Hon JOHN KEY: No.
David Shearer: Did he or his office ask John Banks what contact Kim Dotcom has had with him or his office since he became a Minister; if so, what was his response?
Rt Hon JOHN KEY: No. My office sought an assurance on the basic allegation that Mr Banks had broken the law, and he in fact assured us that he had not broken the law. If the member wants us to start sacking people for complying with the law, it is going to be a very interesting test.
David Shearer: Does he not think it is about time he sat and had another cup of tea with John Banks to discuss his promise to have higher ethical standards under his Government?
Rt Hon JOHN KEY: No, but I will recall for the House that when I went off to the police because I believed I had been illegally taped, the first thing I got from the Labour Party was “Don’t waste the police’s time.”, and the first thing Trevor Mallard has done is run off to the police. Mind you, he knows the police quite well, Trevor Mallard. [Interruption]
Mr SPEAKER: Order!
Hon John Banks—Donations to Member’s Political Campaigns
BARBARA STEWART (NZ First) to the
Prime Minister: Did Mr Banks explain to the Prime Minister’s Chief of Staff that he would use “obfuscation” in his dealings with the media over the “anonymous” donations from Kim Dotcom?
Rt Hon JOHN KEY (Prime Minister)
Barbara Stewart: What did his chief of staff ask Mr Banks about the Dotcom and Skycity donations, bearing in mind that Mr Banks was not being “absolutely upfront” in all his dealings?
Rt Hon JOHN KEY: The thing is, as I said to the House yesterday, on Saturday morning my chief of staff sought an assurance from Mr Banks that he had fully complied with the requirements of the Local Electoral Act in respect of donations. Mr
Banks gave his assurance during that phone call, and stated that he was not aware that Mr Dotcom had made the donation to his mayoral campaign.
Barbara Stewart: What was his reaction to Mr Banks’ admission that he had used obfuscation in his dealings with the media?
Rt Hon JOHN KEY: The Minister himself has said that he has followed legal advice, but in hindsight it may have been better for him just to have answered those questions straight away.
Denis O’Rourke: Did John Banks tell the Prime Minister he was obfuscating as a result of legal advice?
Rt Hon JOHN KEY: No.
Denis O’Rourke: Has the Prime Minister received any other advice or reports indicating that Mr Banks may be obfuscating on other issues dealing with Dotcom, bearing in mind that he had been toastmaster at Dotcom’s birthday party—or did he mistake him for Cameron Slater?
Rt Hon JOHN KEY: No, but can I make this point to the member: he is a member of New Zealand First. If New Zealand First members are that interested in getting answers from Mr Banks, why did he not just get the boss to ask him while he was sitting on the plane? They look like they were having a nice old time together.
Hon Trevor Mallard: Did John Banks tell him or his office that Mr Dotcom facilitated a discount for personal accommodation for Mr Banks at the Hyatt in Hong Kong while Mr Banks was a Minister; and if so, did he or his office ensure that Mr Banks was properly briefed on the requirement to declare that discount on his declaration of pecuniary interests?
Rt Hon JOHN KEY: Not to the best of my knowledge, but my chief of staff has said to me that Mr Banks has made an assurance that he paid for all expenses on the trip to Hong Kong.
Denis O’Rourke: Did John Banks tell the Prime Minister that obfuscation is just another word for bull dot dot dot com?
Rt Hon JOHN KEY: No, but maybe that member should go out and watch the footage of Winston Peters holding up a “No” sign, telling the New Zealand public for 6 months that he did not know anything about Owen Glenn. Maybe he should go and look at Winston Peters dealing with the media for 24-plus years, and he will get a great example of what obfuscation is. It is when you do not answer any question, no matter how directly it is asked of you, and no matter how much you need to bend the truth.
Budget 2012—Amendments to Public Finance Act
MAGGIE BARRY (National—North Shore) to the
Minister of Finance: How does the Government intend to strengthen the Public Finance Act 1989 in the Budget this month?
Hon BILL ENGLISH (Minister of Finance)
: The Government proposes to introduce several new principles to the Public Finance Act to ensure greater transparency around the implications of Government decisions for the wider economy and for future generations. The proposed changes would require Governments to consider the impact of their spending and taxing on the broader economy, particularly interest rates and exchange rates; set out the priorities for revenue and spending, not just debt; take into account the impact of fiscal policy decisions on future generations; and report on successes and failures of past fiscal policy. We are also looking at adding a spending limit to the Public Finance Act.
Maggie Barry: Why is the Government proposing to strengthen the Public Finance Act?
Hon BILL ENGLISH: The current Public Finance Act has served New Zealand well, in terms of maintaining a focus on low debt, since 1994. However, the global recession and the events in the years immediately preceding that recession point to a need for a broader focus. In particular, in times of surplus Governments come under pressure to increase spending, which can put extra pressure on the economy and generate higher inflation, higher interest rates, and higher exchange rates, and this is bad for exports and jobs, and our long-term economic health.
Maggie Barry: How would the proposed spending limit work?
Hon BILL ENGLISH: The proposed spending limit would limit increases in spending to the rate of growth in inflation and population. It would exclude natural disasters, finance charges, and asset impairments, which are outside the Government’s control, and also exclude the unemployment benefit. If a Government decided to exceed the limit, it would need to clearly explain the reasons and outline how it intended to ensure that future expenses remained within the limit.
Maggie Barry: So how would the proposed changes contribute to the Government’s wider economic programme?
Hon BILL ENGLISH: The Government is committed to rebalancing the economy away from property speculation and excessive Government spending and borrowing, to an economy based on savings and exports. The changes in the Public Finance Act will provide more transparency for those times when a Government is tempted to increase spending and borrowing when it is not necessary.
Government Financial Position—Current Account Deficit
Hon DAVID PARKER (Labour) to the
Minister of Finance: In the most recent World Economic Outlook published by the IMF in April 2012, which of the 34 advanced economies listed is forecast to have a worse current account deficit (as a percentage of GDP) than New Zealand in 2013?
Hon BILL ENGLISH (Minister of Finance)
: The two countries are Cyprus and Greece. I note that a number of countries that will have a smaller current account deficit will achieve that because they have deep recessions and are going through dramatic austerity programmes. These are not choices that the New Zealand Government is willing to make.
Hon David Parker: Given that according to the IMF the only country in the world of any size with a worse projected deficit is Greece, how can the Prime Minister be taken seriously in his pre-Budget speech yesterday, titled “Sticking to a Plan That’s Working”?
Hon BILL ENGLISH: For the reasons that we said. New Zealand has the choice of a reasonably moderate adjustment to the global aversion to debt. We are making considered and balanced decisions as we go through that adjustment. Other countries do not have those choices. If the member would prefer the UK’s current account deficit of about 1 percent, then I presume he prefers its policy mix. We do not.
Rt Hon John Key: Has he seen any reports of the Opposition finance spokesman in 1999—
Mr SPEAKER: Order! The Minister of Finance is not responsible for anything the Opposition spokesperson might have said at any time. The right honourable member has to be rather more subtle in framing his question than that, to bring it within order.
Rt Hon John Key: Has he seen any reports of what happened to the current account deficit in the 9 years that Labour was in office, and any reports of what the Opposition finance spokesman said when he was campaigning with Mr Michael Cullen in 1999 about the matter?
Hon BILL ENGLISH: I am sure I would certainly find those reports, but I can recall that at the time the Labour Party campaigned to halve the current account deficit, and it ended up doubling it.
Hon David Parker: Will the rising current account deficit be funded by a combination of more overseas borrowing and selling New Zealand assets to foreigners, or does it intend to print money?
Hon BILL ENGLISH: The current account deficit will be financed in the same way it has been for some time. It is one of those economic variables where change occurs slowly over time. As recently as 4 years ago it was one of the highest in the developed world, at over 8 percent. If it can peak at around 6 percent through this business cycle, taking into account the significant impact of the earthquake, that would represent significant progress. New Zealanders are doing their bit by saving and being careful with their spending, and the Government is lending weight to that by being careful with its spending so that we can get to a position where we are saving, as well.
Hon David Parker: I raise a point of order, Mr Speaker. My question was whether it would be funded by a combination of more borrowing and selling of assets. The Minister said it would be funded as it was previously, but he did not tell the House the answer or address the question as to whether it was a combination of borrowing from overseas and selling assets.
Mr SPEAKER: Order! I cannot ask the Minister to limit it just to those options. What the Minister did say was that it would be funded in the way that it has been traditionally funded. The member asked how it was going to be funded, and that was the answer from the Minister of Finance. I cannot pin him down to those particular options in case there are other options. The member does have further questions, should he wish to pursue that further.
Hon David Parker: Does the Minister realise that another near-zero Budget, rising net international liabilities, and record numbers of New Zealanders leaving to Australia are proof of his Government’s failure to properly manage the economy?
Hon BILL ENGLISH: No, I do not. Many New Zealanders have put their shoulder to the wheel through the recession. They have been resilient, they have been adaptable, they have responded to the economic signals, and the Government is doing everything it can to support them because they want to see more jobs, higher incomes, and a growing economy, and we are on track to achieve that.
Paul Goldsmith: How does New Zealand’s present international position compare with the situation that the Government inherited in 2008?
Hon BILL ENGLISH: Just to add a few facts to the debate, the current account deficit for the year ended 31 March 2012 is 4.1 percent. On 31 March 2008 it was 8 percent. So it is currently half the level that we inherited.
Paul Goldsmith: What steps has the Government taken to rebalance the economy towards savings, exports, and paying its way in the world?
Hon BILL ENGLISH: Every step the Government takes is headed in that direction, but some of the significant ones have been to reform the tax system, increasing taxes on consumption and property speculation, and cutting taxes on work and saving; curbing Government spending increases and getting on track to surplus; keeping a lid on the cost of doing business, for instance, by getting on top of the fast-rising costs like ACC; and providing more investment and savings opportunities for New Zealanders by pushing ahead with the mixed-ownership model.
Hon David Parker: Does the Minister realise that the chorus of reports saying that it is going to get worse include the Bank of New Zealand forecast that New Zealand exports will decline by over $3 billion over the next 12 months, and if so, when is he going to acknowledge that his efforts to rebalance the economy have failed?
Hon BILL ENGLISH: If the member is going to judge any economic policy on what might happen in the next few months, then that indicates his unsuitability to be trying to run an economy.
Mr SPEAKER: Order! I do not think the question quite deserved that kind of answer. I think the question is not unreasonable. There are commentators who have made these kinds of predictions, so I do not think it deserved quite that answer.
Hon BILL ENGLISH: No, I do not acknowledge that. The fact is that it is going to take some time to undo the enormous damage that the Labour Government did to this economy when it had a decade of benign global conditions. We are dealing with that legacy, plus the global recession. Many New Zealanders are actually quite proud of the way they have adapted, and they are looking forward to a brighter future.
Hon John Banks—Compliance with
METIRIA TUREI (Co-Leader—Green) to the
Prime Minister: Does he stand by all the answers he gave to Oral Question No 4 yesterday?
Rt Hon JOHN KEY (Prime Minister)
: Yes, because unlike question No. 2 yesterday, at least the quotations directed at me were correct.
Mr SPEAKER: I call Metiria Turei. [Interruption] Order! I want to be able to hear Metiria Turei.
Metiria Turei: Does the Prime Minister require John Banks to meet ethical standards as a Minister, or will he retain his confidence in John Banks until he is convicted of electoral fraud?
Rt Hon JOHN KEY: For a start-off, the member is making an outrageous assertion that the Minister would be convicted of such a thing. Secondly, the
CabinetManual is quite clear: ethical standards apply at the time of the holding of the warrant.
Mr SPEAKER: Metiria Turei. [Interruption] Order! I must be able to hear Metiria Turei.
Metiria Turei: Given the reason that the Prime Minister lost confidence in Richard Worth was “nothing of a legal nature”, why is he applying now only a legal test to John Banks?
Rt Hon JOHN KEY: I am not. The issue in relation to Mr Worth was his ethical behaviour at the time that he was a Minister.
Metiria Turei: Can he confirm that he would have sacked Pansy Wong, had she not resigned, because of her “ethical lapses” as a Minister, not legal ones?
Rt Hon JOHN KEY: No, I cannot confirm that.
Metiria Turei: Why, as he set out yesterday, is he applying a legal test for John Banks when he accepted Phil Heatley’s resignation because he failed to meet the Prime Minister’s high ethical standards?
Rt Hon JOHN KEY: As I said yesterday, that would have been a matter in relation to a legal test had that been a proven case against Mr Heatley.
Metiria Turei: Can the Prime Minister confirm that he accepted Phil Heatley’s resignation for failure to meet his high ethical standards, before any legal or other proceedings were taken against Phil Heatley?
Rt Hon JOHN KEY: What I can confirm is that I tried to encourage the Minister not to resign and, quite to the contrary, the Minister did resign.
Metiria Turei: Why is it now the position of the Prime Minister to retain confidence in a Minister regardless of a breach of ethical standards when he set an ethical standard for Ministers at the beginning of his tenure as Prime Minister and he applied that ethical standard to Richard Worth, Pansy Wong, and Phil Heatley; and is it because he needs John Banks for the numbers?
Rt Hon JOHN KEY: In relation to the last point, no. In relation to the rest of the question, the member is actually making a whole lot of assertions that are simply not correct. The allegation against Mr Banks—[Interruption] Well, members might not like it but the allegation against Mr Banks is that he failed to meet his legal obligations in the signing of his mayoral declaration. The Minister has made it quite clear that he did meet his legal obligations. I accept that, and the fact that that member is going down this line just shows you that she thinks he met his legal obligations as well, as do those people over there.
David Shearer: What other assurances did Mr Banks give his office, apart from the fact that he had complied with the Local Electoral Act?
Rt Hon JOHN KEY: That was the assurance that we sought. That was the allegation that has been made. The allegation that has been made is that the member failed to meet his legal obligations. The Minister has told us he met his legal obligations. That member wants me to sack Ministers for complying—
Grant Robertson: Oh, he’s getting angry.
Rt Hon JOHN KEY: This is angry? OK, you should meet Trevor.
Business, Innovation and Employment, Ministry—Establishment
KANWALJIT SINGH BAKSHI (National) to the
Minister for Economic Development: What action is the Government taking to improve co-ordination of the business growth agenda?
Hon STEVEN JOYCE (Minister for Economic Development)
: Last week the Government confirmed its intention to establish the new Ministry of Business, Innovation and Employment on 1 July this year. The ministry will bring together the existing functions of the Ministry of Economic Development, the Ministry of Science and Innovation, the Department of Labour, and the Department of Building and Housing. The purpose of the new ministry is to assist the Government to drive forward its business growth agenda, and make it easier for businesses to engage with the Government.
Kanwaljit Singh Bakshi: What benefits can businesses expect to see from a new ministry?
Hon STEVEN JOYCE: Businesses can expect to see the Government moving faster to tackle the issues that matter to them. This will help grow competitive businesses so that we are better able to afford the sort of society we aspire to. Structure, of course, is only one part of the solution, but the current fragmented structure makes it harder to achieve the results New Zealand needs. In the medium term we expect the new ministry to deliver savings through the consolidation of corporate services of about $5 million to $6 million a year, and of policy capability of about $2 million to $5 million a year. Although obtaining savings is not what is driving this change, there will be efficiency benefits.
Foreign Affairs and Trade, Ministry—Implications of Proposed Changes
Hon PHIL GOFF (Labour—Mt Roskill) to the
Minister of Foreign Affairs: What damage, if any, has been done to staff confidence and retention by the change proposals for his Ministry announced on 23 February 2012, and does he intend to announce on 10 May 2012 a reversal of many of the proposals?
Hon CHRISTOPHER FINLAYSON (Minister for Treaty of Waitangi Negotiations) on behalf of the
Minister of Foreign Affairs: Not as much damage as Trevor Mallard caused David Shearer’s self-confidence yesterday.
Mr SPEAKER: Order! [Interruption] Order! I am on my feet. I accept that the primary question does make an assertion of damage, and that it is risky to incorporate
that kind of assertion into a primary question, but, still, it is a primary question, and I think it should be treated with some respect because of that. I accept that the answer was always going to have a few more nuances because of the wording of the primary question, but I think that was a bit over the top.
Hon CHRISTOPHER FINLAYSON: As I was going on to say, the Minister has made it clear to the chief executive that he expects the ministry’s leadership to ensure that any changes are carried out in a manner that retains an appropriate base of talent for New Zealand’s foreign policy interests. The chief executive will announce final decisions in due course.
Hon Phil Goff: What is the Minister’s assessment of the damage done to the vital trade negotiations division in light of this letter, which I am holding, from all of the staff of the trade negotiations division, which states that the change process has undermined confidence, has put real pressure on the retention of staff in their area, and has held up urgent priorities, such as the negotiation of the Trans-Pacific Partnership, which is vital for this country?
Hon CHRISTOPHER FINLAYSON: Any discussions taking place between the chief executive and ministry staff, including communications with the trade negotiations division, are a matter for the chief executive. However, I can go further and say it is no secret that there has been criticism of the change proposals, and the Minister expects that there will be revisions.
Hon Phil Goff: In this paper, which I am holding, from the Minister to the Cabinet committee on State sector reform and expenditure control on Monday, does he admit that “The Government has substantially revised the change proposals” because they have failed to get “the required amount of buy-in from staff”, especially senior staff, and there were too many “unachievable elements”—in other words, the original recommendations and the whole process were botched, and they are now having to do a total U-turn?
Hon CHRISTOPHER FINLAYSON: It is no secret that there has been criticism of the change proposals, and the Minister expects that there will be revisions. The Minister has emphasised the need for the ministry leadership to pay close attention to all feedback before any decisions are made. Those decisions will be for the chief executive to make.
Hon Phil Goff: Has the chief executive now told his staff that the total savings from this dramatic staff restructuring will be a mere $12 million, not the $24 million that the Minister told this House, and not the $40 million that he was told in his briefing paper; and was it worth the damage done to staff morale and retention, the $9.2 million he spent on consultants this year, and the $3.3 million he is now telling me he will be spending on specialist consultants in the next few months? Was it worth it?
Hon CHRISTOPHER FINLAYSON: I am not exactly aware of that figure—
Hon Annette King: You’re lost for words.
Hon CHRISTOPHER FINLAYSON: —because I am the acting Minister. I would say to the future Mayor of Wellington that I am not lost for words. [Interruption] I am praising her! These are matters that have been the cause of some concern and consternation, and, as I have said, the chief executive has been told by the Minister that changes will need to be made.
Hon Phil Goff: Why in this paper to his Cabinet this week is he recommending that New Zealand close its embassy in Stockholm by the end of next month, and then consider closing the embassies in the Netherlands and Spain, when he admits in the Cabinet paper that this has implications for, and I quote his own words, “our overarching goal of securing a comprehensive agreement with the European Union containing preferential trade provisions”?
Hon CHRISTOPHER FINLAYSON: As has been told to that member on a number of occasions, from time to time there will be changes to the places where, for example, consulates or embassies are located. For example, in the late 1980s, when that member was a junior Minister in the Lange-Palmer-Moore—and whoever else—administration, the Labour Government shut down the San Francisco consulate. And, as I explained to the member, embassies have been opened from time to time. Change needs to take place, and, as I have said before, one should not assume that because a consulate or an embassy has been opened it should be open forevermore.
Hon Phil Goff: In admitting in this Cabinet paper, which will, I think, go to Cabinet next Monday for final approval, that he will—I am helping out his colleagues who have not read it already—
Mr SPEAKER: Order!
Hon Phil Goff: Does he say in this paper that he will substantially revise the remuneration proposal that would have slashed allowances to staff with families who are deployed overseas, and does he now acknowledge that this was a particularly dumb and counter-productive proposal that has already caused the outflow of a huge number of talented staff, particularly when staff base salaries in the ministry have been frozen for 4 years, unlike the Minister’s own salary?
Hon CHRISTOPHER FINLAYSON: It is no secret that there has been some criticism of the change proposals, and the Minister expects that there will be revisions. The Minister has emphasised the need for the ministry leadership to pay close attention to all feedback before any decisions are made. Those decisions will be for the chief executive to make.
Health and Safety, Workplace—Funding and Reforms
SIMON O’CONNOR (National—Tāmaki) to the
Minister of Labour: What steps is the Government taking to improve workplace health and safety?
Hon KATE WILKINSON (Minister of Labour)
: Today I announced an extra $37 million over 4 years to help reduce the unacceptably high number of workers who are killed and seriously injured in this country each year. I have also ordered a full review of New Zealand’s health and safety system by an independent task force to ensure that it is fit for purpose. Too many New Zealanders are injured or killed at work. The cost of workplace injuries to New Zealand’s economy is estimated to be in excess of $1 billion a year. The human cost is, of course, immeasurable. The steps announced today will go towards achieving a new target of a 25 percent reduction in the rate of workplace deaths and serious injuries by the year 2020.
Simon O’Connor: How will this added investment help reduce the work toll?
Hon KATE WILKINSON: A strong and effective regulator is the cornerstone of any health and safety system. That is why the bulk of this extra funding will go towards increasing the number of on-the-ground health and safety inspectors by 20 percent, from 148 to 180, over the next 3 years. This will bring our ratio of inspectors to workers in line with Australia’s. In addition, the existing health and safety inspectorate will be upskilled, more front-line specialist technical support will be hired, additional funding will be put into the High Hazards Unit, and more support will be given to joint- and industry-led health and safety initiatives.
Simon O’Connor: What does the Minister expect from the review of the health and safety system?
Hon KATE WILKINSON: I expect fresh thinking and new ideas to improve the system and help change the culture of workplace safety in New Zealand. That is why I am establishing the independent task force to undertake the review. Although the specific terms of reference and membership of the task force will be confirmed shortly,
I will expect the final report at the end of the year. That report will be timed to take any findings of the royal commission into account, and will make recommendations to ensure that the 25 percent by 2020 reduction target is met.
GARETH HUGHES (Green) to the
Minister of Conservation: Does her proposed extension of the Marine Mammal Sanctuary for Maui’s dolphins allow the use of set nets, drift nets, and trawl nets within the sanctuary?
Hon KATE WILKINSON (Minister of Conservation)
: The Government is taking a joint approach to proposed protection for Māui’s dolphins off the Taranaki coast, using both the Marine Mammals Protection Act and the Fisheries Act. We propose dealing with fishing restrictions under the Fisheries Act, which allows for greater penalties, powers for seizure, and greater enforcement capability through fisheries officers. This is an accepted approach, as recommended in the 2007 threat management plan. As the member is aware, we have brought forward a review of this plan.
Gareth Hughes: I raise a point of order, Mr Speaker. It was a clear, concise question, put down on notice: “Does her”—
Mr SPEAKER: Maybe I can save the time of the House, because I accept the member’s point that the question is very clear and is capable of being answered, I would have thought. I did not hear an answer to that primary question.
Hon KATE WILKINSON: The answer I gave was that fishing restrictions, of which set nets, drift nets, and trawl nets form a part, are actually dealt with under the fisheries legislation.
Mr SPEAKER: It appears the Minister is claiming no responsibility for those issues. If that is the case, I must accept the Minister’s response.
Metiria Turei: I raise a point of order, Mr Speaker. It is not clear that that is her reason for not answering the question. But in so far as the question refers directly to her area of responsibility, which is the proposed marine mammal sanctuary and whether or not from her point of view as Minister of Conservation fishing, or these techniques for fishing, is allowed, there still is no direct answer to that question.
Mr SPEAKER: I think in fairness at question time here Ministers should be entitled to answer in a way that is consistent with their responsibilities. It is up to members then to use their intellect to chase the answer that is given, because clearly I can think of plenty of supplementary questions to follow the answer given. I did not hear an answer to the question. The Minister explained why, when I asked her to answer the question, those matters that form part of the question are not her responsibility. But I am sure there are further supplementary questions that can dig into that, without my interfering further in the Minister’s answer.
Gareth Hughes: How can it be described as a sanctuary at all, given that the Minister for Primary Industries has proposed to allow the use of set nets in 42 to 83 percent of her sanctuary and trawl nets in 100 percent?
Hon KATE WILKINSON: We are going through a process, and it is a joint consultation process with the Minister for Primary Industries and me. That will take into account the adequacy of protections, both under conservation legislation and under fisheries legislation. There has been ample opportunity for that process to be consulted on, for submissions to be made, and to avoid any judicial review by overenthusiastic political persuasion.
Gareth Hughes: Is it not true that all that her proposed sanctuary will do is place limited restrictions on seismic surveys?
Hon KATE WILKINSON: As I have explained, this is a joint consultation, as is recommended and as is the accepted approach under the threat management plan. That
threat management plan is also under review, and we have brought that forward. If it is not an accepted approach, then I am sure the member will be making submissions accordingly.
Gareth Hughes: I raise a point of order, Mr Speaker. Again, the question is simple, it is clear, and it is to the Minister about her portfolio area. If I had wanted to ask the question of the Minister for Primary Industries, I would have. The Minister has put a document out for consultation—
Mr SPEAKER: Order! But the Minister, in her answer, has pointed that out exactly—that this is a process of consultation. It would appear no final decisions have been made. I cannot expect the Minister to tell the House of any final decisions if the process of consultation is still under way.
Gareth Hughes: I raise a point of order, Mr Speaker, if I may.
Mr SPEAKER: I will hear the member briefly.
Gareth Hughes: It is a fair point, but my question was specifically on her proposal, not on any decisions that she has made.
Mr SPEAKER: I think, in fairness, she has pointed out that the document is out for consultation, and members are at liberty to make submissions on that consultation process. To expect the Minister to give a finite answer now, I think, is unrealistic. The member still has a further supplementary question.
Gareth Hughes: Is the Minister’s proposal not a sham sanctuary and an insult to the 67,000 people who signed the petition tabled in this Parliament today calling for effective Māui’s dolphin protection measures?
Hon KATE WILKINSON: No.
Prisoners, Employment Training—Progress
IAN McKELVIE (National—Rangitīkei) to the
Minister of Corrections: What reports has she received about trade training within prisons?
Hon ANNE TOLLEY (Minister of Corrections)
: Statistics for 2010-11 show that the number of New Zealand qualifications framework credits gained by prisoners from trade training inside the wire has increased by 45 percent since the year before. In the last financial year there were, on average, 4,767 prisoners engaged in employment activities, and they gained 108,080 credits. The evidence is clear that a lack of skills and education is a major driver of crime. This Government is committed to increasing the numbers of offenders involved in education and training.
Ian McKelvie: What is the Government doing to further improve employment training in prisons?
Hon ANNE TOLLEY: This Government is absolutely committed to improving and increasing employment training in prisons. The recently opened new training workshops at the Christchurch Men’s Prison will see up to 130 prisoners per year provided with real skills and qualifications in essential trades such as plumbing, roofing, drainlaying, and painting and decorating. These are all areas where there are likely to be major skill shortages as we rebuild Christchurch. Giving these prisoners the skills and training they need to get jobs on release will provide them with the opportunity to become productive and hard-working members of the Christchurch community, and we know that offenders who are able to gain employment are more likely to stay out of prison in the future.
Earthquakes, Christchurch and Canterbury—Briefing Paper on Psychosocial Consequences
Hon LIANNE DALZIEL (Labour—Christchurch East) to the
Minister for Canterbury Earthquake Recovery: Has he required that all his Ministers involved in
the Canterbury earthquake recovery read the briefing paper dated 10 May 2011 prepared by Chief Science Advisor, Professor Sir Peter Gluckman, into the psychosocial consequences of the Canterbury earthquakes; if not, why not?
Hon AMY ADAMS (Acting Minister for Canterbury Earthquake Recovery)
: No, because he has no responsibility for other Ministers. I can confirm, however, that both he and the Associate Minister have read the paper.
Hon Lianne Dalziel: Has he seen the statement from orange-zoned residents in Southshore that “Rumours are rife, nerves are frayed, and the feeling of being completely out of control of our lives is overwhelming.” as a result of now the 10th delay of an announcement about their future; and how could he let that happen when he was forewarned by Professor Sir Peter Gluckman that this is exactly what happens to people if they are left disempowered by decision makers?
Hon AMY ADAMS: I cannot comment as to whether the Minister has seen that specific quote that she refers to, but I can tell that member that we are very aware of the stress and difficulty for the remaining 401 orange zone owners of not knowing the long-term fate of their land. Every effort is being made to resolve these issues, but they are incredibly complex. The most important thing we can do is to make sure we get those decisions right, and we are working to do that as fast as is possible.
Hon Lianne Dalziel: How does the Government’s approach to announcing these land decisions measure up to Sir Peter’s advice that recovery is primarily judged in terms of people feeling that they are coping with their lives; and will he assure this House—guarantee to this House—that this latest delay is not related to his availability for the announcement?
Hon AMY ADAMS: That member should know, if she has read the paper, that what Sir Peter also says is that it is inevitable that there will be frustration, anger, and despair as a normal consequence of this process, and the Government is doing everything it can to assist with dealing with those instances. These are very serious issues, and there has been a tremendous emotional impact on the people of Canterbury, as that member knows. This Government has committed immeasurable resources to being on the ground to meet that need, and it is doing everything it can to stand by the people of Canterbury, as the majority of Cantabrians recognise and acknowledge.
Hon Lianne Dalziel: Will he ask the Canterbury Earthquake Recovery Authority, in light of the petition of over 18,500 people presented to Parliament today, to work with the people and local authorities of Christchurch to ensure that the Avon River red zone becomes a reserve and river park when the homeowners have to leave, or does he still believe that red zone property owners have to make decisions about their future, before he will consider anything?
Hon AMY ADAMS: We are certainly interested in considering the proposal from those residents. No decision has been made about the long-term future of the red zone land, and I would note that in fact the Avon River park through the central business district is one of the anchor projects that is being worked on. We are very happy to receive the proposal, and I can assure the member that it will be given full consideration.
Hon Lianne Dalziel: Will he meet with the Wider Earthquake Communities Action Network to discuss its suggested solutions to the range of problems that people are facing right now in Christchurch, solutions that have been endorsed by the Canterbury Communities’ Earthquake Recovery Network and a number of individual resident associations, in light of Sir Peter Gluckman’s advice that governance structures must understand and actively include community participation?
Hon AMY ADAMS: I can assure that member that the Minister, the Associate Minister, the chief executive of the Canterbury Earthquake Recovery Authority, and a
number of the Canterbury Earthquake Recovery Authority managers meet regularly with all interested groups, and will continue to do so.
Hon Lianne Dalziel: I seek leave to table the briefing paper prepared by the Office of the Prime Minister’s science advisory committee and Professor Sir Peter Gluckman.
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.
Hon Lianne Dalziel: I seek leave to table the release from the Wider Earthquake Communities Action Network, setting out the different areas of concern that they have.
Mr SPEAKER: Is this a press release, or is it a—
Hon Lianne Dalziel: It is a media release. It has been sent to the Prime Minister—
Mr SPEAKER: No, we do not table media releases that are readily available to members.
Hon Lianne Dalziel: I would like to seek leave to have it tabled, because this is a community organisation that wanted to have it tabled in the House of Parliament, and I would like to seek leave on their behalf.
Mr SPEAKER: Even members of Parliament, much as they might like to, cannot table media releases, because they are available to all and sundry, and we are not going to—[Interruption] Let me check with the member. Someone has interjected, which they should not have done, but still, because I do not want to disadvantage any community group, is this a media release that was released nationally, to national media, or to only local media? I ask the Hon Lianne Dalziel.
Hon Lianne Dalziel: I believe that it was released only to Christchurch media.
Mr SPEAKER: Leave is sought to table that document from a local community group. Is there any objection? There is objection.
Top Scholar Awards—2011 Results
NIKKI KAYE (National—Auckland Central) to the
Minister of Education: What evidence has she seen of excellent achievement in scholarship exams?
Hon HEKIA PARATA (Minister of Education)
: Last Friday I was honoured to present, together with the Governor-General, the New Zealand Top Scholar Awards. These awards celebrate the highest achievers from last year’s scholarship exams. There were 45 awards in all, 35 for Top Subject Scholars and 10 Premier Award winners. I also presented the Prime Minister’s Award for Academic Excellence to Jade Leung from St Cuthbert’s College. I congratulate all recipients.
Nikki Kaye: What was particularly encouraging about these awards?
Hon HEKIA PARATA: The House will be delighted to know that it was very encouraging to see that 10 of the 45 awards went to Christchurch students. This was despite all the disruption and turmoil these students went through over the last year. It was also encouraging to see that there were schools from a range of deciles represented. However, it will be good to see an even greater spread in future years. These students personify the excellence that is found in the New Zealand education system. I am very proud of them all.
Debate on Budget Policy Statement
PAUL GOLDSMITH (Deputy Chairperson of the Finance and Expenditure Committee)
: I move,
That the House take note of the report of the Finance and Expenditure Committeeon the Budget Policy Statement 2012. The Finance and Expenditure Committee considered the Budget Policy Statement in March, and I
acknowledge the work of the members of the committee under the then chair, Simon Bridges.
I want to begin by congratulating the Minister of Finance on his efforts to steer the New Zealand economy so successfully through such a challenging period. The economy may not be growing as quickly as we would like, but it is growing. It has now grown for 10 of the past 11 quarters, which is more than much of what the developed world can boast. We are expected to grow more strongly over the next 2 years than the Euro area, the United Kingdom, Japan, the United States, and Canada—
Mr SPEAKER: Order! I apologise to the honourable member. I say to other members of the House that it is noisy. I know members are leaving the House, but it is unfair to a member right at the back of the House for there to be so much noise that it makes it difficult to be heard. I just ask for a little courtesy to be extended to the member.
PAUL GOLDSMITH: —thank you, Mr Speaker—despite a number of challenges, including the ongoing European debt crisis, the Canterbury earthquake, and a high exchange rate. Let us not forget that what this Government inherited in late 2008 was an economy that had been in recession for almost a year, forecasts of never-ending deficits, and ever-rising debt. Against that we have been helped along by the fact that our terms of trade have been good and that our two largest trading partners, Australia and China, are forecast to maintain relatively high growth rates. So that bodes well for the coming years.
The Budget Policy Statement 2012 sets out the Government’s plan for Budget 2012 and future years. All members of the House will be familiar with the priorities that the Government has outlined. These are responsibly managing the Government’s finances, building a more productive and competitive economy, delivering better public services within tight financial constraints, and rebuilding Christchurch. These priorities are well known, because this Government has been consistent and steadfast in its purpose. As the Prime Minister has said, we are sticking to a plan that is working. Members should not underestimate the importance of that solidity and clarity of purpose shown by this Government. Strong and stable leadership is a rare commodity in the world at this time.
Going through the four areas, let us focus first on building a more productive and competitive economy. There is no magic here. We are not entitled to anything. This world does not owe us anything. In fact, the rest of the world does not care about us, at all. Some people are interested in the products that Kiwi men and women have on offer, thankfully, and some want to invest their money in our economy, and it is our task as a nation to keep them interested, in the face of strengthening global competition.
The Government’s main role is to set a policy framework that gives individuals and businesses the confidence to invest and to create products, new jobs, and new wealth, and the Minister of Finance has recently outlined some key initiatives to increase our productivity. We can talk about the tax package of the 2010 Budget, which increased taxes on consumption and property speculation and reduced taxes on work, companies, and savings. It is a very important measure. We can talk about changes in regulations—for example, in the Resource Management Act area, building laws, and industrial relations laws—and our multibillion-dollar investment in infrastructure through rail, roads, electricity transmission, and ultra-fast broadband. We can also talk about the focus on changing the incentives around welfare and work. Looking ahead, the Government’s business growth agenda will continue that momentum, more of which we will hear about in the Budget, no doubt.
Of course, we have heard endless criticism from the other side of the House and from some of their supporters. Their approach seems to be to say no to everything except, of course, spending more and borrowing billions of dollars more. They appear to want to
close the country to foreign investment, or at least to investment from some countries, when since 1840, if not before, this country’s economic growth has been based on foreign investment. I stand for internationalism and an outward-looking economy and society. New Zealand has nothing to gain from demonising foreigners and turning inwards.
Opposition members are opposed to a moderate proposal to sell minority stakes in our energy State-owned enterprises in order to strengthen New Zealand’s shallow capital markets and to bring the disciplines of private sector ownership to these companies, as well as to reduce our borrowing requirements. We have heard some economic nonsense there. In another committee I am on, the Local Government and Environment Committee, they are opposed to moderate legislation for New Zealand’s massive exclusive economic zone that would balance economic growth alongside environmental effects. “Don’t do anything.” is the Greens’ basic message. Well, I am sorry, we have got to make a living in this country. We cannot just dream up one new trick such as green technology and expect that it will do for us. Our prosperity requires continuous and relentless improvement in the things that we currently do well, as well as using our creative talents and brains, and it also requires looking for additional natural resources.
Although some New Zealanders may be happy with having lower living standards than those in Australia, most people are not, including the ambitious next generation coming along and hoping to make their way in the world. That is why this Government is focused on economic growth.
As for responsibly managing the Government’s finances, the Budget Policy Statement has underlined the size of the challenge in returning to surplus by 2014-15. Last year the Government’s operating deficit before gains and losses was $18 billion, or 9 percent of the gross domestic product, about half of which was devoted to the earthquakes. The Budget Policy Statement that we are debating today forecasts that our deficit will be around $12 billion in the current June year before roughly halving in each of the subsequent 2 years to return to surplus.
Last week the Minister revealed a $1 billion deterioration in the preliminary forecasts of the operating balance before gains and losses in 2014-15. This is due to such factors as the impact of lower global growth on short-term New Zealand growth forecasts and downward revisions to expected New Zealand Superannuation Fund revenue and State-owned enterprise profits. We are also expecting a rise in some finance costs and higher earthquake costs. So we have a wider gap to bridge, and, as the Budget Policy Statement says, this Government has shown that it is capable of delivering Budgets within tight fiscal parameters. The 2011 Budget introduced a new zero operating allowance in an election year, and the Prime Minister has indicated that we will run close to a zero Budget again this year.
None of this is easy. This is a massive rebalancing of the nation’s finances. It would be politically easy for the Government to find excuses to put it off for a few years and to kick the can down the road, but that is not our intention. Households and businesses up and down the country are doing it, finding savings and ways to make the same amount of money go further, and there is no reason why this Government should not also do it.
If we turn to rebuilding Christchurch, all of this has been made much more difficult by the need to rebuild Christchurch, which we remain absolutely committed to do. I spent time down there over the adjournment, and I continue to be amazed by the scale of the disaster. More than 100,000 homes, or half of the housing stock in Christchurch, are damaged; 7,000 homes are red zoned; and 3,000 to 5,000 businesses in the central business district have not been replaced.
I also want to mention the fact that the Budget Policy Statement reported on the Government’s determination to deliver better public services within tight budgets. We do not have the option of pouring more and more money in, like the Government of the previous decade did. In any case, more money does not always lead to the results expected. As the Government sector is such a large part of the economy, it is crucial that it is as focused on productivity improvement as the rest of the economy is.
In conclusion, this National Government has been taking a moderate and balanced approach to managing the Government’s finances. We have made the hard decisions to reprioritise spending towards the things that work, and we also have a firm focus on results, rather than just on inputs. We have had the guts to prepare this year to see our second zero Budget as we chart a course back to surplus. It is this combination of disciplined fiscal policy and a willingness to make trade-offs—having a plan to rebuild and strengthen the economy and sticking to it—that will give New Zealanders the confidence to invest in this country and in the brighter future that we all aspire to. Thank you.
Hon DAVID PARKER (Labour)
: I would like to start with a quote from the newspaper in New Zealand that has the widest circulation. It is not very old; in fact, it was only from Sunday. The
Sunday Star-Times on 29 April states: “The government is fast shredding its credibility as a sound manager of the economy. Each expedient deal it strikes erodes its integrity and political capital.” I am going to repeat that again: “Each expedient deal it strikes erodes its integrity and political capital.”—and I want to come back to the issue of integrity if I have time during this speech. That was from Rod Oram. Rod Oram, I think, is a pretty considered person. I know that the National Party does not agree with him, but plenty of people do.
The last time I quoted Rod Oram here I heard a cry from the other side that he was a person who was some sort of Labour Party lackey, which I am sure he would find insulting, because he is not. So I was interested to see whether there were any other commentaries that were of similar effect. The Hon Annette King passed me something from
Management magazine—management.co.nz—which in March had an opinion piece on leadership. In respect of John Key it said this: “Key seems to have a strong personal following. He could probably sell his vision if he had one and if he believed it … The fact that he doesn’t suggests a leadership strategy based more on expedience than inspiration.”
I think those two comments from the media are illustrative of the fact that the public are waking up to the fact that under this Government its economic mismanagement is responsible for the facts that the economy is failing to thrive as it should, and that the Government continually fails to meet its own projections—not just the projections of Opposition parties or other financial commentators but its own projections. Every time, it falls off them. As a consequence, in the last Budget Policy Statement we saw the Minister of Finance saying that the revenues are a billion dollars down, roughly, compared with where they were at the time of the election in the
pre-election fiscal update. As a consequence, he says we are going to get a zero Budget, or near to it. Well, a zero Budget is what you get when the economy is failing. There are no excuses now for the Government. We are 4 years into its reign—4 years. The excuse of the Canterbury earthquakes becomes less and less relevant, and, indeed, that information was largely before the Government at the time when the pre-election fiscal update was prepared.
We know that National’s economic strategy is not working, and yet we have the Prime Minister yesterday in his pre-Budget speech delivering a speech titled “Sticking to a Plan That’s Working”.
I thought that was rather an amusing statement, given how things are not going to plan. If National’s plan is working, why is it that we have got
record numbers of New Zealanders heading to Australia? It is higher than ever before, month upon month upon month. Why are they heading there? Because rather than the Government bridging the wage gap with Australia, that wage gap has grown. I know the Government likes to spin the statistics and use different measures of the wage disparity between New Zealand and Australia, so I have looked at all of them. Picking the best of them for the Government, that wage gap has grown by $19 a week since the Government was elected in 2008. That is one of the reasons why they are going to Australia.
What else is going wrong? We had a report out from the IMF. The International Monetary Fund looks at the performance of economies around the world. Its report, in April, had the forecast for different countries in the world and how they were going in the world. Are countries paying their way in the world? There was only one country worse than New Zealand in the advanced economies, and that was Greece. I think this should be of concern to New Zealanders, because it is proof that another of the Government’s promises, to rebalance the economy, has not been kept.
New Zealanders are leaving for Australia in greater numbers than before, and those left behind are getting sick of the short-term unprincipled fixes that do not fix the economic malaise that we are suffering under. Labour would not sell our assets. The Budget Policy Statement for the first time laid bare the consequences of that on the Government deficit. I have been critical before of Treasury being the lapdog of the Government on this, and I will say it happily again in this House—not happily; I will say it in the House because I think it is an outrage that Treasury let the Government book the proceeds of sales from the State-owned enterprises but did not show the drop in income in the books, which is a consequence of no longer getting the full dividends and profits from those companies. We had a lack of transparency on that during the election, but the Budget Policy Statement makes that clear for the first time. If the sale of the State-owned assets proceeds despite the overwhelming opposition from the vast majority of New Zealanders, if the Government still proceeds with those sales, what happens? The Government deficit gets worse. By how much? Treasury says that in 2016 the Government deficit will be worse by $94 million per annum. That is but one of the decisions that this Government is making that make the economic outlook of this country worse than it would otherwise be.
We have had prices going up, since National was elected, four times as fast as wages. After we had our last zero Budget, what happened? We had a credit downgrade, and that credit downgrade leads me to another issue. The Government had said that it was going to avoid credit downgrades, but the other issue there, which for me showed a lack of principle in the Government, is that the Prime Minister misrepresented the comments of the rating agencies in respect of Opposition parties. He tried to say—until he was caught out by the rating agencies speaking up and saying it was not true what he was saying—that the downgrade would have been worse under Opposition parties’ policies. In fact, they said that was not the case. They also emphasised that it is not Government debt that is the primary problem in New Zealand; it is total New Zealand debt, our net international liabilities, which continues to get worse.
You do not have to be a brain surgeon to follow the trend in the deficit. It was $18 billion last year, it is $13 billion this year, in the forthcoming year it will be about $9 billion, the year after that it will be half of that $9 billion, and in the next year it will be overcome. The Government is trying to set up New Zealanders to think that that is economic success, and that if it achieves a balancing of the Budget, as we would have in the 2014-15 year—as we would have—that somehow is economic success. It is not, because every year into the future New Zealand is getting poorer, New Zealanders’
incomes are not rising, and they cannot meet their bills in the way that they ought to be able to, because the underlying economy is not thriving.
That lack of principle that showed up in respect of misrepresentation of the credit downgrades of New Zealand has had a number of sequels of unprincipled behaviour. We had the tea tapes, where the Prime Minister called in the police against the media during the election, and at the end of it, when he was not willing to go to court and have his position exposed under cross-examination, he deemed Mr Ambrose guilty—
Hon Anne Tolley: No, he didn’t. The police did.
Hon DAVID PARKER: He did. Those were his words. Oh, the Minister of the Police says it was the police. Goodness, the Minister of Police thinks it is fair for her and the Prime Minister to deem people guilty. It is a pity National members do not apply the same standards to John Banks. What a double standard. It is a pity they do not apply the same standards to the disreputable conduct of the Prime Minister in appointing Mr McElrea to the Broadcasting Commission, also known as New Zealand On Air. It is a pity they do not apply the same standards to themselves for insider deals for the likes of more pokie machines at the casino. It is a pity they do not stand up and do what they said they would do on the Crafar farms, where they said they were going to tighten up the law, and, notwithstanding the fact that the Overseas Investment Office says there would be no increase in exports and no increase in production, they are pushing that sale through in a joint venture with the Government, through Landcorp. What a lack of principle.
This Budget Policy Statement shows that the economic performance of the Government is lacking. People are starting to wake up to that. The lack of a plan for the economy is hurting people. Asset sales, land sales, and shonky deals on pokie machines are no substitute for a plan to grow the economy. Changing who owns what already exists, be it power companies or land, does not improve the output of our economy. The Labour Party agenda, which is for education, science, more savings, growth, and tax reform, is the Budget that New Zealand needs, not what we have got currently.
Hon BILL ENGLISH (Minister of Finance)
: It is good to have the opportunity to talk about the Budget Policy Statement, which confirmed the Government’s agenda as laid out by the Prime Minister early in the year around the Government’s four main priorities. They are to responsibly manage Government finances, to push for a more competitive and rebalanced economy and better public services—even if there is a bit less money for it—and, of course, to rebuild Christchurch. The Budget Policy Statement confirms that, consistent with policies put in place in the Government’s first term of office, we are essentially on track, which is not a bad effort given the global uncertainty that continues.
We are looking forward to moderate growth over the next few years, and by international standards it is pretty good growth. So over the next 12 months the New Zealand economy will grow faster than Europe, certainly faster than the UK, which has just gone back into recession, likely as fast as the United States, and at a similar growth rate to Australia.
What that amounts to is the creation of more jobs. It amounts to meeting the expectation that New Zealanders have for higher incomes. The quarterly employment survey figures that came out yesterday indicate that incomes are growing faster than inflation—in fact, almost twice as fast—and that means that where in many countries around the developed world people face desperate job insecurity and large-scale unemployment, New Zealanders, on average, have the benefit of real growth in incomes.
Much of the Government policy is focused on supporting those who can ensure that growth in jobs and incomes. As has been explained here in the House, that growth will
not include the Government. The Government is not going to be growing. The Government had a strong period of growth through the first decade of this century. Its spending grew dramatically. But that turned out to be unsustainable, particularly in the light of both the New Zealand recession and then the global recession, and growth in the future will not come from borrowing more, or more Government spending. In fact, the world is not going to lend us the money to keep pretending we are getting wealthier by running up a larger overdraft, either privately or publicly. New Zealand households do have very high levels of debt. They have got the message. That debt has stopped rising and is now falling for the first time in 20 or 30 years.
Growth in the future will have to come from different sources and there are not too many choices for that. It will have to be from selling more goods and services at higher value to more people outside of New Zealand who want to buy them. It is about as simple as that. So Government policy is focused on helping businesses and people who provide employment to make the decision to invest a bit more, take the risks that go with that, and employ another person, therefore creating another job. This will help them with the value of their goods and services so that they can afford to pay higher wages.
Unlike the Opposition, we and most of New Zealand know that you do not get higher incomes by wishing for them. You have to get them from real economic value and employees getting their share of that increase in real economic value. The good news is that despite the headwinds and the global situation, New Zealanders are currently enjoying the benefits of moderate real growth in their incomes. We do not claim that it is stronger than that, but it is moderate real growth in their incomes.
I think their expectations about what can be achieved are not unreasonable. They are in a very pragmatic mood, and keen to see the Government promote more jobs, growth, and incomes, and that is what we will continue to do.
Hon David Cunliffe: God help not.
Hon BILL ENGLISH: Well, picking up on that member’s comment, the Labour Party has probably got a bit of work to do among its four economic spokesmen, who are regularly outpointed by the one economic spokesman in the Greens, who takes up more space giving more considered contributions to public debate. One of their economic spokesmen said—I am told this, and I will have to check this out because I thought it was unlikely, but apparently it is true—that economic policy in New Zealand for the last 30 years has been wrong. So that means that we are going back to the late 1970s, is it—
Paul Goldsmith: I think Muldoon was the last one of that mind, apparently.
Hon BILL ENGLISH: Muldoon? Well, maybe that is where they are going to go, because if it was all a mistake for the last 30 years, you have to go right back to before that. No doubt there are elements of the Labour Party leadership race where that resonates, and I guess we will find out. It is a bit unfortunate that the other spokespeople are advocating those tragically wrong economic policies that were put up in the last 30 years. The research and development tax credit, I think, is the one, and that has got them dancing in the streets—the research and development tax credit.
The bit that Labour has not learnt—and this is directly relevant to the Budget Policy Statement—is that saying you are committed to skills and innovation is one thing, and saying you have spent lots of money on it is another thing, but neither of those mean that it actually made any difference. The Minister on the front bench here, Anne Tolley, indicated that with her response today to questions about trade training and qualifications in prison. So Labour is committed, I am sure, to rehabilitating prisoners—
Hon Anne Tolley: But they didn’t do it when they were here.
Hon BILL ENGLISH: —but it did not do a thing about it except drive up the prison population. There was no cohesive sense of what it was trying to do about qualifications
for prisoners, let alone for the broader public. I mean, for the broader public it just threw lots of money at it, including at the people who had died, the people who had long since left the trades, and the phantom applicants who never showed up for any trade training, but there were 150,000 places or something. Most of it was exposed as meaningless spin, spending lots of money that was not working.
One of the jobs this Government has committed itself to has been undoing a lot of that damage, particularly across our public services, and restoring a sense that a motivated Public Service can actually make a difference to the way the world is, not just talk about it.
Grant Robertson: How motivated is Foreign Affairs?
Hon BILL ENGLISH: Well, that is another thing: the Labour Party gets this stuff all out of proportion. New Zealanders actually want better health services, a safer community, and decent education, and, actually, they are not obsessed with that member’s gossipy little Wellington circuit.
Hon Member: Yeah, the beltway.
Hon BILL ENGLISH: The beltway and “Mr Beltway” himself, the next leader of the Labour Party. When it has finished with Mr Shearer it is going to have “Mr Beltway”, and that will not work. That will not work either and Mr Cunliffe is waiting, waiting, waiting, because he knows he can afford to see off Mr Shearer and “Mr Beltway”, because “Mr Beltway” will not get any more resonance than Mr Shearer, and then it will be Mr Cunliffe’s turn. I agree with Mr Cunliffe. I think the patient strategy is the right one to take—and I am an expert on these things. Mr Cunliffe should take his time.
The Government is not going to be distracted by what is going on in the Labour Party. We are sticking to our four priorities for the economy. We are pleased to be supporting so many New Zealand families and businesses who have changed the way they see the world. They have increased their savings, changed their skills, become more innovative, made their struggling businesses viable, and turned their families’ finances round. We are right behind those people because they are who are changing this economy for the better.
Hon CLAYTON COSGROVE (Labour)
: There is an interesting trend that has happened in the life of this Government in the last few months since the election. It is “third-term-itis” in the second term. But the interesting and more serious point is this: this is a Government now that is getting sidetracked and preoccupied and wallowing in scandals. The body count is going up, the mismanagement is going up, the ministerial resignations and sackings are going up, Government members are getting sidetracked into the mire of their own selfishness and their own self-indulgence, and they are leaving the management of the economy out there just in space. They are leaving New Zealanders behind because there is no plan and they are sitting there looking normally like a third-term Government but inwardly looking at their own mess-ups, their own ministerial cock-ups, like Dr Smith, of course, and others—and now we have the latest one, which is the ethical behaviour of John Banks.
We should be spending question time not trying to hold Ministers accountable for their mismanagement and unethical behaviour, because they should be behaving ethically. Question time should be about holding the Government to account for the big issues. However, all the public see from this Government is Minister after Minister getting hog-tied by their own incompetence, their own self-indulgence, and their own selfishness, and it is left to members of this Parliament on this side to hold them to account for it.
I just want to also raise this issue. You know, Mr Goldsmith was, I think, the person who kicked off this Budget Policy Statement debate. It was Mr Goldsmith, I believe,
who was John Banks’ biographer. In fact, I think he wrote two books, did he not: the authorised version and the unauthorised version. Then it will be the third in the trilogy of books. It will be on the rise and fall of John Banks, to be followed very soon by Mr Goldsmith—who I am told is a very good writer—writing John Banks’ political obituary. That is what will happen.
Paul Goldsmith: You’re just jealous I won’t write one about you.
Hon CLAYTON COSGROVE: Jealous of John Banks—hell, no! Hell, no! I do not think there is anybody alive in this Chamber who would be jealous of John Banks—no one, I think, especially those of us who value our memory and our mental faculties, and can remember our own name, where we come from, and what our job is. We know what a helicopter does. So does Anne Tolley, of course. She spent a fair bit of time flitting around universities in Auckland. He could not remember whether he was in a helicopter; he could not remember what day it was. I mean, for goodness’ sake! I put it to you that, as we debate the Budget Policy Statement—and this is a serious document—a member who cannot remember where he is or what a helicopter looks like, you have got to argue, maybe should not have a ministerial warrant. Can he remember what day it is?
But, on a serious note, that is the first in a litany of Ministers and casualties where this Government should be concentrating on the content of the Budget Policy Statement. Government members should be explaining to people why it is that unemployment has increased 43 percent to 150,000-plus people out of work over the lifetime of this Government. They should not be being self-indulgent, having to deal with that member there, Dr Nick Smith, for his behaviour, and having to deal with John Banks, Richard Worth, Pansy Wong, Mr Heatley, and the “$48,000 man” who just resumed his seat, Mr English, of course, over his little problems with his expenses. No, this is a Government that has forgotten about ordinary New Zealanders, forgotten about them, left them behind, and now it is into this self-indulgent wallowing, trying desperately to paper over the cracks of the Ministers and the members of the Government who are acting reprehensibly.
I thought, as we all did as we look at the record of this Government, that there was going to be a higher plane. Remember the brighter future? Well, is it a brighter future as we look at the figures—
Hon Anne Tolley: I raise a point of order, Mr Speaker. I have listened very carefully to the introduction to this speech and I ask you this: just referring to the fact that it is a Budget Policy Statement speech surely does not bring a mass of wallowing in ministerial actions into scope.
Chris Hipkins: That’s an out-of-order point of order.
Mr SPEAKER: Order! The member knows it is out of order to interject when a point of order is being heard. The member is asking that the speaker be brought back to the subject of the debate, which is a debate on the Budget Policy Statement. I have been indicating to the member that he was staying away from the debate for some period of time, and it does require just a little more than referring to the title of the debate. I ask the member now to come to the substance of the debate.
Hon CLAYTON COSGROVE: I thank Ms Tolley for agreeing with me and conceding that a lot of ministerial wallowing has certainly happened. So, if we are going to deal with the Budget Policy Statement and we are going to look at the record of this Government, let us look at the record of that Minister and her Government, shall we? Let us look at this: prices went up nearly four times as fast as incomes in the last 3 years. There you go—strike one. As we have said, there is a 43 percent increase in unemployment. There are 83,000 young New Zealanders out of work, not in training, wallowing on the dole, or out there in the wilderness, and they hang it all, firstly, on the global financial crisis, and, secondly, on the Canterbury earthquakes.
I put this very simple equation to Ms Tolley. I will make it very simple, very simple, because I know mathematics is not her forte. When you have 83,000 young people who are not in training, not in school, wallowing out there, and then in Christchurch you have the biggest training scheme known to man, called an earthquake, to rebuild the show, why is this Government so inept that it cannot marry those two issues together and put young people to work rebuilding our second-largest city? Oh no. There are not a lot of sounds coming out of the sort of hollow one on the front row—not at all.
Is there a plan here? The only plan seems to be asset sales. Apparently, if you flog everything off, that is going to make 83,000 young people find a job. If you flog everything off, that is going to give people a decent standard of living, and prices will not go up four times, as they have. So let us examine that proposition, because I do come back to that as we debate the Budget Policy Statement. It is a matter of priorities. A Government that is sucked down the hole of its own selfish self-indulgence cannot hope to present a Budget Policy Statement and an economic plan with any credibility when the Prime Minister and other Ministers, day after day, have to get up and defend their unethical behaviour, when they have to get up and try to paper over the cracks of their Ministers who have run amok.
The people of New Zealand look at this and say that Ministers should be spending every moment of their time in this place coming up with a plan to help our communities, rather than the selfish self-indulgence they have engaged in since the election, especially that one down the back there, who looks through his nose—down his nose—at us. I say this. If you look at the State-owned assets—
Hon Tau Henare: How can he look through his nose?
Hon CLAYTON COSGROVE: Oh, he woke up. If you look at the State-owned assets programme, here is the justification that has been put up. Here is the grand plan. We have got to sell off assets, the Government says, because we have to grow and prosper. We all want to grow and prosper. The Government says in order to do that there must be capital injected into the State-owned assets, but the Government, of course, has no money, it tells us. Then Mr Ryall, of course, admits that if the Government faces the dilution equation, in order to maintain 51 percent it will borrow, it will go into debt, it will use taxpayers’ money. To quote Mr Ryall, they will do whatever it takes to keep up the 51 percent.
The Government also promised it would not be tricky with the asset sales debate. The Government says that 51 percent ownership means it is in control, and on the face of it, you would accept that. It is a basic equation, until you look at the legislation, and you find out that the door is wide open for non-voting shares to be issued, where the Crown may take 51 percent of the control, but may have far less than 51 percent of the allocated dividends. That is a big issue, which will be examined as we go on.
There are no guarantees about Kiwis being first in the queue—no guarantees at all—and no plan in terms of that. There is no explanation, and no admission that Kiwis already own these assets, and there is no economic plan. So I say this, as they sort of wallow in this self-indulgence, as days pass and another Minister runs amok. One Minister looking after his mates—gone. Another Minister is looking after his mates—on the way out. The body bags are being measured up for the short man as we speak. Then we have a litany of Ministers who have run amok. People in New Zealand—
Hon Anne Tolley: Really?
Hon CLAYTON COSGROVE: Oh yes. You are one of them, as well. Heatley, English, and the rest—and the rest. The people of New Zealand are looking at this Government and saying: “Where is our brighter future? Where is the plan? Where is the concern for us as a community? Where are the jobs? Where are the great reforms we were promised, and where is the economic growth?”. [Interruption] Oh yes, have a
good laugh. But the people of New Zealand are not laughing, and the 83,000 young people who are on the dole are not laughing. The pensioners who cannot make ends meet because of this Government are not laughing, as prices go up three or four times.
There is no plan exhibited in this Budget Policy Statement. In fact, if you look at the record of this Budget Policy Statement, you will see that it is a shocker. This Government is an inward-looking Government, looking down the tunnel, trying to paper over the cracks of all the mistakes and incompetence its Minsters are making. It will come out as we go through. Today it is Dotcom. Tomorrow it will be something else. And the Prime Minister stands up and moves the goalposts around, talks about ethical standards, and dances on the head of a pin, when he should be standing up and articulating to the people of New Zealand that he will look after them, he will lead them, and he will provide them with the brighter future that he promised at the last election.
Dr RUSSEL NORMAN (Co-Leader—Green)
: I rise to speak on behalf of the Green Party on the Budget Policy Statement debate in this Parliament. The Green Party put forward its own economic plan in the lead-up to the election. It is a plan for a smart, green economy, and that is one where we take our national debt, particularly our current account deficit, seriously but also seek to transform our economy and deal with the fact that our export sector is in real trouble.
When this National Government came in—when it was first elected—it inherited an economy that was out of balance. There is no question about that. It had much too much debt, particularly private debt. The public sector debt was in a good position. The previous Government had actually run a surplus, but private sector debt was very much out of control and the tradable sector was in real trouble. Since then the Government was rocked by some serious external factors that had nothing to do with it, particularly the earthquakes in Christchurch, but more generally the global financial crisis and, of course, the European crisis. So in a sense you could say the Government had some real challenges. The other way to look at it is to say that it had some real opportunities to remake our economy to put it on a more sustainable footing—an economy that saves more, an economy that invests in productive enterprise more, an economy that creates jobs in the emerging cleantech sector, and an economy where Christchurch is rebuilt to be one of the most greentech and sustainable cities in the world. That was one of the many opportunities that were in front of the Government.
The thing is that when you inherit an economy that has some fundamental problems, you do have a window of opportunity to fix it. It is the one moment when powerful vested interests who have a vested interest in maintaining the status quo are open to acting differently, because the status quo is not working. Our view is that the Government has not used this opportunity well to reform the New Zealand economy in some quite fundamental aspects. Firstly, there is the question of the deficit. National’s signature economic policy was its tax cut package, which was introduced in 2010. It was a policy that was designed before the global financial crisis and before the Christchurch earthquakes, and it was a policy that was totally wrong for the time it was introduced after those events. Tax cuts failed to stimulate the economy, because they were not tax cuts to low-income earners. They primarily went to upper-income earners, and they did not stimulate the economy at the time it needed it the most. The other side of it was that it crashed the budget. Because the tax cuts were not fiscally neutral, it meant that at a time when the Government actually needed more revenue, it threw more revenue away. That, in my opinion, is not smart economic management.
The fiscal crisis the Government is currently facing is a problem that is, to a large degree, of its own making, because of the tax cut policy it pursued in the 2010 Budget—a policy that was designed before the global financial crisis and before the Christchurch earthquakes. Figures from the Crown’s year-end Financial Statements
2010-11 show that National’s 2010 tax package has cost the Government $1.1 billion in the first 9 months—it cost $1.1 billion in the first 9 months. Most of that cost is due to the reduction from 38c to 33c of the top tax rate, which benefitted the top 10 percent of New Zealand earners. The signature economic policy for the National Government, the tax cuts—tax cuts for those on high incomes, largely—has not been fiscally neutral. The cuts have crashed the Government’s revenue at a critical moment, and in my opinion that is a failure of good economic management.
National was handed a once in an economic cycle opportunity to institute a comprehensive tax on capital gains. The crisis that the Government inherited created the opportunity in which it could move the tax system to a more sustainable footing, and it failed to take advantage of that. A capital gains tax would remove the unfair tax advantages from investment in property over more productive measures. The Government did actually change some of the rules around tax and property, and I congratulate it on that, but it failed to introduce a capital gains tax that excluded the family home. The Government chose to ignore the conventional wisdom of just about all economists—the OECD, the IMF, and the Government’s own Savings Working Group—so it is no surprise that as our weak economic recovery is emerging at the moment, we are finding that it is concentrated in the housing sector, which is the very sector where we do not need another bubble. The reason it is happening is that the Government refused to change the tax incentives around investment in housing.
Our tepid economic recovery, which we are experiencing at the moment, looks nothing like the export-led recovery we actually need. We need the tradable sector to do well. Part of this is linked to the hands-off approach when it comes to the exchange rate. A recent business operations survey by Statistics New Zealand found that a high and highly volatile New Zealand dollar was the No. 1 barrier that our exporters faced. That is what it said. The same survey shows that the number of businesses exporting has remained flat under 4 years of this Government. The high kiwi dollar has been damaging our tradable sector, the lifeblood of a sustainable, resilient economy. As far back as June 2009 the Governor of the Reserve Bank was uncomfortable with the stronger currency, telling his board that the high New Zealand dollar would not deliver the rebalancing we need in the New Zealand economy. Since then, the kiwi dollar has appreciated a further 28 percent against the US dollar, while the trade-weighted index, which is an attempt to compare the kiwi against lots of other currencies based on how important they are to us as a tradable sector, is up 21 percent. So if we want our export- and our import-competing sectors to thrive to help pay our way in the world, we are going to need to address our high and highly volatile exchange rate.
Our trading partners have not taken a hands-off approach to their exchange rates. If you look at Japan, the United States, and the UK, they have all engaged a suite of measures to actively manage their currencies. The IMF recently even backed Switzerland’s most unorthodox use of quantitative easing—probably one of the most unorthodox exchange rate management policies we have seen for many decades. The IMF said that it was “appropriate” in the circumstances because the Swiss franc was getting so high that it was destroying the tradable sector of the Swiss economy. I wish our Government would take some notice of that. Other countries have introduced new domestic capital requirements on banks and controls on foreign capital to try to dampen some of the wild swings in their exchange rates. The global financial crisis has changed the world as we know it and the rules as to what is acceptable monetary policy and fiscal policy, but no one, it seems, has told the Government. Our exporting sector and our tradable sector have been left high and dry by the Government’s non-interventionist approach to economic management. It has not worked.
Many aspects of the Government’s policy, I think, we could disagree with, but selling the State-owned enterprises through the privatisation programme the Government is engaged in is bad fiscal policy as well as bad economic policy. Fiscal policy is, of course, the management of the Government’s own budget, whereas economic policy refers to the broader impact on the New Zealand economy. The way the Government has sold the privatisation, it has deliberately tried to confuse debt with deficit in order to try to confuse the argument. In the short term, selling these companies will have a negative impact on the Government’s deficit. That is a very important thing to think about. Why is it that we have a public debt problem? It is because we have a deficit problem, and we have to overcome our deficit problem. Selling the assets makes our deficit problem worse. That is because, of course, the cost to the Government of borrowing is much lower that the return on these investments. Actually, we are in a worse position.
So hanging on to these assets is not only good for the fiscal position; it is also good for the economic position of New Zealand, because fundamentally these companies—these clean, green companies, which is not what all of them are, but a significant number of them are—are part of what could be New Zealand’s economic future. There is a growing clean-energy sector globally, and if the climate change science is right—and I have got every reason to think that it is—then the cleantech sector, the clean energy sector, is only going to grow and grow. And New Zealand is, right now, in a great position to take advantage of that. But if these companies fall into overseas ownership, they will move the headquarters and the research and development overseas, and we will become a profit centre for another multinational company that owns these companies, rather than the centre of a sector that is exporting clean technology to the world.
One of the key aspects in all of this that is not getting the attention it should deserve is the current account deficit. If we do not deal with our current account deficit, we will enter a worse and worse spiral. Current projections are for the current account deficit to go towards 6.9 percent of GDP in a couple of years. That is a huge problem. The only way you service a current account deficit is to sell assets or to take on more debt. Each time you do that, you solve your current account problem for this year but you make next year’s current account deficit worse, because you then have higher debt repayments and you lose all the dividends on those assets. The fact that the Government has not addressed the current account deficit problem, I think, is a fundamental fail on the part of the Government. Until it addresses that problem, it cannot claim to be a good economic manager of New Zealand, and clearly on the fiscal side it is failing there as well. Thank you.
Hon Dr NICK SMITH (National—Nelson)
: It is a real pleasure to be speaking in this Budget Policy Statement speech, in that the real issue that is on the minds of New Zealanders is how we manage ourselves through the most challenging economic environment in a generation. These are the issues that matter, and it has been incredibly telling over the adjournment period to contrast the view that has come through from Government Ministers with the alternative economic vision that has come from Opposition parties.
You have had the Minister of Finance talking about the need to responsibly manage finances. You have heard Ministers talking about the plans this Government has for building a more competitive and more productive economy. You have had them making announcements about improving the quality of public services for New Zealanders, and you have seen significant announcements about rebuilding Christchurch. What I want to contrast that with is the announcements from Opposition parties over the adjournment
period that show they are completely out of touch with the challenges that New Zealand faces.
Hon Annette King: No, that was that member. He was totally out of touch.
Hon Dr NICK SMITH: I hear the member Annette King. What was the big announcement that we had from the Labour Party over the adjournment period? It was that it wants to have another $450 million on extending paid parental leave. The simple question I have got for the deputy leader of the Labour Party is: where is the money coming from? You see, Labour members have learnt absolutely nothing from their 9 years in Government where they spent without a care in the world and passed on to this Government a decade of deficits.
But it was not just the Labour Party that was out spending money that this country does not have. We had New Zealand First out there saying: “Hey, look! We’re going to have cheaper power costs for all older people.” What a lovely thing to have—what a lovely thing to have. But over the Budget Policy Statement period of 5 years, that policy is expected to cost $170 million. My challenge for New Zealand First is: where is the money coming from? Can it not comprehend that there is a global financial crisis in which people are losing jobs, in which countries are going broke, because of policies and reckless spending by parties like New Zealand First and the Labour Party?
Then if you look in terms of the argument for growth, I think every member of this House would say that the real future for New Zealand in getting jobs and growing incomes is to grow the economy. Yet in every single commentary over the adjournment period we heard reasons from Opposition parties as to why we should not take initiatives to grow the economy. Let me take my own electorate. A particular initiative is the growth of aquaculture in the Marlborough Sounds. That is a growth of business that is estimated to create another 300 jobs in Nelson and grow the exports of this country by over $100 million a year. And where was the Opposition on that issue over the summer? It said it was opposed.
And then we come to another initiative, the growth of agriculture. Again, over the summer we heard from Opposition parties as to why they were opposed to the growth of agriculture. We heard the debate over the convention centre, an initiative for Auckland that would create over 1,000 jobs. Again, where was the Opposition on that opportunity for New Zealand to grow tourism and grow jobs? Again, parties opposite were in the “no” camp. Take another one: there are tremendous opportunities for this country around minerals and petroleum. I was interested, again, to hear from Opposition parties as to why we cannot grow the minerals and the petroleum sector.
So I just have a very simple question for members opposite over the Budget Policy Statement. Why is it, when there is any proposition for growth, for jobs, for exports, that parties opposite say no? They cannot stand up in this House, talk about higher incomes, talk about closing the deficit and talk about more jobs, if on every single issue that comes along all they can do is promote new ideas for spending Government money we do not have and reasons why we cannot have jobs or growth.
You see, they are the issues in this Budget Policy Statement that contrast the Government with the Opposition parties. It is very easy to give waffly speeches about wanting to grow the economy, wanting to grow exports, and wanting to be able to create opportunities for New Zealanders, but every time it comes to the test and every time it comes to the debate over creating jobs and wealth, Opposition parties say no.
I just challenge members opposite, who want to close the deficit, and say “Well, OK, what are your ideas for ensuring that New Zealand gets back into the black by 2014?”. Members and Ministers on this side of the House have, in this Budget Policy Statement, sent a very important plan down for New Zealand to balance the books. I want to hear from Labour, Green, and New Zealand First—members of the Opposition—where their
plan is to deal with the question of debt. My worry is that when you scratch the surface of the policies of parties opposite, it sounds like it is in Greek. It really does. Every initiative I have heard from Labour members involves more spending, fewer jobs, and fewer opportunities. That is no recipe for New Zealand to get through this very challenging economic period.
I hear members from New Zealand First interjecting. I have a simple question: where is the $150 million coming from to fund Winston Peters’ policy of cheap power bills for the superannuitants?
I am listening. Where is the $150 million coming from? I challenge the members of the Labour Party, who over the adjournment period have promised paid parental leave. My simple question for Labour members is “Where is the money coming from?”. Where is the money coming from, Mr Cunliffe? They are silent—absolutely silent. Well, I say that if we are going to have a sensible, mature debate on the Budget Policy Statement, members opposite, who go around the country promising more spending to everybody, need to front up and say where the money is coming from. Members on this side of the House say the days of increased debt, increased spending, and borrow and hope are over. It is time this country had to earn a living. It is time we grew the productive economy. It is time we balanced the Budget. That is the right economic strategy for New Zealand. That is why this John Key Government is the right answer for the challenges this country faces.
BARBARA STEWART (NZ First)
: On behalf of New Zealand First, I rise to speak to the Budget Policy Statement. No one can believe this Budget Policy Statement. Remember the Budget last year—170,000 new jobs in 4 years? What a con! This Budget is not about creating wealth for New Zealanders. It is not even about new jobs or trading our way into a better future. In reality, this Budget is about the market, overseas banks, currency traders, speculators, financiers, and National’s rich mates buying up our assets.
Insanity is doing the same thing over and over again and expecting a totally different result. This Government is doing exactly the same as it did over 20 years ago—the same recipe. What a mess. This Government is driven by ideology and stupidity masquerading as competence. It worships the market—whatever that is. Yet it is the same financial market that caused all the problems in the first place. The Prime Minister knows this. He was very close to the people who helped manufacture this crisis by their shonky financial dealings in the United States.
John Hayes: And Winnie’s not shonky?
BARBARA STEWART: Shonky—yes, it is. There are some people who think it belongs to them and they have the divine right to get obscenely rich at the expense of everyone else. Almost anyone with some knowledge of economics knows that when Governments cut spending during a recession they reduce economic activity. That makes things much, much worse. It happened in the 1930s—last century—with devastating consequences. It was relieved in New Zealand only when one courageous politician and some smart advisers devalued the currency. They knew that New Zealand had only one opportunity: to export its way out of trouble. That was our last chance. And it worked.
The only way that we will ever restore our country to its rightful place as Godzone will be to rebalance the economy through smart exporting. That means that the Government has to help exporters, not the speculators and the foreign banks. The IMF says that the New Zealand dollar is up to 20 percent overvalued. Even the Governor of the Reserve Bank, who is besotted with inflation, says the high dollar is getting in the
way of our recovery. Can none of these people see that they are actually making things much worse?
And what about National’s commitment to senior citizens? We know, as Nick Smith said, that power prices are soaring in the lead-up to the privatisation of our rivers and our dams. Domestic consumers are getting flogged with high power prices, and they are actually subsidising the commercial and the industrial users. New Zealand First asked the Government for a small discount for senior citizens. We did all of the research. We did the costings. We even prepared the legislation. Yet not one Cabinet Minister would talk to us. Neither would the Prime Minister. They did not want to know. I know that the previous speaker, Nick Smith, might be interested, and so might Mr Hayes. We hope so. This is basically not good enough. The Government cannot treat these people this way. They have made a contribution and paid for all these State assets that our Government is now pimping right around the world. Sell it once and it is gone.
This is not a Government of the many. It is a Government of the greedy few, and they are intent on selling the rest of us down the river. The Budget Policy Statement actually reinforces that view. In 2008 John Key promised the country a brighter future, but the reality is that things are not getting any better. In fact, they have gotten worse. The economy grew by a measly 0.3 percent in the last quarter. We have got tens of thousands of young people out of work. We have got 83,000 young people who are actually unemployed. We have got more than 23,000 Kiwi kids who are living below the poverty line. That is not a good statistic.
In the meantime, the current account deficit has worsened on National’s watch. Foreign debt is soaring, and, thanks to an over-inflated dollar, our export industry is being crippled. What the Minister of Finance has not told you is that the provisional tax take is way, way down. It works like this: people who pay a high level of provisional tax are finding out that their incomes are actually dropping. So instead of paying more provisional tax they are actually claiming refunds.
Hon Member: So?
BARBARA STEWART: That is not the way it should be. The very idea that the Government’s books are going to be balanced in 2014-15 is a pipedream. Even this Budget Policy Statement says that it will be a stretch. But despite all of this, the Government should not be fixated on balancing the books. It should be fixated on stimulating the economy, creating jobs, and giving exporters a really good base to launch from.
New Zealand is not the basket case of Europe. We have resources. We have skills. Basically, we are a very resourceful people. We can trade our way out of this mess, if we reward the people instead of punishing them all the time. Governments are actually supposed to be for people.
There is great concern about child poverty in New Zealand. How does this Government respond? It holds an inquiry. Everybody knows that child poverty is family poverty, and family poverty is actually caused by unemployment. Unemployment is actually the greatest evil that is facing New Zealand, and it is time that National actually did something about it.
We are exporting more and more young people—more and more of our citizens. We educate them, we ensure that they have free health care up to the age of 6, we look after them in every way we can, and then we export them when they can actually put something back into the economy. To my way of thinking that is not smart economic management, in any way.
We had people in this country who built up this great country. They would actually be horrified to know that their descendants are flogging off the assets built up by generations of hard-working people. They were always very wary of slick salesmen and
never did they ever contemplate the thought that the country would actually be run by these people. We in New Zealand First say to the Prime Minister that he should admit his mistakes and start running the country for everybody, not the privileged few. We want economic growth, we want jobs, and we want an export-led economic plan to make this great country the country that it once was.
JOHN HAYES (National—Wairarapa)
: I find it a real tragedy that “Aunt Daisy” was believing what she was saying here in the House this afternoon.
Grant Robertson: I raise a point of order, Mr Speaker.
The ASSISTANT SPEAKER (H V Ross Robertson): And I am going to rule. That was a derogatory remark. There was no need for a personal reflection. That was a personal reflection under Standing Order 117. The member will stand and withdraw.
JOHN HAYES: I withdraw. The member was saying—
Grant Robertson: I raise a point of order, Mr Speaker. I do not want to disagree with your ruling, but when people sometimes use other names to refer to people, that is one thing, but that was quite clearly a deliberately derogatory, possibly sexist, ageist reference, and I think in addition to withdrawing, Mr Hayes should be asked to apologise.
The ASSISTANT SPEAKER (H V Ross Robertson): No, I have made my ruling. It was the first time, and if he does it again, something else will happen.
JOHN HAYES: Thank you, Mr Assistant Speaker. The speaker said that New Zealand First went to the Government and asked for a small discount on the price of power. That small discount would have required an amount of $150 million to implement. Is $150 million a small amount? I think not. I think not. The same speaker also suggested that we need to stimulate the economy. Well, that member’s party leader was a colleague of one Robert Muldoon, who went down the road to stimulate the economy through a series of Think Big projects that actually did not stimulate the economy, at all. It created a whole lot of high-priced jobs, just as the member’s leader did in the last Labour Government, when he saw millions of extra dollars put into the foreign affairs ministry to create jobs that did not exist.
When you create a job and you take money from somewhere, you are taking it from a person’s pocket. Those people live in my electorate. They are taxpayers. They removed your leader and his Government in 2008, because they were sick of the constant drain on their pockets for jobs that were unreal.
Barbara Stewart: No, no.
JOHN HAYES: Your leader’s Government left this party—the new Government—in 2008, in a situation where falling economic growth was reflected in a country in recession. It left rising unemployment. It left high inflation. It left a rising current account deficit. For every dollar a person in these manufactured jobs was earning, the Government was spending $1.02 or $1.04. We have now implemented policies that are ensuring that for every dollar someone is earning, the Government is spending only 98c.
Our Minister of Foreign Affair and our Prime Minister, John Key, have turned this economy round. We are managing the Government’s finances responsibly. We are building a more productive and competitive economy, and I see it in my Wairarapa electorate, where unemployment is dropping quickly. We are delivering better public services, and I see it in my Wairarapa electorate. I see it through health services, I see it through schools, I see it through a police system that works, and I see it through a 111 call system that works, and soon we will see it in the courts system.
Also, we have to rebuild Christchurch. That is a huge project. The Minister of Finance acknowledged that returning the books to surplus by 2014-15—which is our goal, and which my colleague in New Zealand First said was going to be difficult to do—is something that is going to be difficult to do, but we will do it. And we will do it
by putting a cap on the Public Service and stopping the creation of jobs that we cannot afford. We will do it by leaving money in people’s pockets through tax cuts, so that they can get up and engage in productive activity and work. We will do it by moving resources from back offices across a range of agencies, whether it is health, or education, or foreign affairs, or science, and bringing them forward to the front office.
I think we are going to see quite rapid progress, and I am seeing it in my electorate, where I am seeing confidence in the farming sector, where I am seeing confidence in the retail sector, and where I see that companies like JNL, which processes timber, are now back working 24 hours a day, 7 days a week. This is a very, very different economy from the one we had.
Although there have been some comments in the House this afternoon that have interested me on the question of selling, partly, the shares in some State-owned assets, the biggest shock for me, and one of the most difficult things to cope with as a constituency member of Parliament—a constituency member of Parliament—was people who had lost money in finance companies.
When I looked at what those people had done, I saw that they had invested in finance companies because they did not have a sharemarket that could guarantee stable returns. One of the big issues, and one of the reasons, and one of the really big benefits that is going to come from selling shares in some of our power companies is that that group of people can now use some of their savings to invest in stable shares that will guarantee, year after year, a reliable return. We need depth in our sharemarket, and the savers in this community are entitled to be able to buy shares that will offer a good and reliable return.
I am absolutely confident that the Budget’s plan is going to be really worthwhile, and I support totally the Minister of Finance’s plan not to spend any new money. It is most important that we contract the size of government so that we allow people in the private sector to get engaged in real, new investment, not in mickey mouse investment. We get people involved in government that allows people to make their own choices about whether they save, whether they buy shares, and how they create new opportunities. I think that is really important.
I would just like, while I am on my feet, to express my disgust that our foreign affairs ministry would leak Cabinet papers to Mr Goff.
Hon David Cunliffe: Who said they leaked them?
JOHN HAYES: They were tabled and brought into the House this afternoon, and he brought them here. It is quite clear to me, and to most people I speak to in the Ministry of Foreign Affairs and Trade, that change is required in that institution. I am pleased to see Mr Robertson agreeing with me. What really is objectionable is that the Ministry of Foreign Affairs and Trade has moved across a line. It was once one of our most highly respected public servants, and I for one was proud to be a part of it. But it has moved across a line into becoming an entity that is totally untrustworthy and will garner no respect anywhere in this House.
I support entirely the Secretary of Foreign Affairs and Trade and the Minister of Foreign Affairs in their plans, and their plans are being discussed. All staff are involved in their preparation. I think it is highly condemnatory that these documents should be being leaked, and I assume they are being leaked by people with particular vested interests, who want to see no change to a dinosaur that has resisted change for 70 years, since it was in existence.
Grant Robertson: They believe in their organisation, which is being undermined by that member’s Government.
JOHN HAYES: No, no. This entity needs change. John Allen is a very good person to lead it, and all of us in this House need to support him, not to undermine him,
because this undermining by Mr Goff is actually tackling the integrity of the whole Public Service. I feel that Mr Goff and the Labour Party should be really thinking very carefully about what they are doing, and what they are buying into.
Finally, I would like to say that I am seeing very, very great change in my electorate, a high degree of optimism, and a very positive and buoyant view of the future. Thank you.
Hon DAVID CUNLIFFE (Labour—New Lynn)
: A little-known fact is that there is a secret club in Parliament shared by Grant Robertson, me, and John Hayes—[Interruption]—and Tim Groser. We are all alumni of the Ministry of Foreign Affairs and Trade. So I am very, very sad to have to record in the House today that the Government’s change programme for the Ministry of Foreign Affairs and Trade, the savings from which are part of its Budget, is going to be a complete and utter disaster. If that ministry is falling apart, there is no one to blame but its disreputable Minister, Murray McCully, the Minister who is hanging his own chief executive out to dry and presiding over a change programme that will only, on today’s information, save $12 million—
John Hayes: I raise a point of order, Mr Speaker. I think it is inappropriate for that speaker to have used the words “disreputable Minister” in reference to Mr McCully, and I think he should withdraw.
The ASSISTANT SPEAKER (H V Ross Robertson): It is a debatable point, and it is up to the member or the Minister himself to raise a point of order.
Hon DAVID CUNLIFFE: It is saving $12 million but spending $9 million to do it—net $3 million—and wrecking the Foreign Service in the process. But John Hayes did say something very revealing. I am not sure that he was supposed to say it to the House, but he said the crucial thing is to contract the size of government—contract the size of government.
Hon Anne Tolley: Absolutely.
Hon DAVID CUNLIFFE: “Absolutely”, says the Minister. There is the agenda laid clear. National believes that you can cut and sell your way out of a hole—sell the assets, cut government past the bone. The Government delivers services that help the economy. A zero Budget is what you get when the economy is failing. A zero Budget is an admission by the Government that it does not have a plan that is working. National’s economic policy, if you can call it that, is simply selling assets, selling farms, crony deals, and pokies. New Zealand deserves a whole lot better than that.
Mr Key has said “sticking to a plan that is working”. Well, it is very hard to believe that. We should call that the “Yeah, right” Budget—the “Yeah, right” Budget! The plan that is working, apparently, means unemployment up by 43 percent, leaving 150,000 New Zealanders out of work. It apparently means 140,000 New Zealanders who have left the country because they cannot stand to wait for the brighter future the Government has let them down on. Over 1,000 a week are voting with their feet because they have given up hope on their own homeland. That is 1,000 a week whose children will not be living in the same country as their grandparents. Prices have gone up four times faster than wages, and real incomes are falling. New Zealand has had its first credit rating downgrade in 13 years, the first since the last time Mr English was finance Minister. It is amongst the lowest-performing economies in the OECD, under National, right down there with Greece. In fact it is 29th out of 34, just below Greece on the rankings. There are 50,000 more people on benefits, costing over $1 billion a year extra. The number of children living in benefit-dependent households has increased by over 32,000. The median income has gone down $82 a week under National—$82 a week worse off in real terms, after inflation, under National. I do not call that a brighter future. My family
would not call that a brighter future. Ordinary New Zealanders do not call that a brighter future. It is a bleaker future.
National has failed to grow the economy. The mantra that the crucial thing is to cut government reveals the fatal flaw in National’s approach. It thinks its job is to balance the Government’s books. Its job is to balance the country’s books. Its job is to help New Zealanders live better lives through a prosperous economy, decent work, and decent incomes. It is not primarily to balance the Government’s books, which, at best—although we would do it too—is a means to an end. That is why the country’s economy has grown less than 1 percent since John Key took office—less than 1 percent in nearly 4 years. In the last year we have seen the magic disappearing $2 billion. National campaigned on a $1.5 billion surplus by 2015, yet in the last week we have found out that it is going to be a $640 million deficit. That is $2 billion gone in just 6 months. The reality is that you cannot cut services or people fast enough to race down that hill as fast as that budget is disappearing, because austerity economics does not work.
Look, I was fascinated to read through
The Economist magazine and find an article on growth. “There is an alternative to austerity”,
says. When you read that in
The Economist, and you have got this Government presiding over a $2 billion Budget hole in 6 months, you know something is wrong. You know something is deeply, deeply wrong, and here is the reason it is wrong: you cannot cut and sell your way out of a hole. A zero Budget means failure, because you have got no other alternative. A zero Budget is occurring because the Government has lost $2 billion in the last 6 months.
It gets worse. Nick Smith said: “Where’s the money coming from?”. That is a fair enough question. Here is where it is not coming from. It is not coming from that $2 billion the Government just lost. It is not coming from the $200 million of ticket clippers’ fees from selling the assets our parents built up. That is where it is not coming from. It should not be coming from flogging the family silver. That is like selling your house to pay the mortgage, and then renting a more expensive one. Sell your house to pay the mortgage, and then rent for more than you were paying. Is that not brilliant? Brilliant! That is why Bill English is not Prime Minister. He got 2 percent last time. Soufflé does not rise twice for Bill English, does it?
I tell you where else it is not coming from: it does not come from selling our land. This Government thinks it can milk the cows to prosperity, but at the same time it is selling off the land the cows are milking from. Go figure—go figure. It is about value, not volume. It is about smarts, not grass. It is about the future, not the past. Of course the dairy industry is important, but—hello—dairy prices fell 2.5 percent yesterday. We have too many cows in one basket. If we want to have a vital, growing, high-value economy, we need to do what the ratings agencies have told us. Moody’s, Fitch Ratings, and Standard and Poor’s agree that New Zealand has an under-diversified economy and too much private debt. National’s answer? Reduce the diversity and increase private debt even more! Ridiculous! And why is it always the small household that pays? Why does the ordinary Kiwi pay, through fewer services and more GST, to make up the $2 billion hole National just caused and the $200 million of asset-stripping ticket clippers it is funding? I would love to see when the kickbacks are revealed from that lot. This is crony capitalism at its very worst.
The legion of dishonour is growing by the week—Banks-Dotcom, Skycity. We almost do not even need to explain, because the public understands. Look at those members looking at their feet—looking at their feet. Here is the country struggling, here are New Zealanders trying to make ends meet, and there is National doing sweet deals for the big end of town, and breaching good process. That is why that radical socialist Colin James said on TV that businesses are asking themselves whether the rules of the
road have changed. Do you have to do a private deal with John Key rather than rely on a Ministry of Economic Development Budget process? MediaWorks and Ministers doing fee remissions for companies they used to personally own. Appointing the Prime Minister’s personal electoral chairman to the board of the broadcasting funder. Selling the telecommunications law to fund a process National did not have the gumption to write for itself. The league of dishonour goes on and on.
To conclude, a zero Budget is what you get when your economy is failing. It is what you have instead of a real plan for growth and jobs.
DAVID BENNETT (National—Hamilton East)
: That was the probably the best speech we have heard from that member, David Cunliffe; it is a shame no one was listening to it. He has had his time and the Labour Party has moved on. But when he talks about a zero Budget, I think that gives you a pretty good indication of Labour economic policy. It does not want to balance the New Zealand Government’s Budget; it wants to borrow more. If you borrow more, you have to pay it back—
The ASSISTANT SPEAKER (H V Ross Robertson): Order!
DAVID BENNETT: —and if the country has to pay that money back, how are we going to do it? The Labour Party will not give its plan for repayment, apart from taxation increases. If you increase taxes, that hurts the economy more. So you are going to borrow more, then you are going to hurt economic growth by increasing taxes. That will put this economy into a free fall. It will fall down and spiral out of control, and that great economic plan that the Labour Party is now talking about will not work. It has not worked in other countries, and it will not work here. You cannot go out there and just borrow for the sake of it any more. As a country, we need to be responsible, and we need to look forward and promote a growing economy.
One of the other things Mr Cunliffe talked about is having a prosperous economy. We hear this rhetoric from the Labour Party all the time. Labour members talk about growing an economy, and having a more productive sector. When Labour was in power it did the opposite. Labour members say the right things in this House now but when they had the chance, they killed the productive economy of New Zealand. The productive economy of New Zealand knows that if it ever gave that party a chance again, it would get killed again, because the Labour Party does not even understand what a productive economy is, it does not understand how to promote a productive economy, and its rhetoric, its vision, actually hurts a productive economy. If you do not have a country that produces, then there is not that growth and there is not that Government revenue that you need.
This is a very difficult time for New Zealand and the rest of the world. We have been through a major recession. It is a very fragile economic environment out there, in the modern world. On top of that, New Zealand has had to deal with an earthquake in Christchurch of a magnitude that is beyond anyone’s comprehension. Those two factors have meant that you need disciplined expenditure from the Government, you need a Government with a firm hand—
The ASSISTANT SPEAKER (H V Ross Robertson): Order! I have been very tolerant of the member’s use of the word “you”, and I would suggest that the member look at Speaker’s ruling 27/5(1) and (2). When the member uses the word “you”, he brings the Speaker into the debate.
DAVID BENNETT: We have had a firm hand with economic management but in a fair way. The horses have not been scared in New Zealand. People have known that there is strong Government backup in our community and through our social spending, but at the same time the Government has invested in the infrastructure of this country going forward. It has been a balanced approach that looks forward to economic growth in the future, delivers that certainty for people in New Zealand currently, and provides
the basis for a strong economy going forward. That is real economic leadership. It is not talking about things that may happen or could happen, or saying—through some crystal ball—it will all work out fine. It is about providing real and substantial leadership now, and that is what this Budget, and this Budget Policy Statement, is about. It is providing that real leadership.
The real leadership requires us to get back into surplus. The days of borrowing and hoping are gone. No modern economy around the world can continue down that path. If anything, we need to be making money, not borrowing money. And to get into the situation of making money you have, first, to get into a situation of breaking even—that is, where you are not spending more than you are earning. That is the challenge for New Zealand: to make sure that this Government and this country does not spend more than it earns. It is a challenge that is lost on our Opposition. Our Opposition wants to go out there and say that you can borrow for that extra expenditure and you don’t have to worry about it. Well, we do have to worry about it, because that money has to be repaid at some point in time.
So what is this Government doing to try to balance the books to make sure that New Zealand has a pathway going forward? First, we are responsibly managing the Government’s finances. We are building a more productive and competitive economy, we are delivering better public services within the constraints that we now face, and we are rebuilding Christchurch. Those are the key elements of Budget 2012. They are the key elements that New Zealanders are looking for in their Government. New Zealanders know the pain that Governments and countries around the world are going through, because they have experienced that themselves in their own personal circumstances over the last few years. Job security, their willingness to pay down the mortgage on their property investments, and the need to have some money put aside for a rainy day are the things that New Zealanders are looking for. The modern economic reality is not one based on consumption but rather on saving and investment, and you are seeing that through New Zealanders’ choices in how they use their money. New Zealanders expect that from their Government as well. They do not expect to see a Government that borrows and spends. They want to see—
Grant Robertson: That’s what this Government does.
DAVID BENNETT: —a Government that takes account of its money. The Labour Party is saying that that is what this Government is doing. That is not the case. We are getting to the stage of a zero Budget—something that the Labour Party’s past speakers said they do not want to see achieved. The Labour Party does not want that zero Budget; it is keen to just carry on borrowing to get through. There will be some borrowing this year, and there will be some borrowing next year, because we have got a major deficit because there are policies that have been set up by previous Governments that are not economic-friendly, but we have to carry on. There is also the rebuild of Christchurch and the slowing of the economy through a recession that the world has faced. But at this time New Zealand is in one of the most favoured positions for a Western country. Compare our economy with that of many of the European countries, and the real world will hit home. We do not live in an economic, academic bubble, which the Labour Party would want us to be in. We have a real world out there where there is a world recession and where there was an earthquake in Christchurch, and it needs a constructive and well-managed Government to get through.
Hon Trevor Mallard: Next page.
DAVID BENNETT: Well, it is the next page, because we have got a plan, unlike the Labour Party. When you look at the economic outlook for New Zealand going forward, the last speaker, David Cunliffe, talked about growth rates in New Zealand and said that they were small. Well, they are small, but they are better than what we inherited. When
the National Party came into Government, this country was in recession—a recession before the rest of the world, led by poor economic management from the previous administration. That state of recession in the New Zealand economy has been turned round. We have low growth rates, but we have growth rates. If you took on the Labour Party policy of borrowing more, then the growth rates would be even lower and we would be back in recession, like that previous Government made this country go into recession.
At the same time, we have managed to deliver the social spending that New Zealanders expect from their Government, and the New Zealand economy has been able to rebuild in a way in which it can take on the rest of the world. The world has changed. It is no longer an economic bubble where you can just go out there, borrow money, and think that things will be fine. There needs to be a constructive and well-managed plan—a plan that this Government is delivering—and we look forward to seeing more in the Budget coming ahead. Thank you.
The ASSISTANT SPEAKER (H V Ross Robertson): Just before I call the next member, it is a split call, so the member will get a warning bell with 1 minute to go.
Dr DAVID CLARK (Labour—Dunedin North)
: I rise to comment on a few of the things said by the previous speaker, David Bennett. He was trying to encourage us to believe that this current Government has a credible plan for growth. Well, the evidence does not really support that. Under the last Labour Government the economy grew by 25 percent in real terms. This Government has actually shrunk the economy in real terms on a per capita basis. People have less money in their pockets, and they have more that they need to spend it on. Our economy is going backwards under this Government.
The Budget Policy Statement, which we are debating, contains a statement that would maybe lead people to believe that the mixed-ownership model that the Government is proposing—otherwise known as asset sales—is a sensible way forward. Today I sat in a Finance and Expenditure Committee meeting and heard again from people who thought that was a terrible idea—simply a terrible idea. Today we heard another 20-odd people, and every last one of them thought that this was a stupid plan. Treasury’s figures suggest that the Government will go backwards by $94 million per year when these assets are sold off—$94 million per year. We as a country—us taxpayers—will be worse off from the loss of dividends, which means that we have less income as a result.
This is not a plan—this not a plan—but it is what we have come to expect from the current Government. It is desperate sweet sugar hits and quick fixes but not a long-term plan. Previous speakers have said it, and it is true: a zero Budget is what you get when your economy is failing. Mr Speaker, I do not mean you, of course. But it is what we have, and what we have to put up with when our economy is failing.
Today we heard from various people at that select committee who opposed this measure proposed in the Budget Policy Statement. We had people phoning in from Norway to express their discontent at this proposal—Kiwis overseas worried about what they will find when they come home. We had a first-time submitter with a broken arm, an elderly woman, who walked through bad weather to come and tell us how bad this proposal was that is in the Budget Policy Statement. We had the
Citizens’ Select Committee come and present to us, representing 412 people. They had not been heard by their member of Parliament, who refused to hear their submission that this asset sales proposal is a dog. They had been refused an audience by Peter Dunne to even hear their views on the asset sales proposal. The one man whom we know did not campaign for this proposal—in fact, many of the things he said would have led us to believe he stood against it—and now he is standing there, currently supporting the Government’s
proposal to sell assets. It is the very same proposal that Treasury tells us will take our economy backwards by $94 million per year.
We have also heard in the debate from Mr Hayes, who was trying to argue that one of New Zealand First’s proposals was too costly. He shed some crocodile tears. Well, this morning in the select committee he described as “petty cash” the $100 million or so that we suspect that Treasury’s mishandling of the Crown Retail Deposit Guarantee Scheme has cost. That is how we know those were crocodile tears. He described that $100 million that was potentially lost as “petty cash”.
We have heard from speakers who lack credibility, but they contrast with the members of the public whom we heard at the select committee. We heard from Mr Les Howard, representing Grey Power in
Temuka, who said: “There is no doubt in our minds; people will die from cold because of this bill.” He was worried about rising power prices as a result of these asset sales. Mr Les Howard was representing the people of Grey Power. We heard him, and we understood what he meant. The National members who sat opposite were not happy with the submissions they received on the asset sales. They look uncomfortable, they look like they are defending the indefensible, and they do not want to do it. It is in the
Budget Policy Statement. It makes no sense, and I submit that it is not the only thing in the Budget Policy Statement that will take our country backwards. Thank you.
Dr KENNEDY GRAHAM (Green)
: My colleague Russel Norman earlier dissected this Government’s Budget Policy Statement 2012 in a constructively merciless way. But
The quality of mercy is not strain’d,
It droppeth as the gentle rain from heaven
Upon the place beneath:
That place is not the Treasury benches of Her Majesty’s New Zealand Government; it is, more naturally, the voting public—they who are being denied their rightful place in the global economy. Mercy, we are told, is “twice bless’d; It blesseth him that gives and him that takes:”. I do not think it will bless a Government that takes from the poor and gives to the rich, as this Government has done with its misguided tax cuts over the next few years. Mercy, we learn
’Tis mightiest in the mightiest: it becomes
The throned monarch better than his crown;
His sceptre shows the force of temporal power,
The attribute to awe and majesty,
Wherein doth sit the dread and fear of kings;
But down here, with our feet pointing towards Stratford-upon-Avon, the electoral crown is slipping. The sceptre is falling from the executive grasp, and that is because of the absence of mercy in the budgetary policy of this Government. It is because of the lack of vision among its strategic planners, who fail to see the structural distortions in our national economy and the resulting imbalances between it and the global economy.
But mercy is above this sceptred sway,
It is enthroned in the hearts of kings,
It is an attribute to God himself,
And earthly power doth then show likest God’s
When mercy seasons justice.
If ever this Government deserves a seasoned admonition it is today, when its Budget Policy Statement is up for judgment. There have been 3 months of global developments to shade the strategic economic canvas, 3 months of continuing political ineptitude to darken the domestic stage. But it is not only a lack of economic justice and a plea for
political mercy that characterises this Government’s current misfortune. It is, above all, as I said yesterday, an ideological conviction met only by political rigidity and a cautious disposition that will bedevil our future.
The Key Government endlessly repeats the mantra of innovation, creativity, and entrepreneurship, and then cuts the Budget that could underwrite these qualities for our next generation. This is manifest in its wilful blindness to the issue of macroeconomic concepts—how to measure, for example, our economic well-being. According to the Government, only by GDP. It is obsessed with economic growth, to the point of mania. From the Speech from the Throne of December 2008 to this Budget Policy Statement, we have heard that the Government’s overriding objective is economic growth so that Kiwis can have a brighter future, prosperity, jobs, education, and health, and we shall balance economic opportunity with environmental responsibility as we go. But that excludes the broader notion of societal well-being. All around the world, in Bhutan, Canada, and Norway, through the OECD and the UN, work is under way to broaden the measure of economic performance to encompass societal well-being.
In New Zealand our statistics and environment departments have been working with other countries to develop indicators of sustainable development. That was the result of some public funding back in June 2000, initiated by the Green Party. That work was professionally done. We now have a report of 2009, identifying indicators of environmental and social criteria. These would broaden the performance indicators of a country along the lines that experts have been calling for since the Earth Summit back in 1992.
I have submitted into the ballot a member’s bill that would amend the Public Finance Act to broaden the indicators required in the Budget statement beyond the traditional ones of GDP, CPI, unemployment, and current account deficit. I call upon this Government to adopt the bill and incorporate it into its governmental legislative programme. If the Government were to do so, this strict court of national legislators might accept the deeds of mercy of which I have spoken thus, and mitigate the justice of the Government’s plea towards a different sentence from what was written into the annals of English literature some 500 years ago.
MAGGIE BARRY (National—North Shore)
: National of course has a plan, and it is the right plan for these very hard economic times. We are determined to build a more competitive economy that will grow and support real jobs, provide higher incomes, and assure New Zealanders that we are paying our way in the world and holding our own. Yes, the Budget that we deliver in about 3 weeks’ time will be a zero Budget—the second that we have delivered—and we are doing that not because we have any problem with our plan but because we have the courage, determination, and tenacity to take the hard decisions, unlike Labour, of course. In all of the good financial years—
Hon Trevor Mallard: I raise a point of order, Mr Speaker. It is a long-held Speaker’s ruling that one does not question the courage of individuals or parties in the House in the way that that member just did.
The ASSISTANT SPEAKER (H V Ross Robertson): Thank you. I have to say I missed that, but if the member referred to courage, that is out of order. I call the member to order, and to continue her speech.
MAGGIE BARRY: The lack of tenacity and determination that Labour showed in its 9 years in Government is something that New Zealand could not sustain. Let us look at Labour’s failed record. Spending like sailors, the Public Service grew into morbid obesity, and we are trying to bring that back under control. Cullen spent an extra $3 billion every year for the last 5 years Labour was in office. Flogging off State assets, of course, is something Labour knows a great deal about. Some of the people who are on the Opposition benches were not around in the 1980s, but, day after day, in my former
role in the media, they came into the studios and they talked about flogging off the family silver to pay for the groceries. They had to. They sneaked in a very broad-ranging plan that New Zealanders were not in any way expecting. They sold off everything, lock, stock, and barrel.
When we look at the mixed-ownership model, which we are doing very closely now, we have learnt from Labour’s mistakes. We are looking at prudent control of these assets. We will retain the 51 percent control. We will raise enough money so that we do not need to borrow to invest to keep our health and education at the world-class standard that it is now. We will be open about it, and that is why we signalled it nearly a year out from the election. We do have a mandate. The people of New Zealand knew what we were doing, and they continue to support what we will enact.
As far as our policies and reforms are concerned, let us look at some of the things that will be coming up in the next 3 weeks. We heard today, in response to a question I asked of the Minister of Finance in the House about the intention to strengthen the Public Finance Act 1989, that it is going to be looking at limiting spending. This is something, of course, that the people on the other side of the House do not know a great deal about, but it is about a cap on spending and about transparency, so that when a Government is thinking of spending like sailors, increasing taxes, and so forth, there will be restrictions on that. We are going to move away from excessive public spending. This Government has a determination to do that.
The Opposition claims that our economy is going backwards. Let us look at this in an international context. The UK is back in recession. We had the collapse of the Dutch economy. If we followed the failed policies of the people on the other side of the House we would continue to borrow, we would continue to spiral downwards into debt, and we would continue to fund things that we really cannot afford. Paid parental leave—well, it is a pretty good sort of an idea on some levels if you are completely flush, but we are not, and it is not the sort of policy that we would ever support. We need to grow the economy. We need to also look at ways of restricting the amount of spending that we are putting on things.
The Prime Minister signalled the other day that we were going to do some fine-tuning over student loans in our Budget. We remain, of course, absolutely committed to keeping them free, but we are determined to reduce the cost of the overall loan scheme to the taxpayer. This is the prudent thing to do. The scheme is very large. Not that long ago the Government was effectively writing off some 49c of every dollar that was lent. With previous changes we have made we have brought that back down to 45c, and we intend to get it a bit closer to 40c in the future by continuing to chase the overseas borrowers, the people who have left the country and who perhaps think they have left their responsibilities behind. If we give them the benefit of the doubt, it may be that they feel that they are away and they will get to it in due course. But in the meantime the country has an enormous debt around us that needs to be addressed. So we will get it closer to the 40c, and there needs to be faster repayment of those loans. Ultimately, of course, it is so much better for the person who has borrowed the money. They are getting rid of that monkey on their back earlier than they perhaps thought they would. Younger people perhaps tend to think they can put things off for ever and a day, but that is not the case. By speeding up, for example, the process of repayment—not to an unaffordable level but to something that has more momentum than it does currently with many of the borrowers—that is going to be an excellent thing for the New Zealand economy.
This Government is about personal responsibility and about people stepping up to the plate and saying: “Yes, I borrowed. Yes, I’ll pay it back. I have an individual choice and I will exercise it, but I will deliver on what I say I will do.” There is no sense for me to
see people going overseas and not actually continuing to pay back their debts. I think that it is very important that we all take responsibility for these things—the cradle-to-grave dependency and the constant handouts that not everyone needs, actually. This Government is focused on putting the money where it needs to be focused. We target it to those in need. We give them the hand up and not the handout.
Hon Trevor Mallard: That line was tired in the 1980s. It was tired in the 1980s.
MAGGIE BARRY: These are things that are philosophically not terribly much in keeping with some of the rowdier brayers on the other side of the House, but I would have to say that we have a plan. It is the right one, and that is why we were elected and others were not, I assume. The people of New Zealand are not silly. They recognise that the failed policies of 9 years of Labour did them no good. They bear with us in the hard decisions that have to be made, because they know that we have to get back on track. Who can afford to run their houses in the way that Labour used to run the country? If you have not got the money, you do not spend it. You do not keep borrowing everything up to the max. People do not keep borrowing up to the max—not you, Mr Assistant Speaker, of course. I am sure that you are fiscally prudent in all ways, as I would wish that all New Zealanders were, because that effectively is what we are asking people to do: to be more prudent and to accept that there has been overspending and that there has been an amount of money allocated to things that actually does not need to be there. So we do need to tighten up. We are doing that in the Public Service, and we are doing that in a raft of other measures.
I think that with Budget 2012 this Government is going to signal very strongly to the voters of New Zealand that we are determined to get the books back on target and in surplus. I think a zero Budget is an act of courage. I remember back to the days when people feared the Budget. They would go out and fill up their cars and buy their beer and baccy, if they were their poisons, and they would brace themselves for a Budget that was going to sting them. Ours is going to be a Budget that will be fair but will also continue the message that we have been sending since the start of the campaign: that we actually do need to watch what we are spending.
When we look at campaigning and we look at the solutions, there has been a paucity and a scarcity of them coming from the Opposition benches. What exactly is Labour’s plan? OK, taking GST off vegetables and fruit. That will get dropped. It was not a particularly vote-winning idea. There was $5,000 tax free—the first $5,000—is that gone yet? It was never really going to fly anyway, was it? These are the sorts of things that are not going to serve anyone well. When the capital gains tax, if I recall correctly, was announced on the campaign trail, Labour’s popularity went down by about six points overnight. It was not popular with its own people. It was not something that we would have brought in.
New Zealanders, as I said, are too smart to fall for these tricks. They know that we are in trouble. They know that the world economies are in trouble, and that we do not want to end up in a situation where we are defaulting. We do not want to lose the standard of living that we have, and we do not want to see our young people leaving in droves. We need to make this a strong, focused economy that will keep our young people here, that will grow jobs, and that will use smarter measures to actually do what we need to do.
I am a member of the Bluegreens group, the National advisory group on conservation and environmental matters, and I am someone who has a lifelong passion for flora and fauna in this country. They need protecting. We have not got much money at the moment, so what do we do? Do we shelve all of our conservation projects? Indeed not. What we do is we look for smarter ways to fund important projects. A couple of days ago the new tourism conservation partnership was announced. What a fantastic idea.
Kate Wilkinson has negotiated a deal with Air New Zealand so that the two will work together to promote our flora and fauna. We will, under the Air New Zealand arrangement, be able to fly our endangered species to new breeding sites around the country and to invest directly in conservation programmes along the Great Walks. These are great things to do. Tourism and conservation, they go hand in hand.
This country, absolutely, is defined by its land and its people, but we need to look at the things that have been successful. They have not cost money. We did not borrow millions of dollars from offshore, as others have done and would continue to do. We are approaching businesses and asking them to help out with the kākāpō, for example. We have got the aluminium smelters and the Royal Forest and Bird Protection Society all involved in that. People are working collectively, in partnerships, to get the best outcome. There is the Million Dollar Mouse campaign, as it is known. We have a big-business man—Gareth Morgan—joining forces with the Department of Conservation and trying to get to the point where we are saving an endangered species. These are the sorts of initiatives, thinking smarter, that this Government is doing and is very proud to do, and I am very proud to be part of it. I am proud of the policies that we put forward, and I am looking forward to the Budget in 3 weeks’ time. Thank you.
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 2012.
||New Zealand National 59; Māori Party 3; ACT New Zealand 1; United Future 1.
||New Zealand Labour 34; Green Party 14; New Zealand First 8; Mana 1.
|Motion agreed to.
Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill
Hon JUDITH COLLINS (Minister of Justice)
: I move,
That the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill be now read a first time. I nominate the Justice and Electoral Committee to consider the bill. At the appropriate time I intend to move that the committee reports back to the House finally on or before 11 June 2012 and 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 on which there has been a sitting of the House, and on a Friday in a week in which there has been a sitting of the House, and outside the Wellington area during a sitting of the House, despite Standing Orders 188, 190(a), and 191(1)(b) and (c).
The Prisoners’ and Victims’ Claims Act 2005, passed by the previous Labour Government, ensures that awards of financial compensation are made to prisoners only in extraordinary circumstances where no other remedy is deemed appropriate. Prisoners are required to make use of the many existing complaint mechanisms that are available to them, before they seek compensation through the courts. The financial compensation must be awarded. The Act requires that deductions are made first by the Secretary for Justice to pay legal aid debts, reparation, and earlier orders in favour of victims. The Act then allows victims of the prisoner to claim against the money through a simplified victims’ claims process.
The Act contains two sunset clauses that are due to take effect on 1 July 2012. Sunset clauses are effectively expiry dates for the Act. The first sunset clause provides for the expiry of the restrictions on awards of compensation. The second provides a cut-off date
for compensation awarded to prisoners to be subject to the deductions and victims’ claims process. This bill extends the application of the Act for 1 year. The sunset clauses are amended so that they will now take effect on 1 July 2013.
The bill will bridge the gap between the expiry of the current Act and progressing the Government’s policy to redirect prisoner compensation to fund services for victims. The Government’s policy to redirect compensation requires any prisoner compensation remaining after the victims’ claim process is used to fund services and programmes for victims of crime. The existing victims’ claim process will also be made permanent. Legislation to make the Act permanent and to implement the Government’s redirection policy is currently before Parliament. However, there is insufficient time for that legislation to pass through its stages before the imminent expiry of the current regime on 30 June. I also believe that it is important for that redirection bill to be fully considered by a select committee before it is passed. It is important that there is adequate time for all members of the public who want to, to have their say, and for as much cross-party support as possible, and I intend to fully consult with other parties in Parliament as to how that might happen.
If the current Act expires before the redirection bill comes into effect a window of opportunity will be created. It would mean that the restrictions on awards of compensation, the deductions, and the simplified victims’ claims process do not apply to any prisoners’ claims that are lodged. There would be a clear incentive for potential claimants to file their claims during this window to try to defeat the purpose of the current regime and the future redirection regime. The new bill will prevent the unfair window of opportunity from occurring that would disadvantage victims of crime.
To ensure the status quo and the laws governing prisoner compensation it is important that this bill be considered promptly by a select committee and reported back to this House by 11 June 2012 so that it can be in effect by 30 June. The new bill maintains the status quo until we implement our redirection policy later this year. It will ensure that the current restrictions on awards and deductions continue. It will also ensure that victims continue to have access to any financial compensation awarded to prisoners. I commend this bill to the House.
CHARLES CHAUVEL (Labour)
: I am going to take a short call on the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill to respond to what the Minister of Justice has just told the House. The first thing that it is important to say is that the substantive legislation responded to at least a perceived need at the time. But clearly it was an experimental piece of legislation, and if the House needs any evidence for that, in addition to the speeches that were given at the time concerning what is now the Prisoners’ and Victims’ Claims Act, then it simply needs to look at the fact that a sunset clause was applied to that legislation. Clearly the House’s intention was that there would be a review of whether or not the substantive Act had merit, and whether or not it was required to continue past the date of the sunset clause, either in full or with modification, based on experience with the legislation.
Well, it is instructive to look at experience with the legislation. There is a special procedure set out under the Act for victims’ claims in the particular context that this Act deals with. In response to a written question from me, the Minister’s office has indicated that that procedure has been invoked precisely one time—on one occasion since the Act came into force. So it has to be said that the case for the Act has proved to be, despite the apparent need at the time for some sort of measure, somewhat questionable.
I have some sympathy for the position that the Minister is in. Clearly, because there was a sunset clause expressed in the principal Act, it was intended that there should be a review of the Act prior to us getting anywhere near the date that the sunset clause would
be triggered, but no review was commissioned by the Government. And I think that I do not need to say anything about what that says about the record of the Minister’s predecessor and his conduct of the portfolio—we are where we are. The review was not commenced and now the sunset clause is about to take effect.
So the question is what ought Parliament to do. There are a couple of alternatives. We could allow the Act to expire and review the situation to which it applies, consider whether or not special legislation is required and apply it, or simply allow the Act to fall into abeyance. Or we could do what the Minister proposes, which is to extend the existing legislation for a period of time and allow the review that should have been commissioned a good year or so ago to now occur.
The Minister has consulted me. She has given me some assurances in writing about the short period of time for which there will be an extension of the legislation. And I have said to her that I agree that the position is such that we ought to allow the legislation to remain in force for a short period of time—that is, another year—and during the course of that year we ought to conduct the review that should have been conducted. That is what I propose. Certainly, members on this side of the House will support that as a course of action.
I am concerned that the Minister feels that it is necessary for this particular piece of procedural legislation to be referred to the Justice and Electoral Committee for a very, very short period of time, and for leave to be sought from the House for the committee to meet at all times except during question time. The committee is capable, I think, of managing its own business without that sort of leave from the House. I see that the chair of the committee is here and I will be interested in his views later in the debate.
But, given that at least the principal Opposition party has signalled to the Government that we will cooperate in respect of this matter, those sorts of expediting resolutions, which, as we know, can be applied in a heavy-handed way and circumvent the freedom of our committee system to conduct itself in the way that it should, are undesirable. I am disappointed that, although the Minister was prepared to consult about a number of issues, she did not see fit to disclose that it was her intention to have the committee directed by the House in the way that she has.
So that is really all I want to say about this legislation. There needs to be a review. That was always the intention of the original Act. It is an indictment on the Government that, notwithstanding it has been in office for over 3 years, the review was not conducted. But it does need to happen now and we will facilitate participation in that review. We think it is an important exercise and we think that it is important to listen to all sides of the debate as to the question of what ought to, if anything, replace the prisoners’ and victims’ claims legislation. Thank you.
TIM MACINDOE (National—Hamilton West)
: The chairman of the Justice and Electoral Committee is indeed in the House and is delighted to accept Mr Chauvel’s invitation to follow him in this debate. In fact, that seems to be my standard practice. I cannot think of many times when I do not follow Mr Chauvel.
Could I just crave the indulgence of the House for one moment—
Hon Trevor Mallard: Would the member care to rephrase that?
TIM MACINDOE: —no, I am going to move right along—to acknowledge the outstanding Shakespearean performance of Kennedy Graham in the previous debate. It was wonderful to have “Shylock” speaking in the Budget Policy Statement debate, but I find now that I follow “Hamlet” in this particular debate, as he has agonised over the Labour Party’s position on this particular bill that is before the House. The particular bill, the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill, is of course an interim measure and we must not forget that.
National is firmly committed to building a safer New Zealand, and I do want to repeat that because it is an absolutely core priority for our Government. This bill is part of a large measure, a large arsenal of initiatives, to improve public safety and respect for law and order and, indeed, for the rule of law in this country. We are committed to improving the rights of victims and the support that is offered to them, and so we should, for no one chooses to be a victim or to become caught up in our criminal justice system because of the offending of others. So I do look forward to the cooperation of members opposite, as has just been indicated by Mr Chauvel. I appreciate that indication of support, and I look forward to working with him to facilitate the passage of this bill through the business agenda of the Justice and Electoral Committee.
The bill’s purpose is to amend the Prisoners’ and Victims’ Claims Act 2005 to extend the restrictions on the awarding of compensation for 1 more year, from 1 July of this year until 30 June 2013, and to ensure that “the victims’ claims process … applies to compensation awarded, or to be paid pursuant to an out-of-court final settlement, in respect of a prisoner’s claim made on or after 1 July [of this year] but before 1 July 2013.” So, as I have said, it is an interim measure, but it is no less important for that. We are, on this side of the House, directing prisoner compensation to victims to put victims at the heart of our criminal justice system.
Victims have to deal with the financial, emotional, and physical effects of crime long after it has been committed. As I mentioned when I spoke in the financial review debate yesterday, this is something that no one chooses—to be in the position of having to endure yet again everything that they suffered as a result of the offending of someone else, often in the most gruesome of circumstances. So we are ensuring that victims are heard, that they get the support that they need, and that they are not brutalised again when the defendants who subjected them to such cruelty are tried. We are making sure that victims get better information and protection when offenders are released back into the community, and how often have we all heard claims of absolute despair and disgust when that principle has not been followed.
At the same time we are modernising court processes to make the justice system safer and more efficient. We are speeding up court cases, reforming legal aid, and improving civil justice. All of these are important initiatives that the public has been calling out for for a long time. We are absolutely convinced that not only do we enjoy a very strong mandate to move in this direction but also the public is demanding it of us. We have got to ensure that we meet those demands, and we are.
We established a victim compensation scheme that imposed, among other things, a $50 offender levy on all offenders, regardless of the crime they commit. We did that in the face of considerable opposition from members opposite. Yet the levy has already, in its first year, collected more than twice the expected target of $2 million. In its first year we paid out, through this levy, $1.64 million in services and entitlements for victims of crime and their families.
The levy has funded 13 different services for victims of serious crime. These services include funeral grants for families of murder victims; increased grants for travel and accommodation and child care assistance for people who are having to go through the justice system; access for sexual violence victims to a trained adviser who has knowledge of the dynamics of sexual violence cases—and these victims need ongoing support, great sensitivity, and understanding—expanded financial help of up to $1,000 for victims attending case-related hearings; and new financial assistance and counselling for those whose family members have been killed through a criminal act that is not homicide, such as dangerous driving causing death. So there is a whole range of initiatives that are very important.
We inherited a criminal justice system that was falling into some disarray. It was lacking accountability, particularly to those who were victims, and it lacked that focus on the needs of victims. So I am very proud to be part of a Government that has delivered, and continues to deliver. I commend this interim measure to the House, as we continue to strengthen our justice system and give it the priorities that all New Zealanders require it to have.
Hon LIANNE DALZIEL (Labour—Christchurch East)
: I too rise to make a contribution to the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill. My contribution to this debate is probably not on the detail of the legislation, but rather to comment on the regulatory impact statement and how that might impact on our consideration of this at the select committee. The regulatory impact statement was prepared at relatively short notice, according to its cover note. The cover note is dated 28 March 2012, which is actually not very long ago, and I am a little bit concerned about how short a period of time was allowed for this to happen. The comment that is made in the agency disclosure statement states the following: “The Prisoners’ and Victims’ Claims (Redirecting Prisoner Compensation) Amendment Bill was introduced in Parliament on 13 October 2011 to give effect to the redirection policy, but did not receive a first reading. There is now insufficient time to progress it through its Parliamentary stages before the sunset clauses take effect on 1 July 2012. Due to this, the Ministry of Justice was asked to urgently consider alternative options to maintain the existing provisions of the PVC Act until the redirection policy can be given effect at a later date.”
Of course, the regulatory impact statement does, within its content, refer to defining the problem in terms of how the status quo impacts on the problem definition. I guess the paragraph that I have just read out highlights exactly the problem that the Government is faced with. This is legislation that had sunset provisions built into it, which have now been breached twice. So there have been two amendments to those sunset provisions and one other. I think the debate that I would perhaps like us to have—in another context, and probably across party lines—is about how we best achieve what I think we are trying to achieve on both sides of the House, which is the balance between certainty and the need for review of regulatory regimes.
I think that when the sunset provisions were originally written into the legislation, they may in fact have been too short, and perhaps that is explained by my colleague’s contribution about the almost experimental nature of the regime that was being introduced. But 2 years is a relatively short period of time for something to be implemented, reviewed, and analysed, and for a decision to be made about whether there should be a further extension of the principles that were established at the outset. I think that this is an important discussion that we should have at some stage, because we will continue to face the situation where we are having to extend the expiry date of legislation, or the implementation of sunset provisions, in a position of extremis really, where the deadline is looming and people have no real choice other than to agree to the extension.
That being said, I think that it is important that we deal with this legislation in a timely fashion. I did note within the agency disclosure statement that even though the exact numbers of existing and potential claims by prisoners for compensation were not stated in the regulatory impact statement—and I did notice that they were absent—the reason they are absent from the statement is that the information is defined as legally sensitive. I totally agree with that. I understand that, but would like to receive an assurance from the Government that that information will be made available in secret to members of the committee, because I think it would be useful for us to understand the context in which we are debating this. I note the Minister of Justice is nodding her head;
I think it is a matter she would be prepared to take on board and consider. And the reason I raise this is due to the statement in the regulatory impact analysis about the issue around potential behaviour management regime claimants. I guess it had not occurred to me until I read the statement that there were still people who had not lodged their claims as a result of that particular issue, which, of course, was the whole basis for the original legislation.
I think it would help us get a good understanding of some of the technical detail that we do need to understand, but I want to reiterate that I do understand why it is legally sensitive, and I feel that the solution to that would be to provide for secret evidence to the select committee, which would not then become part of the record in this House. I actually agree with the point that is made in the regulatory impact statement—that it is really important that those claims are resolved in the foreseeable future. They were the reason for the original legislation. And to find now that perhaps some of them still have not progressed and that perhaps people are waiting to see whether the regime will be less intrusive or less able to take away some of their outcomes and divert them to the needs of their victims would, I think, be a great shame indeed. And neither side of the House would want to see that as an outcome. So on that basis the Labour Opposition, as clearly articulated by my colleague Charles Chauvel, will be supporting the passage of this bill.
DAVID CLENDON (Green)
: Kia ora koutou. The first look at this bill, the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill, brought on a bit of a case of
Groundhog Day. This bill, to my count, is something like the fifth or sixth piece of legislation we have seen in recent years with the heading of “Prisoners’ and Victims’ ”, none of which, unfortunately, have really generated better outcomes than we might otherwise have had. We believe that this House is once again devoting its very expensive time and resource to what is essentially, and has been from day one, an ill-conceived piece of legislation. We are now seeking to extend the life of this legislation, despite the quantitative and qualitative evidence that it has done very little good over the intervening 7 or 8 years, and, in fact, has considerable potential to do harm.
The intention of the original piece of legislation was to compensate victims of crimes, to ensure that if the perpetrators of crime came upon a windfall or some return as a result of claims against the Crown, victims would be compensated. I would hazard a guess that the amount of money that has been returned to victims as a result of this legislation is significantly less than the cost associated with the initial primary legislation and the numerous amendments to it. It has been a hopelessly ineffective piece of legislation, and we think it ought to end now.
In the 2010 debate that brought us to this 2012 deadline—which, I remind the House, was conducted under urgency nearly 2 years ago—I asked the then Minister of Justice what actual sums of money had been returned to victims and how many people had directly benefited as a result of the legislation. To his credit, the Minister in the Committee stage gave us the answer and told us that a total of $25,000 had been awarded to victims as reparations. A total of four victims had received a total sum of $38,000 collectively. So, in fact, the first 5 years of this Act returned $65,000 in total—a drop in anybody’s bucket. It has not been effective. That is an extraordinarily small amount of money, and I suspect there has been very little added to it in the 18 months or 2 years just gone by.
The Minister, in her presentation of this bill, stressed the importance of getting this through the House quickly, and gave us, effectively, a deadline at the Justice and Electoral Committee of 11 June. She is concerned that otherwise a window will open that would presumably enable prisoners to enjoy the benefit of any reparations they
were paid. I remind the Minister that this bill really kicks in only if prisoners are abused while they are in the care and custody of the State. The easy way to ensure there are no further opportunities for prisoners to benefit, presumably, is to ensure that there is no abuse of prisoners while they are in the custody of the State.
The Greens opposed this legislation—the Prisoners’ and Victims’ Claims Bill, as it was then—prior to 2005 because we saw then it would lead to a reduction in the respect for human rights. We said at the time that it was likely to be ineffectual, and this is now proven to be the case. It had very few redeeming features at the time. We did support the bill. We were persuaded at the time to support the primary legislation that we are seeking to amend. We did that on a promise that there would be a major reassessment, a significant review, a complete overhaul of all legislation, and that some real attention would be paid to assuring victims’ rights and putting in place some structural procedures and elements that would ensure that people who suffer crime—the victims of crimes—are properly compensated and recognised. Sadly, that has not occurred over time; instead we are continuing to perpetuate this piece of legislation. That is a classic example of a Government—in fact, two Governments—pretending to do something, creating the illusion or artifice of doing something positive for victims, but, in fact, doing very little at all.
This is a very convoluted piece of primary legislation. Effectively, the Act denies prisoners the possibility of redress for wrongs done. The only way that victims of crime can benefit through this is if a prisoner or an inmate under the control of the State either has a windfall or, more likely, gets some recompense for their rights being abused. It is a very peculiar and very perverse model, and we would be better to simply remove it from the book. Let us have a little bit of confidence in the Department of Corrections in 2012 that it will not create situations that will enable prisoners to make claims of having been abused that a court would see merit in, and would enable them to have some reparation paid to them.
I recall the genesis of the primary legislation that this bill amends, and the so-called behaviour management regime that was occurring. Inmates were suffering abuse tantamount to torture under the so-called behaviour management regime at Mt Eden Prison. One concedes they were serious high-end offenders. They were not nice people, but the State nevertheless has an absolute responsibility to respect the basic human rights of people who are in custody—even offenders, even prisoners. They remain humans, they remain citizens of this country, and they are entitled to the protection of their human rights. At the time that the primary legislation was passed, a now departed member of this House, to his discredit, referred to payments made under legal claims against the behaviour management regime as effectively a golden handshake for inmates. That is so far from the truth. That set us on this very long-winded path, with multiple amendments, that has brought us to this situation now. This Act has not worked for victims. It has not worked for prisoners. We should simply let it fall, and, as I said, trust the Department of Corrections not to get it wrong.
There are so many things we could be doing to change the corrections regime: the way we deal with offenders, the way we deal with victims, the way we manage our prisons and our prisoners. There is currently a piece of legislation, the Corrections Amendment Bill, before this House that does have some positive features. It does propose some efficiencies in practice and some administrative tweaks to management, but also it unfortunately contains some major steps towards further abuse of human rights and further denials of basic human rights, and it will remove us even further from our national, our legal, and, indeed, our international obligations.
It is worth recalling that when the primary legislation was put in place, it was many of the non-governmental organisations—the organisations dedicated to protecting
human rights—that opposed the legislation, perhaps surprisingly. But they saw through it. They understood very well that what was called for was not some grandstanding piece of legislation that appeared to be producing some benefits and some results for victims, but a serious, ground-up, community-led, I would suggest, assessment of what is needed to do the best by the victims of crimes, and, indeed, to look at how best we can ensure that we reduce the number of victims of crime.
It is clear that over the past decade or more there was a struggle between the two main parties. There was a battle and neither was willing to concede an inch. There was this fear of being seen to be soft on crime, allegedly responding to a sense within New Zealand society that we wanted to punish people who offended. Actually, there is very little evidence that New Zealand is a punitive society. There were some TV polls done in 2006 that indicated a preference for community-based sentences. Colin James, who is not known as one of the more wide-eyed, radical, dumb commentators or journalists in New Zealand, commented recently that a number of organisations have perceived a much more broad-based interest in looking for alternatives to prison, looking for alternatives to incarceration, and looking for alternatives to the so-called tough on crime approach. Last night I was pleased to be at the launch of JustSpeak, a group of young people who are committed to doing better, to seeing improvements in our corrections regimes, particularly in our management of victims and our management of offenders.
We can do a great deal better than this. By perpetuating this bill for another 12 months, we are simply perpetuating a failed model, a flawed model—an approach that we know is incredibly expensive at a time when we are stretched financially. It has not worked, it will not work, and the Greens will continue to oppose it. Thank you.
Dr CAM CALDER (National)
: It is a great pleasure to rise and take a brief call on the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill. The title of this bill really sums up its purpose.
It was a great pleasure to me to be part of a Government elected in 2008 that has as one of its raisons d’être a concentration on allowing our communities to be safe places. We stress the importance of a citizen being able to live in a state of security, being safe in their community. Where I was campaigning, where I had my office based—Manurewa—we certainly have seen the fruits of that enlightened approach by this Government in the form of Policing Excellence programmes, neighbourhood policing teams, and public safety teams. Also, it has to be said that the crime rate has fallen, but there are still victims. The work that we are doing is to redeploy and refocus our system on the rights of victims. We are focusing the justice system on the rights of victims. We want less bureaucracy, less delay, and a greater focus on victims, and that is what this bill helps to bring about.
The Prisoners’ and Victims’ Claims Act 2005 restricts and guides awards of compensation sought by prisoners under the State’s control or supervision and provides a simplified process for the making and determination of claims that a victim of a prisoner may make against compensation required to be paid to that prisoner. The restrictions on the awarding of compensation expire, and, as we have heard from previous speakers, the victims’ claims process applies only to compensation in respect of claims made before 1 July of this year. This bill will defer that expiry and extend the application for 1 year, so that restrictions on awarding of compensation expire with the close of 30 June 2013. The victims’ claims process also applies to compensation awarded or to be paid pursuant to an out-of-court final settlement, in respect of a prisoner’s claim made on or after 1 July 2012 but before 1 July 2013. In other words, this bill bridges the gap ahead of us here.
It is a bill that focuses, again, relentlessly on supporting our victims. As we heard from our chairman of the Justice and Electoral Committee, there are a number of other
areas where we have achieved this end. We have established the victim compensation scheme, and the $50 offender levy on all offenders regardless of the crimes they commit. We supported victims through the Victims of Crime Reform Bill. We have more help for families affected by homicide and more help for sexual violence victims.
This bill is necessary to allow us to review the legislation before the House, as we heard from the Minister of Justice. I appreciate the collegial view of the Opposition in supporting this bill. I commend the bill to the House.
DENIS O’ROURKE (NZ First)
: I will be taking only a very brief call on the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill, on behalf of New Zealand First. I note that the restrictions on the awarding of compensation expire on 1 July 2012, and that this bill simply defers that expiry date to 30 June 2013. To that extent, New Zealand First will have no objection to the passage of this bill, and will support it proceeding. Indeed, as Lianne Dalziel said, we really have very little choice about the matter at this stage, in the circumstances.
So New Zealand First will await with interest the substantive legislation to be brought forward by the Government, which it says will make the existing victims’ claims process permanent. Of course, the devil will be in the detail, and we will look at the substantive legislation in detail when it comes through. I do wonder, as a new member, why there has been such a significant delay by the Government in carrying out this review. Is it because the Government is not really so interested in it, or is it just a low priority for the Government? However, I have listened to the speeches by the Government members, which indicate the opposite, and I hope that is the case.
New Zealand First will be happy to await the review and the new legislation, and to debate it then as though it was a completely new proposal. We will not be affected by the legislation that will expire, or by all the arguments that were made for and against that legislation. Consequently, New Zealand First reserves it position on the substantive bill, when it comes through, and we will be happy to consider the Government’s position.
New Zealand First is not soft on crime, and we will make sure that that is the case in the way that we look at this legislation. At the same time, I personally have some sympathy for the Green position. I too would like to investigate the possible alternatives to imprisonment for some of the people—but not the more serious criminals—we have in prison at the present time. I do think that in the 21st century we ought to have a greater menu of sentences for people who commit crime, and, hopefully, those sentences are much more oriented towards rehabilitation and the avoidance of more crime in the future.
Like the Green Party, New Zealand First will not be supporting any grandstanding on this issue. We hope that we will not hear charges as to who is soft on crime and who is strong on crime. That kind of mindless nonsense needs to be left in the past. As I said, this is the 21st century and being soft or strong on crime is not the issue. The issue is about reducing crime, and doing that requires an approach much more advanced and much more sophisticated than just throwing more and more people in prison and making provisions that are inappropriate.
So New Zealand First will want to make sure that this substantive legislation, when it comes through, is appropriate in restricting claims by prisoners, because there is a case for restricting that. On the other hand, prisoners can also be victims, and their rights must also be protected. So there is a balance to be had there. That is, I think, where the debate should be centred, and that is the way New Zealand First will be looking at it.
What I do not want to hear is what I have just heard from the Opposition benches, which is some mindless, idiotic comment, which will make no positive contribution to the debate whatsoever. So we will listen to good arguments and not those—
Hon Chester Borrows: It’s not the Opposition here.
DENIS O’ROURKE: —from the Government then. We will not listen to arguments from those people who are putting that sort of idea forward. That will not sway us, and I suggest will not sway the members of the public either.
We will be taking an objective approach to this. We will listen to both sides and we will look for that balance, which I spoke of, in the substantive legislation. For the time being we will support this bill, which simply defers the date to 2013.
Dr JACKIE BLUE (National)
: I am very pleased to rise to speak to the first reading of the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill. As has been alluded to before, crime affects everyone. It affects communities, it affects families, it affects society, it affects the economy, but, most of all, it affects the victims. That is why it is so important that this bill, as an interim measure, is passed through the House. The toll on victims and families is immeasurable. Victims did not ask to be a victim. They did not wake up that morning and think: “Right, I’m going to be a victim.” It is something that has happened, obviously without any premeditation on their part. They are blameless.
This bill will ensure that prisoners’ compensation will continue to be redirected to support victims over the next year or so, and will allow time for the 2011 bill—the Prisoners’ and Victims’ Claims (Redirecting Prisoner Compensation) Amendment Bill—to pass through the House. Of course, this Government will ensure that that bill is enacted before June 2013. It is important as an interim measure that we have the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill, and it is pleasing that all parties are supporting it at this stage.
We are, as a Government, serious about putting victims at the centre of the justice system. I am really, really proud of what the Government has actually done for victims, and will continue to do. We are determined to build a safer New Zealand for families, for individuals, and for communities. We have a comprehensive programme that we are implementing. In particular, the $50 levy that has been established for all offenders has been very successful in the first year alone. Over $2 million—twice what was expected—has been achieved in the first year. That money has been redirected to new services to support victims. That is what it is all about. More than 2,000 victims, or their families, have benefited from that levy in the first year. There are 13 new services, such as funeral grants for families of murder victims, grants to families of murder victims, more services for victims of sexual violence, expanded financial help for victims attending case-related meetings, and there is new financial assistance for counselling for families whose loved one has been killed not by homicide but by other criminal acts such as dangerous driving.
I am really particularly pleased that the Victims of Crime Reform Bill is before the Justice and Electoral Committee. In that bill more weighting will be given to victim impact statements. The current process, I understand, is that the victim has to ask permission of the judge to read out the victim impact statement. Surprisingly, sometimes that is declined. This bill will ensure that due weighting is given to that victim impact statement. And so it should be. The only limit will be time, but the victim can traverse any subject on how that crime has affected them at any particular level. I think that is an important change, and I am delighted that it is in that bill.
Importantly, there will be more help for victims of sexual violence. Almost 1,300 victims received a discretionary grant to cover immediate costs, and almost 540 victims were assisted by the sexual violence court support service. This is an important bill. It is an interim measure, and it is vital that it is passed. It is pleasing that it has the support of all parties. I commend it to the House.
Hon PHIL GOFF (Labour—Mt Roskill)
: The Labour Party certainly supports this bill, the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill, and can I welcome the measured way in which members have actually contributed to this bill, starting with the Minister of Justice and going through my own colleagues and other colleagues around the House.
I had a lot to do with the initial legislation, and it is important that the House knows why the legislation was initially put into effect. It followed a range of wrongful actions by the Department of Corrections that led, under longstanding New Zealand and international law, to those inmates who had been treated wrongfully getting compensation for the wrongful actions by the State against them. The difficulty with that is that the wrongful action should never have happened. The Department of Corrections was at fault, and the best way of dealing with this problem, of course, is not to have wrongful action against prisoners and, therefore, not to be awarding compensation. But mistakes were made, compensation was awarded, and the nature of many of the people who received compensation was that they actually had done some pretty awful things to other people. I felt, along with a lot of other New Zealanders and members in the House at the time, that if compensation should be given for the wrong done to the inmate in prison, then surely compensation should also be available for the wrong done by that inmate to that inmate’s victims. That was what motivated it. I mean, it was not about baying for blood, David Clendon, with respect; it was trying to address this problem. If you are going to give compensation to the inmate, surely the victims of that inmate are entitled to get their share of that compensation. That sounded right in justice terms to me.
I knew that this would be particularly hard to do, and for that reason, among others, we put a sunset clause into it: let us do this, let us do what we think is right, and let us see how it works. I think the most important comment today was made by my colleague Charles Chauvel, who said that it has been going for 6 years now and only one case has been taken. That suggests to me that our concerns at the beginning of the process that “We think we are doing the right thing, but is this going to be effective? Therefore, we need to review it.”—and there should have been a review. I regret the fact that that review did not take place in a timely way, but I understand now from the Minister that it will take place, and, therefore, it is sensible to continue this legislation until we find out a better way of addressing the problem.
But I said before that I was pleased about the measured way in which this debate was taking place. Let me quote from the debate in 2005: “The National Party in Opposition is opposed to the Prisoners’ and Victims’ Claims Bill. We believe that payments to prisoners should be blocked, stopped, and wiped out. We do not believe that New Zealand should be constrained by the figment of what the United Nations may or may not state in various conventions.” These were conventions that we had respected for 50 years under respective Governments. Who made that comment? Tony Ryall, now our Minister of Health. You know, I have just got to say that the current Minister in Government is taking a different attitude from the then National Opposition spokesperson when National was in Opposition.
I have got to welcome the comments from New Zealand First, from Denis O’Rourke, because this is what your predecessor said, Denis: “The result of the Labour Government’s legislation will be that scumbags, murderers, and vicious criminals on long-term sentences will harass and taunt prison officers purposely to such an extent that if there is even minor retaliation, they will be entitled to compensation.” That was just so much rubbish, and from time to time in this House, people do speak rubbish for the wrong reason. What I welcome today is that we will have a proper debate about this. We will review it. There is a sense of justice that if somebody who has harmed others
gets compensation, then that person’s victims should be entitled to compensation. I do not think anybody opposes that principle. The real question that we face in this review is how to find a way in which we can allow that just outcome to occur. It seems to me that if this legislation has been used so seldom, then such a review is necessary. So I welcome the fact that—I welcome the fact that I was told to speak for 2 minutes, and now I have been told to speak for 10!
The background to this, I think, is really important. We want a justice system that treats victims fairly. We want a corrections system where people who have committed even horrible crimes nevertheless are treated under law and according to law, and where their position is not abused, either. I was not prepared as Minister of Justice in 2005, and I am not prepared now, to say that basic human rights conventions passed by the international community should be ignored by this country, which is what the National Party in Opposition was saying then. I mean, it was unthinkable. Not the United States, not Australia, not the United Kingdom, and not any civilised country in the world actually ever said or put into its legislation that people whose rights are abused, even prisoners, should not be entitled to be treated under law and not be entitled to redress when their rights were abused. So I think, and I hope, in the House today, 6 years later, there is a level of maturity and principle that means that that will be accepted as a bottom line.
But let us have a review of how the system works. Let us find out whether it was an aberration that the Department of Corrections was abusing those prisoners’ rights in terms of the requirements on it under law in the way it should treat inmates. You know, I am not soft on inmates, but I do believe that everybody is entitled to humane treatment in this country, even those who have broken the law and have committed horrendous acts. I believe they should be locked up and kept locked up for a long, long time if they are a danger to the community, too, but I do not believe in any system that says that people who are subject to the control of the State can be abused and have no rights of redress against that abuse.
Let us try to do this on a bipartisan basis. Let us not make political capital out of it, as my quotes from the past have suggested. Let us be mature about it. Let us find a system that works for the victims, because the rights of the victim—the rights to reparation—I think, are fundamental. You know, I believe in a system of restorative justice. If your rights are abused by somebody who offends against you, you should be able to get proper compensation from that person. If somebody steals my property, yes, they might need to be locked up if they keep doing it, but actually what I would really like to see is them having to pay compensation for the wrong that they have done, and I apply that right across society. More reparations, a restorative system of justice, would be a very positive development for this country to take.
So, Minister, I hope that the review will be set up early so that there is full time for it to happen thoroughly, that that review will consider the rights of victims, and, indeed, that it will consider the obligations that New Zealand operates under in terms of international conventions. If we can do this without making this House a farce because people are playing silly, populist games, we have got a better chance of getting a good outcome—an outcome fair to victims and an outcome that upholds the rule of law, even when it applies to those in custody.
ALFRED NGARO (National)
: I stand and rise to speak on the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill. This bill bridges the gap between the expiry of the current regime, on 30 June 2012, and progressing the Prisoners’ and Victims’ Claims (Redirecting Prisoner Compensation) Amendment Bill through the House.
The issue here is bridging the gap, but the gap that we want to continue to bridge, and I will not labour the point—sorry for the pun, I say to those opposite me—is the gap of confidence in the judicial system to acknowledge and expand the rights and the support for victims. This was no more evident than when we heard the submissions on the Victims of Crime Reform Bill, where stories of the good, the bad, and the ugly of the judicial system’s response to the needs of victims were heard.
This Government is very clear. We are directing prisoner compensation to victims, to put victims at the heart of our justice system. National is reforming our criminal justice system to put a stronger emphasis on the victims, and, as our colleague has said, we want to ensure that there is a fair and just debate and ensure that, again, victims are compensated in the appropriate way. We are ensuring that victims are heard, that they get the support they need, and that they are not brutalised again when defendants are tried. We are making sure that victims get better information and protection when offenders are released back into the community. At the same time, we are modernising our court process to make the justice system safer and more efficient. We are speeding up those court processes, reforming legal aid, and improving civil justice. Our changes are making justice more responsive to the needs of victims, and helping to build a safer and brighter New Zealand for children, families, and older people.
I just want to finally finish my speech by talking about the support for victims, and especially the Victims of Crime Reform Bill. I am proud to be a part of the Justice and Electoral Committee. Among the things this bill will do—again, this bill is part of a whole raft of support for victims—are setting up a victims’ support centre to improve the information and services that victims receive, and improving the victim notification system. We are changing the way that evidence is heard, to better protect vulnerable children, and providing more help for families affected by homicide. It truly was a sobering moment when we again heard the stories of the families, the victims. With that, it is beholden upon us and our leadership to ensure that we have a fair and just system of debate but to ensure that this process goes through.
Finally, again, this bill will provide help for sexual violence victims and also for victims of serious crime. I stand and rise to support this bill.
KRIS FAAFOI (Labour—Mana)
: Thank you very much, Mr Assistant Speaker, for allowing me the chance to speak to the Prisoners’ and Victims’ (Claims 2012 Expiry and Application Dates) Amendment Bill.
I would like to first of all address the mechanics of the primary legislation, which was passed in 2005 under the Hon Phil Goff. As has been said by a number of our speakers from the Labour Party, we will be supporting this bill, because it is a mere extension of some measures that are in the Act that have a sunset clause, and we are extending that sunset clause from 1 July 2012 to 1 July 2013 to ensure that victims of crime will still have the avenue of claiming compensation from inmates who have been mistreated while serving a custodial sentence.
I do agree with Phil Goff—and who would not—who said at the time that the principal legislation was passed that most people believe it is wrong that offenders should be compensated for wrongful treatment but in turn are not required to pay restitution to the victims they harmed. I think, from the tenor of the debate right around the House, most of the MPs in Parliament agree with that. I also agree with, and acknowledge the contributions from, Denis O’Rourke from New Zealand First and the Hon Phil Goff, in that I do think it is time for a relatively mature debate around this issue. From the instances that we heard from Phil Goff, the debate was not so mature, and probably a little political, back in 2005.
So allow me to get a little political. We heard from Tim Macindoe earlier on that this bill was an interim measure, because there is some legislation that hopes to make the
measures in the 2005 legislation much more permanent. I need to ask the question why we have not had a review, when it was stated back in 2005 that we were going to have a review, and given the fact that we have to be in the House, using the time of this House and the resources of this House, to bring in an interim measure when something is going to be passed this time next year. One has to wonder why that might be, and one might come to the conclusion that it is because this Government has become slightly sidetracked as of late by various scandals, and has been a little bit mired in controversy.
Darien Fenton: Which one?
KRIS FAAFOI: Which one? If you want me to get specific, I might just talk about why we have not had a review, or why we have not had a permanent solution to what we are doing at the moment. We could mention the Banks scandal, we could mention the mess that ACC is in, or we could mention Dr Nick Smith. But, as I said earlier on, we have to have a mature debate around this. We do hope that over the time that this bill is being debated we could mention those things. But when we go through the stages of this bill we will be able to make sure that there are some solid interim measures, to make sure that if there are people out there who believe they have a claim to some compensation from an inmate—and, as we heard earlier, there was only one case that was discovered by the Green Party in the last maybe 3 or 4 years—we have some measures to ensure that they can get some compensation.
The Act was, obviously, passed under Labour, so that is why we support the bulk of the bill. But, as I said at the beginning of my contribution, we do have some problems as to how we have arrived at this stage of looking for an interim fix, and also why we have not had a review, and also why we do not have a permanent solution.
JULIE ANNE GENTER (Green)
: Tēnā koe, Mr Assistant Speaker. Tēnā koutou e te Whare. As my colleague David Clendon said earlier, the Green Party will not be supporting this bill, the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill, because it extends a sunset clause that was one of the reasons we finally agreed to support the primary legislation in 2005. When the original 2005 legislation, the Prisoners’ and Victims’ Claims Act, was introduced, the Green Party strongly opposed it, on the grounds that it violated prisoners’ human rights and removed a mechanism for stopping abuse in prisons, and we think it is important that there is not abuse in prisons. We changed our vote to support it at the third reading to prevent even more harmful amendments that were suggested by United Future, and we were hopeful about the promised establishment of an independent prisons inspectorate, and an inquiry into victims’ rights.
The Greens think it is really important to protect victims’ rights, but this is not the way to do so. We have opposed subsequent amendments, and we will continue to oppose the trajectory of this legislation, because the more worrying fact is that this bill is only a bridging effort until the even more troubling Prisoners and Victims’ Claims (Redirecting Prisoner Compensation) Amendment Bill is implemented. The Government’s own Attorney-General has highlighted that this bill will be a denial of an effective remedy, and is therefore in contradiction to the New Zealand Bill of Rights Act 1990. Given the Government’s record on passing legislation that is inconsistent with human rights, that is not so surprising, but it is disappointing and inconsistent with the principles of justice.
The 2005 Act, the primary legislation, limits the ability of prisoners to claim compensation for human rights breaches, and provides a process for victims to claim payment from prisoners’ compensation awards. I have some sympathy for what the Hon Phil Goff said earlier; it seems logical. But even in 2005 Victim Support was opposed to the Prisoners’ and Victims’ Claims Bill, and I would like to read from its submission. It said: “That a prisoner should receive compensation for a breach of rights when the
victim of that individual’s original offending has had no such acknowledgment or received no redress for the harm they have suffered is repugnant to Victim Support”. However, it did not accept that the bill at the time—now the Act—was a remedy for the situation. It said: “The solution to the situation lies not in lessening the rights of victims of abuse of power to seek redress for harm done,”—in this case it is the prisoners—“but in strengthening the rights and abilities of victims of crime to access restitution or compensation for the harm done to them. Putting it simply, two wrongs don’t make a right.”
Prisoners are subject to the day-to-day exercise of the coercive power of the State. They are therefore incredibly vulnerable to the misuse of that power, and ought to be able to claim compensation when their human rights are breached. By further limiting access to damages for breaches of human rights, it encourages those abuses of power, and it disincentivises prisoners from reporting those abuses, simply hiding the problem away rather than addressing it in a humane and principled fashion. The Government’s plans to deny them a right to an effective remedy in the Prisoners’ and Victims’ Claims (Redirecting Prisoner Compensation) Amendment Bill should be anathema to a country dedicated to the rule of law, where individuals should expect protection from the abuse of State power. The bridging bill may therefore be the lesser of two evils, but that does not make it more intrinsically worthwhile.
The Government should be rethinking its approach and finding principled and practical ways to help victims of crime that do not rely on treading on the human rights of prisoners and victimising them in the process. That is not the way to get people to come into the fold and become constructive citizens. It is not the way to do it, by abusing their human rights. We need to have a serious discussion about how we address these issues in line with respect for human rights, our international commitments, and lasting solutions to our issues with crime and justice.
- Sitting suspended from 6 p.m. to 7.30 p.m.
LOUISE UPSTON (National—Taupō)
: I am very proud to take the final call in this first reading debate of the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill, which was brought before the House by Minister Judith Collins. Members of this House and of my electorate will realise that I am a proud supporter of victims’ rights, and I am very pleased to see that the Labour members are also supporting this bill in the first reading. It is an important bill for us to get this extension of the time frame from 1 July 2012 to July 2013. It has been well canvassed, so I do not intend to speak any further, other than to say that I am proud to support this bill.
A party vote was called for on the question,
That the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill be now read a first time.
||New Zealand National 59; New Zealand Labour 34; New Zealand First 8; ACT New Zealand 1; United Future 1.
||Green Party 13; Māori Party 3; Mana 1.
|Bill read a first time.
referred to the Justice and Electoral Committee.
Hon PHIL HEATLEY (Minister of Energy and Resources)
on behalf of the
Minister of Justice: I move,
Justice and Electoral Committee report to the
House on or before 11 June 2012, and that the committee have authority to meet at any time while the House is sitting (except during oral questions), during any evening on a day on which there has been a sitting of the House, on a Friday in a week in which there has been a sitting of the House, and outside the Wellington area during a sitting of the House, despite Standing Orders 188, 190(a), and 191(1)(b) and (c).
The reason why this bill needs to be reported back by the committee by 11 June 2012, which is a period of less than 4 months, is to enable sufficient time for it to be enacted by 30 June 2012 and prevent the current regime lapsing. This is a short, uncomplicated bill, which seeks to maintain the current regime and bridge the gap between the expiry of the current victims’ claims process and progressing the Government’s policy to redirect prisoner compensation to victims of crime. I consider, therefore, that a shortened period for committee consideration is reasonable, and that maintaining the status quo is in the public interest.
Hon TREVOR MALLARD (Labour—Hutt South)
: The Labour Party will be opposing this motion. I think this is a very silly motion and an unnecessary motion. I think it is fair to say that the Labour Party has been working very closely with the Minister of Justice to help the Government get out of a hole that it has got into because of its own disorganisation. Clearly, this matter has been coming up for a long period of time. The Minister has not that unsubtly criticised her predecessor, Simon Power, for not getting the matter sorted earlier. She has been working with Charles Chauvel on this interim regime while there is a review, and I think it is fair to say that over a period of time there is likely to be quite large differentiation in the results of that review. Clearly, the House, even on this part, has a variety of views, but there has been an attempt to work together.
Without wanting to sound like the two big parties ganging up on everyone else, generally when the vast majority of the House is in agreement with something, both within the House and within the select committee process it can be dealt with at a fair speed to get the report back. This motion will make no difference to that. I mean, I am not unaware of a select committee that recently has decided to report a bill back within about 3 weeks of submissions closing, dispensing with a report from departmental officials. The committee thought that was unnecessary, because it knew what it wanted to do, the matter was relatively simple, and it was a matter of just getting on with it within the select committee.
We have had, I think, some quite big changes to our Standing Orders. One of them has allowed us to consider business on Wednesday and Thursday nights and through into the following Thursday and Friday mornings where it is near-unanimous within the Business Committee that that occur. But part of the same group of changes to the Standing Orders was a requirement when bills are going to be at a committee for less than 4 months to have a motion of this sort, which is a debatable motion. I just want to say to the Government that I think it would be wiser in future to do a little bit of consultation around this to seek, as well as an undertaking to support the legislation, a process understanding with as many Opposition parties as it can, and therefore to get things back in a reasonable way, without making it look like legislation is being rammed through.
The problem that we have with this approach is that it looks like the legislation is being rammed through. I think—in fact, I probably am sure—that the Greens have a different point of view, but on this relatively minor extension, albeit of an important law, then I do not think it could be a fair accusation that it is being rammed through, because there is going to be thorough consideration of the issues as part of the report and part of the review, which we will then all look at. We will look the legislation over for the need for it and any changes, whether it should be extended, and whether it
should be totally dropped. That is a process that has to be a thorough one and with proper outside consultation, which is just not available, because, as I said when I started this speech, the Government basically took its eye off the ball and we have got to the point where legislation was going to lapse and it was not really sure of the effect of that and whether it wanted to replace it.
Much as I would like to blame the current Minister of Justice—I would like to blame her for lots of things—this is not one of the things that I am prepared to blame Judith Collins for. We are trying to help her get out of the problem. I just say to the Government, to the Acting Leader of the House, and to the Government whips that in future it might be better to consult and to get an agreement, rather than to put a straitjacket around things, force things through, and possibly get unnecessary debate as a result of it.
DAVID CLENDON (Green)
: I am pleased to take the opportunity to respond to this motion. I understand that it is only our new Standing Orders that actually enable this process to go ahead. I think there is a general consensus around the House that none of us want to spend time unnecessarily in the Chamber debating issues. The use of extended hours and the cognate bills that we have had through the House are all good processes because they do not deny anybody the right to be heard. They are simply efficiency measures, and those are good things. In this instance, however, we oppose this motion for the very clear reason that there is a substantive issue at stake here.
This bill—the Prisoners’ and Victims’ Claims (2012 Expiry and Application Dates) Amendment Bill, which has had its first reading tonight—is a very short bill, but it does some quite significant things. The bill was tabled, as I understand, on 2 April, about a month ago. For 3 of those 4 weeks, of course, this House has been in adjournment. I happened to be at a meeting at lunchtime. It was a gathering of NGOs, civil societies, people representing Government agencies, and members of the public, all of them with a significant interest in corrections and human rights, among other things, but specifically corrections. I mentioned this bill in passing to that group. None of them was aware that it was being debated in the House tonight, which is an indicator to me. Clearly, we want to engage with the public. I am not suggesting for a moment that any party in the House does not believe in the importance of public engagement or civil engagement, in the business, in the bills going through. In this instance, it will come as a complete surprise to people with a vital interest in issues around prisoners’ rights, around victims’ rights, and about the way we manage our corrections sector; it will be a surprise to those people that this bill is to be debated, and that they have until 11 June—that is about 6 weeks, if that, from tonight—to try to get some sort of sensible position, to understand what is at stake, and to make a point to this bill.
I might be less concerned about this foreshortened process if I felt that there was to be a comprehensive review, but I am not convinced there will be. Already, in the regulatory impact statement that accompanies this bill, we see reference to the Government’s redirection policy. It is absolutely clear that the Government is set on embedding permanently the legislation that tonight it is seeking to—
Louise Upston: I raise a point of order, Mr Speaker.
Mr DEPUTY SPEAKER: I can anticipate the point of order. I was just about to rise to my feet. This is a very narrow debate. It is about the curtailment of the times of sitting or the change around that. We are not debating what is actually in the bill. So the member can continue, but he cannot debate the content of the bill. It is about the procedural motion.
DAVID CLENDON: Thank you, Mr Deputy Speaker, for that guidance. Indeed, it is very much about process. It is about the participatory process, and it is about basic democratic procedure. We must allow the public, NGOs, and people with an interest in
these matters to participate. After all, all of us want the public to participate in parliamentary processes, and clearly the select committee process is a primary avenue for people to do that. People need time to prepare their submissions, to think about what they want to say to the select committee, to gather their information, and, conceivably, to talk to members of Parliament about this process. Truncating this process may be acceptable—and certainly I do not suggest tonight for a moment that the Greens would always oppose a truncated select committee process—but in this instance we do believe that there are issues at stake that the select committee ought to and, indeed, needs to hear from members of the public. We are very reluctant to see members of the public, NGOs, and so on denied a reasonable amount of time.
It may well be, in fact, that the Justice and Electoral Committee collectively decides that it can progress this bill through the select committee process quite promptly, and have it back into the House for a second reading reasonably swiftly. That decision should be made by the committee, given an appropriate process within that committee. It should not be made tonight by the will of the Minister or the Government, and so we will oppose this motion.
A party vote was called for on the question,
That the Justice and Electoral Committee report back to the House on or before 11 June 2012, and that the committee have authority to meet at any time while the House is sitting (except during oral questions), during any evening on a day on which there has been a sitting of the House, on a Friday in a week in which there has been a sitting of the House, and outside the Wellington area during a sitting of the House, despite Standing Orders 188, 190(a), and 191(1)(b) and (c).
||New Zealand National 59; New Zealand First 8; Māori Party 3; ACT New Zealand 1; United Future 1.
||New Zealand Labour 34; Green Party 13; Mana 1.
|Motion agreed to.
Crown Pastoral Land (Rent for Pastoral Leases) Amendment Bill
- Debate resumed from 1 May.
RAYMOND HUO (Labour)
: It is a pleasure to take a call at the third reading of the Crown Pastoral Land (Rent for Pastoral Leases) Amendment Bill. It is particularly so following the member for
Waitaki, Miss Jacqui Dean, although she decided not to continue. Listening to the contributions from the Minister for Primary Industries and some of the National backbenchers, it is fair for me to suggest that Miss Dean’s speech was one of the best, because apart from the usual anger and accusations she gave at least some reasons why she believes that it is important for her to pass this bill into law. I like the way she said she had been approached by her constituents, because Labour supports the high country farmers, and Labour supports farmers at large.
But I come back to this bill. As the Hon Damien O’Connor said, the National Government solution is to offer those farmers lollipops, but when they run out of sugar everything will be back to square one. So that is not the real solution.
The Government has the numbers to pass this bill into law, so there is no need, and it is totally unnecessary, for those members to resort to personal attacks. They attacked
Helen Clark, David Parker, Damien O’Connor, and me, although I am not that important—not important at all. They will do the National Government a great favour if they focus just a little bit on the rationale behind the bill rather than resorting to personal attacks. While the bill has been progressed, the attacks from some of the National backbenchers have escalated from accusing Labour or anyone who is opposed to this bill of being anti-farmers or using the politics of envy to now labelling Labour as farmer haters. Following that logic, the Greens, New Zealand First, and even Mr Peter Dunne’s United Future party are all anti-farmers or farmer haters.
One National backbencher confirmed that the Royal Forest and Bird Protection Society of New Zealand is anti-farmers too, because of its review on lower rentals as provided under this bill. The society has supported a number of initiatives under this bill, but it does have a problem with lower rentals due to tenure review negotiations and the missed opportunity to put in place economic pricing instruments that could benefit conservation values.
Following that logic, the Parliamentary Commissioner for the Environment would also be anti-farmers, because her 2009 report entitled
Change in the high country: Environmental stewardship and tenure review questioned the methodology of the current tenure review process and made a number of recommendations. The report also proposed the setting up of a high country commission to provide more oversight of the high country. Of course, neither of those recommendations have been taken up by the Government.
The bill seeks to change the rules for setting rents for Crown pastoral leases from the land valuation basis to stock-carrying capacity or income-related basis. So it basically means that properties in Remuera and properties in Papatoetoe should be treated equally. I use that analogy because the National Government’s policy in that regard is consistent. For instance, its policy to sell our assets to pay the debt is pretty much like selling its house in order to pay the mortgage, and then renting it for a higher price. It does not make any economic sense.
But it does make some sense if National MPs focus on the reasons behind this bill, because I, together with many others, have remained unconvinced, and will unless they give me some reasons. Firstly, the Clayton report. The Clayton report, produced in the 1980s, found that if one gives a discount to lessees of below the market rent, they capitalise an increase in value to the lessee’s side of the ledger, so that the relative division of value between lessor and lessee becomes even more weighted towards the lessee. That means that this small number of farmers will be in a better position to freehold the properties. They are in a better position to onsell a part or all of the farmland and make windfall profits.
Secondly, I come to the Maori Reserved Land Amendment Act 1997. The previous National Government amended the legislation, and good on it, in order to address the injustices for Māori. As owners of the land, Māori were, until that amendment was made, forced to accept lower than market rents for the land through leases based on unimproved land value, with similar perpetual rights of tenure for lessees as exist for pastoral leases. So this bill is actually challenging that legal precedent and compromising the basic property rights of the Crown and New Zealand taxpayers. Therefore, Labour cannot support inconsistencies in law.
Further, there is tenure review. Much has been said about tenure review and I do not intend to repeat it here, but I do want to repeat one comment made by experts, scholars, and concerned parties, and that is that increasingly these Crown-owned properties are being purchased not for their pastoral values but for their non-pastoral values, which relate to exclusive occupation of land. As pointed out by the Hon David Parker, not all lessees are enthusiastic about tenure review. They want to enforce their contractual
rights under the leases, and they want to commit to the dairy business. In the Labour Party all we did was to enforce the legal terms of the lease. The rent of 2 percent of land value excluding improvements is affordable by some but not all tenants. We accept that some lessees—and Mr Shane Ardern made this point very clearly in his contribution in the bill’s second reading—are long-term holders. They do not want to sell. They only want to extract pastoral values from the land. They have not purchased it for tens of millions of dollars and they cannot afford the rent that is based on what they might sell it for. They need a rent that is lower than that. The law already allows for that. We do not need this change in the law to achieve that outcome.
These decreases in rent are unprincipled. Bear in mind that this is a Government that is running a $12 billion deficit. According to the information released by Statistics New Zealand on 21 March 2012, net international liabilities were $147 billion or 71.9 percent of GDP as at 31 December 2011.
Parliament has the role of passing legislation that is fair. We do not want to see people speculate and make windfall profits at the cost of New Zealand taxpayers. The genuine farming families have not been easy with that process at all, because they want to remain on the land, farm it properly, and protect the environmental values. We absolutely respect their management practices and what they have done over many years. We should provide the right incentives for farmers who are managing the land properly and ensure that they have affordable rents. But the establishment of the base value of the land and the base rental has to be consistent with most other commercial entities across the country.
Labour supports our farmers and it supports our farming sector at large. Thank you.
IAN McKELVIE (National—Rangitīkei)
: It gives me a bit of pleasure to get up and speak to the third reading of the Crown Pastoral Land (Rent for Pastoral Leases) Amendment Bill. I certainly support the bill. I am not one to, as the previous speaker said, attack the Opposition, but I find it difficult to believe that they will be milking cows on these pastoral leases, which I am pretty sure I heard the member say. So I think that will be very difficult. But I want to talk briefly about the bill and the potential for this bill to, I guess, rectify what I would see as some wrongs that have occurred over the last few years.
Certainly the tenure review system was not working in New Zealand. It had passed its use-by date. I think it had been abused to some extent, and it certainly was causing some grief for the high country of the South Island in that there were some, I think, 112 contested rental situations or reviews currently. It was quite a problem for both the Government and the farmers, and there is significant expense involved in that type of a review. So the challenge for the Parliament is to get a system in place that works for the high country of the South Island, that avoids the need for us to buy expensive tracts of land off these farmers or rentals off these farmers and take it over, as we have done in the past.
I heard one of our speakers last night speaking on this bill talking about the millionaires in that area. The only millionaires that I know of in the high country of the South Island are the ones whom the previous Government bought out. In fact, I have got a very good friend who has got a brand new D6 tractor as a result of that purchase, and he is pretty happy. He sits on it every day. I think that is the problem that we face with this bill, and I am sure that that will be resolved as a result of the decision to proceed with this bill tonight.
I want to talk briefly about the high country farmers of the South Island, and also last night we heard the Greens talk about the ecological assessments that would be preferable to be carried out to understand the stocking rates required in this country. I
would like to point out to the Greens that just about all farmers who farm with any kind of responsibility in New Zealand probably do ecological assessments on a daily basis. I guess that involves measuring grass and things like that, which clearly enables them to understand what is happening with their land and what is happening with their livestock. I think these high country farmers of the South Island do a wonderful job of the ecological management of that country. I think almost without exception historically they have done a great job of that, and I am sure that will continue in the future.
I want to briefly comment on a couple of other things that I have found a little extraordinary about the discussion we have had recently. In fact, on page 3 of the commentary on the initial draft of this bill, where we talk about the Labour Party’s minority view, it talks about the bill allowing the Government to charge rent on the productive capacity, but excluding rental for the right to exclusive occupation, which the lessees also enjoy. It seems to me it is very difficult to see any difference in that system from what we see in our current Government housing regime throughout the country, where there are clearly State houses that attract the same rental wherever they are located.
Hon Trevor Mallard: But these farmers are State tenants! These farmers are State tenants!
IAN McKELVIE: Absolutely they are. As you well know, they have been for a hundred and something years, and so are those people who live wherever they might live in a Government-owned house. We do not charge them for the view. I think that argument really buys itself.
I have got no problem supporting the movement of this bill through the House, and with a bit of luck it will get out of here fairly soon. I just want to congratulate those who were on the Primary Production Committee at the time this was heard—and I certainly was not—on the work they did; also, the Ministers who have put this through; and Jacqui Dean, whom I have heard speak, I think, three times on this bill since I have been a member of this House, certainly with a significant amount of enthusiasm for the bill. I have much pleasure in supporting this bill and hope that it proceeds with speed.
Mr DEPUTY SPEAKER: I understand this is a split call. There will be a warning bell with 1 minute to go.
Hon TREVOR MALLARD (Labour—Hutt South)
: Yes, I understand that the Greens are going to take 5 minutes, and I will take a 4-minute bell, thank you, if I get that far.
This is an issue that I think has been fraught. There has been a disproportionate amount of time spent on this legislation and on Crown pastoral rents over the period of the last 10 years or so, at least. Certainly, in the time that I was in Cabinet there was far more time spent on it, and trying to get this one sorted was one of those Solomon-type issues. But my view is that the Government has now come down with the wrong decision. Currently, the rent for the properties is set at a relatively low 2 percent, excluding improvements. The Government is proposing to cut this further and thereby transfer the value to the lessees, making it easier for them to freehold the properties and to onsell, if they so wish, part or all of the farm, and make some windfall profits. I think the Primary Production Committee has seen the evidence of that. Of the 77 runs that completed tenure review, at least 28 of the new landholders have onsold 176 parcels of the newly freeholded land. These 28 new owners paid the Crown $6.9 million to freehold, and they have realised $134 million through selling only 44 percent of the freeholded land.
What is clear is that there is a reduction in income, at a time when the Government is telling us it is short of cash—and I agree that it is short of cash. Giving rent reductions to farmers below a 2 percent level, I think, is a waste, or revenue forgone that could be
better used. But also there is a wealth transfer without a proper capital gains tax arrangement, unless these gains can be absolutely proven to be trading gains, and I think you would probably have trouble proving that some farmers have been involved—their families—in farming for 100 years. I think any trading tax we would have trouble applying under current law, although, hopefully, at some stage in the future we will be able to get this sorted.
What we are doing here is sacrificing the right of the Crown to extract fair value from the property. What that does is short-change the New Zealand taxpayer. It is something that we should not be doing. I will go back to where I started and say that the issue is not a simple one. Getting it right, getting it fair, and making sure that we do the best we can to maintain the values, as we do, of many of these properties is something that is hard. What we do know is that when they are freeholded, or even the properties that are close by are, because of their exceptional views, because they are very special places—I note that Nick Smith is in the House. I know he knows the St James Station well. He has cycled through there, I think, on at least a couple of occasions. He had a press conference, I think, halfway through one. [Interruption] Oh, he did not have it. He finished the ride an hour behind me without having a press conference, on that particular occasion. I think it was when I weighed about 20 kilograms—I did not quite weigh what you weigh, Mr Deputy Speaker—more than I do and more than Nick Smith. But I think Nick Smith would agree that these places are very special and we have got to handle them carefully. It is my view that this approach to their privatisation is one that is wrong, and therefore Labour is going to oppose it.
STEFFAN BROWNING (Green)
: I heard from the Government side a concern that the Greens might have been overstating the need for ecological assessments, and a suggestion that all farmers are probably doing an ecological assessment each day. That level of ecological assessment, unfortunately, is too often too shallow.
I think there is some fantastic stuff that has happened in the high country in terms of high country farmers—family farmers—but there is a need to ensure that the best practices happen, or that biodiversity protection is happening all the time. That 2 percent of unimproved land value for something like 50 years—decades—was super cheap, cheap, cheap, and there is no real justification for that. There is no justification for keeping it unreasonably low. However, we believe that these farms should be kept for New Zealand farming families or for biodiversity and environmental protection.
Income-related rents have merit when strong environmental protections are assured and biodiversity gains are measurable, when stocking and pest intensity does not degrade further than natural erosion that has been exacerbated by early clearance and overgrazing. There were some shocking practices in the high country in years gone by. Income-related rentals can be appropriate if they are not turned into cheapo privatisation that later becomes a goldmine for property developers—a windfall, not protection nor production by the family farmers we want to respect. Protection for biodiversity, ecological features, landscape, and family farming can be achieved by this bill, but there are weaknesses that should have been amended. My regular experiences in the Marlborough high country reinforced my desire that the high country is given more respect than this bill may allow in the hands of the National Government.
I recall another pleasant experience in the high country near where I was born in Central Otago—Jacqui Dean is not the only one who has roots or a connection down there. It was when Prince Charles visited New Zealand last. I met him at the luncheon provided near Alexandra where he was touring over a property to see sustainability improvements. I was a little ashamed of what he was being shown at the time, to be honest, but that is what he was being shown and toured over. I believe that property had a way to go. I was there, privileged in my previous role with the Soil and Health
Association, to gift to Prince Charles an organic Bio-Gro certified merino shawl, directly ahead of his forthcoming nuptials with Camilla Parker Bowles.
Certified organic production is one way to ensure a higher level of environmental stewardship than sometimes occurs with less progressive operators. This Government has dropped the ball on organics in New Zealand, treating it like some sector that has no real vision about genuine sustainability in the sectors that do not have that vision genuinely. National expects that organics, which is contributing plenty through good practice in most cases, should also fund the next tranche of conversions to sustainable development. National does not actually understand that the pioneers in organics are the ones who have done a whole lot of work and should have no real personal reason why they should be funding the next tranche.
One thing that Prince Charles also said to me at that luncheon was that New Zealand would be absolutely nuts to be going down the genetic engineering path. Yet National again is going down that path and putting money into pasture grass that is genetically engineered and may end up in the high country. That must stop and, as we say with this bill, there is some real possibility that, if the science behind the ecological assessment is valid, the bill may go some way to ensuring the high country has a good future. Thank you.
LOUISE UPSTON (National—Taupō)
: I am pleased to take the final call in the third reading of the Crown Pastoral Land (Rent for Pastoral Leases) Amendment Bill, and I support it wholeheartedly.
A party vote was called for on the question,
That the Crown Pastoral Land (Rent for Pastoral Leases) Amendment Bill be now read a third time.
||New Zealand National 59; Māori Party 3; ACT New Zealand 1.
||New Zealand Labour 34; Green Party 13; New Zealand First 8; Mana 1; United Future 1.
|Bill read a third time.
Trade (Safeguard Measures) Bill
Part 1Safeguard investigations, provisional safeguard duty, and safeguard measures
JOHN HAYES (National—Wairarapa)
: It is a pleasure to—[Interruption]
The CHAIRPERSON (H V Ross Robertson): Order! [Interruption] Order!
JOHN HAYES: It is a very great pleasure to stand this evening in the Chamber to speak on the Trade (Safeguard Measures) Bill, put forward under the careful leadership of our Associate Minister of Commerce, John Banks.
I would like to make just a couple of introductory remarks before my comments. The only way New Zealand is going to move forward satisfactorily is to earn more money than it spends. We have got to be very careful to keep our debt below 30 percent of gross national income, we have to lift savings productivity, and I think that enhancing and growing our international trade links and opportunities is a key part of our plan to build a competitive and productive economy. This is one of the four objectives that we have in the Government in this term of office.
When you open the door to free competition and you drop your borders, as we have done in New Zealand and as we are asking every other country to do, there is a risk that
small companies throughout the country—but particularly in my electorate; I think of somewhere like Metalform in Dannevirke, which is in the manufacturing area—can be flooded by items imported and, perhaps, dumped in this market. So I think that the commerce Minister has been particularly wise to design this draft legislation with tariff and trade remedies policies, so that our companies can operate in a more predictable environment and play an important role in providing New Zealand industries with confidence to invest, to grow, and to compete, especially as tariffs are being reduced and eliminated under our free-trade agreements. These agreements are going to grow, and the Government, I know, has plans for at least 28 trade missions in this term of office.
One of the issues that I would like to address to the Minister in the chair, the Associate Minister of Commerce, is the question around that part of the legislation that gives the Minister of Commerce authority to impose a provisional and then a final safeguard duty without taking it through a lengthier Cabinet process. I would be quite interested to ask the Minister whether he could please outline and specify the individual considerations that he would be taking into account when determining whether a safeguard duty is in the public interest. I would be interested to know what sorts of considerations the Minister will take account of in that process.
I really support this legislation. I think it is excellent, and I think our Minister has done a good job leading us through this process. Thank you.
Hon PHIL GOFF (Labour—Mt Roskill)
: It is a pleasure to get up to speak to the Committee stage of the Trade (Safeguard Measures) Bill. Labour actually supports this bill, and we support it because it was introduced by Lianne Dalziel, and I think we can rely on a former Minister who introduced this bill who does not forget things, who can be relied on to act with integrity, and who can be relied on to be straight with the media and not to obfuscate. For all of those reasons I think that this bill probably deserves our support, but I do have a number of questions to the Associate Minister of Commerce.
My first question to the Minister is, given the trouble that he is in, will he still be here when we complete—
The CHAIRPERSON (Eric Roy): Look, we are not getting into this speculative area. There is plenty of scope to debate the purpose, and Part 1 is a big part, so I ask the member just to desist from the line that he is on. Thank you.
Hon PHIL GOFF: On a different line, this is a question that was asked on the front page of the
to Mr Banks: has he actually read the bill? He has not read the Local Electoral Act; has he read this bill? If he is the Minister in charge of this Committee stage, our side of the Chamber wants to have assurance—
Louise Upston: I raise a point of order, Mr Chairperson. You spoke only a matter of seconds ago about the content of the bill and the fact that it was quite wide in its scope. I would ask that you manage that member’s relevance, please.
Hon Trevor Mallard: Point of order, Mr Chairperson.
The CHAIRPERSON (Eric Roy): I do not need any assistance. The member on his feet asked the Minister whether he had read this bill. I think his references to the paper were unhelpful, but he did not—[Interruption] Order! I think he is just inside the line at this stage. I caution the member, and I caution other members as we proceed. I am happy to proceed with the debate.
Hon PHIL GOFF: I read that this bill’s purpose is to replace an old regime with a new regime, and I want to know whether the new regime will be as reliable as John Key’s new regime to lift the bar on ministerial standards. I want to know that because, you know, we have been promised new regimes before and they have not been delivered. So I want to know whether the new regime that this bill introduces is going to deliver the goods, because John Key did not deliver the goods on lifting the bar on
ministerial standards. When Ministers can mislead the public, obfuscate, forget things, and not tell the truth, that is not introducing a new regime.
The CHAIRPERSON (Eric Roy): Order! I have been very tolerant here, but the member talks about Ministers not telling the truth. There are standards here about members being honourable members. I just think the member ought to be a little more careful about how he is phrasing that stuff.
Hon Trevor Mallard: I raise a point of order, Mr Chairperson. I apologise to my honourable colleague. The point I would like to make is that Mr Goff at no stage suggested that the Minister did not tell the truth in the House, and that is the requirement. We are allowed to say that Ministers did not tell the truth outside the House, and clearly that is the case with this Minister.
The CHAIRPERSON (Eric Roy): That is not my understanding of Speakers’ rulings. I invite the member to demonstrate to me, through Speakers’ rulings, where my interpretation is not correct. But we will continue with the honourable member.
Hon PHIL GOFF: Part 1 of this bill talks about safeguard investigations. I want to know the meaning of the term “safeguard measures”, because there are a lot of things that the public need to be safeguarded against. They need to be safeguarded against Ministers who do not tell the truth to the media. They need to be safeguarded against Ministers who obfuscate and are not upfront and honest with the public and the media. And they need to be safeguarded against forgetfulness. Can we rely on this Minister in the chair to remember what the provisions of this bill are, so that he can properly implement them, when he could not remember a helicopter ride to the biggest mansion in the country—
The CHAIRPERSON (Eric Roy): Order! I have cautioned the member. This is about the bill, and I caution the member again. That is it—right.
Hon PHIL GOFF: It is a bill—
The CHAIRPERSON (Eric Roy): Are you seeking a second call now?
Hon PHIL GOFF: Yes. I hardly got started. The bill also “promotes efficient, transparent, and objective investigative and decision-making processes.” Let me repeat that, because that is really important. The bill promotes efficient, transparent, and objective investigation and decision-making processes. I would like to hear from the Minister in the chair what he thinks about transparent decision-making—whether things should be upfront, open, and honest, and whether the law should be followed in that regard.
This bill, interestingly, is also about anti-dumping and countervailing duties. Does this mean, I ask the Minister in the chair, that if he dumps on Kim Dotcom, there will be countervailing action by Kim Dotcom to tell the truth about what he said? I think that is a really good question, and I would like to hear the Minister’s comments on that.
Hon Lianne Dalziel: Is that a countervailing duty?
Hon PHIL GOFF: It is a countervailing duty, I think, that if your loyalty and your goodwill towards somebody is not reciprocated—by someone who pretends that they cannot even remember who you are, even though he spent 2 hours with you, dined with the family, and toasted you at your birthday party—then you will expect that person to feel that there has been no countervailing loyalty towards you, and that you have been used. So it is little wonder that Kim Dotcom responded in that way.
Clause 5 of this bill is about the Act binding the Crown. I want to ask about that. Is that the Act binding the Crown in the same way that the
Cabinet Manual binds the Prime Minister, for example, to uphold and be seen to uphold the highest ethical standards on his Ministers? Is that what binding is? It does not say much in the bill. It simply says that the Act binds the Crown. I would have thought—
Kris Faafoi: It’s the ACT Party.
Hon PHIL GOFF: The ACT Party. Well, does the
Cabinet Manual bind the Prime Minister or his Ministers to uphold and be seen to uphold—
Hon Lianne Dalziel: It should be “props up the Crown”.
Hon PHIL GOFF: Yes, well, binding and propping up—there might be something in that.
Clause 6 is about notification of a decision or a report. I wonder whether that notification is a bit like notifying the Electoral Commission that a huge donation was made and that he then asked the donor to split it into two parts, contrary to the spirit of the law. Is that the—
Hon Trevor Mallard: I raise a point of order, Mr Chairperson. There is a requirement for a Minister to be in the chair during the Committee stage of the debate. They are not allowed to run around the Chamber like this, no matter how scared they are.
The CHAIRPERSON (Eric Roy): I will uphold that. Yes, the Minister in the chair should not move more than from the chair to the aisle.
Hon PHIL GOFF: This is a bill—
Hon John Banks: This is very boring.
Hon PHIL GOFF: The Minister might say it is very boring, but I tell him that the country is not bored about his escapades, his misleading comments, and his obfuscation of what he is doing. Maybe the Minister could explain what he meant when he was asked whether he had declared all his donations and he said: “look, look, look, look, look, look, look … I have never been with Dotcom to Skycity.” If that is not obfuscation—
Hon John Banks: I raise a point of order, Mr Chairperson. The chairman of the Foreign Affairs, Defence and Trade Committee, John Hayes, and his colleagues on this side of the Chamber are very, very interested in this debate. This going-on by the member for Mt Roskill serves his interests no good. It is contrary to the Standing Orders because it is irrelevant, and I would like to think that the Committee would stay in order, the shouting and carping from the parliamentary Opposition should cease, interjections should be rare and reasonable, and we can get on with the important business of this Government.
Hon PHIL GOFF: Speaking to the point of order, Mr Chairman.
The CHAIRPERSON (Eric Roy): I will accept the member’s contribution.
Hon PHIL GOFF: My response in fact was to an interjection made by the Minister himself. It is a bit rich for him to be saying that we should not be interjecting.
The CHAIRPERSON (Eric Roy): The member cannot attack another member through a point of order and talk about richness or anything else, and the member should know that by now. I am listening very, very carefully to the debate, and it is fair to say that the member, in his speech, is moving outside the realm of what is acceptable, but then he ducks in again. He is a very senior member. My tolerance about this—we have had a go on this now and I ask members to debate more specifically the purpose and Part 1 of the bill.
Chris Hipkins: I raise a point of order, Mr Chairperson. I just want to alert your attention to the fact that this is the second time that the member speaking has been interrupted in order for relevancy to be questioned, which is in fact out of order. The Speakers’ rulings are quite clear that the sole judge of relevancy is you as the Chairperson, and therefore you should not be questioned by a member abusing the point of order process to interrupt another member speaking.
The CHAIRPERSON (Eric Roy): I think that two times, one on each call, is probably not excessive. The member does make a point, and I have assured the Committee that I am listening. If members wish to test my patience, I will terminate a
few speeches if I think that members have got too far away from the bill. Bearing in mind that members have four calls, I am quite prepared to terminate calls.
Hon Trevor Mallard: I raise a point of order, Mr Chairperson. I think I am going to welcome the ruling that you have just made, but I just ask you to confirm that it is now OK, according to you, for members to question the relevance of other members’ speeches, rather than leaving it to you. It is a new ruling but quite a good one.
The CHAIRPERSON (Eric Roy): No, it is in fact not a new ruling, and members will know that from time to time relevancy has been a call that members on both sides of the House have made, depending on whether they are on the Treasury benches or not. If it is excessive, then warnings are given about members using that to interrupt. I do not believe that on this occasion that it was to interrupt but was merely to set the standard of what is acceptable in this debate, upon which I have given my ruling.
Hon PHIL GOFF: I will come back to the bill, but the Opposition members would feel much more comfortable if they had a Minister in the chair whom they felt they could rely on. This bill is quite an important measure. This country does believe in opening up a free market for trade so that our exports can go into other countries and their imports can come and fairly compete with ours. But there is a need on occasion for safeguard measures, particularly when there is dumping and particularly when that competition is not of a fair nature. My concern about the Government is that this bill was introduced over 3 years ago. This is a straightforward but very important piece of legislation, and it could easily have been carried into effect at any time over the last 3 years. So my question is why it has taken 3 years to bring this legislation back to the House.
We are a member of the World Trade Organization (WTO). We are a small country. We rely on a rules-based system in international trading to protect our rights, and we need to be compliant with the WTO and the rules that it sets out. This legislation is compliant with those rules. It is not a trade protectionist measure. It is about fair-trading rules, and we support it on that basis.
I welcome the fact that this introduces a system that is streamlined, and New Zealand producers and manufacturers will likewise welcome that. It will rely on expertise within the Ministry of Economic Development, rather than setting up temporary safeguard authorities, and I think that that is a positive move. It will extend the time frame for the completion of safeguard investigations to 75 days. I think that also is a sensible move.
Dr PAUL HUTCHISON (National—Hunua)
: It is a pleasure to have an opportunity to speak on the Trade (Safeguard Measures) Bill. I must say that it is absolutely vital to New Zealand that our exports are ever-expanding and trade is fundamental to New Zealand. It is something that the Hon Phil Goff, certainly for most of his speech, seemed to forget. He does wonder why it has taken a year or two for this bill to come through. But the previous Labour Government had adequate time—in fact, it had 9 years—in order to put this bill through if it really wanted to, if it was really serious about trade, if it was really serious about ensuring that we were protected at the borders. But it did not. At the last moment of that dying, inept Government it was actually flicked in by a Minister who is not absolutely lily-white, as was suggested by the Hon Phil Goff.
Hon Trevor Mallard: She stood down.
The CHAIRPERSON (Eric Roy): Order!
Dr PAUL HUTCHISON: I just mentioned that she was not exactly lily-white. That is all.
Hon Lianne Dalziel: Are you being mean about me?
Dr PAUL HUTCHISON: I would never be mean to you, not at all.
Hon Lianne Dalziel: I stood down.
Dr PAUL HUTCHISON: Well, maybe that was the case, but whatever. It was appropriate at the time that you did.
But on to the bill, there is no question that it is vital. Speaking to Part 1 of the bill, the purpose is to enable New Zealand to apply safeguard measures and provisional safeguard duties. The idea is that these be in accordance with the World Trade Organization regulations, which, of course, we need to ensure. We have an ever-changing pattern of more dependence on a wider spectrum of countries that we have free-trade agreements with, and dumping is a very real possibility. But it is interesting to point out that of all the years of the previous legislation, there have been only four cases that have been investigated, and only one of them was actually imposed. It is not something that is used frequently. In fact, the submitters to this bill, of which there were only five, did wonder whether we really needed to have this bill at all. But, on balance, we felt that yes, we did, that dumping could occur, and that it was vital and relevant that this did happen.
I do note that the chamber of commerce was concerned about a variety of issues, and one, of course, was the issue of time allowed for extending an investigation, from 30 days to 70 or even 85 days. It supported that, whereas in contrast one of the other submitters felt that it should be only up to 60 days, because otherwise the long investigation might upset its business operations. The fact is that extending it to 60 or even 85 days allows the opportunity for a very thorough investigation, but it need not take that long, and I am sure that the Associate Minister of Commerce—the very competent Minister, Mr Banks—would ensure that any investigation was done highly expeditiously. He may wish to talk on that particular matter, because it is vital. I would be interested to hear from the Minister as well his views—[Interruption]
The CHAIRPERSON (Eric Roy): I am sorry to interrupt the member, but I cannot hear the member. There is too much—order! I am on my feet—discussion going on.
Dr PAUL HUTCHISON: Thank you. I would be very interested to hear his views on the fact that some of the submitters had felt that it was a question of balance as to whether we would have a bill at all, but indeed it was appropriate that we do.
Hon MARYAN STREET (Labour)
: It is a pleasure to speak to the Committee stage on Part 1 of the Trade (Safeguard Measures) Bill. I am particularly interested because this is the Committee stage, Mr Chairman, and your rulings recently have required us to stay very much on task, even though we are debating fairly widely across the whole of Part 1. The importance of the Committee stage, as I understand it, is that the Minister in the chair defends the legislation. The Minister in the chair, the Associate Minister of Commerce, is required to defend and explain—clause by clause, if necessary—this legislation. It has come into the House in the Minister’s name. He is responsible for it, and he must answer questions about every clause.
I would like to begin, but before I start on that tack, I will just say one thing in response to the member Dr Paul Hutchison, who has just resumed his seat. This bill was introduced by the Hon Lianne Dalziel on 9 September 2008, and then there was an election a couple of months later. It was referred to the select committee on 11 March 2009. It was reported back from the Foreign Affairs, Defence and Trade Committee, on which I sat and deliberated on this bill, on 7 July 2009. So it took from only March to July to dispose of the bill at the select committee. Since then, it has languished on the Order Paper for nearly 3 years—3 whole years. So I do not want to hear another squeak out of that member about whether or not this bill should have arrived in the House earlier. Of course it should have arrived earlier, and it was entirely the Government’s fault and responsibility that it has not.
But can I say, on that note, that I am quite glad that this bill has arrived in the Committee stage today, because it gives me an opportunity to ask this Minister in the
chair what he understands by some of the clauses. I was present when he gave the first reading. It was an automaton kind of speech, and it was clear that he was not very au fait with the bill itself. So I would like him to take a call any time he likes this evening.
Let us start with the explanatory note. I would like this Minister to demonstrate his competence in regard to this bill by explaining what the explanatory note of the bill means where it says that it promotes “efficient, transparent, and objective investigative and decision-making processes.” I would like to know what this Minister understands by the word “transparent”. Does he understand that “Yes” means yes and “No” means no? Does he understand that when he is asked a yes/no question—a closed question—his two options are to say “Yes” or “No”, and that it is reasonably simple to answer a closed question?
Does he understand that transparency is required in all a Minister’s dealings? Even if it is behaviour prior to his entry back into Parliament and his taking up of a ministerial warrant, the nature of the man and the behaviour beforehand go to what we can expect a Minister to uphold.
I would also like to know what the Minister understands by the words “objective investigative and decision-making processes”. Are objective investigative processes characterised by obfuscation, or are they characterised by clarity and a distance—an objectivity? Even if done under legal advice, is obfuscation the same as objective investigative and decision-making processes, or is something more required of the Minister in charge of this bill?
This is the Trade (Safeguard Measures) Bill. Does this Minister understand the meaning of the word “safeguard”? Does he understand that there is more to the law than the words on the page? Does he understand that, in fact, the intention, the import, and the ethical nature of conduct also go to the way that laws are made in the House? This Minister, whose ethical behaviour seems not to be a problem—
The CHAIRPERSON (Eric Roy): Order! Now, just take your seat. This is not an opportunity to do a character assassination about allegations against the Minister. I think the member had done quite well up to that point. We are debating the content of Part 1. I am not going to tolerate the allegation side of it coming into this, in the way the member just did it. The Hon Marian Hobbs.
Hon MARYAN STREET: No, sorry, Mr Chair—Maryan Street. Maryan Street.
The CHAIRPERSON (Eric Roy): Oh, I am sorry; what did I do?
Hon Member: Called her Hobbs.
The CHAIRPERSON (Eric Roy): Well, can I apologise to the member. I think perhaps I could just make the comparator that when the Hon Marian Hobbs was in the Chair, she was very prescriptive about being on message. I was probably thinking of her when I inadvertently called the member by that name, and for that I apologise.
Hon MARYAN STREET: Thank you, Mr Chairman. It is fine; I take it as a compliment. To have Marian Hobbs channelled in this way may, in fact, be quite useful in this debate. However—
Hon Trevor Mallard: Well, I’m moving away.
Hon MARYAN STREET: Ha, ha! Let me turn to clause 10 in Part 1, which talks about “Access to information relevant to safeguard investigation and treatment of confidential information”. Could we please have the Minister’s explanation of what is meant by “safeguard investigation and treatment of confidential information”? In the terms of this bill, what is understood by “confidential information”? Is it like any other kind of meaning of confidential information—that is, information that may not be disclosed—and on what grounds would that information not be disclosed? I would invite the Minister to get on his feet, at some point in this Committee stage—
Grant Robertson: Any time.
Hon MARYAN STREET: —any time would be fine—and explain “safeguard”, explain “confidential”, and explain how this legislation can be deemed to be doing all the things it says it wants to do, with this Minister in charge.
This is an important piece of legislation. It was disposed of quickly by the select committee. It has been sat on by this Government for no good purpose other than the fact that it cannot organise its way out of a paper bag, so the bill has not got to the top of the Order Paper until such time as the Government could not think of what else to do. So it has been put in as a bit of a gap filler, but it does resonate. It does resonate. Of course we want a system that is compliant with World Trade Organization requirements. There are preventions in the bill that protect and safeguard New Zealand trade and New Zealand industry. They are important, and they are part of the safeguard measures, but over and above all that, we have to be able to have confidence that this Government understands the meaning of the words on the page. It is not clear to members on this side of the Chamber that we have a Government that understands the meaning of the words on the page.
Hon TAU HENARE (National)
: I do know the difference between a “Hobbs” and a “Street”, and I do have to say that after listening to the Hon Maryan Street’s speech—
Le’aufa’amulia Asenati Lole-Taylor: Ah! You’ve been listening.
Hon TAU HENARE: Oh, absolutely, and intently, because I am new to the game of trade and new to the Foreign Affairs, Defence and Trade Committee. So I suppose I am doing my—
Chris Hipkins: You traded parties.
Hon TAU HENARE: Sorry?
Hon Members: You traded parties.
Hon TAU HENARE: That was funny! You know, we are here discussing a pretty important piece of legislation, which is something that goes to the heart of any nation when it is faced with an economy that is—
Hon Phil Goff: What’s the bill called?
Hon John Banks: I raise a point of order, Mr Chairperson. Objections and interruptions should be rare and reasonable. Barking and howling from the Opposition side of the Parliament is not helping the debate. I cannot hear the learned member and his questions. I will not be able to answer them if we have this barking from the Labour Party on that side of the Chamber.
Hon Trevor Mallard: Mr Chairman—
The CHAIRPERSON (Eric Roy): I do not need any assistance. I have cautioned the Committee a number of times. We do want to hear the debate. I know that there is a degree of interest and passion at the moment, but that does not mean that we should not be able to hear members speaking.
Hon TAU HENARE: Thank you, Mr Chair. When the nation is faced with a crisis around the world, in terms of economics—
Chris Hipkins: I can hear him, but I’ll swap with someone who can’t!
The CHAIRPERSON (Eric Roy): Order!
Hon TAU HENARE: You see, that is the sort of importance that the Labour Party puts on an international piece of legislation. They moan. They get up on their high heels—hind legs even—and moan “Oh, we sat on this bill for ages and ages.”
Hon Lianne Dalziel: Who introduced it?
Hon TAU HENARE: And the shrill from over that corner—
Hon Lianne Dalziel: Who introduced it?
Hon TAU HENARE: The shrill from that corner is all about obfuscation, is all about a sort of pantomime, and is all about theatre. It is not about the real issue. The real issue is making sure that we safeguard our businesses in the world of trade. What it is
about is actually falling into line with the World Trade Organization’s regime, so we protect and we safeguard—
Hon Lianne Dalziel: Who introduced the bill?
Hon TAU HENARE: Sorry?
Hon Lianne Dalziel: Who introduced the bill?
Hon TAU HENARE: Oh, it was the liar who got sacked from Cabinet. [Interruption]
The CHAIRPERSON (H V Ross Robertson): I think I heard the member use a four-letter word that is totally unacceptable in the Chamber. The member knows that, because it is a reflection on all of the Committee. I ask the member to withdraw and apologise.
Hon TAU HENARE: I withdraw and apologise.
The CHAIRPERSON (H V Ross Robertson): Thank you.
Hon TAU HENARE: It was from the member who got sacked for not telling the truth. That is what it was. That was from the member. They do not want to know.
Hon Members: That’s what’s going to happen to Banks.
Hon TAU HENARE: No, no, no.
Hon John Banks: I raise a point of order, Mr Chairperson. The carping and howling from the Labour Party must cease, Mr Chairperson, under the Standing Orders. I need to hear the parliamentary Government member’s sound and sensible questions on this important piece of legislation, which I need to answer. Barking and howling, yelling and shouting do not do this Parliament any good, and it disgraces the parliamentary Opposition. I ask you to call them to order.
Hon Trevor Mallard: I think it is fair to say that there was a reasonable amount of noise then, and the noise was because the member on his feet, a former Minister, suggested that Ministers who mislead the public should get the sack. We were agreeing with him.
The CHAIRPERSON (H V Ross Robertson): Can I just remind members that this is not a public house. The practice of members engaging in a constant barrage of interjections actually amounts to heckling and is entirely intolerable in a debating chamber. I ask the member to continue.
Hon TAU HENARE: What this is about is enhancing and growing New Zealand’s international trade links. As I said before, if a bill like this was so important, we would not have the sort of pantomime, the theatre, going on from the Opposition members. They are fixated about something else. Well, at least our side is fixated on one thing, and that is making sure that our economy does not tank because—
Hon Lianne Dalziel: You don’t know what it does.
Hon TAU HENARE: Oh, I do not know anything. I know I do not. I do not know as much as the person over there who got into trouble and had to leave Cabinet. That is OK.
Hon Simon Bridges: What did she do?
Hon TAU HENARE: Oh, I do not know. She told one story, and then there was another story. She told one story, and then the story came out that it was not really the story that she really did tell. But that is all right. That was years ago and we should not go down that track into the past.
Hon Simon Bridges: But they would.
Hon TAU HENARE: Well, that is right. That is right. But we are trying to concentrate on getting a bill through—a bill that safeguards our reputation around the world not only with other people in the world but also with the traders and the businesses here in New Zealand. So what is wrong with that? Well, apparently, according to them, we have sat on the bill, we have done this, we have done that, but at
the end of the day, have they helped today? Have they helped the process move along? No, they have not. No, they have not. I would like to hear the Associate Minister of Commerce, but he can get up only when and if the Opposition has got something clear to say and asks some questions about the bill—asks some questions about the bill—and there has not been one question on Part 1, not one. As Winston Peters is wont to say, “not a whisper, not a murmur”, about Part 1 of the Trade (Safeguard Measures) Bill.
Hon John Banks: I raise a point of order, Mr Chairperson. I want to hear the Hon Tau Henare. I want to hear questions asked about the bill. I cannot hear when there is barracking, barking, and howling from the Opposition.
The CHAIRPERSON (H V Ross Robertson): Thank you. Can I just ask members to try to restrain themselves. I would urge all honourable members to play the ball, not the member. Remember that, and we will preserve an excellent field for the full play of ideas.
Grant Robertson: I raise a point of order, Mr Chairperson. In order to keep the order of the Committee, one of the issues that the Minister in the chair has been raising is the importance of being able to hear questions, and I just would wonder whether we could get an indication. I counted 16 questions that were asked of the Minister by the Hon Maryan Street, and I am just wondering whether we could get an indication of whether the Minister intends to answer those questions.
The CHAIRPERSON (H V Ross Robertson): That is for the Minister to decide himself. Where were we? I call the Hon Tau Henare.
Hon TAU HENARE: Not a whisper, not a murmur—
Brendan Horan: I raise a point of order, Mr Chairperson. These cowardly attacks on the leader of New Zealand First should stop. The honourable member knows that it is—
The CHAIRPERSON (H V Ross Robertson): Order!
Brendan Horan: —“not a syllable, not a sound”—
The CHAIRPERSON (H V Ross Robertson): Order! I am on my feet. Can I just remind members to have a look at Standing Order 117, which is to do with personal reflections. It is totally out of order and is unnecessary.
Hon TAU HENARE: I raise a point of order, Mr Chairperson. I think I am big enough and ugly enough to handle being called names, but I do not like to be called a coward.
The CHAIRPERSON (H V Ross Robertson): Well, I do not believe the member was calling the member—
Hon Trevor Mallard: I think he was.
The CHAIRPERSON (H V Ross Robertson): He was?
Hon Trevor Mallard: Yeah, I think he was.
The CHAIRPERSON (H V Ross Robertson): Oh well, in that case, then, the—
Brendan Horan: Point of order, Mr—
The CHAIRPERSON (H V Ross Robertson): No, no. The member called the other member a coward. That is a personal reflection against the member. It is totally out of order. The member will stand, withdraw, and apologise.
Brendan Horan: I apologise.
The CHAIRPERSON (H V Ross Robertson): And withdraw.
Brendan Horan: And withdraw.
The CHAIRPERSON (H V Ross Robertson): Thank you.
Hon Trevor Mallard: I raise a point of order, Mr Chairperson. I think it is important, for both the members, to note that the quote is a Churchillian one. It was, I think, first used in this Parliament by Sir Robert Muldoon. I think giving it to Winston Peters is probably going a bit far.
The CHAIRPERSON (H V Ross Robertson): Right, thank you.
Hon TAU HENARE: Not a word, not a murmur, not a whisper, not a murmur—who cares what he said—
Hon JOHN BANKS (Associate Minister of Commerce)
: The Trade (Safeguard Measures) Bill is a very important bill for this country. It is about our trade. It is about our economic sovereignty. It is about this nation’s future. It is critical as part of the World Trade Organization (WTO). It is critical for the export sector of the New Zealand economy, and it is very important that these matters are dealt with seriously by this Parliament on this night.
I first want to thank the—[Interruption] I raise a point of order, Mr Chairperson. If we continue to hear the unnecessary, unwarranted carping and howling from the Opposition while I am trying to go through these questions, how will we deal with the business of this Committee tonight?
The CHAIRPERSON (H V Ross Robertson): Can I just say to the Hon John Banks that this is a robust Parliament, and I have heard nothing just recently that is out of order.
Hon JOHN BANKS: I want to thank the member for Wairarapa—a first-class member of Parliament and a man who knows more about trade than anyone else in this Parliament. I want to thank the member for Wairarapa, Mr Hayes, for his first-class leadership of this bill through the select committee process. I also want to thank the member Dr Paul Hutchison for his support on the parliamentary Government side of the—[Interruption]
The CHAIRPERSON (H V Ross Robertson): Order! I am having trouble hearing, and I am right next door.
Hon JOHN BANKS: I want to thank Paul Hutchison for his work on the Foreign Affairs, Defence and Trade Committee, and Tau Henare for his work on that select committee.
I want to move to the questions. There has not been much focus, apart from by the parliamentary National Party, on what this bill is all about, because the parliamentary Labour Party does not seem to be much interested. That is why the National Government had to deal with this bill in its last term in office and put in place some sensible provisions within this bill so that we could trade successfully on the global stage without intimidation from trading predators.
The chairman of the Foreign Affairs, Defence and Trade Committee, Mr Hayes, asked a very relevant question: what matters should be taken into account when considering the public interest regarding the tradable sector and the provisions of this bill? They are listed in clause 12(1)(e)(i): “the likely effectiveness of a safeguard measure in assisting the domestic industry:”—protecting the domestic industry base—“the alternatives to a safeguard measure:”, and “the likely effect of a safeguard measure on the market (including on consumers):”. It is important that consumers are looked after, as well. Public interest also entails “New Zealand’s international relations and trade goals:”, pursuant to our responsibilities to the WTO and other ethical trading nations that we are working with.
The member for Wairarapa, the chairman of the select committee, also asked the question of what the importance of this bill is to the domestic industry. As we progress through the stages of this bill we will deal quite specifically with that. The member for south Waikato or Raglan—I forget—
Dr Paul Hutchison: Try Hunua.
Hon JOHN BANKS: Hunua—it is now called Hunua. I thank him also for his questions. He is a very fine member of Parliament. He comes from the trading town of Pukekohe. There is no other trading village in New Zealand that will benefit more from this bill and the provisions of this bill than the people of the wider group of trading
sector growers and exporters based in the member’s seat of Pukekohe. He asked the question—[Interruption]
Dr Paul Hutchison: I raise a point of order, Mr Chairperson. I am having a great—
The ASSISTANT SPEAKER (H V Ross Robertson): I have not called the member yet. [Interruption] Order! A point of order is on the floor. It is to be heard in silence.
Dr Paul Hutchison: I raise a point of order, Mr Chairperson. I am having a great deal of difficulty listening to the Hon John Banks—[Interruption]
The CHAIRPERSON (H V Ross Robertson): I have told the members on my left that during a point of order there is to be absolute silence. The point of order must be terse and to the point. We will have order in this Chamber.
Dr Paul Hutchison: I just want to finish it. As I was saying, I was having a great deal of difficulty listening to the Hon John Banks. He was saying some nice things about me, and I wanted to hear them.
The CHAIRPERSON (H V Ross Robertson): That is hardly a point of order, Dr Hutchison.
Hon Trevor Mallard: I raise a point of order, Mr Chairperson. I thought you were going to remind the member that during a point of order he should not be provocative, as he certainly was early in that point of order.
The CHAIRPERSON (H V Ross Robertson): That is a good point that the member makes.
Hon JOHN BANKS: I want to hear good points, and I have got to say that people watching on the telly tonight this debate on the Trade (Safeguard Measures) Bill will wonder what this Parliament has come to. This is the Parliament of New Zealand, where we make laws in the best interests of industry and commerce, which the member Paul Hutchison represents in Pukekohe. He asked a significant question. He asks why there is a bill at all—why is there a bill at all? The Labour Opposition must have thought that this bill was worthwhile, because once upon a time—a long time ago, and hopefully never into the future—it was in Government and introduced this bill. It was the member for Wairarapa, Mr Hayes, who had to tidy up the bill, as the chairperson of the select committee, when National came into office.
The question Mr Paul Hutchison asked tonight was why there is a bill at all. I gave him the first answer, which was that it is to ensure that New Zealand complies with WTO rules. That is absolutely critical on the world stage of competitive trading. The second answer to that question of why there is a bill at all is that it is to update and simplify the regime, including the processes for undertaking safeguard investigations and applications of—[Interruption]
The CHAIRPERSON (H V Ross Robertson): Order!
Hon JOHN BANKS: I could conclude by the behaviour of members of the parliamentary Opposition that they have had a liquid dinner. I want to finish by saying this: I thought that this bill, Mr Hayes, had general cross-party support. I did not believe that there would be so much interest. I am pleased with the interest. I am pleased that the National Party has got a serious interest in the tradable sector of the New Zealand economy in order to preserve our economic sovereignty on the world stage. The National Party members of Parliament tonight, including the first-class young backbench members of Parliament, clearly understand that this Government’s responsibility is to ensure that international trading represents WTO rules and regulation, so that competition by traders in Pukekohe can reach out to the market and do business in the best interests of foreign exchange earnings for New Zealand.
I want to, finally, before I allow some other member to take a call, turn to the officials who have done the backroom work—first-class public servants doing first-class work. [Interruption]
The CHAIRPERSON (H V Ross Robertson): Order!
Hon Tau Henare: I raise a point of order, Mr Chairperson. I know this place is a pretty robust place, and we sometimes get carried away, but the continual—continual—barracking is out of this world. I would really ask you to just have a look at the volume and the continual barracking from the Opposition when our Minister gets up and does what they have asked him to do, which is answer some questions.
The CHAIRPERSON (H V Ross Robertson): Thank you, Mr Henare. I have asked members several times. This is a robust Parliament, and as long as it is contained and reasonable and within the Standing Orders, then it is permitted. But if it gets out of hand, then I will intervene.
Michael Woodhouse: I raise a point of order, Mr Chairperson. Mr Henare’s point of order was the sixth occasion in the last hour that members have asked, within this robust debate, to be able to hear the speaker. I would draw your attention to Speaker’s ruling 61/4(3), which says: “it is highly disorderly for a member to persist in interjecting when the member has been called to order.” I would suggest that that applies to the collective. To use a sporting parlance, when is the referee going to go to his pocket, and what colour will the card be?
Hon Trevor Mallard: You have just ruled on that area of point of order. It is highly disorderly for any member to suggest that you are acting inappropriately or not acting appropriately. I ask that you make it clear to that member that you are the Chair, not he.
Michael Woodhouse: I was very careful to distinguish between the infringement and the pattern of repeated infringement, which is what a good referee would look at. I suggest to you that that is a new point of order.
The CHAIRPERSON (H V Ross Robertson): I would like to refer the member to Speaker’s ruling 79/1.
Hon JOHN BANKS: I just want to answer a further significant question asked by the chairman of the select committee, the first-class member for Wairarapa, Mr Hayes. Mr Hayes asked this very significant question, which the public of New Zealand who are listening tonight on their crystal sets or on their televisions want to hear answered. Mr Hayes, in respect of this Trade (Safeguard Measures) Bill, asked the significant question of what the significance of this bill is to the domestic industry. The significance is twofold. The bill provides a mechanism for providing temporary protection to a domestic industry from surges of imported goods. We will never have a successful tradable sector of the New Zealand economy if we do not have mechanisms in place so that we can move very, very quickly on illegal importation of things that are going to destabilise the trading market of the New Zealand economy.
Secondly, on the question of what is the significance of this bill for the domestic sector, asked by the member for Wairarapa, Mr Hayes, the chairman of the committee, I say that, in turn, the bill gives the domestic industry time to adjust to import competition. We are out on our own on the global stage. We sink or swim on our own on the global stage. The international trading sector is highly competitive, and there are countries out there that will take our economy off the map, out of the South-west Pacific, and off the world trade scene, unless we put in place rules and regulations that mirror the WTO.
I have to say, finally, on the carping and howling by the parliamentary Opposition, that if that was the way it behaved at the time of the hearings of the select committee, the people making submissions would not have been that impressed.
The CHAIRPERSON (H V Ross Robertson): I just remind members that running commentaries are out of order and if people want to make a speech, they are entitled to do so. I refer them to Speaker’s ruling 60/5. I recognise the Hon Trevor Mallard.
Hon TREVOR MALLARD (Labour—Hutt South)
: Thank you, Mr Chair. So do I when I shave. I think we might be at a historical moment in the Parliament at the moment. Before I get into the detail of the Trade (Safeguard Measures) Bill, I say that people do not get two maiden speeches, but they do sometimes get two valedictories. It may be that tonight we have seen the second valedictory for the Hon John Banks. I want to refer to the comment he made about the young backbenchers from the National Party and their contribution. I want to say that Tau Henare, Paul Hutchison—who, although he does not look it, is older than I am—and John Hayes are the young backbenchers to whom John Banks was referring, who have made contributions today.
I say to John Hayes that I hope he gets John Banks’ job. I think there would be some justice in that. He is seen as a fair person. He is seen as a person who understands the issues, and he made a contribution on this legislation that understood it much better than the Minister did. I do want to ask the Minister what the effect of this bill is on the trade in cabbages. What is the effect on trade in cabbages and their transit on rivers? What is the effect of this bill on the import of cabbages, and is there unfair competition with cabbages that are transported down the river on boats—cabbage boats?
I want to ask the Minister specifically about the amendment that he is proposing to clause 18(1), set out on Supplementary Order Paper 17, where he wants to omit “1 or more” and substitute “1 or both”. I want to ask him what he is referring to when he is substituting both for one, or one for both, or two for one. Is he talking about cheques? Is he talking about products? Is it two lots of $25 million, or what?
Hon Lianne Dalziel: No, this bill is about checks and balances.
Hon TREVOR MALLARD: It is about checks and balances. There is no doubt that this is about checks and balances. How do you spell “checks” in this particular case? Does it have a “q” or a “c” in the middle of it? Is there a “k” in it or a “q” in this check, and which bank balance is affected?
Hon John Banks: I raise a point of order, Mr Chairperson. The member whose name fails me, who has just taken his seat, needs to understand the Standing Orders, because the Standing Orders are quite tight around the Committee stage of bills. He should be talking to Part 1 in a perfect world. Going on to the Supplementary Order Papers or anything is probably OK, but it has got to be relevant to the provisions of the bill in the Committee stage as it has come out of the select committee. I put it to you under the Standing Orders.
The CHAIRPERSON (H V Ross Robertson): Can I just ask members to reflect and deal with the detail of Part 1. That is where we are coming from. I know members can be very clever in the way in which they do that, but I also need to remind members that we need to be within the Standing Orders and the Speakers’ rulings.
Chris Hipkins: I raise a point of order, Mr Chairperson. I just want to clarify for you, lest the point of order raised by the Minister cause any confusion, that a member is entitled to debate a Supplementary Order Paper that amends Part 1 during the debate on Part 1.
Hon TREVOR MALLARD: Speaking to the point of order, that has changed, I think, since the last time this member was in charge of a bill, when the Supplementary Order Papers used to be dealt with at the end rather than as part of the process. I think that changed about 20 years ago.
The CHAIRPERSON (H V Ross Robertson): I understand that that in fact is correct.
Hon TREVOR MALLARD: Mr Chairman—[Interruption]
The CHAIRPERSON (H V Ross Robertson): Your own member is speaking. Give him a fair go.
Hon TREVOR MALLARD: Thank you for the help. I want to refer you to clause 5 of the bill. This is the clause that says that the Act binds the Crown. I think that there could not be a truer thing said at the current time than that ACT is binding the Crown. In fact, the head of the Government, I think, is totally tied up by ACT at the moment. He is bound up almost in a way that he is being dominated. He is being dominated by ACT.
Hon John Banks: I raise a point of order, Mr Chairperson. The member is behaving like a buffoon.
The CHAIRPERSON (H V Ross Robertson): The member will be seated now. Can I just say to members that points of order are to be terse and to the point. It is not an opportunity to have a go at another member. That in itself is out of order, and I would just caution members about that.
Hon TREVOR MALLARD: I would like to refer you to clause 6 of the bill, and in particular clause 6(1)(c), which makes it clear that the report—and we are waiting for a report in this particular matter—is to be made “available on an Internet site, free of charge, and the Internet site address”.
Chris Hipkins: It is dotcom?
Hon TREVOR MALLARD: Well, that is the question. What happens if they are on Megaupload and the address is a dotcom address? Does that count as being available or not available in the current circumstances?
Chris Hipkins: They could make it available by sending a helicopter.
Hon TREVOR MALLARD: Well, you could get a helicopter view, but I am not sure—
Hon John Banks: I raise a point of order, Mr Chairperson. I have to ask myself why am I wasting my time in this Parliament when the parliamentary Opposition— [Interruption]
The CHAIRPERSON (H V Ross Robertson): Can I remind members on my left that when there is a point of order on the floor, there is no sound at all from any other member.
Hon John Banks: People at home who are interested in what is happening in this Parliament want to hear from people like the Green Party. The Green Party member at the back of the Chamber has been seeking the call for a while, and they want to be able to hear his questions and get succinct answers—
The CHAIRPERSON (H V Ross Robertson): Order! I am on my feet.
Hon John Banks: We don’t want—
The CHAIRPERSON (H V Ross Robertson): Order!
Hon John Banks: —this howling and carping all the time.
The CHAIRPERSON (H V Ross Robertson): The member will be seated. I am on my feet. I am the Chair, and I will recognise the member when I do.
Chris Hipkins: I raise a point of order, Mr Chairperson. I want to raise two points of order with you. The first is that points of order are to do with order, and large explanations of what are preambles to a point of order will generally lead to disorder. The second is that the prerogative around who is recognised to speak is solely yours, and for the Minister to be challenging your rulings or your selection of speakers is totally out of order.
The CHAIRPERSON (H V Ross Robertson): Thank you. I have already ruled on that for the Minister and he is aware.
Hon TREVOR MALLARD: I want to refer you again to clause 6(1)(c), about internet addresses.
Hon Lianne Dalziel: What does it say?
Hon TREVOR MALLARD: What it says is that a copy of the report is—“or will be” is struck out—“available on an Internet site, free of charge, and the Internet site address.” What I want to know is whether Megaupload, a dotcom site, will be eligible for these purposes. I would like the Minister’s opinion on whether a dotcom site will be eligible for these purposes, and I want an assurance from the Minister that no previous consideration will be taken into account when that decision is made as to where this will be available and where the report will go.
I would now like to refer you to clause 10 of the bill, which goes to the questions of “access to information relevant to safeguard investigation”—I just want to emphasise those words “safeguard investigation” because those are important, and we will be coming back to that issue—and “treatment of confidential information”. I want to ask whether, when information is confidential, the chief executive—because that is the person who is mainly going to be dealing with it—says “This is confidential.” Or does he say “I don’t know.”, and “I’ve forgotten.”?
What does the chief executive say when he has information that he does not want to get out because he thinks it would be disadvantageous to the country? Does he make clear the reason? Is he fair? Is he democratic? Is he transparent? Or does he just say “I forgot.”, and “I can’t remember.”? What is the standard we expect of our chief executive when dealing with this legislation? Do we expect someone to be transparent and honest, or do we want them to say “I forgot. I can’t remember.”, and then blame a lawyer for encouraging them to tell lies?
Hon John Banks: I raise a point of order, Mr Chairperson. I know this bill inside out and back to front. I invite the member to refer very specifically to clauses or parts of the bill so that I can then take a call and answer any intelligent question that he may pitch to me.
The CHAIRPERSON (H V Ross Robertson): No. That is not a point of order. But I ask the member to be careful in the way in which he is delivering his address to the Committee.
Hon TREVOR MALLARD: Notwithstanding the fact that you, Mr Chair, ruled out the Minister’s point of order, I will refer him to clause 10(1), and in particular clause 10(1)(a), which goes to the treatment of confidential information and which says: “All interested persons are entitled to access all information relevant to a safeguard investigation, except for—(a) confidential information (unless the submitter of the confidential information consents to the confidential information being made available);”. Well, what is clear is that in a number of cases people might give information that a chief executive, the recipient of the information, might prefer to keep confidential, and the people who are giving that information might prefer it to be out there. Skycity, if it had any information in this area, I am certain, would want to be transparent. I think Mr Dotcom, with the information, if he had any in this trade area—
Hon John Banks: I raise a point of order, Mr Chairperson. The Government members responsible for this bill want to make progress tonight by having relevancy around the debate. There is no relevancy—
The CHAIRPERSON (H V Ross Robertson): That is not a point of order, and the Minister is misusing the point of order privilege.
Hon TREVOR MALLARD: I want to ask the Minister about differential pricing and dumping. I want to ask the Minister this. If there is a product that is valued at, say, $3,600 for one, and someone gets five of them and a whole pile of food and pays $2,882, would that be regarded as dumping? Would that level of discount, when a product is valued at $3,600, there are five of them—maybe that is $18,000; five times $3,600—and a pile of food, and the charge is only $2,882, be regarded as excessive discounting? Would that practice be regarded as dumping, and what would happen if
someone who was involved in that approach spoke to a Minister in order to get a special deal?
Dr KENNEDY GRAHAM (Green)
: I do not think it is in all our interests to extend this debate too far. We have had sufficient fun. I appreciate the comments from the Minister in the chair, the Associate Minister of Commerce, in his effort to address some of the questions, but I do think that some of the questions that our colleague from Labour, Maryan Street, put forward have not yet been answered, and the challenge from Tau Henare that they be made substantive and specific I think should be met.
With respect, I ask the Minister whether he would be good enough to address some of those questions. I say this in the context of general support of the Green Party for the Trade (Safeguard Measures) Bill, notwithstanding the broad concerns we have pertaining to the bill itself and certainly to the broader aspect of the free-trade agreements as they come down the track. Would the Minister be good enough to rise to the challenge and address some of those questions that Maryan Street asked. As I see them, they were about the meaning of the phrase “safeguard investigation” in clause 7, the meaning of the phrase “confidential information” or the concept of confidential information for a safeguard investigation in clause 10(1), the meaning of “strategic importance” in clause 12(1)(e)(v), the meaning of “public interest” in clause 18(1)(e), and the meaning of ministerial discretion in clause 22. Thank you.
Hon LIANNE DALZIEL (Labour—Christchurch East)
: The Minister in the chair, the Associate Minister of Commerce, has informed the House that he is all over the detail of the Trade (Safeguard Measures) Bill. Those were his words, and I want to challenge him on that, because there is nothing that he has said in his contribution that would suggest that. I was the Minister who introduced this bill. I was not the Minister who oversaw its reference to a select committee. It was referred to the Foreign Affairs, Defence and Trade Committee, as opposed to the Commerce Committee, and that is because of its trade implications. I want to acknowledge in this Committee the work of John Hayes as the chair of that committee, because he did an excellent job and—
Hon Trevor Mallard: He should be the Minister.
Hon LIANNE DALZIEL: Well, there are a lot of people on this side of the House who think he should be the Minister in charge of this bill now, and perhaps he will have the opportunity to do that some time soon. But that is by the by; that is not the point.
The reality is that the Minister has challenged this side of the Committee to take the politics out of the debate, and I am happy to do that. He was very happy to sit there and listen to every single one of the National members get up and insult me personally for taking, I believe, a position of integrity on a particular matter that I felt I had to take responsibility for. And that, perhaps, is the difference between me and the Minister in the chair: I was prepared to take responsibility for the mistake that I made. I did make a mistake. I should have been a bit more open about the role that I played—in particular, in information being referred to the media. It was for a whole lot of reasons. But I just want to say this: I believe that it is most important that our borders are protected in a whole lot of ways, and that is very relevant to this bill, because it is about our borders being protected from having goods dumped on its shores to undermine local manufacturers. That is what this bill is about, and nobody on the Government side is actually really talking about what the bill is about. That is what it is about.
I stood down from my position as Minister because I was trying to protect our borders from having people arrive here making claims about refugee status that were not true and trying to get around our rules in order to claim their right to remain in New Zealand. I made a mistake, I took responsibility, and I stood down. I think other people in this Chamber should be prepared to do that, as well. I actually do not think that it
does anyone any good to attack me personally on this matter and then to stand up in this Committee and take umbrage—
The CHAIRPERSON (H V Ross Robertson): Order! I am sorry to interrupt the honourable member. Can I just say to members on my right that interjections are out of order unless they are rare and reasonable, and also that a running commentary is out of order, as well. People can take an opportunity to stand and have their say.
Hon Tau Henare: I raise a point of order, Mr Chairperson. That speech has been going on for some 3 or 4 minutes, and it has talked about the indiscretions that that member made when she was a Minister. That has nothing to do with the bill. If you want us to listen and be courteous, that is fine. Talk about the bill, and we will.
Hon Trevor Mallard: Mr Chairperson, you may be at some disadvantage, and so may the Clerk on your left be at some disadvantage, unless you were in fact listening to the debate previously. The matters to which my colleague is responding are the very matters that were brought up and spoken about at length, probably for a minute and a half or two, by the Hon Tau Henare when he was making his speech. He referred to these matters. It is an absolute right of a member in this House to defend their integrity and to contrast it with others when they are so challenged.
The CHAIRPERSON (H V Ross Robertson): Thank you. Can I just refer members to Speakers’ ruling 46/2, which does allow some leeway for a member to respond, but then they have to come back to the detail of Part 1.
Hon LIANNE DALZIEL: This legislation is designed to protect New Zealand’s borders, and it is designed to protect our borders to ensure that our local manufacturers are not put at risk of having cheap goods dumped on our economy, to the detriment of local manufacturing. That is what the legislation does. The Minister told us that he was all over this bill. The reason that I believe that he is not all over the bill is that he actually has not described the fact of what it does. He seems to think that this is a brand new piece of legislation that has somehow emerged from nowhere, and that it has created a new set of obligations under the World Trade Organization rules that did not previously exist.
Well, we currently do have rules that provide for temporary safeguards to be put in place. The problem is that there is not an adequate definition of the public interest for those rules to be applied in an adequate way, and the other problem is an administrative one, which I thought that the Minister would be all over, if he was all over this piece of legislation—which he is not; he has obviously forgotten something. What this legislation does is replace the temporary safeguard authorities that already exist. We already have temporary safeguard authorities, but to set up temporary safeguard authorities is administratively inconvenient. It costs time, it costs money, it wastes time, it wastes money, and I would have thought that the Associate Minister of Commerce would have been all over this. He might have actually mentioned that in his contribution to the debate. But I do not think that he is all over this. Either that, or he has been briefed and he has forgotten what he has been briefed about. I think it probably reflects the reality of the situation that he is in at the moment.
The bottom line is that this is a particular piece of legislation that I was very pleased to introduce as Minister of Commerce. I recall when the previous Minister of Commerce made his contribution to the first reading, which was back on 11 March 2009. Actually, we are not far off that now, so it is now 3 years since the first reading, and the bill was introduced prior to the 2008 election.
Hon Trevor Mallard: Who was the Minister then?
Hon LIANNE DALZIEL: Simon Power was the Minister of Commerce who moved the first reading of this bill.
Hon Trevor Mallard: That’s the speech that was prepared for him, though.
Hon LIANNE DALZIEL: It was prepared for me, and I actually read along with the speech. I will just quote a little bit from
Hansard, because I thought it was quite funny. He said “The current regime is subject to the Temporary Safeguard Authorities Act 1987, which has not been subject to a comprehensive review since its inception. As a consequence”—and I interrupted him, and I am recorded in
Hansard as saying “It’s now outdated”. He then said “—the Act is now outdated—that is quite right, I say to Ms Dalziel—and does not provide an adequate means for New Zealand to comply with its WTO obligations, should it be necessary to take safeguard action.”
So the point was that—I mean, Simon Power was actually reading a speech that had been prepared for me as Minister of Commerce to read, back in 2008. He was reading it on 11 March 2009. Do you know why he was not reading it until 11 March 2009? It was because it did not fit within the concept of that then Government’s 100 days of action, when it had to do all those amazing things within the first 100 days, and it had to introduce all these different things. That was the plan, to have 100 days of action, and actually I think it stopped after the 100 days. But the reality is that this bill has sat on the Order Paper for a very long time, and I think that the Minister in the chair, the Associate Minister of Commerce, does a great disservice to the reality of the need in this particular area. He stands there and tries to take umbrage at some of the issues that this side of the Committee has raised, when he is more than happy to see the attacks made on me personally. I do not really care about what people say about me. I am probably not going to be here for very much longer. The bottom line is that I—
Hon Trevor Mallard: You’re approaching the mid-point of your career.
Hon LIANNE DALZIEL: Yeah, the mid-point in my parliamentary career. I have not got that long to go.
What I want to say is that if the Minister really did understand the reality of what he was doing in this, and if he really was all over it, then he would know a little bit more about why this legislation was so important, and he would actually answer some of the questions that were put on this side of the Committee. The reality is that I do not think that he really cares about it, and the reason that he does not care about it is that he is not long for this place. In fact, I shall be here longer than he will be here, and he will be leaving this place relatively soon. I think that it is important for this member—
Hon Trevor Mallard: Will he be here for the vote on Part 2?
Hon LIANNE DALZIEL: I do not think he will be. But the reality is that I think that the member does this important measure a great disservice, and I am actually quite annoyed that he has allowed the debate to be used in this particular way and not defended the important elements by understanding the reality about what it is designed to protect. It is more about ensuring that our local, domestic manufacturers have a fair go in their own country. It is about some of those ownership issues that matter a lot to New Zealanders and actually matter a lot to the workforce who work for the manufacturers in New Zealand, and who cannot compete with some of the overseas interests who are more than happy to dump on our country. They are more than happy to buy up every element of our country that they can get their hands on.
At the end of the day this actually stands as quite a sad and sorry commentary on a Government that thinks that this is so unimportant that it has been able to sit on the Order Paper for so long, and then end up here in the Committee as part of a debate that does not really matter to this Minister at all. I think that is a very, very sad commentary on the state of affairs that we are confronted with. I think that the Minister should get back on his feet and, rather than complaining about some of the obvious comments that are going to be made about his inability to respond, take responsibility for some of his own actions, like others have done in this House. It is a sad and sorry indictment on him.
MICHAEL WOODHOUSE (Senior Whip—National)
: I move,
That the question be now put.
STEFFAN BROWNING (Green)
: Thank you, Mr Chairman. [Interruption] Yes, I think you said my name right. When the bill was in the previous stage I mentioned that I was hoping the Minister would be able to help me a little bit with some stuff that I brought up at that point about this bill. The Greens support this bill because of the elements of anti-dumping in here, although we are very concerned about the free-trade agreements that make this so apparently necessary.
I had a particular concern about the terminology “serious injury”, meaning that businesses that might get some level of protection under here have been under threat of what was considered serious injury. In here that “means a significant overall impairment in the position of a domestic industry”. I read that, and I read it now, as no protection for anything less. So I would like to hear from the Minister what that level would be, or what the examples would be of where businesses would get protection and where they would not get protection.
The Minister suggested, within many points of order, that he would be able to answer some of these questions, and I just reiterate the earlier ones that we expressed interest in were in relation to the “safeguard investigation” in clause 7, confidentiality in clause 10(1), the strategic importance in clause 12(1)(e), public interest, and then we have also got the ministerial discretion. We have just heard a little bit about the ministerial discretion and we have some concern about where that might go.
We have some real concern about where this might go as well, albeit we are supporting it because we do need to have some sorts of safeguard measures. But this is a temporal bill. This does not protect New Zealand businesses for too long. I think the longest period is about 8 years or something like that. It is really just time to set up businesses to move into something else. It needs to be a little more substantive.
I put it to the Minister that, if he could, he should answer the questions that have been put a couple of times already, but, particularly, let me know some examples of where serious injury would be the definition, and what would not be. I am really interested in protecting, and seeing protection for, New Zealand producers and New Zealand processes—New Zealand manufacturers—from the excesses of the free-trade agreements that seem to have been allowed through successive Governments here. I will leave it to the Minister. Thank you.
Hon JOHN BANKS (Associate Minister of Commerce)
: I will be leaving the Chamber soon and my friend Minister Joyce will be looking after matters. I want to answer the sensible questions raised by the parliamentary Opposition tonight—a number of sensible questions. I will start with Dr Graham, the Green Party member of Parliament, who has been listening intently to this tonight.
Dr Graham asked, some time ago, what the meaning of safeguards was in clause 17. He also asked questions about public interest and he asked questions about strategic importance. I can tell Dr Graham, the parliamentary member for the Green Party, that the strategic importance relates to the domestic industry and protection of the domestic industry, and the significance of the industry to our ability to trade from that. Can I also say to Dr Graham, who asked a question about confidential information, as did his colleague sitting beside him—he asked the same question, as well—that I can say to the two Green members at the back of the Chamber that clause 10(4) answers many of those questions.
Making information available would give a significant competitive advantage to a competitor and that would be a problem. We do not want to give significant competitive advantages to domestic competitors, and we certainly do not want to give significant competitive or uncompetitive advantages to international traders from export industry
led by and represented by the member Dr Paul Hutchison—for instance, those great people in his electorate around Pukekohe who export to the world in a critical fashion. The bill states: “making the information available would have a significantly adverse effect upon the submitter of confidential information:”. I want to make that clear to Dr Graham again; that is the important part of the bill: “making the information available would have a significantly adverse effect on the submitter of the confidential information:” and that, I refer to him, is clause 10(4)(b). And paragraph (c) states that the information should be treated as confidential for reasons as submitted by the submitter.
It is important that we have some confidentiality around these things. I do not intend to answer any of the questions from the parliamentary Labour Party, because I have answered all of their questions—many of them quite convoluted, misguided, poorly informed, and poorly articulated. But I will say I hope I have answered all the questions from the member for Wairarapa, Mr Hayes, who has done such a sterling job in leading the parliamentary select committee. Tau Henare has got a really good grip of these commercial things, and it is good for a westie to have a very good grip of commercial matters affecting the tradable sector. It is great to see Tau Henare make a significant contribution on that important parliamentary committee. Dr Hutchison, “Mr Reliable and Common Sense”, on the select committee is all the way from Pukekohe and is looking after those exporters.
All of the provisions that I have outlined in Part 1 of the bill are the significant parts. I will just say, before I ask my friend Minister Joyce to take the chair, at quarter to ten this night in Parliament, that the second part of the bill is Part 2, and it provides for what you might call tidying-up—
Grant Robertson: I raise a point of order, Mr Chairperson. We have had a number of points of order tonight about the importance of talking about Part 1—the part that we are on. I believe that the Minister was straying into a different part, and I am sure you will pull him into line.
The CHAIRPERSON (H V Ross Robertson): Thank you. I had noticed that. I ask the Minister to refer to the part.
Hon JOHN BANKS: Of course. Well, let us refer to Part 1. I want to thank the members of the parliamentary National Party. I want to thank the members of the Green Party for their very pithy questions—the significantly pithy questions they asked about this bill. I want to finish as I began, before I leave the chair. This bill is about providing the ability of our tradable sector within the New Zealand economy to compete fairly with all-comers on the global trading exchange—to compete fairly without interlopers coming in and trading unfairly in the domestic market place.
GRANT ROBERTSON (Deputy Leader—Labour)
: As the Associate Minister of Commerce resumes his seat, I say that I have heard a rumour that that Minister did not come down the river on a cabbage boat. I have heard that rumour. And all I have heard tonight confirms to me that that Minister very much did come down the river on a cabbage boat. It may well have been the last cabbage boat, but he certainly came down the river on it, because the very last thing he told us demonstrated that he simply did not understand what this bill, the Trade (Safeguard Measures) Bill, is about.
Throughout this evening we have seen from Mr Banks a level of competence that should not surprise me, but that is worrying in the context of this bill. Throughout Part 1 there are numerous references to what the Minister needs to do—what the Minister must do. The Minister may initiate a safeguard investigation. That is what we are told. Do we think Minister Banks is competent to initiate a safeguard investigation? I note the Minister did not actually respond to the questions from Maryan Street and our Green colleagues on the meaning of the word “safeguard”, but I can help with a definition of
“safeguard”, which is not contained in this bill, because there is no definition. One of the definitions of “safeguard” is “a document authorising safe conduct”—“a document authorising safe conduct”.
A similar kind of safe conduct might be a declaration of somebody’s donations for an election. That is a safeguard document. It is a document that safeguards our democracy. It safeguards the transparency of what is going on in an election, be it at a local body level, or be it at a national level. That is a safeguard document. That is what the Minister in this bill is charged with actually creating and initiating—a safeguard document. Has Mr Banks demonstrated anything tonight that would indicate he is competent to initiate such a thing? Has he demonstrated, by anything in his recent behaviour, that he would be able to do that? He has not, in my submission, and that is one of the important roles of a Minister under this bill.
Another one of the important roles of the Minister is initiating a review around safeguards. I refer the new Minister in the chair, the Minister for Economic Development, to clause 20(3), which says: “The Minister must notify the decision to initiate a review of a safeguard measure, and that notification must state the date on which the review was initiated.” It must state the date. I have significant concerns, from what we have seen both from the Minister tonight and from his previous record, about his ability to recall the date on which the review was initiated under clause 20(3). Mr Banks, who would be the Minister referred to under this bill, would not have the memory, I think, to be able to know what date it was. Clearly, he has been very confused about dates in the past, and there is significant confusion about the dates of fireworks displays versus when he got donations. It is very, very difficult to remember those dates, and extremely difficult to remember trips in helicopters, although he does appear to remember training other people to fly helicopters. Perhaps that is something that he should have stuck to.
The Minister, under Part 1, has a number of significant responsibilities. But I think the biggest failing we have seen tonight by the Minister was actually in being able to articulate what this bill is about. I find—and I may run out of time for this—in these situations that it is often good to follow the journey of an issue, of something that is covered by this bill. What this bill is actually about is what happens to a domestic industry if there is dumping—if there are imports that come in. We can follow a particular import on a journey. Shall we choose a particular import? Are there any suggestions?
Dr David Clark: A cabbage.
GRANT ROBERTSON: “Cabbages”, I hear. So if we follow the journey of cabbages being imported—
Hon Trevor Mallard: Chinese cabbages.
GRANT ROBERTSON: Well, they could be Chinese cabbages; Chinese cabbages are one of the things. If we follow the journey of a cabbage under Part 1 of this bill, we would discover that a cabbage may come into our country by a number of means. A cabbage may come in by air, or it may come in by sea. It could come in by helicopter, but it is unlikely. You could not fit that many cabbages in a helicopter, especially if Mr Banks was flying it. But a cabbage may come in, and one of the ways a cabbage could come into this country would be by boat. The concept of a cabbage boat being part of an import into New Zealand is perhaps something that people might find strange. But what we can say categorically—the one thing out of the saga of recent weeks that we can say categorically—is that Mr Banks did not come in on a cabbage boat, and certainly not on the last cabbage boat, he tells us. He denies that he came in on a cabbage boat, but cabbages do come in. So in the context of being able to protect a domestic industry, in
this case the growing of cabbages, we have the possibility of people dumping cabbages with us off a cabbage boat.
I just say as an aside that if one were to look up “cabbage boat” on the internet, one would discover that it is largely a 1970s-style snack, which I think is confusing in the context of Mr Banks’ earlier comments.
JAMI-LEE ROSS (National—Botany)
: I move,
That the question be now put.
CHRIS HIPKINS (Labour—Rimutaka)
: I am very happy to talk on the Trade (Safeguard Measures) Bill, which is designed to protect New Zealand industries or New Zealand enterprises from the damage that can be done by shonky imports. We know in the Labour Party what damage shonky imports can do to a New Zealand enterprise, if it makes the wrong decision about importing something to replace something that is already here, and it gets that wrong. It is a bit like the leadership of the ACT Party. If an enterprise makes the wrong import, it can do enormous damage to the local industry that was already in place. And that is what the ACT Party has seen. This bill, unfortunately, will not provide any extra support for the ACT Party in the case of its shonky imports. The poor old ACT Party—it has happened to it twice. It made two bad import decisions: first, with Don Brash, and then with John Banks.
- Progress to be reported presently.
- The Chairperson reported progress on the Trade (Safeguard Measures) Bill and no progress on the Regulatory Reform Bill and the Airports (Cost Recovery for Processing of International Travellers) Bill.
- The House adjourned at 9.56 p.m.